- Estee Lauder expects its organic net sales to decline by 8% to 9%, exceeding the earlier estimate of -6.64%.
- The adjusted earnings per share (EPS) forecast is between $1.33 to $1.58, slightly higher than the estimate of $1.39.
- In the third quarter, adjusted EPS was 65 cents, down from 97 cents year-on-year (y/y), yet it surpassed the estimate of 31 cents.
- The company’s net sales for the third quarter were $3.55 billion, a 9.9% decline y/y, though slightly above the estimate of $3.52 billion.
- Americas net sales stood at $1.05 billion, reflecting a 5.8% fall y/y, compared to the $1.09 billion estimate.
- EMEA region experienced an 18% drop in net sales to $1.36 billion, underperforming against the $1.4 billion estimate.
- Asia Pacific region showed resilience with net sales of $1.14 billion, a 3.1% decrease y/y, but above the expected $1.03 billion.
- The company’s adjusted gross margin improved to 75%, up from 71.9% y/y, outperforming the 72.8% estimate.
- Revenue from skin care amounted to $1.81 billion, a 12% decline y/y, slightly above the $1.8 billion estimate.
- Makeup sales were $1.04 billion, down 8.9% y/y, missing the estimate of $1.09 billion.
- Fragrance sales reached $557 million, a 3.1% decrease y/y, falling short of the $572.8 million estimate.
- Hair care revenue saw a 12% drop to $126 million, below the forecast of $134.1 million.
- The company is undergoing a strategic reset in its travel retail business to adapt to market trends and hopes to resolve tariff impacts for sales growth by fiscal 2026.
- An estimated net reduction of 5,800 to 7,000 positions is planned, with over 2,600 positions already approved for reduction.
- Total cumulative charges recognized under restructuring reached $498 million as of March 31, 2025, with the approved initiatives reaching $623 million by April 24, 2025.
- Analyst recommendations include 4 buys, 26 holds, and 1 sell.
Estee Lauder Companies Cl A on Smartkarma
Analysts on Smartkarma are closely monitoring Estée Lauder Companies Cl A, providing valuable insights for investors. Baptista Research, in a bullish report titled “Estée Lauder: Can Its Emerging Market Push & Portfolio Realignment Offset the China Slowdown?”, highlighted the company’s Q2 fiscal 2025 performance. Despite a 6% decline in organic net sales, adjusted EPS of $0.62 exceeded expectations due to a favorable mix in the skincare category.
In another bullish perspective, Baptista Research discussed takeover speculation in their report “Estée Lauder: Activist Buzz & Takeover Speculations – What’s Next For The Cosmetics Giant?“. With reports of potential acquisition interest and involvement of activist investors, Estée Lauder is attracting significant attention, although challenges exist due to the family’s control over the company. Value Investors Club also sees potential for Estée Lauder to regain premium valuation through cost-cutting, operational optimization, and investments in high-growth areas, leveraging its strong brand reputation and loyal customer base for future growth.
A look at Estee Lauder Companies Cl A Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 4 | |
| Growth | 2 | |
| Resilience | 2 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 2.6 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on the Smartkarma Smart Scores, the long-term outlook for Estee Lauder Companies Cl A appears to be positive. With a high Dividend score of 4, investors may find the company attractive for its dividend payments. Additionally, the company shows decent Momentum with a score of 3, indicating a good trend in stock price performance. However, the company scores lower in terms of Value, Growth, and Resilience with scores of 2 across these factors.
The Estee Lauder Companies Inc. is a global leader in manufacturing and marketing skin care, makeup, fragrance, and hair care products. With a presence in numerous countries and territories worldwide, the company has established itself as a prominent player in the beauty industry, known for its quality and innovative products.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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