Estee Lauder Inc.’s stock EL fell 2% premarket Friday, following the release of the cosmetics company’s fiscal fourth-quarter earnings report. While the earnings surpassed expectations, the company’s guidance fell short of consensus forecasts.
The company reported a net loss of $33 million, or 9 cents per share, for the quarter ending on June 30. This is in contrast to the earnings of $52 million, or 14 cents per share, during the same period last year. However, when adjusted for certain items, the per-share earnings came to 7 cents, exceeding the FactSet consensus estimate of a loss of 4 cents per share.
In terms of revenue, the company experienced a 1% increase, with sales reaching $3.609 billion. This figure also beat the FactSet consensus estimate of $3.485 billion.
Despite these positive numbers, Chief Executive Fabrizio Freda highlighted challenges in the market. “For full-year fiscal 2023, we achieved organic sales growth and expanded our prestige beauty market share in various developed and emerging markets,” said Freda. “However, our results were impacted by the decline in Asia travel retail, particularly in Skin Care, and we also faced softness in North America.”
Looking ahead, Estee Lauder Inc. has projected a sales growth between 5% and 7% for fiscal year 2024. The company anticipates earnings per share (EPS) to range from $3.50 to $3.75. This forecast falls below the FactSet consensus estimate of $4.88 for fiscal year 2024 EPS.
Since the beginning of the year, the company’s stock has experienced a significant decline of 35%. In comparison, the S&P 500 has recorded a gain of 13.8% during the same period.
Despite the conservative guidance, Estee Lauder Inc. remains hopeful for the future, as it continues to innovate and adapt to changing market dynamics.