Estée Lauder Chief Executive Officer Fabrizio Freda has announced his pending retirement at the end of June 2025. Freda’s 16 year reign saw the company evolve into a global cosmetics giant that ran into some financial problems only recently. Despite these difficulties, Freda highlighted the company’s progress in the fourth quarter and expressed confidence in future growth through strategic adjustments.
Freda said: “Leading The Estée Lauder Companies for sixteen years, is and has been, a true honour and privilege. I am so proud of our company’s incredible accomplishments, and to have built the most talented, dedicated, and passionate team in the industry. Together we have transformed the company in beautiful ways; and we have set new standards for excellence. I look forward to continuing to work closely with our Board of Directors in the selection of my successor and ensuring a seamless transition.”
Estée Lauder Companies (ELC) saw a 2% drop in net sales, totaling $15.6 billion for the fiscal year ending June 30, 2024, largely due to declining demand for prestige beauty products in China and a decrease in travel retail sales across Asia. Organic net sales, excluding currency effects, also fell 2%. Net earnings plummeted to $390 million from $1.01 billion the previous year.
The company faced various other challenges, including the cost of acquiring Tom Ford, disruptions in the Middle East, and a struggling market in China. However, there was a rebound in net sales during the final quarter, which rose 7% year-on-year.
Regional performance varied: Latin America experienced double-digit growth, while sales in North America were flat. In Asia Pacific, weaker sales in China were partially offset by stronger results in Hong Kong and Japan. ELC’s rival, L’Oréal, faced similar challenges in North Asia.
By product category, fragrance sales increased by 2%, driven by Le Labo and Jo Malone. Skincare and haircare saw declines, while makeup sales decreased slightly. ELC plans to focus on improving performance in skincare, capitalizing on high-end fragrance growth, and enhancing marketing and innovation strategies in fiscal 2025.