L'Oreal's Sales Growth Picked Up, Fueled by Improvement in Key Markets — Update

By Andrea Figueras

French beauty giant L'Oreal posted higher sales for the third quarter as both its consumer and higher-end lineups of products continued to attract clients, while the company also noted improvements in the U.S. and China.

The cosmetics group--which owns brands including Kerastase, CeraVe and Maybelline New York--logged quarterly sales of 10.33 billion euros ($12.03 billion), 4.2% higher from a year earlier on a like-for-like basis. Growth showed an acceleration compared with the second quarter, when the group recorded a 2.4% increase in sales, excluding currency fluctuations.

The company's consumer products division booked 3.8% growth in sales on a like-for-like basis to 3.76 billion euros, accounting for the lion's share of its top line. The more premium Luxe division, which houses fragrance brands, reported a 2.5% rise in quarterly sales on a like-for-like basis to 3.72 billion euros.

The group posted an uptick in sales growth, as promised, but the magnitude of the improvement was underwhelming, analysts at RBC Capital Markets wrote in a note. The overall result also fell short of analysts' estimates, which anticipated quarterly sales of 10.45 billion euros, according to a Visible Alpha poll of estimates.

Despite this, Chief Executive Nicolas Hieronimus said the company's progress was broad-based and that the recovery in its two largest markets, the U.S. and China, continued.

Sales in North Asia grew 4.7% on a like-for-like basis in the quarter. The region includes China, a country where beauty names have been facing soft demand due to the country's macroeconomic woes and rising competition from local players. Meanwhile, L'Oreal recorded a 1.4% sales increase in North America despite President Trump's tariffs.

"As we head into the last quarter of the year, I am confident that we will continue to outperform the global beauty market," the CEO said, noting that the group continues to target another year of sales growth and an increase in profitability.

The results come just days after L'Oreal agreed to buy Gucci-owner Kering's beauty unit. "This partnership will further solidify our position as the world's leading luxury beauty company," Hieronimus said.

The deal is in line with L'Oreal's recent acquisition spree which has been particularly skewed toward luxury brands and licenses and, within this, the fragrance category, analysts at UBS wrote in a note prior to results. The group is further strengthening its foothold in prestige fragrances, a category that has been the company's growth engine over the past few years, they added.

L'Oreal's CEO highlighted the growth opportunities with the acquisition of Creed as well as the potential for the beauty and fragrance licenses of Gucci, Bottega Veneta and Balenciaga.

Analysts at Morgan Stanley said the transaction gives L'Oreal a new set of labels at a time when the industry relies on newness to stimulate the consumer. "We expect acquisitions to play an increasingly important role for the beauty incumbents in the battle for market share," the analysts said in a note.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

October 21, 2025 13:15 ET (17:15 GMT)