Shiseido takes measures regarding what happened in the United States. The Japanese cosmetics giant is accelerating its restructuring plan in the United States, with the intention of cutting approximately 300 positions, which is equivalent to more than 15% of its current workforce in that country. This measure responds to the significant deterioration of profitability in its American subsidiary.
In the first half of 2025, the company reported a consolidated net profit of 64.5 million dollars, compared to just 104,000 in the same period of the previous year. However, its US division suffered an operating loss of 39 million, more than double the loss of 16.9 million registered the previous year, driven by a 10% drop in regional sales.
The main reason for this sharp decline is Drunk Elephant, a brand acquired by Shiseido in 2019, which has suffered a considerable decrease in demand. This year, the interrupted production and the consequent loss of customers caused the operating profit of the USA to plummet by 98%, reaching only 200 million yen.
The situation has also affected Europe, where Drunk Elephant generated losses of 1.3 million USD in the first semester. In response, Shiseido plans to launch new facial care products this fall and expects to return profitability to its US business by next year. In addition, the company seeks to reduce its global fixed costs by 169 million USD in 2026 and optimize the supply chain to mitigate a possible 20 million in tariffs.
In the first quarter of 2025, Shiseido reported a drop of 8.5% in its net sales, with a collapse of 65% in Drunk Elephant sales in the USA, which affected a regional decrease of 19%. In 2024, Drunk Elephant sales fell by 25%, and Shiseido's results in America showed a strong weakening in an increasingly competitive market driven by new digital brands and changes in consumer habits.