Estee Lauder, L’Oreal Post China Sales Recovery as Shoppers Return to High-End Cosmetics
By Bao Yunhong
Global beauty giants The Estee Lauder Companies Inc. and L’Oreal S.A. are seeing a sales recovery on the Chinese mainland, signaling a rebound in the country’s high-end consumer market.
Estee Lauder on Thursday reported that sales on the Chinese mainland surged 9% in its latest quarter, the fastest among all its regions. The results from the U.S. cosmetics giant, along with a similar recovery reported by French rival L’Oreal, suggest that consumer confidence is stabilizing in the world’s second-largest economy, a significant development for global luxury and consumer brands.
In its first quarter earnings for fiscal 2026, which ended Sept. 30, Estee Lauder’s total sales rose 4% year-on-year to $3.48 billion. The company swung to an operating profit of $169 million from a loss of $121 million in the same period last year.
The growth was primarily driven by the Asia-Pacific region and the Chinese mainland, which the company now reports as a standalone region. Sales in the Chinese mainland reached $532 million. Estee Lauder attributed this to product innovation, targeted consumer outreach, and key marketing campaigns that boosted both online and offline sales. A low base from the previous year’s weak retail environment also contributed to the strong performance.
Stéphane de La Faverie, president and CEO of Estee Lauder, said during an earnings call that Chinese consumer confidence has passed its low point and is gradually recovering. He noted that the market is stabilizing and even showing signs of slight acceleration. In the third quarter, Estee Lauder’s retail performance in China outpaced the premium beauty sector as a whole, with seven of its brands recording double-digit growth, he said.
Regionally, Estee Lauder’s sales in the Asia-Pacific area grew 8% to $873 million, boosted by its global travel retail business.
L’Oreal also saw its performance on the Chinese mainland improve. The French cosmetics giant recorded mid-single-digit growth on the Chinese mainland during the third quarter, helping its North Asia business return to positive like-for-like sales growth for the first time in two years, the company said on Oct. 22.
The results coincided with a major strategic move for L’Oreal. On Oct. 19, the company announced a long-term partnership with Kering to acquire the fragrance brand Creed and take over the 50-year license for Kering’s beauty and fragrance business for 4 billion euros, a deal expected to close in the first half of 2026. L’Oreal also disclosed that it had completed the integration of the hair care brand Color Wow and skincare brand Medik8 in September.
The recovery of beauty giants on the Chinese mainland comes after a period of turbulence. Earlier in 2025, both L’Oreal and Estee Lauder saw their China sales fall, prompting the latter to announce significant global layoffs.
Despite the downturn, both firms have maintained their focus on the market. L’Oreal has reaffirmed its commitment to expanding its investment and consumer base in China. Meanwhile, Estee Lauder has been pursuing new growth drivers, such as by investing in a local fragrance brand to tap into the fast-growing high-end perfume market.
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