Coty has revised its annual core sales forecast, citing increased pricing and robust demand driven by the success of new makeup and fragrance launches. The post-pandemic growth in the beauty market continues as consumers prioritize «affordable luxuries» amidst inflation concerns, redirecting spending habits in the United States and Europe.
Strategic product introductions, including prestigious offerings like Burberry Goddess and consumer beauty favorites like CoverGirl’s Yummy Gloss, have significantly contributed to double-digit growth in these segments. Gen Z’s active participation is notably propelling the expansion of the consumer beauty category.
The company now expects fiscal 2024 core like-for-like sales growth to range between 9% and 11%, surpassing the previous outlook of an 8% to 10% increase.
In the first quarter, Coty reported an impressive 18% surge in net revenue, reaching $1.64 billion—exceeding estimated figures of $1.58 billion according to LSEG data.
Thomas Hayes, chairman of hedge fund Great Hill Capital, emphasized the positive outlook, stating, «Even consumers at the lower end are holding strong. These affordable luxuries, combined with pricing power and unit growth, create a promising outlook for the future.»
Despite a reported net loss in the first quarter due to factors such as an equity swap impact, changes in the Swiss statutory tax rate, and increased costs, Coty remains optimistic. On an adjusted basis, Coty earned 12 cents per share, slightly below analysts’ estimates of 17 cents. The company has also reiterated its full-year adjusted per-share profit forecast, maintaining it between 44 cents and 47 cents.