Estée Lauder sees UK sales rise despite overall revenue drop

The Estée Lauder Companies has reported a 17% decrease in net sales to £3.7 billion ($4.62 billion) for the second quarter ending 31 December 2022, reflecting the impact of pandemic-related challenges in mainland China. 

Net sales in the UK grew mid-single-digits, powered by the "progression of the makeup renaissance as usage occasions returned, as well as strong growth in fragrance and skincare".

Overall skincare sales declined 25% to £1.8 billion ($2.3 billion), with growth from The Ordinary and Bobbi Brown offset by declines from Estée Lauder, La Mer, Dr.Jart+ and Clinique.

Makeup sales decreased 9% to £974 million ($1.2 billion), with growth from MAC and Clinique offset by declines from Estée Lauder and Tom Ford Beauty.

Fragrance sales were down 3% to £629 million ($775 million), despite a boost from Estée Lauder, Le Labo and Tom Ford Beauty.

Haircare sales increased 1% to £147 million ($182 million), reflecting growth from Aveda and The Ordinary, who recently launched haircare products.

The company reported net earnings of £322 million ($397 million), compared with £884 million ($1.09 billion) in 2021. Looking ahead, net sales for the third quarter are expected to decrease 12-14% and full year sales are forecasted to drop 5-7% versus the prior-year period.

Fabrizio Freda, President and CEO of Estée Lauder Companies, said: “We delivered on our expectations for the second quarter, despite the incremental pressure of COVID-19 in China in December. Fragrance excelled globally, while makeup prospered in a great number of markets, as our brands are realising the promise of the category’s renaissance as usage occasions resume.

“We are encouraged by both our strong momentum in numerous markets globally and improving macro trends. Moreover, so far this fiscal year, we have made exciting progress on several strategic initiatives to drive growth and resiliency in our business. We have great confidence that we will emerge from this year even better positioned to realise the long-term growth opportunities of global prestige beauty.”