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Estee Lauder Cuts Annual Forecasts as China Curbs Drag Demand

Estee Lauder Cuts Annual Forecasts as China Curbs Drag Demand

Wednesday, 2 November, 2022 - 11:00
An Estee Lauder cosmetics counter is seen in Los Angeles, California, US, August 19, 2019. (Reuters)

Estee Lauder Cos Inc cut its full-year sales and profit forecasts on Wednesday, signaling a hit to sales from persistent COVID-19-related lockdowns and store closures in major market China.

The New York-based company's shares were down about 5% in premarket trade.

Sales growth of many US companies like Estee has been impacted in China that has been reeling under the zero-COVID policy to fight rising infections.

The subsequent restrictions have resulted in reduced traffic in stores and temporarily curtailed distribution capacity in the region.

Estee generated about 31% of its sales from Asia-Pacific region in the fiscal 2022, according to a regulatory filing.

The company expects full-year 2023 net sales to decrease between 6% and 8%, compared with the prior forecast of a 3% to 5% growth.

The company expects full-year 2023 adjusted profit per share to decrease between 19% and 21%, compared with the previous forecast of a 5% to 7% growth.

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