Estée Lauder beats FQ1 expectations, sets FY26 sales outlook above street view

[Estee Lauder Shop]
Baloncici

With its travel retail business gaining momentum and expansion into other distribution channels including Amazon (AMZN [https://seekingalpha.com/symbol/AMZN]) Premium Beauty Store and TikTok, Estée Lauder’s investments and cost efficiencies were reflected in a solid performance in the fiscal first quarter [https://seekingalpha.com/news/4511076-estee-lauder-non-gaap-eps-of-0_32-beats-by-0_14-revenue-of-3_48b-beats-by-100m]as profits more than doubled from a year ago.

“We had a strong start to fiscal 2026 as we execute on our Beauty Reimagined strategy—returning to organic sales growth, gaining prestige beauty share in a few key strategic areas of focus, and improving profitability. Encouragingly, we are building momentum across the organization from the significant operational changes we have executed to-date to be faster and more agile,” said Stéphane de La Faverie, Estée Lauder CEO.

The parent company of Clinique, La Mer and Bobbi Brown makeup earned a profit of $0.32 per share versus $0.14 a year ago and $0.14 better than expected. Reflecting net benefits from the Profit Recovery and Growth Plan to reduce promotions and product excess, coupled with a more competitive approach to procure merchandise, adjusted gross margin expanded 60 basis points to 73.3%. Crucially, adjusted operating margin expanded 300 basis points to 7.3%.

With Estée Lauder expanding its presence on platforms like Amazon (AMZN [https://seekingalpha.com/symbol/AMZN]) and TikTok, broadened fragrance distribution, improved sales in China, and double-digit growth in its fragrance luxury brands, total revenue for FQ1 increased 3.6% to a better than expected $3.48B.

For FY26, Estée Lauder (EL [https://seekingalpha.com/symbol/EL]) expects profits to improve by 24% to 37% from FY25 to be within a range of $1.87 to $2.07 per share with a midpoint of $1.97, below the estimated $2.09. Net sales are forecasted to increase by 2% to 5%, translating to a range of $14.61B to $15.04B with a midpoint of $14.82B that is above the $14.78B estimate.

MORE ON ESTEE LAUDER

* Estée Lauder: A Moat That Isn't There, Still Too Pricey To Bear [https://seekingalpha.com/article/4828711-este-lauder-a-moat-that-isnt-there-still-too-pricey-to-bear]
* Estée Lauder: Concealing The Past? [https://seekingalpha.com/article/4824981-estee-lauder-concealing-past]
* The Estée Lauder Companies Inc. (EL) Presents At Barclays 18th Annual Global Consumer Staples Conference 2025 Transcript [https://seekingalpha.com/article/4819230-the-estee-lauder-companies-inc-el-presents-at-barclays-18th-annual-global-consumer-staples]
* Estee Lauder Non-GAAP EPS of $0.32 beats by $0.14, revenue of $3.48B beats by $100M [https://seekingalpha.com/news/4511076-estee-lauder-non-gaap-eps-of-0_32-beats-by-0_14-revenue-of-3_48b-beats-by-100m]
* Estee Lauder Q3 2026 Earnings Preview [https://seekingalpha.com/news/4510443-estee-lauder-q3-2026-earnings-preview]