Estée Lauder, the New-York headquartered cosmetics company, has announced workforce reduction. As part of this restructuring, the company anticipates a net reduction of approximately three to five per cent of its workforce by 30 June, 2024.
As of June 2023, Estee Lauder had approximately 62,000 employees, globally.
The decision comes as a part of an extension of its Profit Recovery Plan for fiscal years 2025 and 2026, impacted by a decrease in demand from Chinese customers for higher-priced luxury items.
Additionally, the company believes that this move will strategically position it for long-term sustainability and profitability. It is hoped that the plan will facilitate sales growth and enhance overall agility and speed-to-market.
Estee Lauder anticipates achieving incremental operating profits ranging from $1.1 billion to $1.4 billion in fiscal years 2025 and 2026, surpassing the previously estimated $800 million to $1 billion. The company anticipates potential charges before taxes in the range of $500 million to $700 million.
Simultaneously, the company revised its annual profit forecast for the second time due to a slowdown in its US business. The company now expects a full-year 2024 adjusted profit per share between $2.08 and $2.23, down from the earlier projection of $2.17 to $2.42.
Estée Lauder, founded in 1946 by Estée and Joseph Lauder, is a renowned American multinational cosmetics company. It offers a wide range of skincare, makeup, fragrance, and hair- care products.
The company’s iconic brands include Estée Lauder, Clinique, MAC and Bobbi Brown, among others. Embracing a customer-centric approach, the company has a strong presence in high-end department stores and also operates its standalone boutiques.
