Estée Lauder Exceeds Expectations with 4% Revenue Growth in Q1

Estée Lauder begins its fiscal year exceeding expectations. The U.S.-based cosmetics company posted sales of $3.481 billion in the first three months of its fiscal year ended Sept. 30th. This is 4% more than in the same period of 2024, when it posted sales of $3,361 million.

Two of its four categories grew in this period: fragrances were the best performers, with 14% more sales than in the first three months of 2024, up to $731 million. Skin care is next, up 3% to $1.575 billion in sales. However, hair care fell 7% to $129 million and makeup declined slightly 1% to $1.03 billion.

Although the Americas remain its largest market, sales in the territory were down 2% to $1.174 billion in the first fiscal quarter.Eukem, which covers Europe, the United Kingdom and Ireland, as well as emerging markets in Asia, Africa and the Middle East, posted sales of $901 million, up 4%. Asia Pacific increased sales by 8% to $873 million and mainland China increased sales by 9% to US$531 million.

Estée Lauder posted a 2% decline in sales in the Americas, its main market

Estée Lauder Chairman and CEO Stéphane de La Faverie welcomed the numbers and described the start of the fiscal year as “excellent,“ which he blames on “operational changes implemented to be faster and more agile.“ By 2026, the executive aims to “regain organic sales growth and expand operating margin for the first time in four years.“ In fact, Estée Lauder is coming off the heels of closing its last fiscal year with a loss. The company posted sales down 8.2% from last year, to $14.326 billion, and a loss of $1.133 billion.

With these results, the company says it “continues to anticipate adverse tariff-related effects that will impact fiscal 2026 profitability” by approximately $100 million. For this reason, it states that it continues to “evaluate” strategies that may affect its prices.

The company is in the process of restructuring its top management, which has already undergone several strategic modifications this year to try to placate the impact of weak U.S. and Chinese consumption. Earlier this year, the group announced the resignation of its chairman, Peter Jueptner, after sixteen years with the company. Earlier, the company fired its chief financial officer, Tracey T. Travis, to bring in Akhil Shrivastava.

In July, Estée Lauder named Franck Besnard senior vice president and general manager for the Northern and Western Europe region. Last year, moreover, the company announced that Stéphane de La Faverie would succeed Fabrizo Freda as CEO of the company.

The beauty industry, in general, is undergoing a profound transformation. After years of vertiginous expansion, the sector has entered a new phase marked by consolidation, divestments and polarization among large groups. In fact, divesting in beauty is one of the first actions taken by Luca de Meo at Kering and, last week, it was announced that LVMH might rethink its position in Fenty Beauty.