03.05.2026 10:00
US cosmetics giant Estée Lauder has increased its layoff plan from 7,000 to 10,000 positions. The company aims to reduce costs by downsizing store operations and shifting towards digital sales channels. With the transformation plan, annual savings of up to $1.2 billion are expected, and investors have responded positively. As signs of recovery emerge in the Chinese market, the company appears to be refocusing on growth.
US-based cosmetics giant Estée Lauder has expanded its previously announced plan to lay off 7,000 employees, raising the target to 10,000. The company aims to reduce costs by downsizing globally.
STORE OPERATIONS SHRINKING
Estée Lauder, which has approximately 57,000 employees, plans to downsize in many areas, particularly in store operations. This step is expected to save the company an additional $200 million. Under the transformation plan, annual pre-tax savings are projected to reach $1.2 billion.
SHIFTING TO DIGITAL SALES
Under the leadership of CEO Stéphane de La Faverie, the company is making a significant change in its sales strategy. Estée Lauder aims to achieve renewed growth by focusing on fast-growing digital platforms such as Amazon and TikTok Shop. The company plans to reverse a three-year consecutive sales decline through this transformation.
MARKET RESPONDS POSITIVELY
The announced restructuring plan was well-received by investors. Company shares rose by up to 13% following the developments. Analysts noted that these results may indicate "the worst could be over."
EARNINGS EXPECTATIONS RAISED
Estée Lauder also revised its expectations for the remainder of the fiscal year upward. The company raised its earnings per share forecast to a range of $2.35 to $2.45, while organic sales growth is expected to be around 3%. In the perfume segment, a 10% growth is targeted.
SIGNS OF RECOVERY IN CHINA MARKET
Signs of recovery are emerging in the long-underperforming China market. In the last quarter, organic net sales in China increased by 6%.
POSSIBLE MERGER ON THE AGENDA
Meanwhile, a potential merger with Puig Brands is being discussed in the market. Although no official steps have been taken yet, analysts remain divided on the matter.