The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
Estée Lauder Cos Inc on Friday reported a surprise rise in second-quarter sales and handily beat profit estimates, as the M.A.C brand owner benefited from a strong demand for its premium skin-care products and fragrances in China.
Shares of the New York-based company, whose skin care segment posted a 28 percent growth on higher demand for its La Mer and Clinique labels, were up 5 percent in premarket trade. The stock gained 29 percent in 2020.
A sustained strong demand for skin care products, including serums and moisturisers, from customers keeping up their self-care routine has helped Estée Lauder offset the impact of weak demand for traditional makeup items such as foundation and lipsticks.
“The powerful engines of skin care, fragrance, Asia/Pacific, travel retail in Asia, and global online fuelled our performance despite the increasing complexity of the pandemic,” Chief Executive Fabrizio Freda said.
Sales in its Asia-Pacific market rose 35 percent in the second quarter, boosted by a robust demand during Tmall’s Singles’ Day shopping event in China, helping Estée Lauder post its first growth in overall revenue since the onset of the pandemic.
The Clinique brand owner has been controlling its advertising and promotional costs, while focusing on its e-commerce business to combat the pandemic’s fallout on its brick-and-mortar stores.
Estée Lauder also said it planned to resume its share buyback program during the second half of the fiscal year.
Net sales rose to $4.85 billion from $4.62 billion a year earlier, beating a Refinitiv IBES estimate of $4.49 billion.
Excluding items, Estée Lauder earned $2.61 per share, much higher than analysts’ estimate of $1.69.
The company, however, forecast third-quarter net sales to grow between 13 percent and 14 percent as makeup sales drag, while analysts on average estimate net sales to rise about 15.3 percent to $3.86 billion, according to IBES data from Refinitiv.
By Aditi Sebastian and Praveen Paramasivam; Editor: Vinay Dwivedi
BoF Careers provides essential industry insights for beauty professionals this month, featuring roles from Burberry, Fashion Nova and Chalhoub Group.
At the second session of The Business of Beauty Global Forum, speakers including Sephora Americas chief executive Jean-André Rougeot and Mielle Organics founder Monique Rodriguez charted beauty’s next stage of growth.
During the third session of The Business of Beauty Global Forum, Pamela Anderson, Isayama Ffrench and Glossier chief executive Kyle Leahy unpacked how to build unique brands and drive authentic relationships with customers.
Please join us on Tuesday, June 6 at 16:00 BST / 11:00 EDT for a special BoF Masterclass as BoF’s Executive Editor of The Business of Beauty Priya Rao and McKinsey & Company’s Senior Partner Kristi Weaver explore findings from the report, share their insight and answer your questions about how beauty players from around the world can arm themselves for success in the years ahead.