Estée Lauder: 12% drop in Q3 2023 revenue
Estée Lauder Companies Inc. has reported a -12% decrease in revenue for Q3 2023, due to stagnant product sales in Asia. Nevertheless, the company announced a net profit of $156 million and is focusing on innovation and sustainability.
By Eva Morletto03 mai 2023
Estée Lauder Companies Inc. has published its results for the third quarter ended March 31. Revenue for the period was $3.75 billion, down -12% from the same period last year ($4.25 billion). The decline was attributed to stagnant product sales in Asia, particularly in retail. The region, led by China, emerged more slowly from the pandemic, with inevitable consequences for markets.
While Asia influenced the -8% decline in net sales, other geographic regions performed better, helping to cushion the losses, notably emerging markets, the United States and the United Kingdom, which posted more promising results, especially in the fragrance sector.
Despite the decline, Estée Lauder announced a net profit of $156 million, slightly lower than Q3 2021 ($2 million difference). President and CEO, Fabrizio Freda, told the press that the quarter was challenging but that positive elements were present to consider a strong recovery: "Our developed and emerging markets grew strongly and exceeded our expectations to offset an even slower-than-expected recovery in Asia travel retail."
Estée Lauder has been focusing on innovation in recent months, and there have been many changes within the group. Nancy Mahon was recently appointed the first Director of Sustainability Development, with a mission to develop the group's climate and environmental strategy, particularly in energy, emissions and ingredient traceability. From July, the brand will also have a new ambassador, model Imaan Hammam, who is already an international ambassador for the "She's the first" NGO dedicated to educational programs for girls around the world.
The group continues to expand its portfolio of brands. After acquiring Clinique, La Mer and Tom Ford last autumn, Estée Lauder has taken a stake in the English perfume label Vyrao, an operation in which the amount remains secret, carried out through New Incubation Ventures, the group's investment vehicle.
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