Key Takeaways
- Fourth-quarter revenue increased 6.3% year-over-year to $3.63 billion, surpassing the $3.55 billion Wall Street forecast
- Adjusted earnings per share of $0.39 exceeded analyst projections of $0.32
- Net loss for the period contracted significantly to $116 million from $546 million in the prior-year quarter
- Workforce reduction of 10,000 positions completed, reaching the upper limit of previously announced guidance
- Operating margin forecast improved to 12.7%-13.5% range from prior 12.5%-13% projection
Shares of Estée Lauder surged approximately 7% during Wednesday’s premarket session, reaching $90.81, following the cosmetics giant’s release of quarterly earnings that exceeded market forecasts and demonstrated ongoing progress in its corporate transformation efforts.
The Estée Lauder Companies Inc., EL
Revenue for the fourth fiscal quarter that concluded on June 30 increased 6.3% to reach $3.63 billion. The figure outpaced analyst projections of $3.55 billion. On an adjusted basis, the company reported earnings of $0.39 per share, surpassing the consensus estimate of $0.32.
The company’s net loss for the period shrank to $116 million, equivalent to $0.32 per share, compared with a loss of $546 million, or $1.51 per share, during the corresponding quarter last year.
The skin care division delivered robust performance, posting revenue growth of 8.7% to $1.85 billion. The fragrance category surged 10% to reach $618 million. Makeup sales increased 2.9% to $1.01 billion. Hair care represented the sole underperforming segment, declining 0.7% to $140 million.
These quarterly figures marked the conclusion of three consecutive years of declining annual revenue, a period that saw approximately $100 billion in market capitalization evaporate since the company reached its post-pandemic high in early 2022.
Restructuring Momentum Builds
Under CEO Stéphane de La Faverie, who assumed leadership in 2025, the company has intensified its focus on profitability enhancement. Management reported achieving $1.2 billion in total gross benefits through its profit recovery and growth initiative, matching the upper end of previously communicated targets.
Estée Lauder verified the completion of workforce reductions totaling 10,000 jobs, likewise reaching the maximum of its projected range. According to the company, these staffing adjustments are expected to generate a 50% improvement in productivity among corporate personnel. Cumulative restructuring expenses slightly exceeded the top end of the $1.5 billion to $1.7 billion guidance range.
“We concluded the fiscal year with strong momentum, as organic sales growth reached 5% for our fourth consecutive quarter of expansion and enhanced profitability,” de La Faverie stated.
Forward Guidance Enhanced
Looking ahead, Estée Lauder upheld its organic revenue growth projection of 3% to 5%, supported by sustained momentum in fragrance and skin care categories, combined with an anticipated rebound in makeup sales.
Management elevated its adjusted operating margin forecast to a 12.7% to 13.5% range, up from the previously indicated 12.5% to 13% preliminary guidance.
The company additionally reconfirmed its fiscal 2027 revenue projections.
The beauty conglomerate has been broadening its appeal to younger demographics through partnerships with Amazon and TikTok Shop, while simultaneously accelerating product introduction timelines across its diverse brand collection, which encompasses La Mer, Jo Malone London, MAC, Smashbox and Kilian Paris.
EL closed trading at $84.27 on August 18.
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