In the Fall of 2024, Estee Lauder – parent company to major brands like Clinique and MAC lipstick – announced a planned turnaround after declining sales led the company to withdraw its forecasts and reduce its dividend.
At the time, the company – which employs around 62,000 – said it would cut 3,000 jobs to reduce millions in costs.
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This week, the New York-based company revealed its latest quarterly results and, with it, the company says it sees the need to double down on its cost-cutting plan.
Estee Lauder’s 2nd quarter was marked by a sales decrease of 6%, but perhaps the worst part of the report was its third quarter forecast, which portends profits well below estimates.
In response, the company says it plans to increase its job cuts significantly. On the high end, Estee Lauder says it could eliminate 7,000 positions – more than double its previous estimate.
The firm says it plans to cut a billion dollars in costs, and that the job cuts will conclude by mid next year.
Estee Lauder blames weak demand – pointing especially to airport sales as well as its business in Asia. But the company also says its aggressive plan aims to "manage external volatility, such as potential tariff increases globally."
A trade war could make for a rough ride. Like many companies with a global footprint, Estee Lauder manufactures goods all across the world – with factories in Africa, Asia, Europe, the Middle East and the Americas.
Besides the job cuts, the company plans to invest in innovation at various price points to attract a greater variety of customers, in hopes of improving turnaround efforts.
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