What types of costs make up the restructuring charges?

Of the cumulative restructuring charges approved through June 30, 2026, $1,044 million are employee-related costs, $196 million are asset-related costs, $28 million are contract termination costs, and $44 million are other exit costs, totaling $1,312 million.

What new initiatives were approved after May 28, 2026?

The company approved initiatives to reorganize its selling model and right-size select brand organizations, modernize its direct-to-consumer digital technology infrastructure, and further reorganize and right-size corporate functions, including exiting an office lease. These are expected to primarily result in employee severance, asset-related costs, and sales returns and cost of sales.

When is the restructuring program expected to be complete?

Approvals under the Restructuring Program concluded as of June 30, 2026. The company expects the cumulative approved initiatives to be substantially completed by the end of fiscal 2027.

Will the restructuring costs require future cash outlays?

Yes. Other than non-cash charges, the company expects the approved restructuring and other charges to result in future cash expenditures funded from cash provided by operations.

EL 8-K: Financial Events

01—Abstract

Summary

Summary of the 8-K/A filed July 7, 2026. Cited figures are marked; the original filing is the authoritative source.

The Estée Lauder Companies Inc. filed this Item 2.05 Current Report to update the restructuring charges tied to its Profit Recovery and Growth Plan (PRGP), which was launched on November 1, 2023 to help rebuild profit margins in fiscal years 2025 and 2026.

The Restructuring Program was expanded in February 2025, and the company updated its expected charge range to $1,500 million to $1,700 million^a (before tax) in its Quarterly Report on Form 10-Q filed May 1, 2026. Approvals under the program concluded as of June 30, 2026, and the cumulative approved initiatives are expected to be substantially completed by the end of fiscal 2027. The filing reports cumulative restructuring and other charges of approximately $1,748 million (before tax) for initiatives approved from inception through June 30, 2026.

That total includes $197 million^b approved between May 29, 2026 and June 30, 2026. Of the $1,748 million, $1,312 million is classified as restructuring charges and $378 million as other charges. Employee-related costs make up $1,044 million of the restructuring charges, and asset-related costs make up $196 million.

The company states that, apart from non-cash charges, these amounts are expected to result in future cash expenditures funded from cash provided by operations. The newly approved initiatives fall into three areas: Go-to-Market Operating Model Acceleration, Digital Organization Transformation, and Enabling Function Re-Invention.

These are expected to drive workforce reductions, asset-related costs, and sales returns and cost of sales impacts. The filing also notes that the cumulative charge total sits above the most recently updated range of $1,500 million to $1,700 million^c.

02—Key points

Key Highlights

Cumulative restructuring and other charges approved through June 30, 2026 total approximately $1,748 million (before tax), compared with the updated expected range of $1,500 million to $1,700 million reported on May 1, 2026.
Charges approved in the May 29 to June 30, 2026 period total $197 million, including $165 million in operating expenses.
Of the $1,748 million cumulative total, $1,312 million is classified as restructuring charges and $378 million as other charges; sales returns contributed $43 million and cost of sales $15 million.
Cumulative restructuring charges are primarily employee-related costs of $1,044 million, with asset-related costs of $196 million, contract terminations of $28 million, and other exit costs of $44 million.
Approvals under the Restructuring Program concluded as of June 30, 2026, with cumulative approved initiatives expected to be substantially completed by the end of fiscal 2027.
Three new initiatives were approved: Go-to-Market Operating Model Acceleration, Digital Organization Transformation, and Enabling Function Re-Invention, the last including an office lease exit.
Except for non-cash charges, the restructuring costs are expected to produce future cash expenditures funded from cash provided by operations.

03—Questions

Frequently Asked Questions

What is the total restructuring and other charge the company now expects from the program?
The filing states cumulative restructuring and other charges of approximately $1,748 million (before tax) for initiatives approved from inception through June 30, 2026. This is above the $1,500 million to $1,700 million range reported in the Form 10-Q filed May 1, 2026.
What types of costs make up the restructuring charges?
Of the cumulative restructuring charges approved through June 30, 2026, $1,044 million are employee-related costs, $196 million are asset-related costs, $28 million are contract termination costs, and $44 million are other exit costs, totaling $1,312 million.
What new initiatives were approved after May 28, 2026?
The company approved initiatives to reorganize its selling model and right-size select brand organizations, modernize its direct-to-consumer digital technology infrastructure, and further reorganize and right-size corporate functions, including exiting an office lease. These are expected to primarily result in employee severance, asset-related costs, and sales returns and cost of sales.
When is the restructuring program expected to be complete?
Approvals under the Restructuring Program concluded as of June 30, 2026. The company expects the cumulative approved initiatives to be substantially completed by the end of fiscal 2027.
Will the restructuring costs require future cash outlays?
Yes. Other than non-cash charges, the company expects the approved restructuring and other charges to result in future cash expenditures funded from cash provided by operations.

04—Continue

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