Cosmetics giant Estée Lauder announced a major restructuring plan, including cuts of up to 7,000 jobs (10% of its workforce) due to persistent demand weakness. The company cited challenges in its Asia travel retail business, particularly in Korea and China, and expects third-quarter profit to fall short of expectations. CEO Stéphane de La Faverie aims to boost sales growth by getting new products to market faster and improving marketing efforts.
Cosmetics giant Estée Lauder Estee Lauder announced a major restructuring plan on Tuesday that includes slashing up to 7,000 jobs as the company grapples with persistent demand weakness — sending its shares spiraling nearly 20%.
The company now expects third-quarter profit to come well below expectations, citing challenges in its Asia travel retail business, particularly at airports and travel destinations in Korea and China.“For the third quarter, we expect overall soft retail trends to persist in Asia travel retail, significantly pressuring our organic net sales,” La Faverie said.
Net sales are expected to drop between 10% to 12% in the three months ending March 31 – worse than the 6.8% fall predicted by analysts, “While we are not satisfied with our third quarter outlook, it primarily reflects weak retail sales trends in our Asia travel retail business, which deteriorated in our second quarter driven by Korea,” de La Faverie said.
ESTEE LAUDER RESTRUCTURING JOB CUTS DEMAND WEAKNESS ASIA TRAVEL RETAIL CHINA GLOBAL ECONOMIC OUTLOOK
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