Newell Brands Inc. (NWL) Balance Sheet

The sequential decline in total assets and equity suggests that the company is not generating sufficient retained earnings to offset ongoing losses and debt repayments. The negative retained earnings balance of -$3.2B as of 2026Q2, as reported in the balance sheet, underscores cumulative losses that have eroded the equity base. This trajectory implies that the balance sheet is weakening, and without a reversal in profitability, equity could approach zero or become negative.

Although total debt has been relatively stable around $5.2-5.6B over the past ten quarters, the decline in equity has caused the D/E ratio to climb from 1.80 in 2024Q1 to 2.26 in 2026Q2. This suggests that the company's leverage is increasing not from new borrowing but from a shrinking equity base, which may constrain financial flexibility. The high absolute debt level, combined with negative retained earnings, implies that the company is reliant on debt financing and may face refinancing risk if cash flows deteriorate further.

The reduction in total assets appears driven by declines in working capital and possibly PPE, while goodwill has remained constant at $3.1B, representing roughly 28% of total assets. This high proportion of goodwill exposes the balance sheet to potential impairment risk if the company's market value or cash-generating ability deteriorates further. The relatively stable PPE of around $1.6-1.7B suggests a maintenance-only capex posture, which may limit long-term operational efficiency gains.

The persistent negative retained earnings reflect a history of net losses, which have consumed the company's accumulated profits. Despite a positive net income in 2026Q2, the trailing twelve-month net margin remains negative at -3.96%, suggesting that the company is not yet consistently profitable. The equity cushion of $2.5B is thin relative to total assets of $11.1B, and any further losses could push equity toward zero, heightening solvency concerns.

The current ratio has hovered around 1.0-1.14 over the past ten quarters, suggesting that current assets are barely sufficient to cover current liabilities. Cash balances are minimal relative to total debt of $5.5B, implying that the company relies on operating cash flow and access to credit markets for liquidity. Given the negative free cash flow in several recent quarters, as noted in the cash flow analysis, the liquidity position appears vulnerable to unexpected shocks or working capital swings.