Riding a wave of strong growth in China and the broader Asia-Pacific region, the Estée Lauder Companies posted net sales growth in nearly all product categories and geographic regions for its second quarter ending December 31, 2018 with its quarterly net sales exceeding US $4 billion for the first time.
President and CEO Fabrizio Freda said in a statement: “We delivered an excellent performance in our fiscal second quarter. Importantly, this was our eighth consecutive quarter of impressive net sales growth that met or exceeded our long-term goal, all while navigating many global macro issues. Our sustained progress is the result of our multiple engines of growth strategy, and demonstrates our agility in moving resources to the best global opportunities. Our earnings per share in the second quarter grew more than twice the rate of net sales in constant currency, delivering an impressive first-half performance. With confidence in our continued ability to execute effectively and grow share in prestige beauty, while simultaneously making strategic investments in our business, we are raising our net sales and EPS guidance for the year.
“Our strongest growth engines this quarter included the skin care category globally, the Asia/Pacific region, the online and travel retail channels, and most brands, including Estée Lauder, La Mer, MAC and our artisanal fragrance brands.”
Freda added: “Despite a volatile and challenging backdrop, we are optimistic about our company’s long-term outlook. We are very well-positioned to build share in global prestige beauty. Leveraging savings generated by our Leading Beauty Forward initiative, we plan to increase our investments during the next six months behind our successful innovations, high-quality products, compelling digital advertising and effective commercial execution, while also enhancing our capabilities to strengthen our industry leadership and deliver long-term profitable growth.”
Net sales soared 7% to $4.01 billion. Total reported operating income rose 9% to $771 million. Net earnings rose to $573 million compared with $123 million last year. These results are in line with those of Procter & Gamble, which recently reported strong growth in its beauty division, driven by performance in skin care. However, not all cosmetics companies are thriving. Coty has faced supply chain challenges lately and Avon Products has continued to underperform.