Estée Lauder Companies (ELC) has slashed an estimated 3,200 roles, with a further 3,800 at risk, as the US beauty giant’s restructuring plans continue at pace.
ELC confirmed the latest job cut figures as of 13 August, which follows the Clinique-owner revealing it was seeking a reduction in staff roles of up to 7,000 in February 2025.
The cuts form part of the company’s ‘Beauty Reimagined’ restructuring plan, aimed at improving profitability and income by up to US$1bn.
This could also see ELC incur charges of between $1.2bn and $1.6bn, and the beauty conglomerate has reported cumulative costs of $747m so far.
Stéphane de La Faverie, ELC President and CEO, remains confident in the restructuring plan’s eventual outcome, however.
“We are very pleased with the progress that we are making at this point, the team is really committed to the challenges that we are [facing],” de La Faverie said during ELC’s full-year 2025 update investor call.
“The culture is evolving and it is changing, but we are really pushing on ambition and accountability throughout every, I would say, pillar of brands and regions and function of the organisation.
“I think this is only the beginning of the momentum that we are just going to see going forward.”
The job cut update comes alongside ELC reporting a significant downturn in sales during 2025.
Organic net sales decreased 8% to $14.3bn for the year ended 30 June 2025, while gross profit sank 5% to $10.5bn.
This was attributed to declines across all product categories, except fragrance, as well as varying performances across ELC’s operating markets and a slump in global travel retail.
Market share gains in mainland China and Japan, driven by skin care brand La Mer and fashion and fragrance label Tom Ford, offset the declines slightly.
“Having closed fiscal 2025 as expected, we remain wholly focused on continuing to execute our strategic vision of Beauty Reimagined with excellence,” said de La Faverie.
Net sales decreased 12% at ELC’s Skin Care division, primarily due to declines from Estée Lauder and La Mer.
Ongoing subdued sentiment and lower conversion from Chinese consumers led to downturns in the company’s Asia travel retail business.
Retailer shifts in strategies toward more profitable duty-free business models in both Korea and mainland China also lowered replenishment orders, leading to fewer sales.
Make-up net sales also decreased 5%, dragged down by MAC Cosmetics, reflecting lower net sales in the face subcategory and retail softness for the brand.
This was partially offset by new product launches, including M·A·C Nudes Collection and MACximal Sleek Satin Lipstick.
ELC also reported declines in the lip and eye subcategories from Too Faced and the face subcategory from Bobbi Brown Cosmetics, reflecting retail softness from the brands.
Fragrance net sales fared slightly better, but came in flat during the year.
ELC’s luxury fragrance brands, including Le Labo and Kilian Paris, shored up the category's performance in 2025.
Le Labo’s performance was driven by its Classic Collection and City Exclusives.
The fragrance category’s growth was partially offset by the declines from Tom Ford as demand for the brand waned in North America during the year.
Hair care saw the largest declines in 2025, slumping 10% amid freestanding store closures at hair care business Aveda and reduced bricks-and-mortar demand.
ELC added that it is closely monitoring “evolving trade policies and enacted tariffs” and how it can reduce the potential impact of US President Donald Trump’s global tax hikes.
This includes leveraging available trade programmes and further optimising its regional manufacturing footprint to bring production closer to its consumers.
Combined with increased supply chain agility, ELC expects to offset more than half of the expected impacts and better position the company.
Despite this, it still expects tariff-related headwinds to impact fiscal 2026 profitability by approximately $100m.
De La Faverie added: “Despite continued volatility in the external environment, we embarked on fiscal 2026 with signs of momentum and confidence in our outlook to deliver organic sales growth this year after three years of declines and to begin rebuilding operating profitability in pursuit of a solid double-digit adjusted operating margin over the next few years.”
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