The Estee Lauder Companies Inc. Reports Fiscal 2024 Second Quarter Results, Revises Full Year Outlook, and Announces Profit Recovery Plan Update

The Estée Lauder Companies Inc. (NYSE: EL) today reported net sales of $4.28 billion for its second quarter ended December 31, 2023, a decline of 7% from $4.62 billion in the prior-year period. Organic net sales fell 8%, reflecting the expected challenges in Asia travel retail as well as ongoing softness in overall prestige beauty in mainland China. The decrease also reflects a 1% headwind due to business disruptions in Israel and other parts of the Middle East. Partially offsetting these pressures, organic net sales grew in several markets in Asia/Pacific and Europe, the Middle East & Africa, as well as in nearly every market in Latin America. The Company reported net earnings of $313 million, compared with net earnings of $394 million in the prior-year period. The Company’s reported effective tax rate was 37.6% in the quarter, compared to 25.4% in the prior-year period. The increase in rate reflects a higher effective tax rate on the Company’s foreign operations, due to the change in the Company’s geographical mix of earnings for fiscal 2024 as well as the unfavorable impact from previously issued share-based compensation. Diluted net earnings per common share was $.87, compared with $1.09 reported in the prior-year period. Excluding restructuring and other charges and adjustments as detailed on page 2, adjusted diluted net earnings per common share declined to $.88.

The Company has revised its fiscal 2024 net sales outlook to a range of $19.0 billion to $19.3 billion, reflecting a decrease of 6% to 7% on a reported basis and an increase of 3% to 4% on an organic basis. The Company has also revised its full year adjusted diluted earnings per share outlook to a range of $.88 to $.90, reflecting a decrease of 43% to 42% on a reported basis and an increase of 6% to 7% on a