Will the world's biggest condom maker break under pressure?

Picture Credit: by The Economist

It produces over five billion condoms a year, roughly one in every five used worldwide. It supplies Durex, Trojan, and dozens of public health programmes across the globe. And right now, Malaysia's Karex is having a very bad year.

The world's largest condom manufacturer has reported its second consecutive quarterly operating loss, with sales in the first three months of 2026 down more than a fifth compared to the same period last year. Its share price has fallen by a third since January. For a company that survived a century and a half of Malaysia's rubber industry, the pressures bearing down on Karex today are coming from every direction at once.

Donald Trump's fingerprints are all over the crisis. Sweeping cuts to America's foreign aid budget have gutted spending by international health agencies on contraceptives, one of Karex's most reliable revenue streams. Tariffs and a weakening dollar have further squeezed margins on its US-bound exports.

Then came the Iran war. With the Strait of Hormuz blockaded, the cost of several key raw materials has surged. Silicone oil, used as lubricant, and aluminium, used in packaging, have both spiked in price. CEO Goh Miah Kiat announced in April that the company would raise prices by 20 to 30% to offset the damage, a necessary move, but one that risks pushing away price-sensitive buyers, particularly in public health markets.

This is not Karex's first crisis. The Covid-19 pandemic, which many assumed would boost condom sales, instead delivered supply-chain chaos that pushed the company to losses in 2021 and 2022. It clawed its way back.

There are reasons for cautious optimism. Karex has just launched the world's first condoms made from synthetic nitrile, cheaper to produce, hypoallergenic, and purpose-built for the future. The material is petroleum-based, meaning costs are elevated for now, but the long-term economics are promising.

Karex has been bent before. It has not yet broken.