Coty Reports Nominal Net Revenue Decreases for First Half of 2025 and Q2

Coty Inc. reported nominal decreases in net revenue for the first half and Q2 of 2025, ended December 31, 2024.

Across both periods, the company delivered strong gross and operating margin expansion, while continuing to invest behind its brands and execute across its strategic growth pillars, officials said.

In the first half of 2025 (1H25), Coty’s reported net revenue decreased 1% year-over-year and included a 2% negative impact from FX and a 1% headwind from the divestiture of the Lacoste license.

Coty’s LFL net revenue grew 2% despite elevated comparisons in the prior year when LFL revenues grew 14%. The 1H25 reported and LFL revenues were supported by growth in both prestige and mass fragrances, as well as mass skin care partially offset by declines in cosmetics and body care.

In Q2 2025, Coty’s reported net revenue declined 3% on a reported basis and included a 2% headwind from FX. Coty’s Q2 net revenue declined 1% on a LFL basis. The Q2 reported sales reflected the further slowing of the mass beauty market, particularly color cosmetics, together with continued headwinds in the APAC region, particularly China, Travel Retail Asia and Australia. At the same time, the global fragrance market remained robust, and estimated sell-out for Coty’s prestige fragrance portfolio grew at a high single-digit percentage in the first half. In both 1H25 and Q2, LFL revenue growth on a company-wide basis includes a contribution of 1% from Argentina, which experienced hyperinflation.

Prestige

In 1H25, prestige net revenue grew 2% on a reported basis, which included a 1% negative impact from FX and a 1% headwind from the divestiture of the Lacoste license. On a LFL basis, prestige net revenue grew 4% in the first half, despite lapping 18% LFL growth in the prior year. Prestige reported net revenue in the first half was supported by solid growth in the underlying fragrance category and Coty’s brands’ performance partially offset by lower cosmetics sales largely as a result of headwinds in the APAC region. The majority of Coty’s leading prestige fragrance brands grew by a mid-single-digit to double-digit percentage year-over-year, with solid growth in prestige fragrance volumes in 1H25.

In Q2, prestige net revenue fell 1% on a reported basis, which included a 1% headwind from FX and a 1% negative impact from the divestiture of the Lacoste license. On a LFL basis, net revenue increased 1% supported by growth in Coty’s prestige fragrance category partially offset by prestige cosmetics. Despite strong sell-out in Coty’s prestige fragrances, Coty’s Prestige reported net revenue was impacted by broader headwinds in China and Travel Retail Asia, coupled with continued tight inventory management and lower than anticipated replenishment orders by retailers in the US, Europe and Australia.

Consumer Beauty

In 1H25, Consumer Beauty net revenue declined 6% on a reported basis, which included a 4% negative impact from FX. Consumer Beauty reported net revenue declined in body care and mass color cosmetics partially offset by reported net revenue growth in mass fragrance and mass skin care. 1H25 Consumer Beauty net revenue declined 2% on a LFL basis. In Q2, Consumer Beauty net revenue declined 8% on a reported basis and were impacted by a 4% headwind from FX, with LFL sales declining 4%. In 2Q25, Consumer Beauty reported net revenue declines in color cosmetics and body care were partially offset by growth in mass fragrance. Coty’s Consumer Beauty sell-out was below the broader mass beauty market due to the company’s greater exposure to the more pressured mass color cosmetics category, officials said.

In addition, Coty’s sell-in continued to track below sell-out driven by pressure on US mass retailers due ongoing channel shifts, tight inventory management at retailers in Australia and parts of Europe, and higher trade investments.

Fiscal Outlook

Coty continues to expect FY25 savings of over $120 million, with these and additional projects expected to deliver further savings in FY26 and beyond. Coty continues to expect solid gross margin expansion in FY25, fueled by the strong gross margin improvement delivered in 1H25. These levers will support ongoing strong investment behind its brands, with A&CP expected to remain in the high 20s percentage.