Estée Lauder Companies Inc. (EL) Financial Results Summary

# Estée Lauder Companies Inc. (EL) Q4 2025 Financial Results Summary

**Release Date:** August 20, 2025

The Estée Lauder Companies Inc. (NYSE: EL) reported its financial results for the fiscal year ended June 30, 2025. The company continues to navigate a challenging business environment, with a keen focus on its strategic vision of Beauty Reimagined. Here’s a summary of the key financial metrics and updates from the report:

### Financial Highlights for Fiscal 2025
– **Net Sales:**
– Reported at **$14,326 million**, down **8%** compared to **$15,608 million** in 2024.
– Organic net sales also decreased by **8%**.

– **Gross Profit:**
– Declined to **$10,597 million**, a decrease of **5%** from **$11,184 million** in 2024.
– Gross margin increased to **74.0%**, up **230 basis points** from **71.7%** in the prior year.

– **Operating (Loss) Income:**
– Reported a loss of **$785 million**, down from a profit of **$970 million** in 2024, reflecting a decline of over **100%**.
– Operating margin fell to **-5.5%**, down from **6.2%** in the previous year.

– **Net (Loss) Earnings Per Common Share:**
– Reached **$(3.15)**, down from **$1.08**, reflecting a drop of over **100%**.
– Adjusted diluted net earnings per common share was **$1.51**, a decrease of **42%** compared to **$2.59**.

– **Adjusted Operating Income:**
– Stood at **$1,146 million**, down **28%** from **$1,588 million** in 2024.
– Adjusted operating margin decreased to **8.0%** from **10.2%**.

### Significant Operational Metrics
– **Effective Tax Rate:**
– Reported at **-8.9%**, decreased from **47.0%** in the previous year due to the establishment of a valuation allowance related to tax credits.

– **Net Cash Flows from Operating Activities:**
– Decreased to **$1.27 billion** from **$2.36 billion** in 2024, largely due to lower pre-tax earnings and unfavorable changes in operating assets and liabilities.

– **Capital Expenditures:**
– Reduced to **$602 million** from **$919 million** due to optimized investment strategy.

### Dividend Declaration
– The company announced a quarterly dividend of **$0.35** per share, scheduled for payment on **September 16, 2025**, to stockholders of record as of **September 2, 2025**.

### Performance by Product Category
– **Skin Care:**
– Net sales fell by **12%**, with significant contributions from brands like Estée Lauder and La Mer.

– **Makeup:**
– Experienced a **6% decline** driven by lower sales in the face subcategory and retail softness for brands such as M·A·C.

– **Fragrance:**
– Flat sales performance, with growth from Luxury Brands, including strong double-digit growth from Le Labo.

– **Hair Care:**
– Sales decreased by **10%**, primarily due to sluggish performance from Aveda.

### Regional Performance
– **Americas:**
– Sales decreased by **4%** to **$4,411 million**, reflecting soft retail performance.

– **Europe, the Middle East & Africa (EMEA):**
– Reported a sales drop of **12%** to **$5,375 million**.

– **Asia-Pacific:**
– Sales also declined by **7%** to **$4,537 million**, with difficulties in travel retail affecting results.

### Strategic Initiatives
– The company is committed to its **Profit Recovery and Growth Plan (PRGP)**. Although it recorded benefits from this plan, overall results for fiscal 2025 included significant costs from impairment charges and restructuring.

– Plans are in place to improve operating profitability moving forward, aiming for a solid double-digit adjusted operating margin in the coming years.

### Conclusion
The Estée Lauder Companies faced several operational challenges in fiscal 2025 amidst a volatile external environment but is confident in its strategic vision to achieve sales growth and profitability restoration in the coming fiscal year.

### CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in millions)

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### CONDENSED CONSOLIDATED BALANCE SHEETS (in millions)