The Estée Lauder Companies reported fourth quarter fiscal 2026 results that exceeded analyst expectations for both top and bottom-line performance. Organic net sales grew 5% in the quarter, signaling a recovery across all geographic regions and key product categories. The company's Profit Recovery and Growth Plan (PRGP) drove significant margin expansion, leading to a raise in the fiscal 2027 adjusted operating margin outlook to a range of 12.7% to 13.5%.
Key Highlights
- Organic net sales growth of 5% in the fourth quarter beat the 3.0% estimate, fueled by a return to growth in North America and high-single-digit growth in Mainland China.
- Full-year adjusted operating margin expanded 320 basis points to 11.2%, as operational efficiencies from the PRGP offset inflationary pressures and higher employee incentive costs.
- Fragrance and Skin Care remained the primary growth engines, with Fragrance net sales increasing 10% for the full year, led by Luxury Brands like Le Labo and TOM FORD.
- The company concluded approvals for its restructuring program, expecting total gross benefits of $1.2 billion and a net reduction of approximately 10,000 positions to optimize corporate productivity.