Connected media – Related media
Fabrizio Freda, President and CEO of Estee Lauder, is set to retire, marking the end of an impactful era for the cosmetics giant.
Estee Lauder has projected its annual profits and sales to fall below expectations, as the global beauty industry faces a dip in demand, particularly in China. The announcement comes alongside news that CEO Fabrizio Freda, who has been at the company’s helm since 2009, will step down on June 30, 2025, concluding nearly 16 years of leadership.
During his tenure, Freda, aged 66, has significantly expanded Estee Lauder’s skincare line, incorporating popular brands such as Dr. Jart and Deciem, owner of The Ordinary. He also navigated the company through significant challenges, including supply chain disruptions during the pandemic, necessitating price increases and a restructuring initiative that led to layoffs last year.
The company’s stock price has seen a sharp decline, dropping 3.6% to $91.56 in premarket trading and plummeting nearly 75% from its peak of $374.20 in January 2022. This downturn reflects the ongoing impact of sustained inflation and persistent market weaknesses in China.
This leadership transition follows closely on the heels of the resignation of Chief Financial Officer Tracey Travis after a 12-year stint. Estee Lauder’s board is currently reviewing both internal and external candidates to find Freda’s successor.
For the fiscal year 2025, Estee Lauder anticipates a possible sales decrease of up to 1% or a modest increase of 2%, starkly contrasting with analysts’ expectations of a 6.4% growth based on LSEG data. Additionally, the company expects adjusted earnings per share to range between $2.75 and $2.95, significantly lower than the anticipated $3.96 by analysts.
The outlook is bleak for the luxury goods sector, including traditionally “recession-proof” items like lipsticks and perfumes. Estee Lauder predicts ongoing declines in the premium beauty market segment in China.
This situation mirrors the experiences of European competitors like L’Oreal, which has also reported slower-than-expected growth in the global beauty market, emphasizing the sustained lack of rebound in the Chinese sector.
Related media – Linked media
