This photo shows the Estee Lauder Companies Inc. logo displayed on a smartphone with the Estee Lauder Companies Inc. logo in the background.
Thiago Prudencio | Light Rocket | Getty Images
estee lauder said Thursday that it expects its full-year profitability to take a $100 million hit from the tariffs.
The beauty company’s stock price fell about 20% on Thursday.
The company is currently in the midst of a restructuring plan called “Beauty Reimagined,” expected to cost between $1.2 billion and $1.6 billion, aimed at reinvigorating growth. The company said in its fiscal second-quarter earnings call Thursday that it still expects to reduce its net workforce by 5,800 to 7,000 as part of the restructuring.
Estée Lauder said it was “actively evaluating development and mitigation strategies” to reduce the impact of the tariffs. The company said it leveraged trade programs, optimized its regional manufacturing footprint and increased supply chain agility, all of which offset more than half of the expected impact.
The company said it expects tariff headwinds to primarily impact profitability in the second half of the year. As part of our calculations, we also identified potential tariff rates in Switzerland, Canada, China, Mexico, the European Union, and Japan, where we have facilities.
Still, Estée Lauder said it continues to monitor the ongoing tariff situation and is working to implement further strategies to further offset these costs, including “potential pricing measures.”
The company also announced that it was raising its financial outlook following its strong performance in the first half of this year, but said it remained cautious about the macroeconomic environment.
“Beauty Reimagined has revitalized our business during this momentous year as we execute the largest operational, leadership and cultural transformation in our history,” CEO Stéphane de la Faverie said in a statement. “On the occasion of our first anniversary, we are confident in the strength of the turnaround and are raising our outlook for 2026, as we expect organic sales growth to return and operating margins to expand for the first time in four years, even as the second half reflects previously anticipated headwinds and increased consumer investment.”
Correction: Stéphane de la Faverie is the CEO of Estée Lauder. A previous version misspelled his name.
