SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

(Address of principal executive offices)

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	KMB	New York Stock Exchange
0.625% Notes due 2024	KMB24	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of ~~October 15, 2019,~~July 16, 2020, there were ~~342,805,599~~ 341,047,156 shares of the Corporation's common stock outstanding.

Table of Contents


PART I – FINANCIAL INFORMATION		1

~~PART I – FINANCIAL INFORMATION~~		1

Item 1. Financial Statements	1

UNAUDITED CONSOLIDATED INCOME STATEMENTS FOR THE THREE AND ~~NINE~~SIX MONTHS ENDED ~~SEPTEMBER~~JUNE 30, ~~2019~~2020 AND ~~2018~~2019		1
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE AND ~~NINE~~SIX MONTHS ENDED ~~SEPTEMBER~~JUNE 30, ~~2019~~2020 AND ~~2018~~2019		2
CONSOLIDATED BALANCE SHEETS AS OF ~~SEPTEMBER~~JUNE 30, ~~2019~~2020 (UNAUDITED) AND DECEMBER 31, ~~2018~~2019		3
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE THREE AND ~~NINE~~SIX MONTHS ENDED ~~SEPTEMBER 30,~~JUNE 3 0 , 2020 AND 2019 ~~AND 2018~~		4
UNAUDITED CONSOLIDATED CASH FLOW STATEMENTS FOR THE ~~NINE~~THREE AND SIX MONTHS ENDED ~~SEPTEMBER~~JUNE 30, ~~2019~~2020 AND ~~2018~~2019		6
UNAUDITED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS		7

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations		1715

Item 4. Controls and Procedures		2523

PART II – OTHER INFORMATION		2624

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		2624

Item 6. Exhibits		2725

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED INCOME STATEMENTS

(Unaudited)


	Three Months Ended September 30						Nine Months Ended September 30							Three Months Ended June 30						Six Months Ended June 30
(Millions of dollars, except per share amounts)	2019			2018			2019			2018			(Millions of dollars, except per share amounts)	2020		2019		2020		2019
Net Sales	$	4,640		$	4,582		$	13,867		$	13,917		Net Sales	$	4,612	$	4,594	$	9,621	$	9,227
Cost of products sold	3,085			3,166			9,398			9,722			Cost of products sold	2,835		3,108		6,053		6,313
Gross Profit	1,555			1,416			4,469			4,195			Gross Profit	1,777		1,486		3,568		2,914
Marketing, research and general expenses	815			749			2,395			2,599			Marketing, research and general expenses	844		811		1,717		1,580
Other (income) and expense, net	(175		)	(2		)	(166		)	6			Other (income) and expense, net	8		5		22		9
Operating Profit	915			669			2,240			1,590			Operating Profit	925		670		1,829		1,325
Nonoperating expense	(11		)	(30		)	(33		)	(75		)	Nonoperating expense	(6)		(11)		(17)		(22)
Interest income	3			2			8			7			Interest income	2		2		4		5
Interest expense	(66		)	(64		)	(198		)	(198		)	Interest expense	(65)		(67)		(126)		(132)
Income Before Income Taxes and Equity Interests	841			577			2,017			1,324			Income Before Income Taxes and Equity Interests	856		594		1,690		1,176
Provision for income taxes	(192		)	(138		)	(467		)	(380		)	Provision for income taxes	(199)		(132)		(396)		(275)
Income Before Equity Interests	649			439			1,550			944			Income Before Equity Interests	657		462		1,294		901
Share of net income of equity companies	31			23			91			80			Share of net income of equity companies	35		33		73		60
Net Income	680			462			1,641			1,024			Net Income	692		495		1,367		961
Net income attributable to noncontrolling interests	(9		)	(11		)	(31		)	(25		)	Net income attributable to noncontrolling interests	(11)		(10)		(26)		(22)
Net Income Attributable to Kimberly-Clark Corporation	$	671		$	451		$	1,610		$	999		Net Income Attributable to Kimberly-Clark Corporation	$	681	$	485	$	1,341	$	939

Per Share Basis													Per Share Basis
Net Income Attributable to Kimberly-Clark Corporation													Net Income Attributable to Kimberly-Clark Corporation
Basic	$	1.95		$	1.30		$	4.68		$	2.86		Basic	$	2.00	$	1.41	$	3.93	$	2.73
Diluted	$	1.94		$	1.29		$	4.65		$	2.85		Diluted	$	1.99	$	1.40	$	3.92	$	2.71

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	Three Months Ended September 30						Nine Months Ended September 30							Three Months Ended June 30						Six Months Ended June 30
(Millions of dollars)	2019			2018			2019			2018			(Millions of dollars)	2020		2019		2020		2019
Net Income	$	680		$	462		$	1,641		$	1,024		Net Income	$	692	$	495	$	1,367	$	961
Other Comprehensive Income (Loss), Net of Tax													Other Comprehensive Income (Loss), Net of Tax
Unrealized currency translation adjustments	(170		)	(79		)	(148		)	(343		)	Unrealized currency translation adjustments	125		(4)		(274)		22
Employee postretirement benefits	16			22			38			101			Employee postretirement benefits	5		26		39		22
Other	2			3			(18		)	31			Other	(24)		(3)		8		(20)
Total Other Comprehensive Income (Loss), Net of Tax	(152		)	(54		)	(128		)	(211		)	Total Other Comprehensive Income (Loss), Net of Tax	106		19		(227)		24
Comprehensive Income	528			408			1,513			813			Comprehensive Income	798		514		1,140		985
Comprehensive (income) loss attributable to noncontrolling interests	1			(10		)	(15		)	(14		)	Comprehensive (income) loss attributable to noncontrolling interests	(15)		(9)		(18)		(16)
Comprehensive Income Attributable to Kimberly-Clark Corporation	$	529		$	398		$	1,498		$	799		Comprehensive Income Attributable to Kimberly-Clark Corporation	$	783	$	505	$	1,122	$	969

See notes to the unaudited interim consolidated financial statements.

KIMBERLY-CLARK CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)


	Three Months Ended September 30, 2018																															Three Months Ended June 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued			Additional Paid-in Capital				Treasury Stock								Retained Earnings			Accumulated Other Comprehensive Income (Loss)					Non-controlling Interests			Total Stockholders' Equity			(Millions of dollars, shares in thousands, except per share amounts)		Common Stock Issued					Additional Paid-in Capital		Treasury Stock							Retained Earnings	Accumulated Other Comprehensive Income (Loss)								Non-controlling Interests	Total Stockholders' Equity
	Shares	Amount					Shares			Amount																						Shares	Amount					Shares			Amount
Balance at June 30, 2018	378,597	$	473		$	542			30,713			$	(3,632		)		$	5,782		$	(3,222		)		$	235				$	178
Balance at March 31, 2019																														Balance at March 31, 2019		378,597	$	473	$	538	34,657		$	(4,075)		$	6,048	$	(3,289)				$	223			$	(82)
Net income in stockholders' equity, excludes redeemable interests' share	—	—		—				—			—					451			—					10			461			Net income in stockholders' equity, excludes redeemable interests' share		—	—		—		—		—			485		—			9				494
Other comprehensive income, net of tax	—	—		—				—			—					—			(53			)		—			(53		)
Other comprehensive income, net of tax, excludes redeemable interests' share																														Other comprehensive income, net of tax, excludes redeemable interests' share		—	—		—		—		—			—		20			(2)				18
Stock-based awards exercised or vested	—	—		(8		)		(300	)		34					—			—					—			26			Stock-based awards exercised or vested		—	—		(60)		(1,672)		192			—		—			—				132
Shares repurchased	—	—		—				1,561			(174			)		—			—					—			(174		)	Shares repurchased		—	—		—		1,396		(179)			—		—			—				(179)
Recognition of stock-based compensation	—	—		19				—			—					—			—					—			19			Recognition of stock-based compensation		—	—		31		—		—			—		—			—				31
Dividends declared ($1.00 per share)	—	—		—				—			—					(347		)	—					—			(347		)
Dividends declared ($1.03 per share)																														Dividends declared ($1.03 per share)		—	—		—		—		—			(355)		—			—				(355)
Other	—	—		2				—			—					—			—					—			2			Other		—	—		1		—		—			(8)		—			(2)				(9)
Balance at September 30, 2018	378,597	$	473	$	555			31,974			$	(3,772		)		$	5,886		$	(3,275		)		$	245		$	112
Balance at June 30, 2019																														Balance at June 30, 2019		378,597	$	473	$	510	34,381		$	(4,062)		$	6,170	$	(3,269)		$	228			$	50

See notes to the unaudited interim consolidated financial statements.

Note 1. Accounting Policies

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all material adjustments which are of a normal and recurring nature necessary for a fair presentation of the results for the periods presented have been reflected. Dollar amounts are reported in millions, except per share dollar amounts, unless otherwise noted.

For further information, refer to the consolidated financial statements and footnotes included in our Annual Report on Form ~~10‑K~~10-K for the year ended December 31, ~~2018.~~2019. The terms "Corporation," "Kimberly-Clark," "K-C," "we," "our" and "us" refer to Kimberly-Clark Corporation and its consolidated subsidiaries.

~~Annual Goodwill Impairment Assessment~~

Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses. Goodwill is not amortized, but rather is assessed for impairment annually and whenever events and circumstances indicate that impairment may have occurred. Impairment testing compares the reporting unit carrying amount, including goodwill, with its fair value. Fair value is estimated based on discounted cash flows. If the reporting unit carrying amount, including goodwill, exceeds its fair value, a goodwill impairment charge for the excess amount above fair value would be recorded. For 2019, we completed the required annual testing of goodwill for impairment for all of our reporting units using the first day of the third quarter as the measurement date, and determined through quantitative impairment testing that goodwill is not impaired.

Highly Inflationary Accounting in Argentina

GAAP guidance requires the use of highly inflationary accounting for countries whose cumulative three-year inflation exceeds 100 percent. In the second quarter of 2018, published inflation indices indicated that the three-year cumulative inflation in Argentina exceeded 100 percent, and as of July 1, 2018, we elected to adopt highly inflationary accounting for our subsidiaries in Argentina (“K-C Argentina”). Under highly inflationary accounting, K-C Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other (income) and expense, net and was not material. As of ~~September~~June 30, ~~2019,~~2020, K-C Argentina had a small net peso monetary position. Net sales of K-C Argentina were approximately 1 percent of our consolidated net sales for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018.~~2019.

Lease assets and lease liabilities are recognized at the commencement of an arrangement where it is determined at inception that a lease exists. Lease assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. These assets and liabilities are initially recognized based on the present value of lease payments over the lease term calculated using our incremental borrowing rate generally applicable to the location of the lease asset, unless the implicit rate is readily determinable. Lease assets also include any upfront lease payments made and exclude lease incentives. Lease terms include options to extend or terminate the lease when it is reasonably certain that those options will be exercised.

Variable lease payments are generally expensed as incurred and include certain index-based changes in rent, certain nonlease components, such as maintenance and other services provided by the lessor, and other charges included in the lease. Leases with an initial term of 12 months or less are not recorded on the balance sheet, and the expense for these short-term leases and for operating leases is recognized on a straight-line basis over the lease term.

Certain lease agreements with lease and nonlease components are combined as a single lease component. The depreciable life of lease assets and leasehold improvements is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Recently Adopted Accounting Standards

The Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. ~~2016-02,~~2018-15, ~~Leases (Topic 842),~~ ~~amended by ASU 2018-11,~~ ~~Leases(Topic 842): Targeted Improvements. The new guidance requires a lessee to recognize assets and liabilities for all leases with lease terms of more than 12 months and provide additional disclosures. The~~

ASU requires adoption using a modified retrospective transition approach with either 1) periods prior to the adoption date being recast or 2) a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. We adopted this standard on January 1, 2019 using the cumulative-effect adjustment approach. We elected the package of practical expedients in transition for leases that commenced prior to January 1, 2019 whereby these contracts were not reassessed or reclassified from their previous assessment as of December 31, 2018. We also elected certain other practical expedients in transition including not reassessing existing land easements as lease contracts. For all new and modified leases after adoption of the ASU, we have taken the component election allowing us to generally account for lease components together with nonlease components in the calculation of the lease asset and corresponding liability. We implemented processes and a lease accounting system to ensure adequate internal controls were in place to assess our contracts and enable proper accounting and reporting of financial information upon adoption. No cumulative-effect adjustment was recognized as the amount was not material, and the impact on our results of operations and cash flows was also not material. See Note 7 for the financial position impact and additional disclosures.

~~The FASB issued ASU No. 2017-12,~~ ~~Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities~~. ~~The~~new standard makes more financial and non-financial hedging strategies eligible for hedge accounting. It also amends presentation and disclosure requirements and changes how companies assess hedge effectiveness. This ASU requires adoption using a modified retrospective transition approach with a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. We adopted this standard on January 1, 2019 with no cumulative-effect adjustment as the amount was not material. The effects of this standard on our financial position, results of operations and cash flows were not material.

~~The FASB issued ASU No. 2018-13,~~ ~~Fair Value Measurement (Topic 820)~~. The new guidance modifies disclosure requirements related to fair value measurement. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Implementation on a prospective or retrospective basis varies by specific disclosure requirement. We early adopted this standard as of July 1, 2019 on a prospective basis. The impact on our disclosures was not material.

~~Accounting Standards Issued - Not Yet Adopted~~

~~The FASB issued ASU No. 2018-15,~~Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40). The new guidance reduces complexity for the accounting for costs of implementing a cloud computing service arrangement and aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). We adopted this standard as of January 1, 2020 on a prospective basis. The effects of this standard on our financial position, results of operations and cash flows were not material.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This guidance provides temporary optional expedients and exceptions to accounting guidance on contract modifications and hedge accounting to ease entities’ financial reporting burdens as the market transitions from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. The guidance was effective upon issuance and generally can be applied through December 31, 2022. The effects of this standard on our financial position, results of operations and cash flows are not expected to be material.

Accounting Standards Issued - Not Yet Adopted

The FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). The new guidance simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, hybrid taxes and the recognition of deferred tax liabilities for outside basis differences. It also clarifies and simplifies other aspects of the accounting for income taxes. For public companies, the amendments in this ASU are effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal ~~years,~~years. Early adoption is permitted in interim or annual periods with any adjustments reflected as of the beginning ~~after December 15, 2019, with~~of the annual period that includes that interim period. Additionally, entities that elect early adoption ~~permitted. Implementation should~~must adopt all the amendments in the same period. Amendments are to be applied prospectively, except for certain amendments that are to be applied either retrospectively or ~~prospectively~~with a modified retrospective approach through a cumulative effect adjustment recorded to ~~all implementation costs incurred after the date of adoption.~~retained earnings. The effects of this standard on our financial position, results of operations or cash flows are not expected to be material.

Note 2. 2018 Global Restructuring Program

In January 2018, we announced the 2018 Global Restructuring Program to reduce our structural cost base by streamlining and simplifying our manufacturing supply chain and overhead organization. We expect to close or sell approximately 10 manufacturing facilities and expand production capacity at several others. We expect to exit or divest some lower-margin businesses that generate approximately 1 percent of our net sales. The ~~sales are concentrated in our consumer tissue business segment. The~~ restructuring is expected to impact our organizations in all major geographies. Workforce reductions are expected to be in the range of 5,000 to 5,500. Certain capital appropriations under the 2018 Global Restructuring Program are being finalized. Accounting for actions related to each appropriation will commence when the appropriation is authorized for execution.

The restructuring is expected to be completed ~~by the end of 2020,~~in 2021, with total costs anticipated to be toward the high end of the range of $1.7 billion to $1.9 billion pre-tax ($~~1.35~~1.3 billion to ~~$1.5~~$1.4 billion after tax). Cash costs are expected to be $900 to $1.0 billion, primarily related to workforce reductions. Non-cash charges are expected to be $800 to $900 pre-tax and will primarily consist of incremental depreciation, asset write-offs and pension settlement and curtailment charges. ~~Restructuring charges in 2019 are expected to be $375 to $425 pre-tax ($300 to $345 after tax).~~

The following net charges were incurred in connection with the 2018 Global Restructuring Program:


	Three Months Ended June 30						Six Months Ended June 30
	2020		2019		2020		2019
Cost of products sold:
Charges for workforce reductions	$	1	$	2	$	1	$	32

Asset write-offs	3		15		9		27
Incremental depreciation	33		65		68		132
Other exit costs	23		20		52		36
Total	60		102		130		227
Marketing, research and general expenses:
Charges (adjustments) for workforce reductions	1		(12)		(2)		(8)
Other exit costs	26		29		52		53
Total	27		17		50		45
Other (income) and expense, net	—		—		—		(1)
Total charges	87		119		180		271
Provision for income taxes	(15)		(27)		(33)		(58)
Net charges	72		92		147		213
Net impact related to equity companies and noncontrolling interests	—		—		(1)		1
Net charges attributable to Kimberly-Clark Corporation	$	72	$	92	$	146	$	214

Three Months Ended
September 30 Nine Months Ended
September 30
2019 2018 2019 2018
Cost of products sold:
Charges for workforce reductions $ 1
$ 31
$ 33
$ 156
Asset impairments —
—
—
74
Asset write-offs 18
16
45
102
Incremental depreciation 57
47
189
115
Other exit costs 28
9
64
18
Total 104
103
331
465
Marketing, research and general expenses:
Charges (adjustments) for workforce reductions (4 ) (13 ) (12 ) 257
Other exit costs 25
39
78
84
Total 21
26
66
341
Other (income) and expense, net (181 ) —
(182 ) —
Nonoperating expense^(a)
—
20
—
50
Total charges (56 ) 149
215
856
Provision for income taxes 23
(30 ) (35 ) (197 )
Net charges (33 ) 119
180
659
Net impact related to equity companies and noncontrolling interests —
—
1
(10 )
Net charges attributable to Kimberly-Clark Corporation $ (33 ) $ 119
$ 181
$ 649

The asset impairment charges were measured based on the excess of the carrying value of the impacted asset groups over their fair values. These fair values were measured by using discounted cash flows expected over the limited time the assets would remain in use and as a result, the assets were essentially written off. The use of discounted cash flows represents a level 3 measure under the fair value hierarchy.

Other (income) and expense, net in 2019 includes a pre-tax gain of approximately $182 on the sale of a manufacturing facility and associated real estate which were disposed of as part of the restructuring.

2019 2018
Restructuring liabilities at January 1 $ 210
$ —
Charges for workforce reductions and other cash exit costs 159
512
Cash payments (230 ) (229 )
Currency and other 3
(20 )
Restructuring liabilities at September 30 $ 142
$ 263


	2020		2019
Restructuring liabilities at January 1	$	132	$	210
Charges for workforce reductions and other cash exit costs	99		112
Cash payments	(122)		(142)
Currency and other	(3)		6
Restructuring liabilities at June 30	$	106	$	186

Restructuring liabilities of ~~$84~~$75 and ~~$138~~$125 are recorded in Accrued expenses and other current liabilities and ~~$58~~$31 and ~~$125~~$61 are recorded in Other Liabilities as of ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. The impact related to restructuring charges is recorded in Operating working capital and Other Operating Activities, as appropriate, in our consolidated cash flow statements.

Through ~~September~~June 30, ~~2019,~~2020, cumulative pre-tax charges for the 2018 Global Restructuring Program were ~~$1.3~~$1.6 billion ($~~1.0~~1.2 billion after tax).

~~Note 3. Income Taxes~~

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Tax Act"). In the period ended December 31, 2017, we recorded a provisional discrete net tax benefit related to the transition tax, remeasurement of deferred taxes, our reassessment of permanently reinvested earnings, uncertain tax positions

and valuation allowances, and actions taken in anticipation of the Tax Act. The provisional amounts recorded in 2017 were finalized in 2018. During 2018, we recorded discrete net tax expense related to new guidance issued during 2018 affecting tax benefits we recorded in the period ended December 31, 2017 for the transition tax and certain tax planning actions taken in anticipation of the Tax Act. At December 31, 2018, we finalized our policy and elected to use the period cost method for global intangible low-taxed income (“GILTI”) provisions and therefore have not recorded deferred taxes for basis differences expected to reverse in future periods.

In the first quarter of 2018, we recorded discrete net tax expense of $82 primarily related to guidance issued affecting tax benefits we recorded in the fourth quarter of 2017 for certain tax planning actions taken in anticipation of the Tax Act. In the third quarter of 2018, we recorded discrete net tax expense of $26 as a result of finalizing estimates related to the transition tax and remeasurement of deferred taxes.

The Brazilian tax authority, Secretaria da Receita Federal do Brasil ("RFB"), concluded an audit for the taxable periods from 2008-2013. This audit included a review of our determinations of amortization of certain goodwill arising from prior acquisitions in Brazil, and the RFB has proposed adjustments that effectively eliminate the goodwill amortization benefits related to these transactions. Administrative appeals have been exhausted, and the dispute is moving into the judicial phase. The amount of the proposed tax adjustments and penalties is approximately $90 as of September 30, 2019 (translated at the September 30, 2019 currency exchange rate). The amount ultimately in dispute will be significantly greater because of interest. We believe we have meritorious defenses and intend to vigorously defend these proposed adjustments; however, it is expected to take a number of years to reach resolution of this matter.

Note 4.3. Fair Value Information

The following fair value information is based on a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels in the hierarchy used to measure fair value are:

Level 1 – Unadjusted quoted prices in active markets accessible at the reporting date for identical assets and liabilities.

Level 2 – Quoted prices for similar assets or liabilities in active markets. Quoted prices for identical or similar assets and liabilities in markets that are not considered active or financial instruments for which all significant inputs are observable, either directly or indirectly.

Level 3 – Prices or valuations that require inputs that are significant to the valuation and are unobservable.

A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

During the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and for the full year ~~2018,~~2019, there were no significant transfers to or from level 3 fair value determinations.

Derivative assets and liabilities are measured on a recurring basis at fair value. At ~~September~~June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, derivative assets were ~~$61~~$113 and ~~$30,~~$34, respectively, and derivative liabilities were ~~$27~~$28 and ~~$18,~~$44, respectively. The fair values of derivatives used to manage interest rate risk and commodity price risk are based on LIBOR rates and interest rate swap curves and NYMEX price quotations, respectively. The fair values of hedging instruments used to manage foreign currency risk are based on published quotations of spot currency rates and forward points, which are converted into implied forward currency rates. Measurement of our derivative assets and liabilities is considered a level 2 measurement. Additional information on our classification and use of derivative instruments is contained in Note 8.6.

Redeemable preferred securities of subsidiaries are measured on a recurring basis at fair value and were ~~$38 and $64 at September~~$29 as of June 30, ~~2019~~2020 and December 31, ~~2018, respectively.~~2019. They are not traded in active markets. As of ~~September~~June 30, ~~2019,~~2020, the fair values of the redeemable securities were based on a discounted cash flow valuation model. Measurement of the redeemable preferred securities is considered a level 3 measurement.

Company-owned life insurance ("COLI") assets are measured on a recurring basis at fair value. COLI assets were ~~$72~~$69 and ~~$64~~$76 at ~~September~~June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, respectively. The COLI policies are a source of funding primarily for our nonqualified employee benefits and are included in Other Assets. The COLI policies are measured at fair value using the net asset value per share practical expedient, and therefore, are not classified in the fair value hierarchy.

The following table includes the fair value of our financial instruments for which disclosure of fair value is required:


	Fair Value Hierarchy Level	Carrying Amount			Estimated Fair Value		Carrying Amount		Estimated Fair Value

				June 30, 2020							December 31, 2019
Assets
Cash and cash equivalents^(a)	1	$	1,448		$	1,448	$	442	$	442
Time deposits^(b)	1	336			336		275		275

Liabilities
Short-term debt^(c)	2	93			93		775		775

Long-term debt^(d)	2	7,980			9,410		6,972		7,877

Fair Value Hierarchy Level Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value

September 30, 2019 December 31, 2018
Assets
Cash and cash equivalents^(a)
1 $ 416
$ 416
$ 539
$ 539
Time deposits^(b)
1 302
302
256
256
Liabilities
Short-term debt^(c)
2 796
796
495
495
Long-term debt^(d)
2 6,957
7,885
6,960
7,192

(a)Cash equivalents are composed of certificates of deposit, time deposits and other interest-bearing investments with original maturity dates of 90 days or less. Cash equivalents are recorded at cost, which approximates fair value.


~~(a)~~	Cash equivalents are composed of certificates of deposit, time deposits and other interest-bearing investments with original maturity dates of 90 days or less. Cash equivalents are recorded at cost, which approximates fair value.


~~(b)~~	Time deposits are composed of deposits with original maturities of more than 90 days but less than one year and instruments with original maturities of greater than one year, included in Other current assets or Other Assets in the consolidated balance sheet, as appropriate. Time deposits are recorded at cost, which approximates fair value.


~~(c)~~	~~Short-term debt is composed of U.S. commercial paper and/or other similar short-term debt issued by non-U.S. subsidiaries, all of which are recorded at cost, which approximates fair value.~~


~~(d)~~	Long-term debt includes the current portion of these debt instruments. Fair values were estimated based on quoted prices for financial instruments for which all significant inputs were observable, either directly or indirectly.

(b)Time deposits are composed of deposits with original maturities of more than 90 days but less than one year and instruments with original maturities of greater than one year, included in Other current assets or Other Assets in the consolidated balance sheet, as appropriate. Time deposits are recorded at cost, which approximates fair value.

(c)Short-term debt is composed of U.S. commercial paper and/or other similar short-term debt issued by non-U.S. subsidiaries, all of which are recorded at cost, which approximates fair value.

(d)Long-term debt includes the current portion of these debt instruments. Fair values were estimated based on quoted prices for financial instruments for which all significant inputs were observable, either directly or indirectly.

Note 5.4. Earnings Per Share ("EPS")

There are no adjustments required to be made to net income for purposes of computing EPS. The average number of common shares outstanding is reconciled to those used in the basic and diluted EPS computations as follows:

Three Months Ended
September 30 Nine Months Ended
September 30
(Millions of shares) 2019 2018 2019 2018
Basic 343.8
347.2
344.1
348.8
Dilutive effect of stock options and restricted share unit awards 2.1
1.6
1.9
1.6
Diluted 345.9
348.8
346.0
350.4


	Three Months Ended June 30			Six Months Ended June 30
(Millions of shares)	2020	2019	2020	2019
Basic	340.9	344.2	341.1	344.3
Dilutive effect of stock options and restricted share unit awards	1.0	1.8	1.2	1.7
Diluted	341.9	346.0	342.3	346.0

The impact of options outstanding that were not included in the computation of diluted EPS because their exercise price was greater than the average market price of the common shares was insignificant. The number of common shares outstanding as of ~~September~~June 30, 2020 and 2019 ~~and 2018~~ was ~~343.1~~341.0 million and ~~346.6~~344.2 million, respectively.

Note 6.5. Stockholders' Equity

Net unrealized currency gains or losses resulting from the translation of assets and liabilities of foreign subsidiaries, except those in highly inflationary economies, are recorded in Accumulated Other Comprehensive Income ("AOCI"). For these operations, changes in exchange rates generally do not affect cash flows; therefore, unrealized translation adjustments are recorded in AOCI rather than net income. Upon sale or substantially complete liquidation of any of these subsidiaries, the applicable unrealized translation would be removed from AOCI and reported as part of the gain or loss on the sale or liquidation.

Also included in unrealized translation amounts are the effects of foreign exchange rate changes on intercompany balances of a long-term investment nature and transactions designated as hedges of net foreign investments.

The change in net unrealized currency translation for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 was primarily due to weakening of foreign currencies versus the U.S. ~~dollar, including the South Korean won, British pound sterling, and Brazilian real.~~

dollar.

The changes in the components of AOCI attributable to Kimberly-Clark, net of tax, are as follows:

Unrealized Translation Defined Benefit Pension Plans Other Postretirement Benefit Plans Cash Flow Hedges and Other
Balance as of December 31, 2017 $ (1,864 ) $ (976 ) $ (39 ) $ (40 )
Other comprehensive income (loss) before reclassifications (333 ) 25
14
17
(Income) loss reclassified from AOCI 1
63
(a) (1 ) (a) 14
Net current period other comprehensive income (loss) (332 ) 88
13
31
Tax effects reclassified from AOCI (18 ) (125 ) (5 ) (8 )
Balance as of September 30, 2018 $ (2,214 ) $ (1,013 ) $ (31 ) $ (17 )

Balance as of December 31, 2018 $ (2,297 ) $ (1,017 ) $ 12
$ 3
Other comprehensive income (loss) before reclassifications (132 ) 1
16
(6 )
(Income) loss reclassified from AOCI —
22
(a) (1 ) (a) (13 )
Net current period other comprehensive income (loss) (132 ) 23
15
(19 )
Balance as of September 30, 2019 $ (2,429 ) $ (994 ) $ 27
$ (16 )


~~(a)~~	~~Included in computation of net periodic benefit costs.~~

~~Note 7. Leases~~

We have entered into leases for certain facilities, vehicles, material handling and other equipment. Our operating leases have remaining contractual terms up to 13 years, some of which include options to extend the leases for up to 20 years, and some of which include options to terminate the leases within 1 year. Our operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. Our operating lease costs are primarily related to facility leases for inventory warehousing and administration offices, and our finance leases are immaterial.

~~Operating Lease Cost~~

Three Months Ended
September 30, 2019 Nine Months Ended
September 30, 2019 Income Statement Classification
Lease cost $ 41
$ 120
Cost of products sold, Marketing, research and general expenses
Variable lease cost^(a)
30
102
Cost of products sold, Marketing, research and general expenses
Total lease cost $ 71
$ 222


	Unrealized Translation		Defined Benefit Pension Plans			Other Postretirement Benefit Plans			Cash Flow Hedges and Other
Balance as of December 31, 2018	$	(2,297)	$	(1,017)		$	12		$	3
Other comprehensive income (loss) before reclassifications	29		1			15			(12)
(Income) loss reclassified from AOCI	—		6		(a)	(1)		(a)	(8)
Net current period other comprehensive income (loss)	29		7			14			(20)

Balance as of June 30, 2019	$	(2,268)	$	(1,010)		$	26		$	(17)

Balance as of December 31, 2019	$	(2,271)	$	(979)		$	(13)		$	(31)
Other comprehensive income (loss) before reclassifications	(266)		22			2			17
(Income) loss reclassified from AOCI	—		16		(a)	(1)		(a)	(9)
Net current period other comprehensive income (loss)	(266)		38			1			8

Balance as of June 30, 2020	$	(2,537)	$	(941)		$	(12)		$	(23)

(a) ~~Includes short-term leases, which are immaterial.~~Included in computation of net periodic benefit costs.

~~Operating Lease Assets and Liabilities~~

September 30, 2019 Balance Sheet Classification
Lease assets $ 399
Other Assets

Current lease liabilities $ 133
Accrued expenses and other current liabilities
Noncurrent lease liabilities 275
Other Liabilities
Total lease liabilities $ 408

~~Maturity of Operating Lease Liabilities~~

September 30, 2019
2019 $ 40
2020 138
2021 95
2022 66
2023 45
Thereafter 75
Total lease payments 459
Less imputed interest 51
Present value of lease liabilities $ 408

As of September 30, 2019, our operating leases have a weighted-average remaining lease term of 4.3 years and a weighted-average discount rate of 5.0 percent. Cash paid for amounts included in the measurement of operating lease liabilities was $121 for the nine months ended September 30, 2019.

As of September 30, 2019, we have additional operating leases, primarily for facilities, that have not yet commenced of $105. These operating leases will commence during 2020 with lease terms of up to 10 years.

~~The future minimum obligations under operating leases in effect as of December 31, 2018 having a noncancelable term in excess of one year as determined prior to the adoption of ASU 842 are as follows:~~

December 31, 2018
2019 $ 160
2020 123
2021 85
2022 57
2023 41
Thereafter 72
Future minimum obligations $ 538

Note 8.6. Objectives and Strategies for Using Derivatives

As a multinational enterprise, we are exposed to financial risks, such as changes in foreign currency exchange rates, interest rates, and commodity prices. We employ a number of practices to manage these risks, including operating and financing activities and, where appropriate, the use of derivative instruments.

At ~~September~~June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, derivative assets were ~~$61~~$113 and ~~$30,~~$34, respectively, and derivative liabilities were ~~$27~~$28 and ~~$18,~~$44, respectively, primarily comprised of foreign currency exchange contracts. Derivative assets are recorded in Other

current assets or Other Assets, as appropriate, and derivative liabilities are recorded in Accrued expenses and other current liabilities or Other Liabilities, as appropriate.

Foreign Currency Exchange Rate Risk

Translation adjustments result from translating foreign entities' financial statements into U.S. dollars from their functional currencies. The risk to any particular entity's net assets is reduced to the extent that the entity is financed with local currency borrowings. A portion of our balance sheet translation exposure for certain affiliates, which results from changes in translation rates between the affiliates’ functional currencies and the U.S. dollar, is hedged with cross-currency swap contracts and certain foreign denominated debt which are designated as net investment hedges. The foreign currency exposure on certain non-functional currency denominated monetary assets and liabilities, primarily intercompany loans and accounts payable, is hedged with primarily undesignated derivative instruments.

Derivative instruments are entered into to hedge a portion of forecasted cash flows denominated in foreign currencies for non-U.S. operations' purchases of raw materials, which are priced in U.S. dollars, and imports of intercompany finished goods and work-in-process priced predominantly in U.S. dollars and euros. The derivative instruments used to manage these exposures are designated as cash flow hedges.

Interest Rate Risk

Interest rate risk is managed using a portfolio of variable and fixed-rate debt composed of short and long-term instruments. Interest rate swap contracts may be used to facilitate the maintenance of the desired ratio of variable and fixed-rate debt and are designated as fair value hedges. From time to time, we also hedge the anticipated issuance of fixed-rate debt, and these contracts are designated as cash flow hedges.

Commodity Price Risk

We use derivative instruments, such as forward contracts, to hedge a limited portion of our exposure to market risk arising from changes in prices of certain commodities. These derivatives are designated as cash flow hedges of specific quantities of the underlying commodity expected to be purchased in future months. In addition, we utilize negotiated short-term contract structures, including fixed price contracts, to manage volatility for a portion of our commodity costs.

Fair Value Hedges

Derivative instruments that are designated and qualify as fair value hedges are predominantly used to manage interest rate risk. The fair values of these interest rate derivative instruments are recorded as an asset or liability, as appropriate, with the offset recorded in Interest expense. The offset to the change in fair values of the related debt is also recorded in Interest expense. Any realized gain or loss on the derivatives that hedge interest rate risk is amortized to Interest expense over the life of the related debt. As of ~~September~~June 30, ~~2019,~~2020, the aggregate notional values and carrying values of outstanding interest rate contracts designated as fair value hedges were $300 and ~~$310,~~$325, respectively. For the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, gains or losses recognized in Interest expense for interest rate swaps were not significant.

Cash Flow Hedges

For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative instrument is initially recorded in AOCI, net of related income taxes, and recognized in earnings in the same income statement line and period that the hedged exposure affects earnings. As of ~~September~~June 30, ~~2019,~~2020, outstanding commodity forward contracts were in place to hedge a limited portion of our estimated requirements of the related underlying commodities in the remainder of ~~2019~~2020 and future periods. As of ~~September~~June 30, ~~2019,~~2020, the aggregate notional value of outstanding foreign exchange derivative contracts designated as cash flow hedges was ~~$640.~~$663. For the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, no significant gains or losses were reclassified into Interest expense, Cost of products sold or Other (income) and expense, net as a result of the discontinuance of cash flow hedges due to the original forecasted transaction no longer being probable of occurring. At ~~September~~June 30, ~~2019,~~2020, amounts to be reclassified from AOCI into Interest expense, Cost of products sold or Other (income) and expense, net during the next twelve months are not expected to be material. The maximum maturity of cash flow hedges in place at ~~September~~June 30, ~~2019~~2020 is ~~September 2021.~~June 2022.

Net Investment Hedges

For derivative instruments that are designated and qualify as net investment hedges, the aggregate notional value was $1.5 billion at ~~September~~June 30, ~~2019.~~2020. We exclude the interest accruals on cross-currency swap contracts and the forward points on foreign exchange forward contracts from the assessment and measurement of hedge effectiveness. We recognize the interest accruals on cross-currency swap contracts in earnings within Interest expense. We amortize the forward points on foreign exchange contracts into earnings within Interest expense over the life of the hedging relationship. Changes in fair value of net investment hedges are recorded in AOCI and offset the change in the value of the net investment being hedged. For the ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, unrealized gains of ~~$49~~$71 related to net investment hedge fair value changes were recorded in AOCI and no significant amounts were reclassified from AOCI to Interest expense.

No significant amounts were excluded from the assessment of net investment, fair value or cash flow hedge effectiveness as of ~~September~~June 30, ~~2019.~~2020.

Undesignated Hedging Instruments

Gains or losses on undesignated foreign exchange hedging instruments are immediately recognized in Other (income) and expense, net. ~~Losses~~A gain of ~~$14~~$12 and $9loss of $5 were recorded in the three months ended ~~September~~June 30, 2020 and 2019, respectively. A gain of $8 and ~~2018, respectively. Losses~~loss of ~~$27 and $46~~$13 were recorded in the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. The effect on earnings from the use of these non-designated derivatives is substantially neutralized by the transactional gains and losses recorded on the underlying assets and liabilities. At ~~September~~June 30, ~~2019,~~2020, the notional value of these undesignated derivative instruments was approximately $1.7 billion.

Note 9.7. Business Segment Information

We are organized into operating segments based on product groupings. These operating segments have been aggregated into three reportable global business segments: Personal Care, Consumer Tissue and K-C Professional. The reportable segments were determined in accordance with how our chief operating decision maker and our executive managers develop and execute global strategies to drive growth and profitability. These strategies include global plans for branding and product positioning, technology, research and development programs, cost reductions including supply chain management, and capacity and capital investments for each of these businesses. Segment management is evaluated on several factors, including operating profit. Segment operating profit excludes Other (income) and expense, net and income and expense not associated with ongoing operations of the business segments, including the costs of corporate decisions related to the 2018 Global Restructuring Program described in Note 2.

The principal sources of revenue in each global business segment are described below:

•

•Personal Care brands offer our consumers a trusted partner in caring for themselves and their families by delivering confidence, protection and discretion through a wide variety of innovative solutions and products such as disposable diapers, training and youth pants, swimpants, baby wipes, feminine and incontinence care products, and other related products. Products in this segment are sold under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Kotex, U by Kotex, Intimus, Depend, Plenitud, Poise and other brand names.

•Consumer Tissue offers a wide variety of innovative solutions and trusted brands that responsibly improve everyday living for families around the world. Products in this segment include facial and bathroom tissue, paper towels, napkins and related products, and are sold under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brand names.

•K-C Professional partners with businesses to create Exceptional Workplaces, helping to make them healthier, safer and more productive through a range of solutions and supporting products such as wipers, tissue, towels, apparel, soaps and sanitizers. Our brands, including Kleenex, Scott, WypAll, Kimtech and KleenGuard are well known for quality and trusted to help people around the world work better.


•	~~Consumer Tissue~~ offers a wide variety of innovative solutions and trusted brands that responsibly improve everyday living for families around the world. Products in this segment include facial and bathroom tissue, paper towels, napkins and related products, and are sold under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Neve and other brand names.

•

~~K-C Professional~~ partners with businesses to create Exceptional Workplaces, helping to make them healthier, safer and more productive through a range of solutions and supporting products such as wipers, tissue, towels, apparel, soaps and sanitizers. Our brands, including Kleenex, Scott, WypAll, Kimtech and KleenGuard are well known for quality and trusted to help people around the world work better.

Information concerning consolidated operations by business segment is presented in the following tables:


	Three Months Ended June 30								Six Months Ended June 30
	2020		2019		Change		2020		2019		Change
NET SALES
Personal Care	$	2,229	$	2,286	-2	%	$	4,651	$	4,561	+2	%
Consumer Tissue	1,645		1,472		+12	%	3,368		2,998		+12	%
K-C Professional	724		821		-12	%	1,572		1,638		-4	%
Corporate & Other	14		15		N.M.		30		30		N.M.
TOTAL NET SALES	$	4,612	$	4,594	—	%	$	9,621	$	9,227	+4

OPERATING PROFIT
Personal Care	$	519	$	485	+7	%	$	1,046	$	969	+8	%
Consumer Tissue	428		221		+94	%	793		462		+72	%
K-C Professional	155		162		-4	%	336		312		+8	%
Corporate & Other^(a)	(169)		(193)		N.M.		(324)		(409)		N.M.
Other (income) and expense, net^(a)	8		5		+60	%	22		9		+144	%
TOTAL OPERATING PROFIT	$	925	$	670	+38	%	$	1,829	$	1,325	+38	%

Three Months Ended September 30 Nine Months Ended September 30
2019 2018 Change 2019 2018 Change
NET SALES
Personal Care $ 2,305
$ 2,252
+2 % $ 6,866
$ 6,816
+1 %
Consumer Tissue 1,484
1,469
+1 % 4,482
4,520
-1 %
K-C Professional 839
848
-1 % 2,477
2,541
-3 %
Corporate & Other 12
13
N.M.
42
40
N.M.
TOTAL NET SALES $ 4,640
$ 4,582
+1 % $ 13,867
$ 13,917
—

OPERATING PROFIT
Personal Care $ 490
$ 466
+5 % $ 1,459
$ 1,397
+4 %
Consumer Tissue 264
212
+25 % 726
668
+9 %
K-C Professional 176
160
+10 % 488
483
+1 %
Corporate & Other^(a)
(190 ) (171 ) N.M.
(599 ) (952 ) N.M.
Other (income) and expense, net^(a)
(175 ) (2 ) N.M.
(166 ) 6
N.M.
TOTAL OPERATING PROFIT $ 915
$ 669
+37 % $ 2,240
$ 1,590
+41 %
(a) Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including charges related to the 2018 Global Restructuring Program. Restructuring charges related to the Personal Care, Consumer Tissue and K-C Professional business segments were $40, $34 and $11, respectively, for the three months ended June 30, 2020, $66, $36 and $15, respectively, for the three months ended June 30, 2019, $74, $76 and $26, respectively, for the six months ended June 30, 2020 and $155, $82 and $31, respectively for the six months ended June 30, 2019.

~~(a)~~

Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including charges related to the 2018 Global Restructuring Program. Restructuring charges related to the personal care, consumer tissue and K-C Professional business segments were $53, $49 and $21, respectively, for the three months ended September 30, 2019, $75, $35 and $11, respectively, for the three months ended September 30, 2018, $208, $131 and $52, respectively, for the nine months ended September 30, 2019 and $476, $194 and $112, respectively, for the nine months ended September 30, 2018.

N.M. - Not Meaningful

Sales of Principal Products

Three Months Ended
September 30 Nine Months Ended
September 30
(Billions of dollars) 2019 2018 2019 2018
Consumer tissue products $ 1.5
$ 1.5
$ 4.5
$ 4.5
Baby and child care products 1.6
1.6
4.7
4.7
Away-from-home professional products 0.8
0.8
2.5
2.5
All other 0.7
0.7
2.2
2.2
Consolidated $ 4.6
$ 4.6
$ 13.9
$ 13.9


	Three Months Ended June 30						Six Months Ended June 30
(Billions of dollars)	2020		2019		2020		2019
Baby and child care products	1.5		1.6		3.2		3.1
Consumer tissue products	1.6		1.5		3.4		3.0
Away-from-home professional products	0.7		0.8		1.6		1.6
All other	0.8		0.7		1.4		1.5
Consolidated	$	4.6	$	4.6	$	9.6	$	9.2

Note ~~10.~~8. Supplemental Balance Sheet Data

The following schedule presents a summary of inventories by major class:

September 30, 2019 December 31, 2018
LIFO Non-LIFO Total LIFO Non-LIFO Total
Raw materials $ 81
$ 233
$ 314
$ 99
$ 263
$ 362
Work in process 130
91
221
120
94
214
Finished goods 462
687
1,149
461
692
1,153
Supplies and other —
263
263
—
275
275
673
1,274
1,947
680
1,324
2,004
Excess of FIFO or weighted-average cost over LIFO cost (168 ) —
(168 ) (191 ) —
(191 )
Total $ 505
$ 1,274
$ 1,779
$ 489
$ 1,324
$ 1,813


	June 30, 2020										December 31, 2019
	LIFO		Non-LIFO		Total		LIFO		Non-LIFO		Total
Raw materials	$	122	$	261	$	383	$	85	$	236	$	321
Work in process	106		75		181		113		93		206
Finished goods	448		679		1,127		451		696		1,147
Supplies and other	—		277		277		—		271		271
	676		1,292		1,968		649		1,296		1,945
Excess of FIFO or weighted-average cost over LIFO cost	(143)		—		(143)		(155)		—		(155)
Total	$	533	$	1,292	$	1,825	$	494	$	1,296	$	1,790

Inventories are valued at the lower of cost or net realizable value, determined on the FIFO or weighted-average cost methods, and at the lower of cost or market, determined on the LIFO cost method.

The following schedule presents a summary of property, plant and equipment, net:


	September 30, 2019			December 31, 2018				June 30, 2020		December 31, 2019
Land	$	164		$	169		Land	$	162	$	165
Buildings	2,788			2,787			Buildings	2,863		2,877
Machinery and equipment	13,888			14,059			Machinery and equipment	13,887		13,946
Construction in progress	780			699			Construction in progress	826		851
	17,620			17,714				17,738		17,839
Less accumulated depreciation	(10,462		)	(10,555		)	Less accumulated depreciation	(10,372)		(10,389)
Total	$	7,158		$	7,159		Total	$	7,366	$	7,450

This management's discussion and analysis ("MD&A") of financial condition and results of operations is intended to provide investors with an understanding of our recent performance, financial condition and prospects. Dollar amounts are reported in millions, except per share dollar amounts, unless otherwise noted. The following will be discussed and analyzed:

•Overview of ~~Third~~Second Quarter ~~2019~~2020 Results

•Impact of COVID-19

•Results of Operations and Related Information

•Liquidity and Capital Resources

~~Business Outlook~~

We describe our business outside North America in two groups – Developing and Emerging Markets ("D&E") and Developed Markets. D&E markets comprise Eastern Europe, the Middle East and Africa, Latin America and Asia-Pacific, excluding Australia and South Korea. Developed Markets consist of Western and Central Europe, Australia and South Korea. We have three reportable business segments: Personal Care, Consumer Tissue and K-C Professional. These business segments are described in greater detail in Note 97 to the unaudited interim consolidated financial statements.

This section presents a discussion and analysis of our ~~third~~second quarter ~~2019~~2020 net sales, operating profit and other information relevant to an understanding of the results of operations. In addition, we provide commentary regarding organic sales growth, which describes the impact of changes in volume, net selling prices and product mix on net sales. Change in foreign currency exchange rates and exited businesses also impact the year-over-year change in net sales. Our analysis compares the three and ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 results to the same periods in ~~2018.~~2019.

Throughout this MD&A, we refer to financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S., or GAAP, and are therefore referred to as non-GAAP financial measures. These measures include adjusted gross and operating profit, adjusted net income, adjusted earnings per share, adjusted other (income) and expense, net and adjusted effective tax rate. We believe these measures provide our investors with additional information about our underlying results and trends, as well as insight into some of the financial measures used to evaluate management.

Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measures, and they should be read only in conjunction with our unaudited interim consolidated financial statements prepared in accordance with GAAP. There are limitations to these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled measures of other companies due to potential differences in methods of calculation and items being excluded. We compensate for these limitations by using these non-GAAP financial measures as a supplement to the GAAP measures and by providing reconciliations of the non-GAAP and comparable GAAP financial measures.

The non-GAAP financial measures exclude the following ~~items~~item for the relevant time periods as indicated in the reconciliations included later in this MD&A:

•2018 Global Restructuring Program - In 2018, we initiated this restructuring program to reduce our structural cost base by streamlining and simplifying our manufacturing supply chain and overhead organization. See Item 1, Note 2 to the unaudited interim consolidated financial statements for details.

Overview of ~~Third~~Second Quarter ~~2019~~2020 Results

•Net sales of $4.6 billion increased ~~more than 1 percent~~slightly compared to the year-ago period. Changes in foreign currency exchange rates reduced sales approximately 4 percent, while organic sales increased 4 percent.

•Operating profit was ~~$915~~$925 in ~~2019~~2020 and ~~$669~~$670 in ~~2018.~~2019. Net Income Attributable to Kimberly-Clark Corporation was ~~$671~~$681 in ~~2019~~2020 compared to ~~$451~~$485 in ~~2018,~~2019, and diluted earnings per share were ~~$1.94~~$1.99 in ~~2019~~2020 compared to ~~$1.29~~$1.40 in ~~2018.~~2019. Results in ~~2019 and 2018~~both periods include charges related to the 2018 Global Restructuring Program. ~~Results in 2019 also include a gain~~

We continue to actively address the COVID-19 situation and its impact globally. We believe that we will emerge from these events well positioned for long-term growth, though we cannot reasonably estimate the duration and severity of this global pandemic or its ultimate impact on the ~~sale~~global economy and our business and results.

We have experienced increased volatility in demand for some of our products as consumers adapt to the evolving environment. Beginning in the first quarter, particularly in March, demand across all business segments and major geographies increased as consumers increased home inventory levels in response to COVID-19. We expect the increase to be followed by periods of potential demand softness and volatility as consumers use existing home inventories and demand potentially returns to more normal levels. Demand for our consumer tissue products has been elevated so far this year as more people spend more time at home. Our K-C Professional business experienced volume declines in the second quarter reflecting the reduction in away from home demand.

During 2020, we have experienced temporary closures of certain facilities, though we have not experienced a ~~manufacturing facility~~material impact from a plant closure to date and ~~associated real estate~~our facilities have largely been exempt or partially exempt from government closure orders. At many of our facilities, we have been experiencing increased employee absences, which ~~were disposed of~~may continue in the current situation.

During 2020, we experienced increased volatility in foreign currency exchange rates and commodity prices, as ~~part of the restructuring.~~

Results of Operations and Related Information


Selected Financial Results	Three Months Ended June 30										Six Months Ended June 30
	2020		2019		Percent Change		2020		2019		Percent Change
Net Sales:
North America	$	2,623	$	2,430	+8	%	$	5,224	$	4,820	+8	%
Outside North America	2,052		2,235		-8	%	4,536		4,550		—	%
Intergeographic sales	(63)		(71)		N.M.		(139)		(143)		N.M.
Total Net Sales	4,612		4,594		—	%	9,621		9,227		+4	%
Operating Profit:
North America	769		608		+26	%	1,428		1,180		+21	%
Outside North America	333		260		+28	%	747		563		+33	%
Corporate & Other^(a)	(169)		(193)		N.M.		(324)		(409)		N.M.
Other (income) and expense, net^(a)	8		5		+60	%	22		9		+144	%
Total Operating Profit	925		670		+38	%	1,829		1,325		+38	%



Share of net income of equity companies	35		33		+6	%	73		60		+22	%

Net Income Attributable to Kimberly-Clark Corporation	681		485		+40	%	1,341		939		+43	%
Diluted Earnings per Share	1.99		1.40		+42	%	3.92		2.71		+45	%

Selected Financial Results Three Months Ended September 30 Nine Months Ended September 30
2019 2018 Percent Change 2019 2018 Percent Change
Net Sales:

North America $ 2,476
$ 2,407
+3 % $ 7,296
$ 7,139
+2 %
Outside North America 2,227
2,252
-1 % 6,777
7,009
-3 %
Intergeographic sales (63 ) (77 ) N.M.
(206 ) (231 ) N.M.
Total Net Sales 4,640
4,582
+1 % 13,867
13,917
—
Operating Profit:
North America 638
561
+14 % 1,818
1,685
+8 %
Outside North America 292
277
+5 % 855
863
-1 %
Corporate & Other^(a)
(190 ) (171 ) N.M.
(599 ) (952 ) N.M.
Other (income) and expense, net^(a)
(175 ) (2 ) N.M.
(166 ) 6
N.M.
Total Operating Profit 915
669
+37 % 2,240
1,590
+41 %
Share of net income of equity companies 31
23
+35 % 91
80
+14 %
Net Income Attributable to Kimberly-Clark Corporation 671
451
+49 % 1,610
999
+61 %
Diluted Earnings per Share 1.94
1.29
+50 % 4.65
2.85
+63 %
(a) Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including adjustments as indicated in the Non-GAAP Reconciliations.

N.M. - Not Meaningful

GAAP to Non-GAAP Reconciliations of Selected Financial Results

Diluted Earnings per Share^(a)


	Three Months Ended June 30, 2019
	As Reported			2018 Global Restructuring Program		As Adjusted Non-GAAP
Cost of products sold	$	3,108		$	102	$	3,006
Gross Profit	1,486			(102)		1,588
Marketing, research and general expenses	811			17		794

Operating Profit	670			(119)		789

Provision for income taxes	(132)			27		(159)
Effective tax rate	22.2		%	—		22.3		%


Net Income Attributable to Kimberly-Clark Corporation	485			(92)		577
Diluted Earnings per Share^(a)	1.40			(0.27)		1.67

Diluted Earnings per Share^(a)

Three Months Ended September 30, 2019

As
Reported

2018 Global
Restructuring
Program

As
Adjusted
Non-GAAP
Cost of products sold $ 3,085
$ 104
$ 2,981
Gross Profit 1,555
(104 ) 1,659
Marketing, research and general expenses 815
21
794
Other (income) and expense, net (175 ) (181 ) 6
Operating Profit 915
56
859
Provision for income taxes (192 ) (23 ) (169 )
Effective tax rate 22.8 % —
21.5 %
Net Income Attributable to Kimberly-Clark Corporation 671
33
638
Diluted Earnings per Share^(a)
1.94
0.10
1.84

Diluted Earnings per Share^(a)

Reform Related Matters

Diluted Earnings per Share^(a)

(a) "As Adjusted Non-GAAP" may not equal "As Reported" plus "Adjustments" as a result of rounding.

Analysis of Consolidated Results

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

Net sales in the second quarter of $4.6 billion ~~in the third quarter of 2019~~ increased ~~more than 1 percent~~slightly compared to the year-ago period. Changes in foreign currency exchange rates reduced sales ~~by 2~~approximately 4 percent, ~~and business exits in conjunction with the 2018 Global Restructuring Program reduced sales slightly. Organic~~while organic sales increased 4 percent. ~~Changes~~Volumes increased 2 percent and changes in net selling prices and product mix each increased sales by ~~4 percent and 1 percent, respectively, while sales volumes decreased~~ 1 percent. In North America, organic sales increased 412 percent in consumer products ~~and 5~~but fell 3 percent in K-C Professional. Outside North America, organic sales ~~increased 5~~rose 3 percent in developed markets but fell 3 percent in D&E markets, ~~and 1 percent in developed markets.~~driven by Latin America.

Operating profit in the ~~third~~second quarter was ~~$915~~$925 in ~~2019~~2020 and ~~$669~~$670 in ~~2018.~~2019. Results in both periods include charges related to the 2018 Global Restructuring Program. Results in 2019 also include a pre-tax gain recorded in Other (income) and expense, net of approximately $182 on the sale of a manufacturing facility and associated real estate as part of the restructuring. ThirdSecond quarter adjusted operating profit was ~~$859~~$1,012 in ~~2019~~2020 and ~~$798~~$789 in ~~2018.~~2019. Results benefited from ~~higher net selling prices, $50~~organic sales growth, $120 of cost savings from our FORCE program and ~~$45~~$55 of cost savings from the 2018 Global Restructuring Program. Input costs decreased ~~$10,~~$80, driven by ~~lower raw material costs.~~pulp, while other manufacturing costs rose year-on-year. Advertising spending increased and ~~selling,~~ general and administrative costs were also higher ~~including increased incentive compensation expense. Other manufacturing costs also increased year-on-year.~~compared to the prior year. Foreign currency translation effects reduced operating profit by $15 and transaction effects also negatively impacted the comparison.

The ~~third~~second quarter effective tax rate was ~~22.8~~23.2 percent in ~~2019~~2020 and ~~23.9~~22.2 percent in ~~2018.~~2019. The ~~third~~second quarter adjusted effective tax rate was ~~21.5~~22.7 percent in ~~2019~~2020 and ~~19.6~~22.3 percent in ~~2018. The adjusted effective tax rate in 2018 benefited from certain tax planning initiatives.~~2019.

Our share of net income of equity companies in the ~~third~~second quarter was ~~$31~~$35 in ~~2019~~2020 and ~~$23~~$33 in ~~2018. At Kimberly-Clark de Mexico, S.A.B. de C.V. (K-C de Mexico),~~2019. The results benefited from organic sales growth and ~~cost savings.~~lower input costs, partially offset by negative foreign currency effects.

Diluted net income per share for the ~~third~~second quarter of ~~2019~~2020 was ~~$1.94~~$1.99 in 2020 and ~~$1.29~~$1.40 in ~~2018. Third~~2019. Second quarter adjusted earnings per share were ~~$1.84~~$2.20 in ~~2019,~~2020, an increase of 832 percent compared to ~~adjusted earnings per share of $1.71~~$1.67 in ~~2018.~~2019.

Year-to-date net sales of ~~$13.9~~$9.6 billion ~~were down slightly~~increased 4 percent compared to the year ago period. Organic sales increased 7 percent, as volumes rose 5 percent and changes in net selling prices and product mix each increased sales by 1 percent. Changes in foreign currency exchange rates reduced sales by 43 percent and business exits in conjunction with the 2018 Global Restructuring Program reduced sales slightly. ~~Organic sales increased 4 percent. Changes in net selling prices and product mix increased sales by 4 percent and 1 percent, respectively, while sales volumes fell 1 percent.~~ Year-to-date operating profit was ~~$2,240~~$1,829 in ~~2019~~2020 and ~~$1,590~~$1,325 in ~~2018.~~2019. Results in both periods include charges related to the 2018 Global Restructuring Program. ~~Results in 2019 also include a gain recorded in Other (income) and expense, net on the sale of a manufacturing facility and associated real estate which were disposed of as part of the restructuring.~~ Year-to-date adjusted operating profit was ~~$2,455~~$2,009 in ~~2019~~2020 and ~~$2,396~~$1,596 in ~~2018.~~2019. Results benefited from organic sales growth, ~~$175~~$220 of FORCE cost savings and ~~$125~~$80 of cost savings from the 2018 Global Restructuring Program. Input costs decreased $195, driven by pulp. The comparison was impacted by ~~$205 of higher input costs,~~ unfavorable foreign currency effects, other manufacturing cost increases, increased advertising spending and higher general and administrative costs. Through ~~nine~~six months, diluted net income per share was ~~$4.65~~$3.92 in ~~2019~~2020 and ~~$2.85~~$2.71 in ~~2018.~~2019. Year-to-date adjusted earnings per share were ~~$5.18~~$4.34 in ~~2019~~2020 and ~~$5.01~~$3.33 in ~~2018.~~

Results by Business Segments

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

~~Third~~Second quarter net sales ~~of $2.3 billion~~in North America increased 4 percent. Volumes increased 2 ~~percent. Changes~~percent, and changes in product mix and net selling prices increased sales by 32 percent ~~sales volumes rose~~and 1 percent, respectively. The improved volumes and ~~changes~~product mix were driven by baby and child care.

Net sales in D&E markets decreased 9 percent. Changes in foreign currency exchange rates reduced sales 11 percent. Changes in product mix ~~increased~~improved sales by 2 percent and volumes rose slightly, while changes in net selling prices decreased sales by 1 percent.

Net sales in developed markets outside North America decreased 8 percent. Changes in foreign currency exchange rates reduced sales by 5 percent. Volumes fell 6 percent, while the combined impact of changes in net selling prices and product mix increased sales by 3 percent. ~~Third quarter operating~~

Operating profit of ~~$490~~$519 increased 57 percent. The comparison benefited from organic sales growth, cost savings and ~~cost savings.~~lower input costs. Results were impacted by unfavorable foreign currency effects, other manufacturing cost increases, higher advertising spending and increased ~~selling,~~ general and administrative costs.

Net sales in North America increased 4 percent. Changes in net selling prices and product mix increased sales by 2 percent and 1 percent, respectively, both driven by baby and child care. Sales volumes increased 1 percent overall. Volumes increased double-digits in adult care but were down mid-single digits in baby and child care compared to a mid-single digit increase in the year-ago period.

Net sales in D&E markets increased 3 percent. Changes in net selling prices and product mix increased sales by 6 percent and 1 percent, respectively, while sales volumes were even year-on-year and changes in foreign currency exchange rates were unfavorable by 5 percent. The higher net selling prices mostly occurred in Argentina, the Middle East/Eastern Europe/Africa and China. Volumes increased in Eastern Europe, ASEAN and South Africa, but fell in Latin America.

Net sales in developed markets outside North America decreased 3 percent, including a 6 percent decrease due to unfavorable changes in foreign currency exchange rates. Changes in product mix increased sales by 2 percent and sales volumes increased 1 percent.

Consumer Tissue


		Three Months Ended September 30					Nine Months Ended September 30						Three Months Ended September 30					Nine Months Ended September 30						Three Months Ended June 30						Six Months Ended June 30							Three Months Ended June 30				Six Months Ended June 30
		2019		2018			2019		2018				2019		2018			2019		2018				2020		2019		2020		2019			2020		2019		2020		2019
Net Sales		$	1,484	$	1,469		$	4,482	$	4,520		Operating Profit	$	264	$	212		$	726	$	668		Net Sales	$	1,645	$	1,472	$	3,368	$	2,998	Operating Profit	$	428	$	221	$	793	$	462

Net Sales		Percent Change					Percent Change					Operating Profit	Percent Change					Percent Change					Net Sales	Percent Change						Percent Change					Operating Profit		Percent Change				Percent Change
Volume				(2		)			(3		)	Volume			(5		)			(8		)	Volume			14				14		Volume			41				33
Net Price	Net Price			5					5			Net Price			34					36			Net Price					1				1	Net Price						9		7
Mix/Other	Mix/Other			—					—			Input Costs			5					(10		)	Mix/Other					(1)				—	Input Costs						27		30

Currency	Currency			(2		)			(3		)	Cost Savings^(c)			14					12			Currency					(3)				(2)	Cost Savings^(c)						33		26
Total^(a)	Total^(a)			1					(1		)	Currency Translation			(1		)			(1		)	Total^(a)					12				12	Currency Translation						(2)		(1)
												Other^(d)			(22		)			(20		)											Other^(d)						(14)		(23)
Organic^(b)	Organic^(b)			3					2			Total			25					9			Organic^(b)					14				14	Total						94		72

(a) Total may not equal the sum of volume, net price, mix/other and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

~~Third~~Second quarter net sales in North America increased 22 percent. Volumes rose 24 percent and changes in net selling prices improved sales by 1 percent, while changes in product mix decreased sales by 2 percent. Volumes increased double-digits in all major product categories. The volume increase was driven by increased shipments to support higher consumer and customer demand related to the global outbreak of ~~$1.5 billion~~COVID-19, including the significant increase in the number of people working from home.

Net sales in D&E markets decreased 9 percent including a 7 percent negative impact from changes in foreign currency exchange rates. Volumes decreased 2 percent and changes in net selling prices decreased sales by 1 percent, while changes in product mix increased sales by 1 percent.

Net sales in developed markets outside North America increased 8 percent. Volumes rose 7 percent, driven by South Korea and Western/Central Europe. The volume increase was driven by increased shipments to support higher consumer and customer demand related to the global outbreak of COVID-19. Changes in net selling prices and product mix increased sales by ~~5 percent, while sales volumes declined 2~~4 percent and ~~changes~~1 percent, respectively. Changes in foreign currency exchange rates reduced sales by 24 percent. ~~Third quarter operating~~

Operating profit of ~~$264~~$428 increased 2594 percent. Results benefited from ~~higher net selling prices,~~organic sales growth, cost savings and lower input costs. The comparison was impacted by ~~other manufacturing cost increases, lower volumes~~increased advertising spending and ~~increased selling, general and administrative costs.~~

Net sales in North America increased 3 percent compared to a 5 percent decline in the year-ago period. Changes in net selling prices increased sales by 8 percent, while sales volumes fell 4 percent and changes in product mix decreased sales by 1 percent.

~~Net sales in D&E markets increased 1 percent. Changes in net selling prices and product mix each increased sales by 1 percent, while changes in~~unfavorable foreign currency ~~exchange rates decreased sales by 2 percent.~~effects.

Net sales in developed markets outside North America decreased 4 percent. Changes in foreign currency exchange rates reduced sales by 5 percent. Changes in net selling prices increased sales by 2 percent.

Exited Businesses^(e)

(a) Total may not equal the sum of volume, net price, mix/other, exited businesses and currency due to rounding.

(b) Combined impact of changes in volume, net price and mix/other.

(d) Includes impact of changes in product mix, marketing, research and general expenses, foreign currency transaction effects and other manufacturing costs.

(e) Exited businesses in conjunction with the 2018 Global Restructuring Program.

~~Third~~Second quarter net sales ~~of $0.8 billion~~in North America decreased 13 percent. Volumes decreased 9 percent, as double-digit declines in washroom and safety products were partially offset by double-digit increases in wipers and other products. Changes in net selling prices and product mix increased sales by 4 percent and 3 percent, respectively.

Net sales in D&E markets decreased 35 percent including a 5 percent negative impact from changes in foreign currency exchange ~~rates~~rates. Volumes fell 32 percent, with significant declines in all major geographies, and ~~business exits~~changes in ~~conjunction with the 2018 Global Restructuring Program each reduced~~product mix decreased sales 2by 1 percent. Changes in net selling prices increased sales by ~~more than~~ 3 percent and changes in product mix increased sales by 1 percent, while sales volumes decreased 2 percent. Third quarter operating profit of $176 increased 10 percent. Results benefited from increased net selling prices and cost savings. The comparison was impacted by lower volumes, other manufacturing cost increases, unfavorable currency effects and higher selling, general and administrative costs.

Net sales in North America increased 4 percent. Changes in net selling prices increased sales by 4 percent and sales volumes increased 1 percent, while business exits in conjunction with the 2018 Global Restructuring Program reduced sales approximately 2 percent.

Net sales in D&E markets decreased 2 percent, including a 2 percent decrease due to unfavorable changes in foreign currency exchange rates. Sales volumes declined 5 percent, while changes in net selling prices increased sales by 4 percent.

Net sales in developed markets outside North America ~~were down 7~~decreased 12 percent. ~~Changes in foreign currency exchange rates~~Volumes decreased ~~sales by 5 percent and business exits in conjunction with the 2018 Global Restructuring Program reduced sales by 1 percent. Sales volumes fell 7~~17 percent, while changes in product mix and net selling prices increased sales by 45 percent and 23 percent, respectively. The changes ~~occurred mostly in~~were driven by Western/Central Europe. Changes in foreign currency exchange rates decreased sales by 4 percent.

Operating profit of $155 decreased 4 percent. The comparison was impacted by lower volumes, other manufacturing cost increases and unfavorable currency effects. Results benefited from increased net selling prices, improved product mix and cost savings.

2018 Global Restructuring Program

~~Annual pre-tax savings from~~As a result of the ~~2018 Global Restructuring Program~~outbreak of COVID-19 and the related uncertainty and complexity of the environment, consistent with our Form 10-Q filed on April 22, 2020, we expect that some restructuring activity and the related charges will extend into 2021 rather than being completed at the end of 2020 as previously planned. Total restructuring charges to implement the program are expected to be toward the high end of the range of $1.7 billion to $1.9 billion pre-tax ($1.3 billion to $1.4 billion after tax). We continue to expect the program will generate annual pre-tax cost savings of $500 to ~~$550~~$550. We target to achieve those savings by ~~2021.~~ the end of 2021, although it is possible the full realization could occur in 2022 because of the uncertainties related to COVID-19. Savings for the first ~~nine~~six months of ~~2019~~2020 were ~~$125,~~$80, bringing cumulative savings to ~~$260.~~

~~To implement this program, we expect to incur incremental capital spending of approximately $600 to $700 by the end of 2020.~~$380. See Item 1, Note 2 to the unaudited interim consolidated financial statements for additional information.

Liquidity and Capital Resources

Cash Provided by Operations

Cash provided by operations was ~~$1.8 billion~~$2,283 for the first ~~nine~~six months of ~~2019~~2020 compared to ~~$2.0 billion~~$926 in the prior year. The ~~decrease~~increase was ~~primarily~~ driven by ~~increased~~improved working capital, higher earnings and ~~higher~~the timing of tax ~~payments, partially offset by lower pension contributions and higher operating income.~~payments.

During the ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, our capital spending was ~~$867~~$636 compared to ~~$566~~$569 in the prior year. We anticipate that full year capital spending will be ~~$1.1~~$1.2 billion to $1.3 billion, including incremental spending associated with the 2018 Global Restructuring Program. Proceeds from dispositions of property in 2019 include approximately $200 from the sale of a manufacturing facility and the associated real estate as part of the 2018 Global Restructuring Program.billion.

In April 2019, we terminated our short-term $300 revolving credit facility in conjunction with the issuance of $700 aggregate principal amount of 3.20% notes due April 25, 2029. Proceeds from the offering were used for general corporate purposes, including the repayment of a portion of our outstanding commercial paper indebtedness.

Our short-term debt, which consists of U.S. commercial paper with original maturities up to 90 days and/or other similar short-term debt issued by non-U.S. subsidiaries, was ~~$0.8 billion~~$93 as of ~~September~~June 30, ~~2019~~2020 (included in Debt payable within one year on the consolidated balance sheet). The average month-end balance of short-term debt for the ~~third~~second quarter of ~~2019~~2020 was ~~$1.0 billion.~~$112. These short-term borrowings provide supplemental funding for supporting our operations. The level of short-term debt generally fluctuates depending upon the amount of operating cash flows and the timing of customer receipts and payments for items such as dividends and income taxes.

At ~~September~~June 30, ~~2019~~2020 and December 31, ~~2018,~~2019, total debt was ~~$7.8~~$8.1 billion and ~~$7.5~~$7.7 billion, respectively.

In February 2020, we issued $500 aggregate principal amount of 2.875% notes due February 7, 2050. Proceeds from the offering were used for general corporate purposes including the repayment of a portion of our commercial paper indebtedness.

In March 2020, we issued $750 aggregate principal amount of 3.10% notes due March 26, 2030. Proceeds from the offering were used for general corporate purposes including the repayment of a portion of our commercial paper indebtedness.

We maintain a $2.0 billion revolving credit facility which expires in June 2023 and a $750 revolving credit facility which expires in June ~~2020.~~2021. These facilities, currently unused, support our commercial paper program, and would provide liquidity in the event our access to the commercial paper markets is unavailable for any reason.

In July 2017, the United Kingdom's Financial Conduct Authority, which regulates the London Interbank Offered Rate (LIBOR), announced that it intends to phase out LIBOR by the end of 2021. We are currently evaluating the potential effect of the eventual replacement of the LIBOR, but we do not expect the effect to be material. Accounting guidance has been recently issued to ease the transition to alternative reference rates from a financial reporting perspective. See Item 1, Note 1 to the unaudited interim consolidated financial statements for details.

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. During the first ~~nine~~six months of ~~2019,~~2020, we repurchased ~~4.3~~1.9 million shares of our common stock at a cost of ~~$548~~ $263 through a broker in the open market. We ~~expect full-year 2019~~temporarily suspended our share repurchase program effective April 24, 2020 to enhance flexibility in the current environment, but we will be restarting our share repurchase program effective July 24, 2020 with full year share repurchases ~~of $800, consistent with our original target~~anticipated to be in the range of ~~$600 and $900, subject~~$700 to ~~market conditions.~~

K-C Argentina began accounting for their operations as highly inflationary effective July 1, 2018, as required by GAAP. Under highly inflationary accounting, K-C Argentina’s functional currency became the U.S. dollar, and its income statement and balance sheet have been measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on peso-denominated monetary assets and liabilities has been reflected in earnings in Other (income) and expense, net and was not material. As of ~~September~~June 30, ~~2019,~~2020, K-C Argentina had a small net peso monetary position. Net sales of K-C Argentina were approximately 1 percent of our consolidated net sales for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019 and 2018.~~2020.

We believe that our ability to generate cash from operations and our capacity to issue short-term and long-term debt are adequate to fund working capital, payments for our 2018 Global Restructuring Program, capital spending, pension contributions, dividends and other needs for the foreseeable future. Further, we do not expect restrictions or taxes on repatriation of cash held outside of the U.S. to have a material effect on our overall business, liquidity, financial condition or results of operations for the foreseeable future.

~~Business Outlook~~

Information Concerning Forward-Looking Statements

Certain matters contained in this report concerning the business outlook, including the anticipated cost savings from our FORCE program, ~~charges~~costs and savings from the 2018 Global Restructuring Program, cash flow and uses of cash, growth initiatives, innovations, marketing and other spending, net sales, anticipated currency rates and exchange risks, including the impact in Argentina, raw material, energy and other input costs, effective tax rate, contingencies and anticipated transactions of Kimberly-Clark, including dividends, ~~and~~ share repurchases and pension contributions, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based upon management's expectations and beliefs concerning future events impacting Kimberly-Clark. There can be no assurance that these future events will occur as anticipated or that our results will be as estimated. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to publicly update them.

The assumptions used as a basis for the forward-looking statements include many estimates that, among other things, depend on the achievement of future cost savings and projected volume increases. In addition, many factors outside our control, including pandemics (including the ongoing COVID-19 outbreak), epidemics, fluctuations in foreign currency exchange rates, the prices and availability of our raw materials, potential competitive pressures on selling prices for our products, energy costs, our ability to maintain key customer relationships and retail trade customer actions, as well as general economic and political conditions globally and in the markets in which we do business, could affect the realization of these estimates.

For a description of certain factors that could cause our future results to differ from those expressed in these forward-looking statements, see Item 1A entitled "Risk Factors" in each of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and our Annual Report on Form 10-K for the year ended December 31, ~~2018 entitled "Risk Factors."~~2019. Other factors not presently known to us or that we presently consider immaterial could also affect our business operations and financial results.

Item 4. Controls and Procedures

As of ~~September~~June 30, ~~2019,~~2020, an evaluation was performed under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of ~~September~~June 30, ~~2019.~~2020. There were no changes in our internal control over financial reporting during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. All our share repurchases during the ~~third~~second quarter of ~~2019~~2020 were made through a broker in the open market.

The following table contains information for shares repurchased during the ~~third~~second quarter of ~~2019.~~2020. None of the shares in this table were repurchased directly from any of our officers or directors.


Period (2020)	Total Number of Shares Purchased^(a)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
April 1 to April 30	299,900	$	130.49	32,299,728	7,700,272
May 1 to May 31	—	—		32,299,728	7,700,272
June 1 to June 30	—	—		32,299,728	7,700,272
Total	299,900

(a)Share repurchases were made pursuant to a share repurchase program authorized by our Board of Directors on November 13, 2014. This program allows for the repurchase of 40 million shares in an amount not to exceed $5 billion.

Period (2019)
Total Number
of Shares
Purchased^(a)

Average
Price Paid
Per Share

Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs

Maximum Number
of Shares That May
Yet Be Purchased
Under the Plans or
Programs
July 1 to July 31 400,200
$ 136.94
27,338,444
12,661,556
August 1 to August 30 594,600
138.97
27,933,044
12,066,956
September 1 to September 30 566,400
135.76
28,499,444
11,500,556
Total 1,561,200

Exhibit No. (4). Copies of instruments defining the rights of holders of long-term debt will be furnished to the Securities and Exchange Commission on request.

Exhibit No. (101).INS XBRL Instance Document - the ~~instant~~instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

Exhibit No. (101).SCH XBRL Taxonomy Extension Schema Document

Exhibit No. (101).CAL XBRL Taxonomy Extension Calculation Linkbase Document

Exhibit No. (101).DEF XBRL Taxonomy Extension Definition Linkbase Document

Exhibit No. (101).LAB XBRL Taxonomy Extension Label Linkbase Document

Exhibit No. (101).PRE XBRL Taxonomy Extension Presentation Linkbase Document

Exhibit No. 104 The cover page from this Current Report on Form 10-Q formated as Inline XBRL

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

~~October 22, 2019~~

	~~39-0394230~~
Delaware		39-0394230
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)


(Millions of dollars)	September 30, 2019			December 31, 2018			(Millions of dollars)	June 30, 2020		December 31, 2019
ASSETS							ASSETS
Current Assets							Current Assets
Cash and cash equivalents	$	416		$	539		Cash and cash equivalents	$	1,448	$	442
Accounts receivable, net	2,306			2,164			Accounts receivable, net	2,024		2,263
Inventories	1,779			1,813			Inventories	1,825		1,790
Other current assets	563			525			Other current assets	607		562
Total Current Assets	5,064			5,041			Total Current Assets	5,904		5,057
Property, Plant and Equipment, Net	7,158			7,159			Property, Plant and Equipment, Net	7,366		7,450
Investments in Equity Companies	294			224			Investments in Equity Companies	319		268
Goodwill	1,438			1,474			Goodwill	1,401		1,467
Other Assets	1,079			620			Other Assets	1,183		1,041
TOTAL ASSETS	$	15,033		$	14,518		TOTAL ASSETS	$	16,173	$	15,283

LIABILITIES AND STOCKHOLDERS' EQUITY							LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities							Current Liabilities
Debt payable within one year	$	1,555		$	1,208		Debt payable within one year	$	850	$	1,534
Trade accounts payable	2,942			3,190			Trade accounts payable	3,032		3,055
Accrued expenses and other current liabilities	1,931			1,793			Accrued expenses and other current liabilities	2,252		1,978
Dividends payable	354			345			Dividends payable	360		352
Total Current Liabilities	6,782			6,536			Total Current Liabilities	6,494		6,919
Long-Term Debt	6,198			6,247			Long-Term Debt	7,223		6,213
Noncurrent Employee Benefits	881			931			Noncurrent Employee Benefits	859		897
Deferred Income Taxes	506			458			Deferred Income Taxes	527		511
Other Liabilities	540			328			Other Liabilities	546		520
Redeemable Preferred Securities of Subsidiaries	38			64			Redeemable Preferred Securities of Subsidiaries	29		29
Stockholders' Equity							Stockholders' Equity
Kimberly-Clark Corporation							Kimberly-Clark Corporation
Preferred stock - no par value - authorized 20.0 million shares, none issued	—			—			Preferred stock - no par value - authorized 20.0 million shares, none issued	—		—
Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at September 30, 2019 and December 31, 2018	473			473
Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at June 30, 2020 and December 31, 2019							Common stock - $1.25 par value - authorized 1.2 billion shares; issued 378.6 million shares at June 30, 2020 and December 31, 2019	473		473
Additional paid-in capital	535			548			Additional paid-in capital	554		556
Common stock held in treasury, at cost - 35.5 and 33.6 million shares at September 30, 2019 and December 31, 2018, respectively	(4,222		)	(3,956		)
Common stock held in treasury, at cost - 37.6 and 37.1 million shares at June 30, 2020 and December 31, 2019, respectively							Common stock held in treasury, at cost - 37.6 and 37.1 million shares at June 30, 2020 and December 31, 2019, respectively	(4,545)		(4,454)
Retained earnings	6,485			5,947			Retained earnings	7,299		6,686
Accumulated other comprehensive income (loss)	(3,412		)	(3,299		)	Accumulated other comprehensive income (loss)	(3,513)		(3,294)
Total Kimberly-Clark Corporation Stockholders' Equity	(141		)	(287		)	Total Kimberly-Clark Corporation Stockholders' Equity	268		(33)
Noncontrolling Interests	229			241			Noncontrolling Interests	227		227
Total Stockholders' Equity	88			(46		)	Total Stockholders' Equity	495		194
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,033		$	14,518		TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	16,173	$	15,283


	Nine Months Ended September 30							Six Months Ended June 30
(Millions of dollars)	2019			2018			(Millions of dollars)	2020		2019
Operating Activities							Operating Activities
Net income	$	1,641		$	1,024		Net income	$	1,367	$	961
Depreciation and amortization	700			652			Depreciation and amortization	414		470
Asset impairments	—			74

Stock-based compensation	74			45			Stock-based compensation	54		48
Deferred income taxes	8			44			Deferred income taxes	12		26
Net (gains) losses on asset dispositions	(155		)	57			Net (gains) losses on asset dispositions	13		17
Equity companies' earnings in excess of dividends paid	(31		)	(18		)
Equity companies' earnings (in excess of) less than dividends paid							Equity companies' earnings (in excess of) less than dividends paid	(47)		(30)
Operating working capital	(399		)	117			Operating working capital	490		(525)
Postretirement benefits	(16		)	(87		)	Postretirement benefits	(15)		(21)
Other	(10		)	113			Other	(5)		(20)
Cash Provided by Operations	1,812			2,021			Cash Provided by Operations	2,283		926
Investing Activities							Investing Activities
Capital spending	(867		)	(566		)	Capital spending	(636)		(569)
Proceeds from dispositions of property	206			16

Investments in time deposits	(353		)	(218		)	Investments in time deposits	(323)		(186)
Maturities of time deposits	287			139			Maturities of time deposits	254		229
Other	(40		)	(3		)	Other	15		4
Cash Used for Investing	(767		)	(632		)	Cash Used for Investing	(690)		(522)
Financing Activities							Financing Activities
Cash dividends paid	(1,054		)	(1,039		)	Cash dividends paid	(722)		(700)
Change in short-term debt	324			453			Change in short-term debt	(667)		543
Debt proceeds	700			—			Debt proceeds	1,241		696
Debt repayments	(705		)	(310		)	Debt repayments	(252)		(703)
Proceeds from exercise of stock options	211			50			Proceeds from exercise of stock options	135		160
Acquisitions of common stock for the treasury	(544		)	(596		)	Acquisitions of common stock for the treasury	(263)		(330)
Other	(92		)	(41		)	Other	(39)		(79)
Cash Used for Financing	(1,160		)	(1,483		)	Cash Used for Financing	(567)		(413)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(8		)	(28		)	Effect of Exchange Rate Changes on Cash and Cash Equivalents	(20)		4
Change in Cash and Cash Equivalents	(123		)	(122		)	Change in Cash and Cash Equivalents	1,006		(5)
Cash and Cash Equivalents - Beginning of Period	539			616			Cash and Cash Equivalents - Beginning of Period	442		539
Cash and Cash Equivalents - End of Period	$	416		$	494		Cash and Cash Equivalents - End of Period	$	1,448	$	534


☒	~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~


	Three Months Ended June 30, 2020
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock							Retained Earnings	Accumulated Other Comprehensive Income (Loss)				Non-controlling Interests	Total Stockholders' Equity
		Shares			Amount				Shares		Amount
Balance at March 31, 2020	378,597		$	473		$	559	37,761	$	(4,562)		$	6,978	$	(3,615)		$	213	$	46
Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			681		—			10		691
Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		102			4		106
Stock-based awards exercised or vested	—		—			(38)		(557)	66			—		—			—		28
Shares repurchased	—		—			—		370	(49)			—		—			—		(49)
Recognition of stock-based compensation	—		—			38		—	—			—		—			—		38
Dividends declared ($1.07 per share)	—		—			—		—	—			(365)		—			—		(365)
Other	—		—			(5)		—	—			5		—			—		—
Balance at June 30, 2020	378,597		$	473		$	554	37,574	$	(4,545)		$	7,299	$	(3,513)		$	227	$	495



	Three Months Ended September 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued			Additional Paid-in Capital			Treasury Stock					Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
	Shares	Amount		Additional Paid-in Capital			Shares		Amount			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
Balance at June 30, 2019	378,597	$	473	$	510		34,381		$	(4,062	)	$	6,170		$	(3,269	)	$	228		$	50
Net income in stockholders' equity, excludes redeemable interests' share	—	—		—			—		—			671			—			8			679
Other comprehensive income, net of tax	—	—		—			—		—			—			(142		)	(10		)	(152		)
Stock-based awards exercised or vested	—	—		(3		)	(483	)	55			—			—			—			52
Shares repurchased	—	—		—			1,562		(215		)	—			—			—			(215		)
Recognition of stock-based compensation	—	—		24			—		—			—			—			—			24
Dividends declared ($1.03 per share)	—	—		—			—		—			(354		)	—			—			(354		)
Other	—	—		4			—		—			(2		)	$	(1	)	3			4
Balance at September 30, 2019	378,597	$	473	$	535		35,460		$	(4,222	)	$	6,485		$	(3,412	)	$	229		$	88



	Nine Months Ended September 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued			Additional Paid-in Capital			Treasury Stock					Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
	Shares	Amount		Additional Paid-in Capital			Shares		Amount			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
Balance at December 31, 2018	378,597	$	473	$	548		33,635		$	(3,956	)	$	5,947		$	(3,299	)	$	241		$	(46	)
Net income in stockholders' equity, excludes redeemable interests' share	—	—		—			—		—			1,610			—			28			1,638
Other comprehensive income, net of tax	—	—		—			—		—			—			(112		)	(17		)	(129		)
Stock-based awards exercised or vested	—	—		(90		)	(2,642	)	302			—			—			—			212
Shares repurchased	—	—		—			4,467		(568		)	—			—			—			(568		)
Recognition of stock-based compensation	—	—		72			—		—			—			—			—			72
Dividends declared ($3.09 per share)	—	—		—			—		—			(1,063		)	—			(24		)	(1,087		)
Other	—	—		5			—		—			(9		)	(1		)	1			(4		)
Balance at September 30, 2019	378,597	$	473	$	535		35,460		$	(4,222	)	$	6,485		$	(3,412	)	$	229		$	88


	Six Months Ended June 30, 2020
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock							Retained Earnings	Accumulated Other Comprehensive Income (Loss)				Non-controlling Interests	Total Stockholders' Equity
		Shares			Amount				Shares		Amount
Balance at December 31, 2019	378,597		$	473		$	556	37,149	$	(4,454)		$	6,686	$	(3,294)		$	227	$	194
Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			1,341		—			24		1,365
Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		(219)			(8)		(227)
Stock-based awards exercised or vested	—		—			(52)		(1,622)	187			—		—			—		135
Shares repurchased	—		—			—		2,047	(278)			—		—			—		(278)
Recognition of stock-based compensation	—		—			53		—	—			—		—			—		53
Dividends declared ($2.14 per share)	—		—			—		—	—			(730)		—			(17)		(747)
Other	—		—			(3)		—	—			2		—			1		—
Balance at June 30, 2020	378,597		$	473		$	554	37,574	$	(4,545)		$	7,299	$	(3,513)		$	227	$	495



	Nine Months Ended September 30, 2018
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued			Additional Paid-in Capital			Treasury Stock					Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
	Shares	Amount		Additional Paid-in Capital			Shares		Amount			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Non-controlling Interests			Total Stockholders' Equity
Balance at December 31, 2017	378,597	$	473	$	594		27,491		$	(3,288	)	$	5,769		$	(2,919	)	$	253		$	882
Net income in stockholders' equity, excludes redeemable interests' share	—	—		—			—		—			999			—			22			1,021
Other comprehensive income, net of tax	—	—		—			—		—			—			(200		)	(10		)	(210		)
Stock-based awards exercised or vested	—	—		(87		)	(1,207	)	137			—			—			—			50
Shares repurchased	—	—		—			5,690		(621		)	—			—			—			(621		)
Recognition of stock-based compensation	—	—		44			—		—			—			—			—			44
Dividends declared ($3.00 per share)	—	—		—			—		—			(1,046		)	—			(20		)	(1,066		)
Other	—	—		4			—		—			164			(156		)	—			12
Balance at September 30, 2018	378,597	$	473	$	555		31,974		$	(3,772	)	$	5,886		$	(3,275	)	$	245		$	112


	Six Months Ended June 30, 2019
(Millions of dollars, shares in thousands, except per share amounts)	Common Stock Issued							Additional Paid-in Capital	Treasury Stock							Retained Earnings	Accumulated Other Comprehensive Income (Loss)				Non-controlling Interests	Total Stockholders' Equity
		Shares			Amount				Shares		Amount
Balance at December 31, 2018	378,597		$	473		$	548	33,635	$	(3,956)		$	5,947	$	(3,299)		$	241	$	(46)
Net income in stockholders' equity, excludes redeemable interests' share	—		—			—		—	—			939		—			20		959
Other comprehensive income, net of tax, excludes redeemable interests' share	—		—			—		—	—			—		30			(7)		23
Stock-based awards exercised or vested	—		—			(87)		(2,159)	247			—		—			—		160
Shares repurchased	—		—			—		2,905	(353)			—		—			—		(353)
Recognition of stock-based compensation	—		—			48		—	—			—		—			—		48
Dividends declared ($2.06 per share)	—		—			—		—	—			(709)		—			(24)		(733)
Other	—		—			1		—	—			(7)		—			(2)		(8)
Balance at June 30, 2019	378,597		$	473		$	510	34,381	$	(4,062)		$	6,170	$	(3,269)		$	228	$	50


~~(a)~~	~~Represents non-cash pension settlement charges resulting from restructuring actions.~~



	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019		Income Statement Classification
Lease cost	$	41	$	120	Cost of products sold, Marketing, research and general expenses
Variable lease cost^(a)	30		102		Cost of products sold, Marketing, research and general expenses
Total lease cost	$	71	$	222



	September 30, 2019		Balance Sheet Classification
Lease assets	$	399	Other Assets

Current lease liabilities	$	133	Accrued expenses and other current liabilities
Noncurrent lease liabilities	275		Other Liabilities
Total lease liabilities	$	408



~~Delaware~~


~~Item 2.~~	~~Management's Discussion and Analysis of Financial Condition and Results of Operations~~


~~(a)~~	~~Corporate & Other and Other (income) and expense, net include income and expense not associated with the business segments, including adjustments as indicated in the Non-GAAP Reconciliations.~~


Net Sales	Percent Change				Adjusted Operating Profit	Percent Change				Net Sales	Percent Change			Adjusted Operating Profit	Percent Change
	Three Months Ended September 30		Nine Months Ended September 30			Three Months Ended September 30		Nine Months Ended September 30			Three Months Ended June 30	Six Months Ended June 30		Three Months Ended June 30	Six Months Ended June 30
Volume	(1	)	(1	)	Volume	(1	)	(1	)	Volume	2	5	Volume	8	13
Net Price	4		4		Net Price	21		23		Net Price	1	1	Net Price	7	6
Mix/Other	1		1		Input Costs	1		(8	)	Mix/Other	1	1	Input Costs	10	12
Currency	(2	)	(4	)	Cost Savings^(c)	12		13		Currency	(4)	(3)	Cost Savings^(c)	22	19
Total^(a)	1		—		Currency Translation	(2	)	(3	)	Total^(a)	—	4	Currency Translation	(2)	(2)
					Other^(d)	(23	)	(22	)				Other^(d)	(17)	(22)
Organic^(b)	4		4		Total	8		2		Organic^(b)	4	7	Total	28	26



Period (2019)	Total Number of Shares Purchased^(a)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
July 1 to July 31	400,200	$	136.94	27,338,444	12,661,556
August 1 to August 30	594,600	138.97		27,933,044	12,066,956
September 1 to September 30	566,400	135.76		28,499,444	11,500,556
Total	1,561,200


~~(a)~~	Share repurchases were made pursuant to a share repurchase program authorized by our Board of Directors on November 13, 2014. This program allows for the repurchase of 40 million shares in an amount not to exceed $5 billion.



		KIMBERLY-CLARK CORPORATION
		~~KIMBERLY-CLARK CORPORATION~~(Registrant)
			~~(Registrant)~~

~~By:~~		~~/s/ Maria Henry~~
		~~Maria Henry~~
		~~Senior Vice President and~~
		~~Chief Financial Officer~~
		~~(principal financial officer)~~
By:
~~By:~~	/s/ Andrew S. Drexler
		Andrew S. Drexler
		Vice President and Controller
		(principal accounting officer)