THE WHAT? The Estee Lauder Companies has reported its results for the first quarter of fiscal 2024. The US prestige beauty giant reported net sales of US$3.52 billion in the three months ended September 30, 2023, down 10 percent from the prior-year period.

THE DETAILS Net earnings were down significantly, at US$31 million compared with US$489 million a year ago. Diluted net EPS was US$0.09, versus last year’s US$1.35.

In terms of categories, Skin Care took the biggest hit, with sales plummeting 22 percent on a reported basis. Hair Care sales fell 6 percent while Makeup inched up 1 percent and Fragrance climbed a more respectable 5 percent.

The company has revised its full year outlook accordingly, it now expects net sales to range between a decrease of 2 percent and an increase of 1 percent versus the prior year.

THE WHY? Fabrizio Freda, President and Chief Executive Officer said, “While we had a better-than-expected first quarter, we are lowering our fiscal 2024 outlook given incremental external headwinds, namely from the slower growth in overall prestige beauty in Asia travel retail and in mainland China, which is currently confirmed in the pre-sale phase of the 11.11 Shopping Festival, and the risks of business disruption in Israel and other parts of the Middle East. We are accelerating and expanding our profit recovery plan, to benefit fiscal years 2025 and 2026, to realize our ambitions to rebuild profitability despite the external headwinds’ increased pressure on the business in fiscal 2024.”