THE WHAT? The Estee Lauder Companies has reported its results for the second quarter of fiscal 2023. Sales dropped 17 percent on the prior-year period from US5.54 billion to US$4.62 billion. The US prestige beauty giant has adjusted its full-year guidance accordingly, with sales now expected to decrease between 5 and 7 percent.

THE DETAILS In terms of regional performance, all regions saw sales drop, with The Americas dipping 5 percent, Europe, the Middle East & Africa falling 22 percent and Asia/Pacific diving 17 percent. By sector, it looks like skin care’s dominance has rather unceremoniously come to an end with sales down 20 percent and 3 percent was shaved off make-up sales. Fragrance, in contrast gained 12 percent and hair care saw a 4 percent rise.

THE WHY? Lauder’s results are a stark contrast to those reported by LVMH just days ago; it looks like Lauder has failed to learn the lessons of the pandemic and continues to be over-reliant on the Chinese and travel retail markets. Fabrizio Freda, President and Chief Executive Officer said, “We delivered on our expectations for the second quarter of fiscal 2023, despite the incremental pressure of COVID-19 in China in December. Many developed and emerging markets around the world outperformed to realize our organic sales growth outlook and, given disciplined expense management and moderation of the stronger U.S. dollar, we exceeded our adjusted diluted EPS outlook. Fragrance excelled globally, while Makeup prospered in a great number of markets, as our brands are realizing the promise of the category’s renaissance as usage occasions resume.