Net Sales Increase 23% for The Estée Lauder Companies in 2022 First Quarter Results

The Estée Lauder Companies Inc. reached net sales of $4.39 billion for its first quarter, which ended Sept. 30, representing an increase of 23% from the prior-year period. 

 

Net sales grew in every region and product category, reflecting the recovery in brick-and-mortar retail stores, primarily in western markets. Organic net sales increased 18%.

 

The Company reported net earnings of $692 million, a substantial increase from the prior-year period, which was $523 million. 

 

“We delivered excellent performance to begin fiscal 2022, despite the increased volatility and variability globally during the quarter, by virtue of our dynamic multiple engines of growth strategy. Our growth engines increasingly diversified, as we expected,” said Fabrizio Freda, president and CEO. ELC also released its sustainability and social impact report.

 

Thirteen brands contributed double-digit organic sales growth versus the prior-year period. Estée Lauder and MAC drove makeup’s emerging renaissance, while La Mer and Clinique delivered stand-out results in skin care. Fragrance soared double-digits in every region, driven by Tom Ford Beauty and Jo Malone London. 

 

Skin Care

 

Skin care net sales grew across every region, primarily led by La Mer and Clinique. The non-comparable impacts of net sales related to acquisitions, divestitures and brand closures contributed approximately 6 percentage point to net sales growth.

 

Strong double-digit growth from La Mer reflected the brand’s significant strength with Chinese consumers. Net sales growth was driven by increases in hero products, including Crème de la Mer, The Moisturizing Soft Cream, and The Treatment Lotion. The launch of The Hydrating Infused Emulsion and targeted expanded consumer reach, including the launch on a new online platform in Southeast Asia, also contributed to growth.

 

Clinique delivered double-digit growth driven by strong demand for its hero products, including Even Better Clinical Radical Dark Spot Corrector + Interrupter, and the launch of the Smart Clinical Repair Wrinkle Correcting Serum.

 

Skin care operating income decreased, primarily reflecting product mix, strategic investments in advertising and promotional activities and difficult comparisons to a prior year launch, largely offset by higher net sales from La Mer.

 

Makeup
 

Makeup net sales increased, reflecting a recovery in western markets as usage occasions increased and the category benefited from the easier comparisons to the prior year. The increase was led by strong double-digit sales growth from Estée Lauder and MAC as COVID-19 restrictions eased somewhat and social events began to recover in certain locations.

 

Growth from Estée Lauder was fueled by the Double Wear and Futurist foundation product lines as well as the successful launches of Double Wear Sheer Long-Wear Foundation and Pure Color Whipped Matte Lip Color.

 

MAC’s growth reflected successful marketing campaigns to drive the makeup renaissance as COVID-19 restrictions subside, with particular strength in face and eye products. Makeup operating income increased, primarily reflecting higher net sales, partially offset by strategic investments to support the makeup recovery.

 

Fragrance

 

Net sales grew in every region and across virtually all brands that sell fragrances, driven by continued resilience in luxury fragrance, easy comparisons versus the prior-year period, and the timing of shipments, including holiday shipments.

 

Tom Ford Beauty grew strong double-digits, reflecting strength in Private Blend, including Oud Wood and Lost Cherry, and Signature, including Black Orchid. The launch of Ombre Leather Parfum and accelerated growth in emerging markets also contributed to growth.

 

Jo Malone London’s net sales grew double digits primarily driven by strength in colognes, particularly in hero franchises like Wood Sage & Sea Salt and English Pear & Freesia. Bath & Body and Home also delivered strong growth reflecting consumer demand for home fragrance products during the pandemic.

 

Designer fragrances growth primarily reflected timing of holiday shipments as well as easy comparisons in travel retail versus the prior year.

 

Net sales from Le Labo and Estée Lauder rose strong double digits with growth primarily reflecting the opening of brick-and-mortar, improved traffic to those retail locations and initial shipments of Estée Lauder’s The Luxury Collection.

 

Kilian Paris’ net sales nearly doubled, driven by retail reopening and demand for hero products, including Love, Don’t be Shy, and the successful launch of The Liquors franchise.

 

Fragrance operating income increased, driven primarily by higher net sales partly offset by strategic investments to support brick-and-mortar reopening.

 

Hair Care
 

Hair care net sales rose, reflecting increases from both Bumble and bumble and Aveda primarily due to the reopening of brick-and-mortar salons and retail.

 

Hair care operating results were flat reflecting higher net sales offset by strategic investments to support the recovery as brick-and-mortar reopens.