Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
The Estée Lauder Companies' fiscal 2026 was defined by a return to reported profitability, reversing the prior year's impairment- and litigation-driven loss. Management attributes the recovery primarily to strong skin care and fragrance momentum, particularly from La Mer, Estée Lauder, The Ordinary, Le Labo and TOM FORD, while the Profit Recovery and Growth Plan delivered gross margin and cost benefits. Gross margin expanded by 150 basis points and operating expenses fell sharply as a percentage of sales, helping operating income swing from a loss to positive territory. However, the company remains cautious about tariff impacts, softness in certain Western markets, and trademark valuations with limited headroom. The reported sales growth also benefited from roughly $250 million of favorable foreign currency translation, which does not carry over to future periods.
Revenue
$15.05B
+5.05% YoY
EPS (Diluted)
$0.50
+115.87% YoY
Gross Margin
75.5%
+1.5 pts YoY
Operating Income
$780M
+199.36% YoY
Filed · Source: SEC EDGAR 10-K filing · Audit Opinion: Unqualified (Source: 10-K Report of Independent Registered Public Accounting Firm)
Next EL earnings expected
Source: SEC XBRL
Estee Lauder (EL) reported FY2026 revenue of $15.05B, up 5.0% year over year. Operating margin was 5.2%, against -5.5% a year earlier. Operating cash flow was $1.77B, up 39.4% year over year.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 0.39 | 0.33 | Beat +18.4% |
| Mar 2026 | 0.91 | 0.67 | Beat +36.2% |
| Dec 2025 | 0.89 | 0.86 | Beat +3.4% |
| Sep 2025 | 0.32 | 0.18 | Beat +75.9% |
4 reported segments · SEC XBRL
Segment revenue totals $14.96B, which is the $14.96B of consolidated revenue on the income statement.
Compiled by AI from 10-K Item 7 of this filing
Reported net sales increased 5% in fiscal 2026, driven by skin care and fragrance, with La Mer, Estée Lauder and The Ordinary contributing approximately $466 million of skin care growth and Le Labo, TOM FORD and KILIAN PARIS contributing approximately $221 million of fragrance growth. Favorable foreign currency translation added about $250 million to the reported increase, so constant currency sales growth was 3%.
Source: 10-K Item 7 MD&A
Gross margin rose to 75.5% from 74.0% in the prior year, driven by favorable business mix, lower obsolescence charges and manufacturing cost efficiencies under the Profit Recovery and Growth Plan, partially offset by inflation and tariffs.
Source: 10-K Item 7 MD&A
Operating expenses fell to 70.3% of net sales from 79.4% in fiscal 2025, largely because the prior year included $1,286 million of goodwill and other intangible asset impairments and a $159 million talcum litigation settlement, while the current year incurred $84 million for a securities class action settlement and higher restructuring charges.
Source: 10-K Item 7 MD&A
As of June 30, 2026, approvals under the Restructuring Program concluded, with a final estimate of approximately 10,000 net position reductions, total restructuring and other charges of $1,748 million before taxes, and expected annual gross benefits of about $1,200 million once fully implemented, a portion of which will be reinvested in consumer-facing activities.
Source: 10-K Item 7 MD&A
Management anticipates tariffs to have an adverse effect on fiscal 2027 profitability and cash flows, and continues to monitor the Middle East conflict, Western market softness, and changes in Asia travel retail, including the Beijing and Shanghai airport duty-free retailer transition.
Source: 10-K Item 7 MD&A
Compiled by AI from 10-K Item 1A of this filing · 4 high, 1 medium, 0 low
The company faces vigorous competition from multinational consumer product companies and indie brands, and must maintain brand strength in key countries such as the United States and China. A longer-term decline in U.S. department store traffic and dependence on large retailers increases customer concentration risk, and changes in retailer strategies or relationships could materially hurt results.
Source: 10-K Item 1A Risk Factors
The long-term strategy requires investment in new capabilities, brands, channels and technologies, which may be dilutive in the short term. The restructuring program is expected to eliminate about 10,000 positions and incur $1,748 million in charges, and failure to realize anticipated benefits or manage transition risks could materially harm the business.
Source: 10-K Item 1A Risk Factors
Acquisitions have resulted in significant goodwill and indefinite-lived intangible assets that must be tested annually. Certain trademarks, including Dr.Jart+, Too Faced and TOM FORD, have limited excess fair value over carrying value, and unfavorable changes in sales, cost reduction or economic conditions could trigger future impairment charges.
Source: 10-K Item 1A Risk Factors
The company operates globally and is subject to tariffs, sanctions, currency controls and geopolitical tensions in key markets. It anticipates tariffs to have an adverse effect on fiscal 2027 profitability and cash flows, and continues to monitor the Middle East conflict and travel retail disruptions, which could materially affect results.
Source: 10-K Item 1A Risk Factors
The company has experienced cybersecurity incidents that resulted in unauthorized access to systems and data, and continues to face threats such as ransomware, social engineering and insider risks. A significant breach or system failure could disrupt operations, damage reputation and lead to remediation costs and legal exposure.
Source: 10-K Item 1A Risk Factors
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 15.05 $B | 14.33 $B | +5.05% |
Cost of Revenue $B | 3.69 $B | 3.73 $B | -1.13% |
Gross Profit $B | 11.36 $B | 10.60 $B | +7.22% |
Operating Income $M | 780.00 $M | -785.00 $M | +199.36% |
EPS (Basic) $ | 0.50 $ | -3.15 $ | +115.87% |
EPS (Diluted) $ | 0.50 $ | -3.15 $ | +115.87% |
SG&A Expense $B | 9.69 $B | 9.46 $B | +2.42% |
Answers draw on this SEC filing and the data on this page
EL (Estée Lauder) posted Q3 FY2026 revenue of $3.71B (+4.6% YoY) but net income fell 44% to $89M as higher operating costs and elevated SG&A compressed margins significantly.
Estée Lauder Companies (EL) delivered a strong Q2 FY2026 turnaround, with revenue rising 5.6% YoY to $4.23B and operating income swinging to $401M from a prior-year loss of $580M, driven by gross margin expansion and disciplined SG&A control.
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