On Thursday, May 1, the U.S. cosmetics giant reported another quarter of disappointing results, primarily attributed to sluggish consumer spending.
From January to March, the third quarter of the group’s staggered fiscal year, The Estée Lauder Companies’ net profit plunged 53% from the previous year, to USD 159 million.
Excluding exceptional items, earnings per share came in at 65 cents, significantly surpassing the FactSet analyst consensus, which was of 31 cents.
The Estée Lauder Companies’ global revenue fell 10% to USD 3.55 billion, but remained above expectations.
In a statement released Thursday, the group attributed the decline in its results to several factors, including the gloomy mood of consumers in several regions of the world, as well as “lower conversion from Chinese consumers.”
The company also said to be “mindful of inflationary pressures (including those caused by tariffs) on its cost base” and to be “monitoring the impact on consumer preferences”.
“We have mitigated more than 40% of the initial effects of the tariffs, and we are continuing to work on this,” assured Stéphane de La Faverie, the group’s CEO, during a call with investors.
The cosmetics group also confirmed its restructuring plan, which includes the elimination of 5,800 to 7,000 net jobs by the end of 2026 and will impose a cost of between USD 1.2 billion and USD 1.6 billion on the company.
“As of April 24, 2025, the company has approved initiatives totaling cumulative charges of USD 623 million and a net reduction of over 2,600 positions,” said The Estée Lauder Companies.
Stéphane de La Faverie, added he was “confident” in the company’s “ability” to return to sales growth in the 2026 financial year, provided “there is a significant resolution of the recently enacted customs duties.”
