Estée Lauder Issues Q3 Guidance; Now Estimates Net Reduction In Positions Of 5,800 To 7,000

Estée Lauder Companies

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(RTTNews) - The Estée Lauder Companies Inc. (EL) said, for the third quarter, the company's forecasted EPS is in a range of $0.04 - $0.17. Adjusted EPS is forecasted in a range of $0.20 - $0.30. Adjusted constant currency EPS is projected in a range of $0.24 - $0.34. The company noted that additional restructuring charges are anticipated as initiatives are approved throughout fiscal 2025.

The Estée Lauder anticipates continued volatility and low visibility in the near term. Third quarter reported sales are estimated to decline in a range of 12% - 10%, on a reported basis, and decrease in a range of 10% - 8%, on an organic basis.

Stéphane de La Faverie, CEO, said "While we are not satisfied with our third quarter outlook, it primarily reflects weak retail sales trends in our Asia travel retail business, which deteriorated in our second quarter driven by Korea."

Second quarter loss to Estée Lauder was $590 million compared to profit of $313 million, last year. Net loss per common share was $1.64, compared with net earnings per share of $0.87. Adjusted net earnings per share decreased to $0.62 from $0.88. Analysts on average expected the company to report profit per share of $0.32, for the quarter. Analysts' estimates typically exclude special items.

Second quarter net sales decreased 6% to $4.0 billion. Organic net sales were down 6%. Analysts on average had estimated $3.98 billion in revenue.

The Estée Lauder Companies also announced it is expanding its profit recovery and growth plan, including the restructuring program. Actions under the plan are expected to be substantially executed in fiscal 2025 and 2026 and completed in fiscal 2027. The company now estimates a net reduction in positions of 5,800 to 7,000, including approvals to date. Once fully implemented, the company expects to take restructuring and other charges of between $1.2 billion and $1.6 billion. The restructuring program is expected to yield annual gross benefits of between $0.8 billion and $1.0 billion.

The company announced a quarterly dividend of $0.35 per share on Class A and Class B Common Stock, payable in cash on March 17, 2025 to stockholders of record at the close of business on February 28, 2025.

Shares of Estée Lauder Companies are down 8% in pre-market trade on Tuesday.

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