Estée Lauder Raises Sales Growth Outlook to 4%-5.5% for Fiscal 2027
Key Facts
Estée Lauder raised its annual sales and earnings forecasts on November 2, citing resilient demand for skin care products and luxury fragrances ahead of the holiday season, according to Reuters. The company now expects organic sales growth of 4%-5.5% in fiscal 2027, compared with its previous range of 3%-5%. It also raised its adjusted earnings-per-share forecast to $3.20-$3.45, from $3.10-$3.35. The revision followed adjusted earnings of 72 cents per share in the first quarter, topping the Reuters estimate of 51 cents. The results point to improving demand in key markets at the start of the fiscal year, while the holiday season factors into the new forecasts.
Regional comparisons showed organic sales growth in mainland China of 9% in the first quarter of fiscal 2027, the same rate as in the year-earlier quarter, Reuters reported. In the Americas, organic sales rose 4%, after falling 2% a year earlier. The figures reflect different starting points in the two regions: China maintained its previous growth pace, while the Americas moved from contraction to expansion. The company said it expects strong growth from new and existing products in China after increasing consumer-focused investment. Reuters added that the company reduced discounts and promotional activity in the market, alongside sales growth there.
Operating income growth differs from sales growth and does not in itself mean fragrances had the highest operating margin among product categories. The category’s strength is supported by demand from wealthy consumers and younger shoppers, according to Reuters, which cited brands including Le Labo, Tom Ford and Jo Malone London. That demand remained resilient despite economic uncertainty, the news agency reported. Organic fragrance sales rose 10% in the fourth quarter of fiscal 2026 to $618 million, from $560 million in the year-earlier period, meaning the category’s growth preceded the latest results.
Across the other product categories, organic makeup sales rose 1%, while hair care sales were flat, according to the company’s official statement. The company said it expects makeup sales growth to return during the fiscal year, alongside continued growth in fragrances and skin care. These indicators follow organic sales growth of 3% in fiscal 2026 and a 5% increase in the fourth quarter ended June 30, 2026, according to the company’s filing with the U.S. Securities and Exchange Commission. Those earlier results provide context for the new fiscal year, as sales returned to growth in the final quarter of the previous fiscal year. The updated outlook now focuses on continued improvement during the current fiscal year.
Chief Executive Stefan de La Faverie said, "Growth is accelerating, profitability is improving significantly, and the impact of our Beauty Reimagined strategy is becoming more evident across our business." Reuters noted that the company expects greater acceleration in the first half of the fiscal year, making performance in the second half a focus as the year progresses. In an initial reaction, the company’s shares rose about 3% in premarket trading on November 2. Alongside Reuters’ estimate of 51 cents for adjusted earnings per share, the Associated Press reported a different estimate of 52 cents, based on a Zacks survey of 11 analysts. The updated annual outlook is the next benchmark against which results will be measured as subsequent quarterly reports are released.