01—Abstract
Summary
Summary of the 10-K filed August 19, 2026. Cited figures are marked; the original filing is the authoritative source.
The Estée Lauder Companies Inc. reported fiscal 2026 (year ended June 30, 2026) net sales of $15.05 billiona, up from $14.33 billion in fiscal 2025, with reported net sales increasing 5% and constant-currency net sales increasing 3%.
Operating income was $780 millionb compared with an operating loss of $785 million in fiscal 2025, and net earnings attributable to the company were $182 million, or $0.50 per diluted share, versus a net loss of $1.13 billion in the prior year. Excluding restructuring charges, the securities class action settlement, impairments and talc settlement charges, diluted net earnings per share as adjusted were $2.51, up 66% as reported, and operating income as adjusted rose 47% to $1.69 billion. Growth was led by skin care and fragrance, with Mainland China net sales up 12% and EUKEM up 6%.
Gross margin rose to 75.5% from 74.0%, reflecting net benefits from the Profit Recovery and Growth Plan (PRGP). The company updated its Restructuring Program estimates to a final net reduction of approximately 10,000 positions and total charges of $1.748 billionc, with annual target gross benefits of approximately $1.2 billion. The filing states the company expects tariffs to have an adverse effect on fiscal 2027 profitability and cash flows.
Total debt as a percent of total capitalization was 66%, and the company declared a quarterly dividend of $0.35d per share payable September 15, 2026. The Lauder family holds approximately 82% of voting power. Key risks flagged in the filing include ongoing challenges in Western Europe and the United States, tariff uncertainty, reliance on travel retail, litigation including cosmetic talc claims whose number of pending state-court cases rose to 118 from 84, and limited excess fair value on certain trademarks, notably TOM FORD with a carrying value of $1.805 billion exceeding fair value by 19%.
02—Key points
Key Highlights
- Net sales rose 5% to $15.05 billion, with constant-currency growth of 3%, driven by skin care, fragrance and Mainland China.
- Operating income was $780 million (5.2% operating margin) versus an operating loss of $785 million in fiscal 2025, which included $1.29 billion of goodwill and intangible impairments.
- Net earnings attributable to the company were $182 million, or $0.50 per diluted share, compared with a net loss of $1.13 billion in fiscal 2025.
- Adjusted diluted EPS (non-GAAP) was $2.51, up 66% as reported, excluding restructuring, securities class action and other items.
- Gross margin increased to 75.5% from 74.0%, driven by PRGP benefits, partly offset by inflation and tariffs.
- Restructuring Program estimates were finalized at about 10,000 net position reductions and $1.748 billion of total charges, with target annual gross benefits of about $1.2 billion.
- Management expects tariffs to adversely affect fiscal 2027 profitability and cash flows, and the Lauder family controls approximately 82% of voting power.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2026, Estée Lauder Companies kept $0.01.
- Revenue$15.05B100.0%
- Cost of revenue−$3.69B24.5%
- Gross profit$11.36B75.5%
- Operating costs−$10.58B70.3%
- Operating income$780.0M5.2%
- Interest, other & tax−$598.0M4.0%
- Net income$182.0M1.2%
Where FY2026 revenue went
$15.05B- SG&A: $9.69B, 64% of revenue
- Cost of revenue: $3.69B, 24% of revenue
- Net income: $182.0M, 1.2% of revenue
- Other operating costs: $897.0M, 6.0% of revenue
- Interest, other & tax: $598.0M, 4.0% of revenue
Kept 1.2% as net incomeNet income $182.0M · 1.2%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2026filed August 19, 2026Financial Statements
FY2026 against FY2025
| Line item | FY2026FY2025 | Change |
|---|---|---|
| Revenue | $15.05B$14.33B | +5.0% |
| Cost of Revenue | $3.69B$3.73B | −1.1% |
| Gross Profit | $11.36B$10.60B | +7.2% |
| SG&A Expenses | $9.69B$9.46B | +2.4% |
| Operating Expenses | $10.58B$11.38B | −7.0% |
| Operating Income | $780.00M-$785.00M | +199.4% |
| Net Income | $182.00M-$1.13B | +116.1% |
| EPS (Basic) | $0.50$-3.15 | +115.9% |
| EPS (Diluted) | $0.50$-3.15 | +115.9% |
| Shares Outstanding (Basic) | 362.30M360.10M | +0.6% |
| Shares Outstanding (Diluted) | 364.80M360.10M | +1.3% |
05—Questions
Frequently Asked Questions
How did the company's sales and profitability change in fiscal 2026?
Net sales increased 5% to $15.05 billion, and operating income moved to $780 million from an operating loss of $785 million, largely because fiscal 2025 included impairment charges. Net earnings attributable to the company were $182 million, or $0.50 per diluted share. On an adjusted basis, excluding restructuring and other specified items, diluted EPS was $2.51.
Which product categories and regions drove growth?
Skin care net sales rose $376 million, or 5%, led by La Mer, Estée Lauder and The Ordinary, and fragrance rose $288 million, or 12%, led by Le Labo, TOM FORD and KILIAN PARIS. By region, Mainland China rose 12% and EUKEM rose 6%, while The Americas rose 1%.
What is the status of the restructuring program and its expected savings?
Approvals under the Restructuring Program concluded as of June 30, 2026. The company estimates a final net reduction of approximately 10,000 positions and total charges of $1,748 million before taxes, with cumulative initiatives expected to be substantially completed by the end of fiscal 2027 and annual target gross benefits of about $1,200 million.
What risks does the filing highlight for investors?
The filing cites tariffs, which management expects to adversely affect fiscal 2027 profitability and cash flows, ongoing challenges in Western Europe and the United States, and reliance on travel retail. It also notes talc-related lawsuits, with 118 cases pending in U.S. state courts as of June 30, 2026, up from 84, and limited excess fair value on certain trademarks, including TOM FORD, which exceeded its carrying value by 19%.
What is the company's capital return and balance sheet position?
A dividend of $0.35 per share was declared on August 18, 2026, payable September 15, 2026. Share repurchases under the program have been suspended since December 2022. Total debt was 66% of total capitalization at June 30, 2026, versus 65% a year earlier, and long-term debt is rated A- with a negative outlook by S&P and A3 with a negative outlook by Moody's.
06—Continue