Estée Lauder · 10-Q · Item 2 MD&A

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

RESULTS OF OPERATIONS

The Estée Lauder Companies Inc. is one of the world’s leading manufacturers, marketers and sellers of quality skin care, makeup, fragrance and hair care products. We are a steward of over 20 luxury and prestige brands globally. Our products are sold in approximately 150 countries and territories. We operate as a wholesaler, with our products sold in brick-and-mortar locations and on various e-commerce platforms, including those operated by department stores, duty-free retailers, specialty-multi retailers, online pure players, upscale perfumeries and pharmacies, and top-tier salons and spas. Additionally, we operate a direct-to-consumer business across freestanding stores, our brands' websites and third-party online platforms.

Three Months Ended March 31,

Nine Months Ended March 31,

($ in millions)

$

%

$

%

$

%

$

%

Net sales

$

%

$

%

$

%

$

%

Cost of sales

Gross profit

Operating expenses:

Selling, general and administrative

Restructuring and other charges

Securities class action litigation settlement

—

—

—

—

Impairment of goodwill and other intangible assets

—

—

—

—

—

—

Talcum litigation settlement agreements

—

—

—

—

—

—

Total operating expenses

Operating income (loss)

Interest expense

Interest income and investment income, net

Other components of net periodic benefit cost

3

5

Earnings (loss) before income taxes

Provision (benefit) for income taxes

(2)

—

Net earnings (loss)

$

%

$

%

$

%

$

%

Percentages not adjusted for differences caused by rounding

The following table is a comparative summary of operating results for the three and nine months ended March 31, 2026 and 2025, for our product categories and geographic regions and reflects the basis of presentation described in Notes to Consolidated Financial Statements, Note 1 – Summary of Significant Accounting Policies and Note 13 – Segment Data and Related Information, for our product categories that meet the definition of reportable segments, for all periods presented. Royalty revenue from license arrangements, and products and services that do not fit within our definitions of skin care, makeup, fragrance and hair care have been included in the “other” category.

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Three Months Ended

Nine Months Ended

(In millions)

NET SALES

By Product Category:

Skin Care

$

$

$

$

Makeup

Fragrance

Hair Care

Other

Returns associated with restructuring and other activities

—

—

1

—

Net sales

$

$

$

$

By Geographic Region(1):

The Americas

$

$

$

$

Europe, United Kingdom and Ireland and Emerging Markets ("EUKEM")

Asia/Pacific

Mainland China

Returns associated with restructuring and other activities

—

—

1

—

Net sales

$

$

$

$

OPERATING INCOME (LOSS)

By Product Category:

Skin Care

$

$

$

$

Makeup

(3)

—

Fragrance

Hair Care

(5)

1

Other

9

Charges associated with restructuring and other activities

Operating income (loss)

$

$

$

$

By Geographic Region(1):

The Americas

$

$

$

$

EUKEM

Asia/Pacific

Mainland China

Charges associated with restructuring and other activities

Operating income (loss)

$

$

$

$

(1) The net sales and operating results from our travel retail business are included in the Asia/Pacific region.

Period-over-period changes in our net sales are generally attributable to the impacts from (i) pricing on our base portfolio, including changes in mix and those due to strategic pricing actions, (ii) volume, including changes driven by the impact of new product innovation, (iii) acquisitions and/or divestitures, and/or (iv) foreign currency translation. The percentages disclosed for these impacts are calculated on an individual basis.

The net sales impact from pricing consists of changes in list prices, due to strategic pricing actions, and mix shifts within and among product categories, geographic regions, brands and distribution channels. The prices at which we sell our products vary by brand, distribution channel (e.g., wholesale or direct-to-consumer) and may also vary by country. Our brands and products cover a broad array of pricing tiers. Prices of skin care and fragrance products are typically higher than makeup and hair care products.

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New product innovation includes the introduction of new products, as well as changes related to existing products or where they are sold, including reformulations, regional expansion, repackaging and sets. A product is considered "new innovation" for the twelve-month period following the initial shipment date. Our innovation is launched at different price points than existing products and value derived from innovation may vary from year to year. We continually introduce new products, support new and established products through advertising, merchandising and sampling and phase out existing products that no longer meet the needs of our consumers or our objectives. The economics of developing, producing, launching, supporting and discontinuing products impact our sales and operating performance each period.

The introduction of new products often has some cannibalizing effect on sales of existing products, inclusive of potential sales returns, which we take into account in our business planning. The impact of new product introductions, including timing compared to introductions in prior periods, also affects our results.

Non-GAAP Financial Measures

We use certain non-GAAP financial measures, among other financial measures, to evaluate our operating performance, which represent the manner in which we conduct and view our business. Management believes that excluding certain items that are not comparable from period to period helps investors and others compare operating performance between periods. While we consider the non-GAAP measures useful in analyzing our results, they are not intended to replace, or act as a substitute for, any presentation included in the consolidated financial statements prepared in conformity with U.S. GAAP. See Reconciliations of Non-GAAP Financial Measures beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

We operate on a global basis, with the majority of our net sales generated outside the United States. Accordingly, fluctuations in foreign currency exchange rates affect our results of operations. Therefore, we present certain net sales, operating results and diluted net earnings (loss) per common share information excluding the effect of foreign currency rate fluctuations to provide a framework for assessing the performance of our underlying business outside the United States. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We calculate constant currency information by translating current-period results using prior-year monthly average foreign currency exchange rates and adjusting for the period-over-period impact of foreign currency cash flow hedging activities.

Outlook

While we have seen improvements within our business, we are mindful of areas of volatility and uncertainty that may impact our results. We continue to face challenges in key markets in the West, including in some markets in Western Europe and the United States. T1Within our Asia travel retail business, we continue to experience a transitory headwind from the change of duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses. We are also monitoring the conflict in the Middle East as it relates to our business in the domestic markets and travel retail locations in the region. Net sales from locations impacted by the conflict in the Middle East accounted for approximately 2% of consolidated net sales in fiscal 2025.

We continue to monitor and assess the impact that these challenges may have on net sales and profitability, including impacts to our effective tax rate from changes to our geographical mix of earnings.

We are continuing to monitor and assess the potential effects of changing tariff conditions in the United States as well as in other markets in which we operate. These tariffs have led to significant volatility and uncertainty in global markets and difficulty in forecasting demand. We have implemented and are continuing to implement and consider additional mitigation measures. Our strategy remains optimizing our global supply chain network, by sourcing and manufacturing in the geography of sale where feasible. We also continue to leverage trade programs where available and monitor for additional opportunities as countries continue to update their trade programs. T2We continue to anticipate higher tariff rates to have an adverse effect on fiscal 2026 profitability and cash flows, and depending on actual rates and countries imposing tariffs such adverse impacts could be material.

On February 20, 2026, the U.S. Supreme Court ruled that the U.S. tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) on goods imported into the U.S. were unauthorized. The ruling did not address potential refunds, however on March 4, 2026, the U.S. Court of International Trade ordered U.S. Customs and Border Protection to begin refunding all tariffs imposed under IEEPA. As of March 31, 2026, despite the ruling by the U.S. Court of International Trade, there continues to be uncertainty as to the ultimate recovery of any funds as a result of a potential appeal of this ruling, as well as uncertainty associated with the process, timing and amount of any potential refunds. As such, we have determined that the totality of uncertainties prevents us from reasonably asserting the probability of refund recovery at this time.

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We continue to believe that the best way to increase long-term stockholder value is to provide superior products and services in the most efficient and effective manner while recognizing shifts in consumers’ behaviors and shopping practices. Accordingly, our long-term strategy has numerous initiatives across product categories, brands, geographic regions, channels of distribution and functions designed to grow our sales, provide cost efficiencies, leverage our strengths, such as our history of outstanding creativity and innovation, high quality products and services, and engaging communications, and make us more productive and profitable. Following the transition of leadership in the second and third quarters of fiscal 2025, we are executing against "Beauty Reimagined," our previously announced strategic vision which focuses on accelerating best-in-class consumer coverage, creating transformative innovation, boosting consumer-facing investments, fueling sustainable growth through bold efficiencies and reimagining the way we work, including through the expansion of the Profit Recovery and Growth Plan ("PRGP") during the fiscal 2025 third quarter, as discussed below.

We continue to monitor the effects of the global macro environment, including the risk of recession; currency volatility; inflationary pressures; supply chain challenges; social and political issues; competitive pressures; legal and regulatory matters, including the imposition of tariffs and sanctions; geopolitical tensions; and global security issues. We are also mindful of inflationary pressures (including those caused by tariffs) on our cost base and are monitoring the impact on consumer preferences, the impact of changes being made in the organization, including those related to Beauty Reimagined and the PRGP, as well as the potential impact of changes expected to be made as part of the PRGP on suppliers, retailers and others, and challenges relating to successfully outsourcing select services.

Declines in net sales and profitability have, and may continue to, adversely impact the goodwill and other intangible assets associated with our brands, as well as long-lived assets, potentially resulting in impairments.

In December 2021, the Organization for Economic Cooperation and Development issued "Pillar Two" Global Anti-Base Erosion model rules for countries to enact into domestic law that would establish a 15% global minimum tax applied on a country-by-country basis for multinational companies. We are continuing to monitor and evaluate the potential impact of incorporating the global minimum tax in additional countries that have yet to enact the legislation.

On July 4, 2025, new U.S tax legislation was enacted known as the "One Big Beautiful Bill Act". This legislation includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of certain business tax provisions. The legislation has multiple effective dates, and we are continuing to evaluate the potential impact of the provisions that are expected to be effective in future fiscal years.

Our ability to recognize deferred tax assets, inclusive of utilizing net operating loss carryforwards, tax credits, and other carryforwards is dependent on the generation of sufficient taxable income in future periods. Accordingly, there can be no assurance that additional valuation allowances on our deferred tax assets will not be required should our financial performance be negatively impacted in the future. Such valuation allowance could be material.

Restructuring Program Component of the Profit Recovery and Growth Plan

As announced on November 1, 2023, we launched the PRGP to help progressively rebuild our profit margins in fiscal years 2025 and 2026.

As a component of the PRGP, on February 5, 2024, we announced a two-year restructuring program. We committed to this course of action on February 1, 2024.

After reviewing additional potential initiatives and the progress of previously approved initiatives, on February 3, 2025, we committed to the expansion of the PRGP, including an expansion of the restructuring program.

The expanded component of the restructuring program began during our fiscal 2025 third quarter. The focus of the overall expanded restructuring program (collectively the “Restructuring Program”) includes (i) reorganization and rightsizing of certain areas, (ii) simplification and acceleration of processes, (iii) outsourcing of select services and (iv) evolution of go-to-market footprint and selling models, all to help rebuild operating margin and also fuel reinvestment in consumer-facing areas to drive sustainable sales growth. Specific initiatives under the Restructuring Program are expected to be approved by the end of fiscal 2026 and substantially completed by the end of fiscal 2027.

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In connection with the Restructuring Program, T3we now estimate a final net reduction in the range of approximately 9,000 to 10,000 positions globally, an increase from the previous range of 5,800 to 7,000. Over 70% of the increase is attributable to the reduction in point-of-sale demonstration roles at select unproductive doors in our department store and freestanding store channels, as we continue to evolve our focus towards high-growth channels. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

We now expect that the Restructuring Program will result in restructuring and other charges totaling between $1,500 million and $1,700 million, before taxes, an increase from the previous range of $1,200 million and $1,600 million, before taxes, consisting of employee-related costs, asset-related costs, contract terminations and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

T4Once fully implemented, we now expect the Restructuring Program to yield annual target gross benefits of between $1,000 million and $1,200 million, before taxes, an increase from the previous range of $800 million and $1,000 million, before taxes, a portion of which is expected to be reinvested in consumer-facing activities. The net benefits of the PRGP, which includes the Restructuring Program, are expected to enable a return to a double-digit operating margin over the next few years.

Further information about the Restructuring Program Component of the Profit Recovery and Growth Plan, is described in Notes to Consolidated Financial Statements, Note 3 – Charges Associated with Restructuring and Other Activities herein.

Securities Class Action Litigation Settlement

On December 7, 2023 and January 22, 2024, purported securities class action complaints were filed in the United States District Court for the Southern District of New York against the Company and its then Chief Executive Officer and Chief Financial Officer. The actions were consolidated on February 20, 2024. On March 22, 2024, plaintiffs filed a consolidated amended complaint alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on alleged materially false and misleading statements between February 3, 2022 and October 31, 2023. On March 31, 2025, the Court denied defendants’ motion to dismiss. On April 2, 2026, the parties reached an agreement in principle to settle the securities class action litigation.

T5In light of these discussions, we recorded a loss contingency of $84 million, net of the estimated probable insurance recoveries, in the consolidated statements of earnings (loss) relating to a potential settlement of the securities class action.

NET SALES

Three Months Ended

Nine Months Ended

($ in millions)

As Reported:

Net sales

$

$

$

$

$ Change from prior-year period

% Change from prior-year period

5

%

5

%

Non-GAAP Financial Measure(1):

% Change from prior-year period in constant currency

2

%

3

%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales increased across all product categories for the three and nine months ended March 31, 2026. The increase in net sales was primarily driven by fragrance, skin care and makeup for the three months ended March 31, 2026, and primarily driven by fragrance and skin care for the nine months ended March 31, 2026.

By geographic region, reported net sales increased across all geographic regions for the three and nine months ended March 31, 2026, with the exception of Asia/Pacific for the three months ended March 31, 2026, and The Americas for the nine months ended March 31, 2026, with each remaining virtually flat. The increase in net sales for the three and nine months ended March 31, 2026 was primarily driven by Mainland China and EUKEM.

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Reported net sales were impacted by approximately $101 million and $200 million of favorable foreign currency translation for the three and nine months ended March 31, 2026, respectively.

Reported net sales increased 5% for the three months ended March 31, 2026, driven by the favorable impact from foreign currency translation of 3%, the increase from volume of 1% and the increase from pricing of 1%, reflecting the favorable impact from strategic price actions, partially offset by changes in mix.

Reported net sales increased 5% for the nine months ended March 31, 2026, driven by the favorable impact from foreign currency translation of 2%, the increase from volume of 2% and the increase from pricing of 1%, reflecting the favorable impact from strategic price actions, partially offset by changes in mix.

Returns associated with restructuring and other activities are not allocated to our product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed a Company-wide initiative to redesign, resize and reorganize select areas of the business. Accordingly, the following discussions of Net sales by Product Categories and Geographic Regions exclude the impacts of return adjustments associated with restructuring and other activities of $1 million for the nine months ended March 31, 2026. There were no returns associated with restructuring and other activities for the three months ended March 31, 2026 and the three and nine months ended March 31, 2025.

Product Categories

Reported net sales for our product categories for the three and nine months ended March 31, 2026 and 2025 were as follows:

Three Months Ended March 31,

Nine Months Ended March 31,

($ in millions)

$ Change

% Change

% Change in Constant Currency(1)

$ Change

% Change

% Change in Constant Currency(1)

Skin Care

$

$

$

3

%

—

%

$

$

$

4

%

3

%

Makeup

4

—

1

(1)

Fragrance

Hair Care

2

2

—

1

—

—

Other

3

4

5

5

5

2

5

3

Returns associated with restructuring and other activities

—

—

—

—

—

1

—

1

Net sales

$

$

$

5

%

2

%

$

$

$

5

%

3

%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Skin Care

Reported skin care net sales increased $49 million, or 3% for the three months ended March 31, 2026, including the favorable impact of foreign currency translation of 3%. Including the favorable impact of foreign currency translation, the increase in skin care net sales was primarily driven by higher net sales from La Mer, reflecting the benefit from new product launches and growth from The Treatment Lotion franchise.

Reported skin care net sales increased $228 million, or 4% for the nine months ended March 31, 2026, reflecting higher net sales from La Mer, Estée Lauder and The Ordinary, combined, of approximately $301 million. Net sales from La Mer increased, reflecting growth in hero product franchises, as well as the benefit from new product launches. The increase in net sales from Estée Lauder reflected growth attributable to new product launches and key campaigns, benefitting from key shopping moments and holiday. Net sales from The Ordinary increased, primarily reflecting targeted expanded consumer reach.

Partially offsetting the increase in net sales for the nine months ended March 31, 2026 were lower net sales from Origins, reflecting our retail softness, including the impact of door and market closures.

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Skin care net sales were impacted by approximately $46 million and $80 million of favorable foreign currency translation for the three and nine months ended March 31, 2026, respectively.

Reported skin care net sales increased 3% for the three months ended March 31, 2026, driven by the increase from pricing of 4%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 3%, partially offset by the decrease from volume of 4%.

Reported skin care net sales increased 4% for the nine months ended March 31, 2026, driven by the increase from pricing of 3%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 2%. The impact from volume was flat period-over-period.

Makeup

Reported makeup net sales increased $37 million, or 4% for the three months ended March 31, 2026, including the favorable impact of foreign currency translation of 3%. Including the favorable impact of foreign currency translation, the increase in makeup net sales was primarily driven by higher net sales from Estée Lauder, reflecting the launch of its next-generation of Double Wear Stay-in-Place Longwear Matte Foundation during the fiscal 2026 third quarter.

Reported makeup net sales increased $43 million, or 1% for the nine months ended March 31, 2026, including the favorable impact of foreign currency translation of 2%. Including the favorable impact of foreign currency translation, the increase in makeup net sales was primarily driven by an increase in net sales from M·A·C, reflecting higher net sales in the lip subcategory, driven by the success of Lipglass Air, Lip Pencil and Powder Kiss Lipstick. Also contributing to the increase in M·A·C net sales were higher net sales from shipments to support the launch of the brand in select U.S. Sephora locations as well as online and in Sephora at Kohl's.

Makeup net sales were impacted by approximately $35 million and $71 million of favorable foreign currency translation for the three and nine months ended March 31, 2026, respectively.

Reported makeup net sales increased 4% for the three months ended March 31, 2026, driven by the increase from volume of 5% and the favorable impact from foreign currency translation of 3%. Partially offsetting these increases was the decrease from pricing of 5%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions.

Reported makeup net sales increased 1% for the nine months ended March 31, 2026, driven by the increase from volume of 3% and the favorable impact from foreign currency translation of 2%. Partially offsetting these increases was the decrease from pricing of 4%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions.

Fragrance

T6Reported fragrance net sales increased $71 million, or 13%, and $230 million, or 12%, for the three and nine months ended March 31, 2026, respectively, reflecting higher net sales from Le Labo, TOM FORD and Kilian Paris, combined, of approximately $51 million and $185 million, for the respective periods.

Le Labo net sales increased in both periods, led by the Classic Collection, reflecting growth from targeted expanded consumer reach and the benefit from new product launches. The net sales increase from TOM FORD in both periods reflected the benefit from new product launches which created halo benefits on existing products, with overall growth in both the Private Blend and Signature franchises. Net sales from Kilian Paris increased in both periods, driven by the Angels' Share and Love, don't be shy franchises including growth attributable to new product launches and key campaigns, as well as growth from targeted expanded consumer reach.

Fragrance net sales were impacted by approximately $18 million and $46 million of favorable foreign currency translation for the three and nine months ended March 31, 2026, respectively.

Reported fragrance net sales increased 13% for the three months ended March 31, 2026, driven by the increase from volume of 7%, the favorable impact from foreign currency translation of 3%, and the increase from pricing of 2%, reflecting the favorable impact from strategic pricing actions, partially offset by changes in mix.

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Reported fragrance net sales increased 12% for the nine months ended March 31, 2026, driven by the increase from volume of 5%, the increase from pricing of 4%, reflecting the favorable impact from strategic pricing actions and changes in mix, and the favorable impact from foreign currency translation of 2%.

Hair Care

Reported hair care net sales increased $2 million, or 2%, including the impact of foreign currency translation of 2%, for the three months ended March 31, 2026, and increased $1 million, or less than 1%, including the impact of foreign currency translation of 1%, for the nine months ended March 31, 2026. Including the favorable impact of foreign currency translation, the increase in hair care net sales in both periods was primarily driven by higher net sales from The Ordinary, reflecting the growth of the Multi-Peptide Serum for Hair Density and impacts from targeted expanded consumer reach.

Partially offsetting the hair care net sales increase for the nine months ended March 31, 2026 were lower net sales from Aveda, reflecting the brand’s strategies to improve long-term performance, including (i) planned reductions in online promotional activity and (ii) the exit from underperforming doors, including freestanding stores. These declines were partially offset by the impact from its launch in Amazon's U.S. Premium Beauty store during the fiscal 2025 fourth quarter.

Hair care net sales were impacted by approximately $2 million and $3 million of favorable foreign currency translation for the three and nine months ended March 31, 2026, respectively.

Reported hair care net sales increased 2% for the three months ended March 31, 2026, driven by the increase from pricing of 2%, reflecting the favorable impact from strategic pricing actions and changes in mix, and the favorable impact from foreign currency translation of 2%. These increases were partially offset by the decrease from volume of 2%.

Reported hair care net sales were virtually flat for the nine months ended March 31, 2026, driven by the increase from pricing of 6%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 1%. These increases were offset by the decrease from volume of 6%.

Geographic Regions

Reported net sales by geographic region for the three and nine months ended March 31, 2026 and 2025 were as follows:

Three Months Ended March 31,

Nine Months Ended March 31,

($ in millions)

$ Change

% Change

% Change in Constant Currency(2)

$ Change

% Change

% Change in Constant Currency(2)

The Americas

$

$

$

1

%

—

%

$

$

$

(1)

—

%

—

%

EUKEM

9

3

7

2

Asia/Pacific(1)

(3)

—

(1)

3

3

Mainland China

6

9

5

2

5

3

Returns associated with restructuring and other activities

—

—

—

—

—

1

—

1

Net sales

$

$

$

5

%

2

%

$

$

$

5

%

3

%

(1)The net sales from our travel retail business are included in the Asia/Pacific region.

(2)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales increased for the three months ended March 31, 2026, primarily driven by higher net sales in Mainland China and our Priority Emerging Markets, combined, of approximately $121 million. The increase in net sales in Mainland China reflected growth attributable to key shopping moments, including the benefits from key campaigns to drive sales and new product launches. Net sales in our Priority Emerging Markets within EUKEM and The Americas increased collectively, reflecting growth in all product categories, supported by targeted expanded consumer reach, successful campaigns and new product launches.

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Reported net sales increased for the nine months ended March 31, 2026, primarily driven by higher net sales in Mainland China and our Priority Emerging Markets, reflecting the aforementioned growth as discussed above, and higher net sales in our travel retail business, combined, of approximately $443 million. The increase in net sales in our travel retail business was driven by Asia travel retail, reflecting favorability attributable to the low prior-year period net sales base which reflected (i) the challenging retail environment, including low consumer sentiment and conversion from Chinese consumers, as well as (ii) our prior-year efforts to improve in-trade inventory levels. Also contributing to the growth in Asia travel retail was the favorable impact of higher traffic in certain areas of the business, including during key shopping moments, supported by key campaigns to drive growth.

These increases were partially offset by impacts associated with the transitory headwind from the change of duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses.

Reported net sales in The Americas increased 1% for the three months ended March 31, 2026, driven by the increase from volume of 4% and the favorable impact from foreign currency translation of 1%. These increases were partially offset by the decrease from pricing of 3%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions. Reported net sales in EUKEM increased 9% for the three months ended March 31, 2026, driven by the increase from volume of 7% and the favorable impact of foreign currency translation of 7%. These increases were partially offset by the decrease from pricing of 5%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions.

Reported net sales in Asia/Pacific were virtually flat for the three months ended March 31, 2026, driven by the decrease from volume of 4%, offset by the increase from pricing of 3%, reflecting the favorable impact from strategic pricing actions and changes in mix. Reported net sales in Mainland China increased 11% for the three months ended March 31, 2026, driven by an increase from pricing of 10%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 5%. These increases were partially offset by the decrease from volume of 4%.

Reported net sales in The Americas were virtually flat for the nine months ended March 31, 2026, driven by the decrease from pricing of 2%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions. This decrease was offset by the increase from volume of 2%. Reported net sales in EUKEM increased 7% for the nine months ended March 31, 2026, driven by the favorable impact of foreign currency translation of 6% and the increase from volume of 4%. These increases were partially offset by the decrease from pricing of 2%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions.

Reported net sales in Asia/Pacific increased 3% for the nine months ended March 31, 2026, driven by an increase from pricing of 6%, reflecting changes in mix and the favorable impact from strategic pricing actions, partially offset by the decrease from volume of 3%. Reported net sales in Mainland China increased 11% for the nine months ended March 31, 2026, driven by the increase from pricing of 6%, reflecting changes in mix and the favorable impact from strategic pricing actions, the increase from volume of 3% and the favorable impact from foreign currency translation of 2%.

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GROSS MARGIN

T7Gross margin increased to 76.4% and 75.5% for the three and nine months ended March 31, 2026, as compared with 75.0% and 74.6% in the prior-year periods.

Favorable (Unfavorable) Basis Points

Three Months Ended

Nine Months Ended

As Reported:

Mix of business

Obsolescence charges

Manufacturing costs and other

Foreign exchange transactions

Charges associated with restructuring and other activities

—

As Reported Gross Margin Basis Point Variance

Non-GAAP Financial Measure Adjustments

Charges associated with restructuring and other activities

—

Non-GAAP Gross Margin Basis Point Variance

The increase in gross margin for the three and nine months ended March 31, 2026 reflected net benefits from the PRGP, including reductions in excess inventory, accretive new product launches and lower promotional activity in both periods, as well as the favorable impact of cost efficiencies within our global supply chain network, primarily in the nine months ended March 31, 2026. Additionally, in both periods, favorability in manufacturing costs and other benefited from the year-over-year favorable impact of the recognition of manufacturing variances associated with reduced manufacturing volumes on our standard cost within cost of sales in the fiscal 2025 third quarter, with offsets to overall favorability driven by the impact of tariffs and inflation on our costs.

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OPERATING EXPENSES

Operating expenses as a percentage of net sales were 69.7% and 68.3% for the three and nine months ended March 31, 2026, as compared with 66.3% and 78.2% in the prior-year periods.

Favorable (Unfavorable) Basis Points

Three Months Ended

Nine Months Ended

As Reported:

General and administrative expenses

Advertising, marketing, promotion and product development

Selling

Shipping

Store operating costs

—

Stock-based compensation

Foreign exchange transactions

Charges associated with restructuring and other activities

Securities class action litigation settlement

Impairment of goodwill and other intangible assets

—

Talcum litigation settlement agreements

—

As Reported Operating Expense Margin Basis Point Variance

Non-GAAP Financial Measure Adjustments:

Impact of restructuring and other activities

Securities class action litigation settlement

Impairment of goodwill and other intangible assets

—

Talcum litigation settlement agreements

—

Non-GAAP Operating Expense Margin Basis Point Variance

The increase in our operating expense margin for the three months ended March 31, 2026 reflected the year-over-year unfavorable impact of restructuring and other activities and the securities class action litigation settlement. Partially offsetting these increases was favorability reflecting the impact of the increase in net sales, as well as the favorable year-over-year impact within general and administrative expenses associated with the timing of recognition of local government subsidies in China in the fiscal 2026 third quarter. Additionally, we increased investments in consumer-facing areas of the business to drive sales, including selling, advertising, store operating costs and promotion expenses, offsetting a portion of the favorability from the increase in net sales.

The favorability in our operating expense margin for the nine months ended March 31, 2026 reflected the impact of the increase in net sales, as well as the favorable year-over-year impact within general and administrative expenses associated with the timing of recognition of local government subsidies in China in the fiscal 2026 third quarter, with additional favorability associated with the impact of the change in policy related to local government subsidies in China that impacted the fiscal 2025 second quarter. Also contributing to the overall favorability were lower expenses within non-consumer facing areas of the business collectively, including lower employee-related costs realized through initiatives as part of the PRGP, with these benefits partially offset by higher employee incentive costs.

Partially offsetting the overall favorability in our operating expense margin, including the benefit from the increase in net sales, were increased investments in consumer-facing areas of the business to drive sales, including advertising, selling, store operating costs and promotion expenses.

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THE ESTÉE LAUDER COMPANIES INC.

OPERATING RESULTS

Three Months Ended

Nine Months Ended

($ in millions)

As Reported:

Operating income (loss)

$

$

$

$

$ Change from prior-year period

% Change from prior-year period

%

Operating margin

%

%

%

%

Non-GAAP Financial Measure(1):

% Change in operating income (loss) from the prior-year period adjusting for the impact of charges associated with restructuring and other activities, the securities class action litigation settlement, impairment of goodwill and other intangible assets and talcum litigation settlement agreements

%

%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

The decrease in reported operating margin for the three months ended March 31, 2026 reflected the unfavorable operating expense margin, which includes the unfavorable impacts from restructuring and other activities and the securities class action litigation settlement. Partially offsetting the increased operating expense margin was the increase in net sales and increase in gross margin, as discussed above.

The increase in reported operating margin for the nine months ended March 31, 2026 was driven by the favorable operating expense margin, which includes the favorable year-over-year impact of the goodwill and other intangible asset impairment charges in the fiscal 2025 second quarter of $861 million, as well as the increase in net sales and increase in gross margin, as discussed above.

Charges associated with restructuring and other activities are not allocated to our product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed a Company-wide initiative to redesign, resize and reorganize select areas of the business. Accordingly, the following discussions of Operating income (loss) by Product Categories and Geographic Regions exclude the impact of charges associated with restructuring and other activities for the three months ended March 31, 2026 and 2025 of $224 million and $97 million, respectively, and for the nine months ended March 31, 2026 and 2025 of $517 million and $384 million, respectively.

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THE ESTÉE LAUDER COMPANIES INC.

Product Categories

Reported Operating income (loss) for our product categories for the three and nine months ended March 31, 2026 and 2025 were as follows:

Three Months Ended March 31,

($ in millions)

$ Change

% Change

(As reported)

% Change

(Non-GAAP)(1)

Non-GAAP Financial Measure(1)

Skin Care

$

$

$

%

%

Adjusted for the impact of the securities class action litigation settlement

Makeup

(3)

Adjusted for the impact of the securities class action litigation settlement

Fragrance

6

Adjusted for the impact of the securities class action litigation settlement

Hair Care

(5)

8

Adjusted for the impact of the securities class action litigation settlement

Other

9

7

%

Charges associated with restructuring and other activities

Operating income

$

$

$

%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Nine Months Ended March 31,

($ in millions)

$ Change

% Change

(As reported)

% Change

(Non-GAAP)(1)

Non-GAAP Financial Measure(1)

Skin Care

$

$

$

%

%

Adjusted for the impact of the securities class action litigation settlement

Makeup

—

—

Adjusted for the impact of the securities class action litigation settlement, impairment of goodwill and other intangible assets and talcum litigation settlement agreements

Fragrance

Adjusted for the impact of the securities class action litigation settlement and other intangible asset impairments

Hair Care

1

Adjusted for the impact of the securities class action litigation settlement

Other

Adjusted for the impact of other intangible asset impairments

%

Charges associated with restructuring and other activities

Operating income (loss)

$

$

$

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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THE ESTÉE LAUDER COMPANIES INC.

Skin Care

Reported skin care operating income increased $83 million, or 23%, and $301 million, or 38%, for the three and nine months ended March 31, 2026, respectively, reflecting an increase in net sales. Also contributing to the increase for the nine months ended March 31, 2026 was lower non-consumer-facing expenses, including the reduction in employee-related costs realized through initiatives as part of the PRGP, partially offset by higher employee incentive costs. In both periods, the increase in operating income was partially offset by an increase in investments in consumer-facing areas of the business, including to support key campaigns, new product launches and targeted expanded consumer reach.

Makeup

Reported makeup operating results decreased $17 million, or over 100%, for the three months ended March 31, 2026, reflecting an increase in investments in consumer-facing areas of the business, including to support new product launches and key campaigns, as well as the unfavorable allocated impact of the securities class action litigation settlement. Largely offsetting the decrease in operating results was an increase in net sales and lower cost of sales.

Reported makeup operating results increased $382 million, or 100%, for the nine months ended March 31, 2026, reflecting the favorable year-over-year impacts of other intangible asset impairment charges in the prior-year period relating to TOM FORD and Too Faced, combined, of $245 million and a goodwill impairment charge relating to Too Faced of $13 million, as well as the favorable year-over-year impact of the charge in the fiscal 2025 first quarter associated with the talcum litigation settlement agreements of $159 million. Partially offsetting the increase in operating results was an increase in investments in consumer-facing areas of the business, including to support new product launches and key campaigns.

Fragrance

Reported fragrance operating income decreased $11 million, or 34%, for the three months ended March 31, 2026, reflecting an increase in investments in consumer-facing areas of the business, including to support key campaigns, new product launches and targeted expanded consumer reach, an increase in cost of sales, as well as the unfavorable allocated impact of the securities class action litigation settlement, partially offset by an increase in net sales.

Reported fragrance operating results increased $566 million, or over 100%, for the nine months ended March 31, 2026, reflecting the favorable year-over-year impact of the other intangible asset impairment charge in the prior-year period of $549 million relating to TOM FORD and an increase in net sales, partially offset by an increase in investments in consumer-facing areas of the business, including to support key campaigns, new product launches and targeted expanded consumer reach.

Hair Care

Reported hair care operating results increased $8 million, or 62%, for the three months ended March 31, 2026, reflecting lower operating expenses, as well as an increase in net sales. These increases to operating results were partially offset by the unfavorable allocated impact of the securities class action litigation settlement.

Reported hair care operating results increased $35 million, or over 100%, for the nine months ended March 31, 2026, reflecting lower non-consumer-facing expenses, including the reduction in employee-related costs realized through initiatives as part of the PRGP, lower consumer-facing investments and lower cost of sales. These increases to operating results were partially offset by the unfavorable allocated impact of the securities class action litigation settlement.

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THE ESTÉE LAUDER COMPANIES INC.

Geographic Regions

Three Months Ended March 31,

($ in millions)

$ Change

% Change

(As Reported)

% Change

(Non-GAAP)(1)

Non-GAAP Financial Measure(2)

The Americas

$

$

$

%

%

Adjusted for the impact of the securities class action litigation settlement

EUKEM

4

Asia/Pacific(2)

Mainland China

%

Charges associated with restructuring and other activities

Operating income

$

$

$

%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

(2)The operating results from our travel retail business are included in the Asia/Pacific region.

Nine Months Ended March 31,

($ in millions)

$ Change

% Change

(As Reported)

% Change

(Non-GAAP)(1)

Non-GAAP Financial Measure(1)

The Americas

$

$

$

%

Adjusted for the impact of the securities class action litigation settlement, impairment of goodwill and other intangible assets and talcum litigation settlement agreements

EUKEM

6

6

Asia/Pacific(2)

Mainland China

%

Charges associated with restructuring and other activities

Operating income (loss)

$

$

$

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 57 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

(2)The operating results from our travel retail business are included in the Asia/Pacific region.

Reported operating income in The Americas decreased $46 million, or 69%, for the three months ended March 31, 2026, reflecting the unfavorable impact of the securities class action litigation settlement charge in the fiscal 2026 third quarter. Partially offsetting the lower operating income were lower non-consumer-facing expenses, due in part to the reduction in employee-related costs realized through initiatives as part of the PRGP, despite higher employee incentive costs, and higher net sales.

Reported operating results in The Americas increased $1,001 million, or over 100%, for the nine months ended March 31, 2026, reflecting the favorable year-over-year impacts of other intangible asset impairment charges in the prior-year periods relating to TOM FORD and Too Faced, combined, of $848 million and a goodwill impairment charge relating to Too Faced of $13 million, as well as the favorable year-over-year impact of the charge in the fiscal 2025 first quarter associated with the talcum litigation settlement agreements of $159 million. Partially offsetting the increase in operating results is the unfavorable impact of the securities class action litigation settlement charge in the fiscal 2026 third quarter.

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THE ESTÉE LAUDER COMPANIES INC.

Reported operating income in EUKEM increased $4 million, or 14%, and $11 million, or 6%, for the three and nine months ended March 31, 2026, respectively. Included in the nine months ended March 31, 2026 is the favorable impact of foreign currency translation of 6%. The increase in operating income for both periods reflected higher net sales, partially offset by an increase in non-consumer-facing expenses, due in part to higher employee incentive costs, an increase in investments in consumer-facing areas of the business, including to support targeted expanded consumer reach, key campaigns and new product launches, and higher cost of sales.

Reported operating income in Asia/Pacific increased $29 million, or 13%, and $151 million, or 33%, for the three and nine months ended March 31, 2026, respectively. For the three months ended March 31, 2026, reported operating income increased, reflecting lower cost of sales and lower non-consumer-facing expenses, due in part to the reduction in employee-related costs realized through initiatives as part of the PRGP, despite higher employee incentive costs. These increases in operating income were partially offset by an increase in investments in consumer-facing areas of the business, including to support key campaigns. For the nine months ended March 31, 2026, reported operating income increased, reflecting higher net sales and lower non-consumer-facing expenses, due in part to the reduction in employee-related costs realized through initiatives as part of the PRGP, partially offset by higher employee incentive costs.

Reported operating income in Mainland China increased $83 million, or over 100%, and $184 million, or over 100%, for the three and nine months ended March 31, 2026, respectively, reflecting higher net sales, as well as the favorable year-over-year timing of recognition of local government subsidies in the fiscal 2026 third quarter, with additional favorability for the nine months ended March 31, 2026 associated with the impact of the change in policy related to local government subsidies that impacted the fiscal 2025 second quarter. Partially offsetting the increase in operating income in both periods was an increase in investments in consumer-facing areas of the business, including to support key campaigns, new product launches and targeted expanded consumer reach.

INTEREST AND INVESTMENT INCOME

Three Months Ended

Nine Months Ended

(In millions)

Interest expense

$

$

$

$

Interest income and investment income, net

$

$

$

$

Interest expense decreased for the three and nine months ended March 31, 2026, primarily reflecting a lower average debt balance compared to the prior-year periods, with commercial paper outstanding during the fiscal 2025 third quarter. Interest income and investment income, net decreased for the three months ended March 31, 2026, primarily driven by the impact of the impairment of a cost method minority investment. Interest income and investment income, net decreased for the nine months ended March 31, 2026, primarily driven by a lower average cash balance compared to the prior-year period, as well as the impact of the impairment of a cost method minority investment, partially offset by the favorable year-over-year impact of cost method minority investment activity.

PROVISION FOR INCOME TAXES

The provision or benefit for income taxes represents U.S. federal, foreign, state and local income taxes. The effective rate differs from the federal statutory rate primarily due to the effect of state and local income taxes, the tax impact of stock-based compensation, the taxation of foreign income and income tax reserve adjustments, which represent changes in our net liability for unrecognized tax benefits including tax settlements and lapses of the applicable statutes of limitations, as well as changes to valuation allowances based on our assessment of the realizability of deferred tax assets. Our effective tax rate will change from quarter-to-quarter based on recurring and non-recurring factors including the geographical mix of earnings, enacted tax legislation, state and local income taxes, tax reserve adjustments, the tax impact of stock-based compensation, changes to valuation allowances, the interaction of various global tax strategies and the impact from certain acquisitions.

In addition, changes in judgment from the evaluation of new information resulting in the recognition, derecognition or remeasurement of a tax position taken in a prior annual period are recognized separately in the quarter of change.

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THE ESTÉE LAUDER COMPANIES INC.

Three Months Ended

Nine Months Ended

Effective rate for income taxes

%

%

%

%

Basis-point change from the prior-year period

For the three months ended March 31, 2026, the increase in effective tax rate was primarily attributable to the estimated unfavorable impact of the One Big Beautiful Bill Act, resulting from an increase in tax deductible interest expense which reduced U.S. taxable income and increased the excess foreign tax credits generated which require a valuation allowance.

For the nine months ended March 31, 2026, the increase in effective tax rate was primarily attributable to the loss before income taxes, the impact of the discrete treatment of charges associated with restructuring and other activities, the impairment of goodwill and other intangible assets, and the charge associated with the talcum litigation settlement agreements, each during the nine months ended March 31, 2025. Further contributing to the increase in the effective tax rate was the estimated unfavorable impact of the One Big Beautiful Bill Act, resulting from an increase in tax deductible interest expense which reduced U.S. taxable income and increased the excess foreign tax credits generated which require a valuation allowance, a higher effective tax rate on our foreign operations due to an unfavorable impact associated with the establishment of valuation allowances against certain net deferred tax assets, partially offset by the year-over-year favorable impact associated with previously issued stock-based compensation.

NET EARNINGS (LOSS)

Three Months Ended

Nine Months Ended

($ in millions, except per share data)

As Reported:

Net earnings (loss)

$

$

$

$

$ Change from prior-year period

% Change from prior-year period

%

Diluted net earnings (loss) per common share

$

$

$

$

% Change from prior-year period

%

Non-GAAP Financial Measure(1):

% Change in diluted net earnings (loss) per common share from the prior-year period adjusting for the impact of charges associated with restructuring and other activities, the securities class action litigation settlement, impairment of goodwill and other intangible assets and talcum litigation settlement agreements

%

%

(1)See “Reconciliations of Non-GAAP Financial Measures” below for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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THE ESTÉE LAUDER COMPANIES INC.

RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES

We use certain non-GAAP financial measures, among other financial measures, to evaluate our operating performance, which represent the manner in which we conduct and view our business. Management believes that excluding certain items that are not comparable from period to period, or do not reflect the Company’s underlying ongoing business, provides transparency for such items and helps investors and others compare and analyze our operating performance from period to period. In the future, we expect to incur charges or adjustments similar in nature to those presented below; however, the impact to the Company’s results in a given period may be highly variable and difficult to predict. Our non-GAAP financial measures may not be comparable to similarly titled measures used by, or determined in a manner consistent with, other companies.

While we consider the non-GAAP measures useful in analyzing our results, they are not intended to replace, or act as a substitute for, any presentation included in the consolidated financial statements prepared in conformity with U.S. GAAP. The following tables present Net sales, Operating income (loss) and Diluted net earnings (loss) per common share adjusted to exclude the impact of charges associated with restructuring and other activities; the securities class action litigation settlement; impairment of goodwill and other intangible assets; talcum litigation settlement agreements; and the effects of foreign currency translation.

The following tables provide reconciliations between these non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

($ in millions, except per share data)

Three Months Ended March 31,

Variance

% Change

% Change in

constant currency

Net sales, as reported

$

$

$

5

%

2

%

Returns associated with restructuring and other activities

—

—

—

Net sales, as adjusted

$

$

$

5

%

2

%

Operating income, as reported

$

$

$

%

%

Charges associated with restructuring and other activities

Securities class action litigation settlement

—

Operating income, as adjusted

$

$

$

%

%

Diluted net earnings per common share, as reported

$

$

$

%

%

Charges associated with restructuring and other activities

Securities class action litigation settlement

—

Diluted net earnings per common share, as adjusted

$

$

$

%

%

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THE ESTÉE LAUDER COMPANIES INC.

($ in millions, except per share data)

Nine Months Ended

Variance

% Change

% Change in

constant currency

Net sales, as reported

$

$

$

5

%

3

%

Returns associated with restructuring and other activities

1

—

1

Net sales, as adjusted

$

$

$

5

%

3

%

Operating income (loss), as reported

$

$

$

Charges associated with restructuring and other activities

Securities class action litigation settlement

—

Impairment of goodwill and other intangible assets

—

Talcum litigation settlement agreements

—

Operating income, as adjusted

$

$

$

%

%

Diluted net earnings (loss) per common share, as reported

$

$

$

Charges associated with restructuring and other activities

Securities class action litigation settlement

—

Impairment of goodwill and other intangible assets

—

Talcum litigation settlement agreements

—

Diluted net earnings per common share, as adjusted

$

$

$

%

%

As diluted net earnings per common share, as adjusted, is used as a measure of the Company’s performance, we consider the impact of current and deferred income taxes when calculating the per-share impact of each of the reconciling items.

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THE ESTÉE LAUDER COMPANIES INC.

The following tables reconcile the change in net sales by product category and geographic region, as reported, to the change in net sales excluding the effects of foreign currency translation:

As Reported

Impact of foreign

currency translation

Variance,

in constant currency

% Change,

as reported

% Change,

in constant currency

Three Months Ended March 31,

($ in millions)

Variance

By Product Category:

Skin Care

$

$

$

$

$

3

3

%

—

%

Makeup

2

4

—

Fragrance

Hair Care

2

(2)

—

2

—

Other

3

—

3

5

2

Returns associated with restructuring and other activities

—

—

—

—

—

Total

$

$

$

$

$

5

%

2

%

By Geographic Region:

The Americas

$

$

$

$

(9)

$

4

1

%

—

%

EUKEM

9

3

Asia/Pacific

(3)

(3)

(6)

—

(1)

Mainland China

6

5

2

Returns associated with restructuring and other activities

—

—

—

—

—

Total

$

$

$

$

$

5

%

2

%

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THE ESTÉE LAUDER COMPANIES INC.

As Reported

Impact of foreign

currency translation

Variance,

in constant currency

% Change,

as reported

% Change,

in constant currency

Nine Months Ended

($ in millions)

Variance

By Product Category:

Skin Care

$

$

$

$

$

4

%

3

%

Makeup

1

(1)

Fragrance

Hair Care

1

(3)

(2)

—

—

Other

4

—

4

5

5

5

3

Returns associated with restructuring and other activities

1

—

1

—

1

Total

$

$

$

$

$

5

%

3

%

By Geographic Region:

The Americas

$

$

$

(1)

$

(9)

$

—

%

—

%

EUKEM

7

2

Asia/Pacific

6

3

3

Mainland China

9

5

3

Returns associated with restructuring and other activities

1

—

1

—

1

Total

$

$

$

$

$

5

%

3

%

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THE ESTÉE LAUDER COMPANIES INC.

The following tables reconcile the change in operating results by product category and geographic region, as reported, to the change in operating results excluding the impact of the securities class action litigation settlement for the three and nine months ended March 31, 2026, as well as the impairment of goodwill and other intangible assets and talcum litigation settlement agreements for the nine months ended March 31, 2026:

As Reported

Add:

Securities class action

litigation settlement

Variance, as adjusted

% Change, as reported

% Change, as adjusted

Three Months Ended March 31,

($ in millions)

Variance

By Product Category:

Skin Care

$

$

$

$

$

%

%

Makeup

(3)

Fragrance

2

6

Hair Care

(5)

8

9

Other

9

7

—

7

$

$

%

%

Charges associated with restructuring and other activities

Total

$

$

$

By Geographic Region:

The Americas

$

$

$

$

$

%

%

EUKEM

4

—

4

Asia/Pacific

—

Mainland China

—

$

$

%

%

Charges associated with restructuring and other activities

Total

$

$

$

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THE ESTÉE LAUDER COMPANIES INC.

As Reported