Este Lauder sees sales drop on recovery in China

Reuters-Este Lauder Cos Inc forecast a smaller fall in full-year sales than previously expected, on resilient demand for its skincare and fragrances, and an expected recovery in major market China that recently loosened its COVID curbs.

With the United States on the edge of a recession, the beauty market's post-pandemic rebound thrives with wealthy consumers indulging in smaller luxuries like lipsticks and fragrances, as they delay big-ticket purchases in the current environment.

Analysts believe that China will relax its COVID curbs in early December and lift some travel restrictions in the region to benefit luxury and beauty companies that have flagged a hit to sales in the country from its strict zero-COVID policy.

Estee Lauder expects net sales to fall between 5% and 7% in the year 2023, compared to its previous forecast of a decrease between 6% and 8%.

Estee expects to see its adjusted profit per share fall between 27% and 29%, compared with its previous forecast of a decrease between 19% and 21%, due to a stronger dollar.