Business Recorder
NEW YORK: Estée Lauder on Friday raised its annual profit forecast and said it would cut up to 3,000 more jobs globally as it accelerates a broader restructuring, sending its shares up about 7% in early trading. The Clinique and M.A.C owner, which is in talks to merge with Jean Paul Gaultier-owner Puig, said it now expects total job cuts of 9,000 to 10,000, up from a prior estimate of as many as 7,000, and aims to save as much as $1.2 billion in annual costs. At the upper end, the new target would amount to about 17.5% of its global workforce of 57,000 as of June 30, 2025, according to Estée’s latest annual filing. “The increase in planned job cuts could be an indication that in light of merger plans, Estée Lauder will be able to shed more positions on its side while retaining Puig employees,” eMarketer analyst Sky Canaves said. More than 70% of the additional cuts will come from reductions in department store roles, the company said, as it shifts focus towards faster-growing digital and specialty retail channels such as Ulta, Sephora, Amazon and TikTok Shop. Estée’s push into premium launches and efforts to streamline its supply chain under CEO Stephane de La Faverie’s “Beauty Reimagined” strategy helped lift quarterly sales in luxury markets, including China and Europe. To bolster its fragrances business amid sluggish US consumer spending, Estée has been exploring a merger with Puig. Luxury brands have also been hit in Dubai and Abu Dhabi by the impact of the Iran war, which has disrupted the sector’s fastest-growing market. French luxury group LVMH said in April that the Iran war cut at least 1% off group sales in the last quarter. Puig said this week that the conflict was hurting demand, but kept its full-year outlook unchanged.
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