Estée Lauder earns less in its fiscal second quarter. The US cosmetics giant earned % less in the second fiscal quarter ended December 2023. Net attributable profit for the period was 290 million euros, down 21% from the same period last year. To mitigate this fall, Estée Lauder has explained that it will lay off part of its workforce: between 3 and 5% of employees will be made redundant.
The segments most affected by this fall were skin care, which declined by 10.5%, or more than 2 billion euros, and make-up, which declined by more than 7.5%, or more than 1 billion euros. Meanwhile, the perfumery division stabilised with 683 million euros, and hair care also decreased by 5%.
At the same time, the group has announced that it will extend its earnings recovery plan for the fiscal years 2025 and 2026. Included in this recovery plan is a restructuring programme to be implemented later this quarter. The restructuring involves re-organising and re-sizing some areas and divisions of the company with the aim of simplifying and speeding up processes.
Once this turnaround plan is completed, the US cosmetics and fragrance group expects to face extraordinary restructuring charges of between 463 and 649 million euros. It is confident that this programme will be able to generate annual gross profits of between 324 and 463 million euros and then reinvest a portion in consumer-oriented areas to drive sustainable and profitable growth.