Estee Lauder Companies Inc (NYSE:EL, XETRA:ELAA) posted stronger-than-expected third-quarter results on Friday, raising its full-year outlook while announcing an expansion of its workforce reduction program to as many as 10,000 positions.
The beauty conglomerate reported revenue of $3.71 billion for the quarter ended March 2026, edging past analyst estimates of $3.69 billion. Adjusted earnings per share came in at $0.91, well above the $0.65 consensus estimate.
The results reflected early returns from the company's Profit Recovery and Growth Plan, with brands including The Ordinary, Tom Ford, La Mer, and Aveda posting strong growth. Innovation accounted for roughly 25% of sales in the period.
Fragrance was a standout, rising 10% on an organic basis to $628 million, ahead of estimates. Skincare, the company's largest segment at 50% of total sales, was flat organically at $1.86 billion, slightly below the $1.88 billion consensus, with La Mer and The Ordinary providing growth partially offset by declines at Clinique and Origins. Mainland China delivered 6% organic growth to $774 million, above the $731 million estimate, while Asia-Pacific missed at $1 billion, declining 1% on a like-for-like basis.
For the full fiscal year, the company now expects organic net sales growth of approximately 3%, raised to the high end of its prior guidance range. Adjusted EPS guidance was lifted to $2.35 to $2.45, from $2.05 to $2.25, against a $2.22 analyst estimate.
Management flagged that Middle East conflict is expected to weigh on travel retail in the fourth quarter, with guidance assuming no further deterioration in the geopolitical landscape beyond May 2026.
As part of its expanded restructuring program, Estée Lauder now expects a net workforce reduction of 9,000 to 10,000 roles, up from a prior target of 5,800 to 7,000, with the bulk of new cuts coming from point-of-sale demonstration roles at underperforming department stores. Total restructuring charges are now forecast at $1.5 billion to $1.7 billion, with annual gross benefits of $1 billion to $1.2 billion expected, primarily in fiscal 2027.
Shares rose more than 8% in early trading on Friday.