## L'Oreal Exceeds Expectations with 9.4% Sales Growth in First Quarter
L'Oreal, the French cosmetics giant, reported a 9.4% increase in first-quarter sales on a like-for-like basis, exceeding analyst expectations and defying concerns about a slowdown in the beauty markets of the United States and China. The company, which owns brands like Maybelline and Lancome, generated sales of 11.24 billion euros ($11.98 billion) for the first three months of the year, surpassing the 6.1% growth predicted by analysts.
This strong performance comes as a welcome relief to the market, following bearish comments from U.S. retailer Ulta Beauty earlier this month about a faster-than-expected slowdown in the American market. These comments had caused L'Oreal shares to drop by 4% and also impacted other U.S. beauty brands.
L'Oreal attributed its success to strong growth in both North America and Europe, where its mass market range and dermatological products compensated for weakness in the luxury segment. The company's consumer products division, which accounts for over a third of its revenue, grew by 11.1% on a like-for-like basis, driven by higher volumes and value.
The smaller but fast-growing dermatological beauty unit, which sells La Roche-Posay and CeraVe skincare, experienced a 21.9% growth, benefiting from continued medical recommendations. The luxury division, which markets fragrances like YSL's Libre and Aesop products, grew by 1.8%, exceeding expectations for a decline. This growth was fueled by strong performance in Europe and North America, offsetting softness in North Asia.
Despite concerns about slowing sales in the leading U.S. market, L'Oreal's performance in China was particularly noteworthy. The company achieved a 6.2% growth in China, significantly outperforming the market.
L'Oreal's shares, which are among the most valuable in Europe with a market capitalization of approximately 220 billion euros ($234.26 billion), have declined by 6% so far this year. This is slightly higher than the 5% decline experienced by its U.S. competitor, Estee Lauder.