Estee Lauder Eyes Weak Annual Results on Slow Recovery in Asia Travel Retail 

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, Aug. 19, 2019. (Reuters)
An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, Aug. 19, 2019. (Reuters)
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Estee Lauder Eyes Weak Annual Results on Slow Recovery in Asia Travel Retail 

An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, Aug. 19, 2019. (Reuters)
An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, Aug. 19, 2019. (Reuters)

Estee Lauder on Wednesday cut its annual profit forecast and said it expects a drop in annual sales, as the MAC lipstick maker struggles with a slower-than-anticipated recovery in its Asia travel retail business. Shares of the New York-based company were down about 15% in premarket trading.

Major global companies including European peer L’Oreal have flagged ongoing challenges to their travel retail businesses in Asia, particularly China, as the world's second-largest economy struggles to revive domestic demand post-pandemic.

Last quarter, Estee had said the recovery in Asia travel retail - sales made at airports or travel destinations like Korea and China's Hainan - has been under pressure with retail sales trends turning negative in May and June.

Estee makes about 36% of its annual revenue from the Asia Pacific region.

The company now expects full-year 2024 adjusted profit per share between $2.17 and $2.42, compared with its prior forecast of $3.50 to $3.75.

Estee now expects full-year 2024 sales to decrease 2% to an increase of 1%, compared with the previous forecast of an increase between 5% and 7%.



Gucci Parts Ways with Design Chief De Sarno

FILE - Sabato De Sarno, creative director of Gucci, accepts applause after the Gucci Spring Summer 2025 collection, that was presented in Milan, Italy, Sept. 20, 2024. (AP Photo/Luca Bruno, File)
FILE - Sabato De Sarno, creative director of Gucci, accepts applause after the Gucci Spring Summer 2025 collection, that was presented in Milan, Italy, Sept. 20, 2024. (AP Photo/Luca Bruno, File)
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Gucci Parts Ways with Design Chief De Sarno

FILE - Sabato De Sarno, creative director of Gucci, accepts applause after the Gucci Spring Summer 2025 collection, that was presented in Milan, Italy, Sept. 20, 2024. (AP Photo/Luca Bruno, File)
FILE - Sabato De Sarno, creative director of Gucci, accepts applause after the Gucci Spring Summer 2025 collection, that was presented in Milan, Italy, Sept. 20, 2024. (AP Photo/Luca Bruno, File)

Gucci-owner Kering said on Thursday its creative director Sabato de Sarno would leave the Italian flagship label after less than two years in the job, the latest high-profile designer change as the luxury industry grapples with a slowdown.
De Sarno took over as Gucci's design chief in 2023, succeeding Alessandro Michele, one of the towering figures of the fashion industry whose exuberant and playful designs had defined the brand for seven years.
A new artistic director will be announced in due course, Kering said. Its shares were down almost 3% in early trade, underperforming industry peers.
Revenues at Gucci, which account for about half of the group's total, were down 25% in the third quarter, dragging down Kering's performance. The company's share price has fallen by roughly a third over the past 12 months.
"I think the writing was on the wall. The demure style of Sabato De Sarno didn't fit the exuberant image that consumers have built of Gucci in the past 30 years," Bernstein analyst Luca Solca said.
Kering has been managing a broad overhaul of the century-old Italian fashion house, rebuilding top executive teams. Kering is due to report financial results next Tuesday.