Net revenue saw a 6% dip for Coty Inc. in Q1 2026 to $1.57 billion for the three months ended Sept. 30, 2024.

Consumer beauty net revenue of $507.7 million, representing 32% of the company’s total sales, decreased 9% on a reported basis and 11% on a LFL basis.

The company’s 25.8% retained stake in Wella was valued at about $1 billion.

“Coty’s strategic progress is accelerating as we elevate Coty as a prestige beauty company with an emphasis on fragrances and scenting across price points, complemented by capabilities in prestige cosmetics and skincare,” said Sue Nabi, CEO of Coty. “In line with our recent strategic announcements, over the coming years we will concentrate investment behind our portfolio brands with the greatest long-term potential, while also building and elevating our newly added licenses and brands. By integrating Prestige Beauty and Mass Fragrances; unlocking material opportunities in ultra-premium fragrances, mists and broader scenting; and implementing a performance improvement plan for our Consumer Beauty brands while pursuing our strategic review of Consumer Beauty Cosmetics and Brazil, we will ensure that Coty realizes the full value of its scale as a fragrance and scenting powerhouse. This will further strengthen our Top 3 position in global fragrances.”

Following recent changes, Coty’s underlying business trends are improving, in line to slightly ahead of expectations, particularly in prestige, officials said. In Q1, the company’s US prestige fragrance sell-out grew by a mid-to-high single digit percentage, in line with the market, and officials expect the US prestige business to return to both sales and sell-out growth in Q2.

Coty continues to build on its track record of leading fragrance innovations. BOSS Bottled Beyond is currently on track to be the No. 2 male fragrance launch of the fall in Europe, the No. 1 male launch by volume in Germany, and the No. 1 male SKU in Australia, and is unlocking a significant untapped opportunity for Hugo Boss in the US market, where the brand historically had limited presence.

The company has also expanded into new scenting adjacencies across price points, including its ultra-premium collections, which grew 17% on a reported basis in Q1. Coty also unlocked material adjacencies with mist launches under Calvin Klein, Kylie Cosmetics, philosophy, adidas and Nautica, with results confirming that fragrance mists boost brand sales while delivering strong margins. Coty is also seeing positive early results on internally developed scenting projects, such as the Arabian fragrance collection Jawhara, which has launched on Amazon in the US, as well as several retailers across Europe.

Outlook

Coty continues to expect a gradual profit trend improvement, with adjusted EBITDA declining by a low-to-mid teens percentage in 2Q26, consistent with its prior guidance. The Company also expects to return to adjusted EBITDA growth in 2H26, targeting $1 billion in adjusted EBITDA in fiscal 2026. While this outlook implies very strong year-over-year expansion in 2H26 adjusted EBITDA, this is primarily a function of prior year comparisons, with an implied low-single-digit growth in in the second half of 2026 with adjusted EBITDA on a two-year basis.