Estée Lauder

New York, NY

www.elcompanies.com

Sales: $15.2 billion

Key Personnel: Stéphane de La Faverie, president and chief executive officer; Michael Bowes, executive vice president, chief people officer; Roberto Canevari, executive vice president, chief value chain officer; Amber English, president, digital & online, The Americas; Joy Fan, president and chief executive officer, China; Brian Franz, chief technology, data & analytics officer; Nadine Graf, president, EMEA, UK & I, and emerging markets; Matthew Growdon, president, APAC and travel retail worldwide; Carl Haney, executive vice president, global innovation and research and development; Jane Hertzmark Hudis, executive vice president, chief brand officer; Akhil Shrivastava, executive vice president, chief financial officer; Tara Simon, president, The Americas

Major Products: Cosmetics, Fragrances and Toiletries. Brands include: Aerin Beauty, Aramis, Aveda, Balmain Beauty, Bobbi Brown, Bumble and Bumble, Clinique, Darphin Paris, Deciem, Dr.Jart+, Editions de Parfums, Estée Lauder, Frédéric Malle, Glamglow, Jo Malone London, Killian Paris, La Mer, Lab Series, Le Labo, MAC, Niod, Origins, Smashbox, Tom Ford, Too Faced

New Products: MACximal Sleek Satin Lipstick, MAC Viva Glam Lipglass Air, MAC Drops Radiance Boosting Eye Treatment; Aveda Hydrating Scalp & Hair Masque; Origins Clear Improvement Skincare

Comments: It’s been a rough couple of years for the biggest US beauty company—and things are getting worse. In fiscal 2024, sales fell 2%. Net earnings tumbled 60%. The decline was blamed on a weak Chinese beauty market and a decline in Asia travel retail. Partially offsetting these declines was growth in Hong Kong SAR, the overall European market, the Middle East & Africa (“EMEA”), Japan and Latin America. Still, analysts say problems in its China business are the main reasons why ELC lost $100 billion in value during the past three years. Estée Lauder’s Asia Pacific business has fallen for three years in a row: Sales for fiscal 2024 came in at $4.89 billion, 16% below their 2021 peak.

By product category, skincare accounted for 51% of sales last year, followed by makeup (28%), fragrance (16%), haircare (4%) and other (1%).

Skincare sales fell 4% last year due to declines from Estée Lauder, Clinique and Dr.Jart+. ELC blamed those declines, primarily, on weakness in mainland China and its Asia travel retail business. Lower demand for Dr.Jart+ was partially offset by higher net sales of La Mer and The Ordinary.

Makeup sales fell slightly, driven by lower net sales of MAC, Tom Ford and La Mer. Strong Clinique sales helped improve results.

Fragrance sales rose last year. Results got a lift from growth in Le Labo and Jo Malone London. These gains were partially offset by lower net sales from Estée Lauder.

Haircare sales fell 4%. Driven by Aveda’s lower North American sales.

By region, sales in The Americas increased slightly in fiscal 2024. Mexico and Brazil drove the gains, with the US providing a lift as well. Net sales in Europe, the Middle East & Africa decreased slightly. The decline was blamed on Asia travel retail business. Net sales in Asia/Pacific fell 6%.

China isn’t the only trouble spot, ELC faces challenges in its home market, too. Reliance on department stores, made the company late to launch a store on Amazon. When it finally did, in October, some executives worried the move would blemish the company’s image. Maybe, but it was the infighting among family members that gave ELC a blackeye. Jane Lauder reportedly sent to a letter to several board members in September 2024, expressing concerns about William Lauder’s leadership and called for his removal. And while she was considered for the CEO role, Jane Lauder was passed over for Stephane de La Faverie. As a result, no Lauder family member holds executive roles in the business.

Despite changes in the c-suite, business continued to slide in fiscal 2025. Third quarter sales fell 10% to $3.55 billion. Skincare net sales fell 11%, with the decline blamed on the faltering Asia travel retail business. Makeup sales fell 7%, primarily due to declines in MAC sales. Hair care sales fell 10%, due to continued weakness in the Aveda salon and freestanding stores channels.

Even fragrance, a stalwart category that’s thrived since the pandemic, stumbled. Sales fell 1%. The decline was blamed on Clinique Happy sales, and retail softness in Asia/Pacific for the Estée Lauder brand.

Last month, Leonard Lauder died at 92. He grew a family-owned beauty company into a multinational, multibillion-dollar company. See p. 8 in this issue for more on Lauder and his impact on the beauty industry.

ELC’s fiscal 2025 ended on June 30. The company expected sales to fall 8-9%.