Shiseido Downsizing in Americas Following Decline in Drunk Elephant Hype

Shiseido adjusts its workforce in the Americas. The Japanese cosmetics group has launched a major downsizing plan at its US subsidiary as part of a transformation process aimed at restoring profitability. Although the company has not disclosed the exact number of positions eliminated, it has confirmed in an official communication to which the American media WWD has had access that it is a transversal measure.

Shiseido Americas has undertaken a business transformation to return to growth and profitability,“ the company said. “As part of this process, we have made the difficult decision to eliminate certain positions within the company, and several of our employees have been negatively affected,“ the statement said. In it, the Japanese company has pledged to “offer support” to all those affected during the transition process.

The move comes after a year in which results in the Americas have deteriorated sharply. Sales fell 19% in the first quarter of 2025, dragged down by the slump in Drunk Elephant, a brand acquired in 2019 for $845 million. According to the financial report published in May, Drunk Elephant posted a decline of more than 60% in the region, a drop that was also replicated in Asia-Pacific.

Founded in 2013 by Tiffany Masterson, the successful brand among Generation Z consolidated itself as a clean beauty phenomenon, with strong digital penetration and a pop image that made it a benchmark among the younger generations. However, in recent years, the brand has lost traction, facing segment saturation, increased competition and an adjustment in consumer habits, especially in the United States. The group has confirmed that it is already working on a restructuring to relaunch the brand.

Shiseido will follow the trend of cosmetics company layoffs initiated by Coty and Estée Lauder

In the same leaked internal report, interim CEO Alberto Noé warned that “the combination of factors has led to a truly difficult decision.“ The executive noted that 2024 was a “significantly negative” year in the region and that forecasts for 2025 “remain bleak,“ with an environment marked by inflation and macroeconomic uncertainty.

While Drunk Elephant has dragged down regional results, other brands in the portfolio have shown stronger performance. The flagship Shiseido brand posted single-digit growth, while Clé de Peau Beauté, the group’s premium brand, increased sales by double digits.

Shiseido’s adjustment plan comes on top of a wave of restructuring in the beauty sector. In the past year, Estée Lauder has announced cuts of up to 7,000, Coty has unveiled 700 job cuts and L’Oréal recently denied a restructuring in China that, according to rumors, could affect 200 people. The trend reflects a structural shift in which large multinationals are rethinking their operating models to adapt to more restrained consumption, especially in the Americas.

Shiseido has not specified whether the layoffs will affect other regions outside the Americas, but internal communication speaks of “a significant reduction in headcount affecting multiple businesses, functions and locations.“ In this context, the group’s immediate objective is to restore the commercial performance of its U.S. subsidiary, redefine the future of Drunk Elephant and consolidate its most profitable brands.