Fashion
A summer roundup of news from the beauty industry: amidst flagging results and economic turbulence
Published
August 27, 2025
As summer draws to a close, it’s time to take stock for global beauty players. The 2025 summer season has been marked by mixed financial publications, against a backdrop of slowing consumer spending, markets that have become unpredictable and, above all, the forthcoming rise in customs duties in the United States.
While some companies fared better than others, all had to contend with a more complex economic reality. Here’s a look at the main players in the sector: France’s L’Oréal and the Americans, Coty and Estée Lauder.
Coty in transition, between falling sales and possible asset disposals
The American group Coty saw its sales fall by 4% in its fiscal year ending June 30, 2025, for net sales of $5.89 billion (€5.07 billion). Demand remains weak, particularly in North America, and retailers are clearing their inventories rather than placing new orders. The group has indicated that it is going through a “transition year” and is counting on a return to growth in the second half of fiscal 2026.
Faced with this tense economic situation, Coty has launched a new phase of transformation called All-in to Win, which involves restructuring around 700 jobs. At the same time, market speculation has been circulating since June about a possible sale of assets, notably in luxury and consumer cosmetics. France’s Interparfums may be in the running.
Estée Lauder deepens losses and accelerates restructuring
For the other American giant, Estée Lauder, the results published at the end of August were particularly alarming. The group recorded a net loss of $546 million in the fourth quarter of its 2025 fiscal year, a figure almost double that of last year. This underperformance is largely due to the implementation of a restructuring plan announced in February, the total cost of which is estimated at between $1.2 and $1.6 billion. In all, between 5,800 and 7,000 jobs will be eliminated worldwide.
The general decline in sales, down 8% for the full year to $14.3 billion (€12.3 billion), affected all segments except perfume, which remained stable. The group was particularly hard hit by the collapse of travel retail sales, which fell by 28%.
Despite this, Estée Lauder remains hopeful of a rebound as early as 2026, betting on a gradual recovery, selective price increases, and double-digit growth in e-commerce. However, management anticipates a negative impact of around $100 million from U.S. tariffs in the current financial year.
L’Oréal forges ahead, buoyed by North America
In this tense climate, L’Oréal is doing rather well. At the end of July, the French group published sales up 1.6% to 22.47 billion euros for the first half of 2025, with net income up 1% excluding exceptional items. The United States is positioned as the main contributor to this growth, despite the introduction of new customs duties of up to 15% on cosmetics imported from Europe.
For the moment, management is downplaying the impact of these tariffs, describing the situation as “manageable”. L’Oréal already manufactures half of its products sold in North America in its four local plants, has built up strategic stocks, notably for its luxury and fragrance ranges, and is planning moderate price adjustments.
The group is also continuing to invest and strengthen its position, with the acquisition announced in June of the Color Wow brand, specialized in hair care products. CEO Nicolas Hieronimus says he is “ambitious” for the second half-year, while acknowledging an uncertain economic climate for both businesses and consumers.
While performances are mixed, global beauty players all share one observation: the market has become more volatile, purchasing behavior more unpredictable, and economic pressures increasingly difficult to circumvent.
Inventory adjustments, restructuring, industrial relocation, price increases, or asset disposals… the strategies differ, but all aim to maintain balance in an environment that has become highly unstable.
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Wholesale revenue dropped 12.8 per cent on a currency-adjusted basis to €4.9 billion, while direct-to-consumer (DTC) sales increased 3.4 per cent, lifting the DTC share to 32.4 per cent from 28.9 per cent.
Regionally, sales fell 6.9 per cent in Europe, Middle East and Africa (EMEA), 7.4 per cent in Asia-Pacific and 10 per cent in the Americas, with North America driving much of the decline.
Puma has reported sales of €7.3 billion (~$8.61 billion) in FY25, with currency-adjusted revenue down 8.1 per cent amid strategic reset actions.
Wholesale declined while DTC share increased.
Margins contracted and EBIT turned negative, leading to a net loss.
Q4 saw sharper declines across regions and categories.
Puma expects further sales softness and negative EBIT in FY26.
By product segment, footwear sales decreased 7.1 per cent, apparel declined 9.7 per cent and accessories fell 8.5 per cent, although selective growth was observed in running, training and premium sport style lines, Puma said in a press release.
Profitability weakened significantly during the year. Gross margin contracted 260 basis points to 45.0 per cent, impacted by promotional activity, inventory reserves, unfavourable mix and currency effects. Adjusted EBIT turned negative at €165.6 million, while reported EBIT declined to -€357.2 million after €191.6 million in one-off costs related mainly to the cost efficiency programme and goodwill impairments.
Loss from continuing operations widened to -€643.6 million, translating to earnings per share of -€4.37 versus €1.88 in the prior year.
From a balance sheet perspective, inventories rose 2.3 per cent to €2.06 billion as inventory takebacks from wholesale partners supported distribution clean-up. Working capital increased 20.2 per cent, while trade receivables and payables declined sharply in line with reduced sales and purchasing activity. Puma ended the year with additional financing capacity, including €1,202.2 million in unutilised credit lines.
Fourth quarter (Q4) performance reflected the peak impact of the strategic reset. Currency-adjusted sales declined 20.7 per cent to €1,564.9 million, with reported revenue down 27.2 per cent due to currency headwinds. The decline was driven by deliberate reductions in wholesale exposure, inventory clearance actions and lower promotional intensity.
Wholesale sales fell 27.7 per cent in Q4, while DTC revenue decreased 8.0 per cent, although DTC share increased to 41.1 per cent from 35.5 per cent. Regionally, sales dropped 12.6 per cent in Asia-Pacific, 22.2 per cent in the Americas and 24.3 per cent in EMEA.
Across product divisions, footwear sales declined 25.4 per cent, apparel fell 13.7 per cent and accessories dropped 18.2 per cent, with selective resilience in training and performance running categories.
Profitability deteriorated sharply. Gross margin declined to 40.2 per cent from 47.7 per cent due to promotions, inventory provisions and currency effects. Adjusted EBIT fell to -€228.8 million, while reported EBIT reached -€307.7 million following one-off costs linked to restructuring and impairment charges. The quarter ended with a loss from continuing operations of -€335 million.
Arthur Hoeld, CEO of Puma, said: “2025 was a reset year for us. We want to establish Puma as a top 3 sports brand globally, return to above-industry growth and generate healthy profits in the medium term. It is crucial to make the Puma brand less commercial and ensure we once again excite our consumers with attractive products, compelling storytelling and distribution in the right channels. I am satisfied with the progress we have made so far. We cleaned up most of our distribution by reducing promotions in our own channels and cutting our exposure to those wholesale channels that damage our brand’s desirability. To better position our product icons and our performance offering and tell more engaging product stories, we created the right structures inside our company. We also addressed operational inefficiencies and further optimised our cost base.”
Looking ahead, Puma expects currency-adjusted sales in fiscal 2026 to decline in the low- to mid-single-digit percentage range, with EBIT projected between -€50 million and -€150 million. Capital expenditure of around €200 million is planned as the company continues investments in brand repositioning and digital capabilities, added the release.
Fibre2Fashion News Desk (SG)
Nominal GDP, or GDP at current prices, is estimated to grow at 8.6 per cent to reach ₹345.47 trillion in FY26 against ₹318.07 trillion in 2024-25.
India’s real GDP is estimated to grow at 7.6 per cent to ₹322.58 trillion (~$3.54 billion) in FY26 compared to the first revised GDP estimate of ₹299.89 trillion for FY25 (7.1 per cent growth).
It released the new series of annual and quarterly national accounts estimates with FY23 base.
Real GVA is projected to grow at 7.7 per cent to reach ₹294.40 trillion in FY26 against ₹273.36 trillion in FY25.
Real gross value added (GVA) is projected to grow at 7.7 per cent to reach ₹294.40 trillion in FY26 against ₹273.36 trillion in FY25 (a 7.3-per cent growth rate).
Nominal GVA is estimated to grow at 8.7 per cent to hit ₹313.61 trillion during FY26, against ₹288.54 lakh crore in 2024-25.
Robust economic performance in FY26 is primarily on account of robust real growth observed in the second quarter (8.4 per cent) and third quarter (7.8 per cent).
The manufacturing sector has been the major driver of resilient performance of the economy the consecutive three fiscals after rebasing, a release from the ministry said.
Both private final consumption expenditure and grossed fixed capital formation exhibited more than 7-per cent growth rate in FY26.
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