Estee Lauder Companies Q1 2022 Earnings Results & Report

Estee Lauder Companies EPS Results

• Actual EPS: $1.89
• Consensus EPS: $1.67
• Beat/Miss: Beat by +$0.22
• One Year Ago EPS: $1.44
• EPS Beat Rate: 8 of last 8 quarters

Estee Lauder Companies Revenue Results

• Actual Revenue: $4.39 billion
• Expected Revenue: $4.24 billion
• Beat/Miss: Beat by +$156.07 million
• YoY Revenue Growth: N/A

The Estée Lauder Companies Inc. (NYSE: EL) is a global prestige beauty company that develops, markets and sells skincare, makeup, fragrance and hair-care products. Its portfolio includes brands such as Estée Lauder, Clinique, M·A·C, La Mer, Jo Malone London, Aveda, Bobbi Brown Cosmetics, Tom Ford Beauty, Le Labo and The Ordinary.

Founded in 1946 by Estée and Joseph Lauder, the company began with four skincare products and has expanded into a multinational beauty business. Its products are sold through department and specialty stores, beauty retailers, brand-operated stores, e-commerce platforms, salons, spas and other distribution channels.

The Estée Lauder Companies serves consumers in markets across the Americas, Europe, the Middle East and Africa, and Asia-Pacific. Stéphane de La Faverie serves as president and chief executive officer, while William P. Lauder is executive chairman.

Estee Lauder Companies Q1 2022 Earnings Call Transcript

Key Takeaways

• Estee Lauder reported Q1 FY22 organic net sales growth of 18% and adjusted EPS up 31%, making the business 13% larger and more profitable than pre-pandemic Q1 FY20.
• Growth was driven by a diverse portfolio: 13 brands achieved double-digit organic growth, led by Estee Lauder and MAC in makeup, La Mer and Clinique in skincare, and Tom Ford Beauty and Jo Malone London in fragrance.
• All regions contributed to growth: the Americas surged 27% on eased COVID restrictions and new retailer partnerships, EMEA rose 19% with lifted tourism, and Asia Pacific grew 10% thanks to Mainland China’s continued strength despite intermittent lockdowns.
• Channel momentum was balanced: brick-and-mortar rebounded with high-touch in-store activations, while global online sales nearly doubled pre-pandemic levels, supported by social commerce and data-driven personalization.
• For FY22, the company forecasts 9–12% organic sales growth and EPS of $7.23–7.38, backed by a makeup renaissance, travel recovery, at least 3 points of pricing benefit, and ongoing investments despite supply-chain inflation.

Presentation

[Operator]

Good day, everyone, and welcome to The Estée Lauder Companies' fiscal 2022 first quarter conference call. Today's call is being recorded and webcast. For opening remarks and introductions, I would like to turn the call over to Senior Vice President of Investor Relations, Ms. Laraine Mancini.

[Laraine Mancini, SVP of Investor Relations at Estée Lauder]

Hello. On today's call are Fabrizio Freda, President and Chief Executive Officer, and Tracey Travis, Executive Vice President and Chief Financial Officer. Since many of our remarks today contain forward-looking statements, let me refer you to our press release and other reports filed with the SEC, where you'll find factors that could cause actual results to differ materially from these forward-looking statements.

[Laraine Mancini, SVP of Investor Relations at Estée Lauder]

To facilitate the discussion of our underlying business, the commentary on our financial results and expectations is before restructuring and other charges and adjustments disclosed in our press release. Unless otherwise stated, all net sales growth numbers are in constant currency, and all organic results exclude the non-comparable impacts of acquisitions, divestitures, brand closures, and the impact of currency translation. You can find reconciliations between GAAP and non-GAAP measures in our press release and on the investors section of our website.

[Laraine Mancini, SVP of Investor Relations at Estée Lauder]

As a reminder, references to online sales include sales we make directly to our consumers through our brand.com sites and through third-party platforms. It also includes estimated sales of our products through our retailers' websites. During the Q&A session, we ask that you please limit yourself to one question so that we can respond to all of you within the time scheduled for this call. Now I'll turn the call over to Fabrizio.

[Fabrizio Freda, President and CEO at Estée Lauder]

Thank you, Laraine, and hello, everyone. We are grateful you have joined us today. We delivered excellent performance to begin fiscal year 2022, reinforcing our optimism in the opportunities of tomorrow as we discussed with you in August. Our multiple engines of growth strategy enabled us to excel amid continued volatility and variability from the pandemic.

[Fabrizio Freda, President and CEO at Estée Lauder]

Organic sales rose 18%, and adjusted diluted earnings per share grew an even stronger 31%. Encouragingly, relative to the pre-pandemic first quarter of fiscal year 2020, our business is 13% larger on a reported basis and more profitable. We achieved these outstanding results with increasingly diverse growth engines, as we expected. By virtue of our dynamic strategy, we could act locally amid the complexity of the pandemic to both create and capture demand.

[Fabrizio Freda, President and CEO at Estée Lauder]

The growth engines of makeup developed markets in the West, and brick-and-mortar reignited and complemented momentum in skincare, fragrance, Mainland China, travel retail in Asia Pacific, and global online. 13 brands contributed double-digit organic sales growth, demonstrating the breadth of strengths across our portfolio. Estée Lauder and M·A·C drove the makeup renaissance, while La Mer and Clinique delivered standout results in skincare.

[Fabrizio Freda, President and CEO at Estée Lauder]

Impressively, skincare solidly outpaced its prior year organic sales growth performance despite having the far toughest comparison among the categories. Fragrance soared double digits, driven by Tom Ford Beauty and Jo Malone London. Let me share a few highlights by brand. Estée Lauder's advanced planning for the makeup renaissance delivered significant sales growth. As social and professional user education resumed in certain markets, the brand was well-positioned with compelling innovation, superb merchandising, and on-point communication.

[Fabrizio Freda, President and CEO at Estée Lauder]

Its Double Wear and Futurist foundation franchises rose strong double digits, while its new Pure Color Whipped Matte Lip Color was a hit. M·A·C strategically engaged consumers to drive performance in makeup, in the Americas and EMEA, excellent results from in-store activations and regional M·A·C The Moment campaigns, combined with desirable innovation like Lustreglass Sheer-Shine Lipstick and Magic Extension 5mm Fibre Mascara.

[Fabrizio Freda, President and CEO at Estée Lauder]

The brand's new omni-channel capabilities, which leverage its freestanding stores, also contributed to the strengths and demonstrate a new capability for M·A·C to benefit from going forward. La Mer performed magnificently and led the company with sales rising strong double digits. Its new Dehydrating Infused Emulsion expanded our portfolio of East to West innovation, captivating consumers in every region. The product successes are many, as it welcomed new and younger consumers, as well as men into the brand and created a powerful halo benefit for La Mer's skincare portfolio.

[Fabrizio Freda, President and CEO at Estée Lauder]

It is a striking example of the innovation gains we can achieve when the power of our data analytics combines with our creative talent and R&D. La Mer's iconic Crème de la Mer prospered, as a new global campaign focused on its moisturizing benefit realized terrific initial results. Clinique thrived in skincare from the strength of its heroes.

[Fabrizio Freda, President and CEO at Estée Lauder]

Moreover, its new Smart Clinical Repair Wrinkle Correcting Serum with powerful, clinically led claims and compelling before-and-after visualizations extend the Clinique winning streak with innovation and further demonstrated the brand ability to be highly relevant for consumers of all ages. In makeup, Clinique Skincare Authority drove growth in complexion-led subcategories.

[Fabrizio Freda, President and CEO at Estée Lauder]

While in lip, the brand leveraged Black Honey viral social sensation on TikTok to expand its consumer base, especially among Gen Z. DECIEM complemented our organic sales growth in skincare with its coveted vegan brand, The Ordinary.

[Fabrizio Freda, President and CEO at Estée Lauder]

DECIEM is known for its transparency, which has enamored it with consumers. In the first quarter, it launched the insightful Everything is Chemicals campaign. The new regimen builder by The Ordinary on brand.com realized spectacular adoption, further enhancing the brand's powerful online ecosystem. Fragrance momentum continued with stellar double-digit performance in every region, powered by hero products and innovation from Tom Ford Beauty, Jo Malone London, and our artisanal offerings.

[Fabrizio Freda, President and CEO at Estée Lauder]

We are excited for the Estée Lauder brand launch of its Luxury Collection in the second quarter as it expands our portfolio in the high growth segment of fragrances. Our fragrance category benefits from diversification among subcategories as well as regions with outstanding performance from both historically strong markets for fragrance and emerging fragrance opportunities. The self-care rituals related to scent, which were embraced during the pandemic, continue even as social and professional user education resume.

[Fabrizio Freda, President and CEO at Estée Lauder]

Of note, Tom Ford Beauty performed strongly in both fragrance and makeup, such that the brand was among our top performers in the quarter. Its new Ombré Leather perfume and heroes Oud Wood and Lost Cherry fueled the brand's success. Our growth engines also diversified geographically, led by developed markets in the West. Our business in North America executed with excellence to deliver strong double-digit organic sales growth, powered by readiness for makeup's emerging makeup renaissance, ongoing strength in skincare, fragrance and recovery in hair care.

[Fabrizio Freda, President and CEO at Estée Lauder]

Strategic go-to-market initiatives supported by on-trend innovation, increased advertising spending and expert in-store virtual services delighted consumers. Our expanded consumer reach enhanced these initiatives as Bobbi Brown launch in Ulta Beauty exceeded expectation, and we are encouraged by the early results of the new Ulta Beauty at Target and Sephora at Kohl's relationships.

[Fabrizio Freda, President and CEO at Estée Lauder]

In Asia Pacific, many markets faced COVID-induced lockdowns and temporary store closures, which pressured performance. Despite this, the region still grew 10% organically, driven by strengths in Greater China and Korea. Mainland China achieved double-digit organic sales growth owing to skincare and fragrance, with online and brick-and-mortar both higher.

[Fabrizio Freda, President and CEO at Estée Lauder]

We launched locally relevant innovation, which proved highly desirable. While we also increased advertising spending, strategically extended our consumer reach to match success on JD, and designed successful activation for Chinese Valentine's Day. We continue to invest in the vibrant and compelling long-term growth opportunity of mainland China, led by our talented local team. We are enthusiastic for our new innovation center in Shanghai to open in the second half of this fiscal year. This new world-class innovation center will be the first of its kind for our company.

[Fabrizio Freda, President and CEO at Estée Lauder]

With it, we will have a unique ability to grow and build on our market and consumer insights to develop exceptional products to meet and surpass the needs and desires of Chinese consumers. What is more, we are seeing the benefits of recent investment in online fulfillment, which have led to higher service levels and better inventory management, while setting the stage for expanded omni-channel capabilities in the market.

[Fabrizio Freda, President and CEO at Estée Lauder]

From a channel perspective, globally, brick-and-mortar grew strongly in markets which are gradually emerging from the latest waves of COVID-19. We realized excellent results across the board in brick-and-mortar, most especially in the Americas and EMEA. Our brands created excitement in store with enticing high-touch services and unique activations. We are encouraged by improving trends in the productivity of brick-and-mortar owing to both increased traffic and our strategic actions, including those under the Post-COVID Business Acceleration Program.

[Fabrizio Freda, President and CEO at Estée Lauder]

As brick-and-mortar reunites, our global online business continues to showcase its tremendous promise with impressive organic results despite significant organic sales growth in the year-ago period. Online grew to be nearly double the size on a reported basis of the pre-pandemic first quarter of fiscal year 2020. Many markets capitalized on the remarkable new consumer acquisition trend of the pandemic to deliver sustained gains in repeat purchases.

[Fabrizio Freda, President and CEO at Estée Lauder]

As we seek to engage with consumers in innovative ways, we advanced our work with Instagram, Snapchat, TikTok, WeChat, and others to capitalize on exciting trends in social commerce. We also deployed a technology solution which enables brands to better customize consumer outreach by leveraging data to merchandise and personalize communication. This is leading to higher conversion rates for new consumers and a deeper level of relationship building after the initial purchase to foster retention.

[Fabrizio Freda, President and CEO at Estée Lauder]

Initiatives such as this position us well to realize even greater success with trial and repeat. We continue to invest in online to strategically extend our consumer reach and realize promising results. For example, in the first quarter, La Mer launched on Lazada in Southeast Asia to tremendous success. We differentiated merchandising, unique services, and prestige packaging, making it one of the platform's biggest brand launches ever.

[Fabrizio Freda, President and CEO at Estée Lauder]

Our relationship with Lazada expanded in the current quarter with Jo Malone London debut. Before I close, I wanted to share that today we will release our fiscal year 2021 social impact and sustainability report. We are incredibly inspired by the achievements of our employees globally. The report highlights initiatives across key areas, including inclusion, diversity, and equity, climate, packaging, social investment, responsible sourcing, and green chemistry.

[Fabrizio Freda, President and CEO at Estée Lauder]

I'm particularly proud of our support to employees globally who face financial hardships due to COVID-19. The ELC Cares Employee Relief Fund awarded nearly 14,000 grants and distributed nearly $8 million through June 30, 2021. Here are a few among the many other highlights of the report. We continued to contribute to a low carbon future. For the second year in a row, we sourced 100% renewable electricity globally for our direct operations and achieved Net Zero Scope 1 and Scope 2 emissions. The company also made strong progress in its science-based targets for Scope 1 and 2 and made efforts toward meeting its Scope 3 science-based targets.

[Fabrizio Freda, President and CEO at Estée Lauder]

We achieved our existing post-consumer recycled content goal ahead of schedule and announced a more ambitious goal to increase the amount of such material in our packaging to 25% or more by the end of calendar year 2025. We also committed to reduce the amount of virgin petroleum plastic in our packaging to 50% or less by the end of calendar year 2030. On the last few earnings calls, I discussed actions we are taking to make more progress on our commitments for racial equity as well as women advancement and gender equality, which are reflected in the report.

[Fabrizio Freda, President and CEO at Estée Lauder]

We also deepened our work by further aligning the strategy of The Estée Lauder Companies Charitable Foundation to identify and support programs at the intersection of climate justice, human rights, and wellbeing, with a focus on equity, building upon our legacy of funding girls' education and leadership programs.

[Fabrizio Freda, President and CEO at Estée Lauder]

In the beginning of fiscal year 2022, and aligned with our social impact commitments, we were pleased to announce a three-year partnership with Amanda Gorman, activist, award-winning writer, and the youngest inaugural poet in U.S. history. The Estée Lauder Companies will contribute $3 million over three years to support WRITING CHANGE, a special initiative to advance literacy as a pathway to equality, access, and social change. In addition, Mrs. Gorman will bring her voice of change to the Estée Lauder brand, debuting her first campaign in the second half of this fiscal year.

[Fabrizio Freda, President and CEO at Estée Lauder]

In closing, we delivered outstanding performance to begin the new fiscal year amid the volatility and variability of the pandemic, while continuing to invest in sustainable long-term growth drivers. We are focusing on fundamental capabilities for product quality and the consumer-centric elements of acquisition, engagement, and high-touch experiences and services.

[Fabrizio Freda, President and CEO at Estée Lauder]

We are doing this while improving our cost structure, diversifying our portfolio and its distribution, investing behind the best growth opportunities, and living our values. Our confidence in the long-term growth opportunities for global prestige beauty and our company is reflected in the announcement today to raise the quarterly dividend. I'm forever grateful to the grace, wisdom, and ingenuity of our employees globally who are making us a stronger company each and every day. I will now turn the call over to Tracey.

[Tracey Travis, EVP and CFO at Estée Lauder]

Thank you, Fabrizio, and hello, everyone. We are off to an outstanding start with first quarter net sales growing 18% organically, driven by the nascent recovery in the Americas and EMEA during the quarter compared to a more difficult environment in the prior year. Global logistics constraints caused some retailers, primarily in North America, to order earlier to ensure popular sets and products would be on counter for holiday.

[Tracey Travis, EVP and CFO at Estée Lauder]

We estimate that this contributed approximately 1.5 points to our first quarter sales growth that otherwise would have occurred in the second quarter. The inclusion of sales from the May 2021 DECIEM investment added approximately 3 points to reported net sales growth and currency added just over 2 points. From a geographic standpoint, organic net sales in the Americas climbed 27% as COVID restrictions eased throughout the region.

[Tracey Travis, EVP and CFO at Estée Lauder]

Brick-and-mortar retail grew sharply across all formats compared to the prior year period when many stores were temporarily shut down. Distribution in Kohl's with Sephora and in Target with Ulta Beauty began its phased rollout to initial stores and online in mid-August, with minimal impact on net sales growth for the quarter.

[Tracey Travis, EVP and CFO at Estée Lauder]

With the strong resurgence of brick-and-mortar traffic, online organic sales growth in the Americas declined single digits against a sharp increase last year, while organic online penetration remained solid at 31% of sales. The inclusion of sales from DECIEM added about 9 points to the overall reported growth in the region. In our Europe, the Middle East, and Africa region, organic net sales rose 19%, with virtually every market contributing to growth led by the emerging markets in the Middle East, Turkey and Russia, as well as the U.K.

[Tracey Travis, EVP and CFO at Estée Lauder]

Most markets throughout the region saw COVID restrictions lifted and some tourism resume during the peak summer months. By channel, the region saw more balance between brick-and-mortar and online growth. All major categories grew this quarter, and the region saw the strongest growth in fragrance and makeup as social occasions increased. Our global travel retail business grew double digits as China and Korea continued to be strong.

[Tracey Travis, EVP and CFO at Estée Lauder]

Internal travel restrictions during the quarter in China slowed high-end sales temporarily, but restrictions lifted in early September and traffic rebounded. Retailers also responded to the August dip by driving post-travel consumption online. Summer holiday travel in Europe and the Americas picked up, but international travel still reached only 40% of pre-COVID levels. In our Asia-Pacific region, organic net sales rose 10%, driven by Greater China and Korea.

[Tracey Travis, EVP and CFO at Estée Lauder]

The region overall experienced higher levels of COVID lockdowns this quarter compared to last year's quarter due to the rise of the Delta variant, although online remained strong. Sales growth in mainland China was somewhat slower due to COVID restrictions during July and August, and the pace of online sales growth slowed following the successful 618 programs last quarter and in anticipation of the 11.11 shopping festival.

[Tracey Travis, EVP and CFO at Estée Lauder]

As we've mentioned before, these key shopping moments have created some additional seasonality in our business in this region. More than half of our brands in virtually all channels rose double digits in mainland China. Hong Kong and Macau were bright spots this quarter. They benefited from strong new product launches from La Mer and Jo Malone and successful marketing campaigns from several other brands. From a category perspective, net sales growth in fragrance jumped nearly 50%.

[Tracey Travis, EVP and CFO at Estée Lauder]

Virtually every brand that participates in the category contributed to growth, with exceptional double-digit increases from Tom Ford Beauty, Jo Malone London and Le Labo. Perfumes and colognes led the category growth, and bath, body and home fragrances continued to perform well. Net sales in makeup rose 18% as markets in the Americas and Europe began to recover from COVID shutdowns.

[Tracey Travis, EVP and CFO at Estée Lauder]

We are encouraged by the sequential improvement in makeup versus pre-COVID levels. However, makeup sales in the quarter were still 19% below two years ago. Nonetheless, Estée Lauder foundations continued to resonate strongly with consumers, and M·A·C leaned into the makeup recovery with a number of fun and compelling campaigns. Skincare sales remained strong during the quarter. Organic net sales grew 12%, and the inclusion of sales from DECIEM added 6 percentage points to reported growth.

[Tracey Travis, EVP and CFO at Estée Lauder]

Nearly all of our skincare brands contributed to growth, although Estée Lauder had a tough comparison with the prior year launch of its improved Advanced Night Repair serum. Our haircare net sales rose 8% as traffic in salons and stores in the U.S. and Europe began to return. Both Aveda and Bumble and bumble. saw growth in hero products as well as continued strength from innovation. Our gross margin declined 100 basis points compared to the first quarter last year. The positive impacts from strategic pricing and currency were more than offset by higher obsolescence costs for both basic and holiday product sets and the inclusion of DECIEM. Operating expenses decreased 240 basis points as a percent of sales.

[Tracey Travis, EVP and CFO at Estée Lauder]

Our strong sales growth was partly due to earlier orders from some North America retailers concerned about logistics constraints, and costs related to these sales are expected to be incurred in our second quarter. We do continue to manage costs with agility, realizing savings from our cost initiatives while also investing to support a continued brick-and-mortar recovery as well as our strategic initiatives.

[Tracey Travis, EVP and CFO at Estée Lauder]

Our operating income rose 32% to $941 million, and our operating margin rose 140 basis points to 21.4% in the quarter. Diluted EPS of $1.89 increased 31% compared to the prior year. During the quarter, we used $81 million in net cash flows from operating activities, which was below the prior year. This reflects a more normalized first quarter, where we typically have seasonally higher working capital needs.

[Tracey Travis, EVP and CFO at Estée Lauder]

We invested $205 million in capital expenditures as we ramped up our investment to build the new manufacturing facility in Japan, and we returned $749 million in cash to stockholders through both share repurchases and dividends. We also announced this morning an increase in our quarterly dividend. Now let's turn to our outlook.

[Tracey Travis, EVP and CFO at Estée Lauder]

We are encouraged by the green shoots we are seeing around the world, even in the context of an environment of increased volatility. Our strong performance reflects our ability to navigate through the volatility while leveraging our multiple engines of growth. At the same time, we are mindful that recovery is tenuous and likely to be uneven. Nevertheless, we are cautiously optimistic, and our assumptions for fiscal 2022 remain consistent.

[Tracey Travis, EVP and CFO at Estée Lauder]

We continue to expect an emerging renaissance in the makeup category as restrictions are safely lifted and social occasions increase. We welcome the resumption of some travel in the Americas and EMEA in the first quarter. As intercontinental restrictions are lifted, we expect international passenger traffic to build toward the end of the fiscal year.

[Tracey Travis, EVP and CFO at Estée Lauder]

We began taking strategic pricing actions in July, and overall, pricing is expected to add at least 3 points of growth, helping to offset inflationary pressures. On the cost side, we plan to continue to increase advertising to support our brands and drive traffic in all channels. Selling costs are expected to rise to support the reopening of brick-and-mortar retail. We also continue to invest behind key strategic capabilities like data analytics, innovation, technology, and sustainability initiatives.

[Tracey Travis, EVP and CFO at Estée Lauder]

As you are all aware, global supply chains are being strained by COVID and its related effects in some markets, resulting in port congestion, higher fuel costs, and labor shortages at a time when demand for goods is rising. This is causing us to experience inflation in freight and procurement, which we expect to impact our cost of goods and operating expenses beginning next quarter. Based on what we see through October, the expected benefit of pricing, combined with good cost discipline elsewhere, are enabling us to maintain our expectations for the year. For the full fiscal year, organic net sales are forecasted to grow 9%-12%.

[Tracey Travis, EVP and CFO at Estée Lauder]

Based on rates of 1.163 for the euro, 1.351 for the pound, and 6.471 for the Chinese yuan, we expect currency translation to be negligible for the full fiscal year. This range excludes approximately 3 points from acquisitions, divestitures, and brand closures, primarily the inclusion of DECIEM.

[Tracey Travis, EVP and CFO at Estée Lauder]

Diluted EPS is expected to range between $7.23 and $7.38 before restructuring and other charges. This includes approximately $0.04 of accretion from currency translation and $0.03 accretion from DECIEM. In constant currency, we expect EPS to rise 11%-14%. At this time, we expect organic sales for our second quarter to rise 8%-10%. The net incremental sales from acquisitions, divestitures, and brand closures are expected to add about 3 points to reported growth, and currency is forecasted to be neutral.

[Tracey Travis, EVP and CFO at Estée Lauder]

Operating expenses are expected to rise in the second quarter as we support holiday activations and the continued recovery of brick-and-mortar retail around the world. Additionally, the prior year quarter included some benefit of government subsidies, which are not anticipated in the current year quarter. We expect second quarter EPS of $2.51-$2.61. Both currency and the inclusion of DECIEM are expected to be immaterial to EPS.

[Tracey Travis, EVP and CFO at Estée Lauder]

Notably, our EPS forecast also reflects a 23% tax rate compared to a 15.9% in the prior year, when we benefited from certain one-time items. In closing, we are pleased with the terrific start to the year and are proud of the continued efforts of our global teams. We remain confident in our corporate strategy with its multiple growth engines to drive sustainable, profitable growth. That concludes our prepared remarks.

[Tracey Travis, EVP and CFO at Estée Lauder]

We'll be happy to take your questions at this time.

[Operator]

Thank you. The floor is now open for your questions. If you have a question, you simply press the star key followed by the digit one on your touchtone phone. To ensure that everyone can ask their question, we will limit each person to one question. Time permitting, we will return you for additional questions. Just queue up again by pressing the star key and the digit one. Our first question today comes from Erinn Murphy, Piper Sandler.

[Erinn Murphy, Managing Director at Piper Sandler]

Great. Thank you. Good morning. I guess my question is around the supply chain, Tracey, for you. If you could talk a little bit more about your ability to get product to the end markets in a timely manner into holiday. And then maybe if you can share, if you think about the higher OpEx, you know, how you're balancing air freight versus ocean freight currently. Thank you so much.

[Tracey Travis, EVP and CFO at Estée Lauder]

Yeah. Hi, Erinn. You know, we are seeing some supply chain impact as I said in our prepared remarks. We have experienced some air freight, and we have experienced some delays. By and large, we're in very good shape for holiday. Our holiday sets, you know, we had anticipated some of the supply chain challenges earlier in the year when clearly our supply chain and more publicly there were discussions about supply chain challenges. We did order some products early. We produced some products early, and we landed many of our gift sets early. That set us up pretty well for Q2. We are experiencing some inflation in transport.

[Tracey Travis, EVP and CFO at Estée Lauder]

We're managing it as best we can. One of the things that, you know, certainly we have the benefit of is we are a luxury company, so we do have pricing power. We have pricing power not only in our inline products, but also in our innovation as well. We do have the opportunity, and have taken the opportunity to offset some of the cost inflation, with some of the pricing that we've taken this year.

[Operator]

Our next question is going to come from the line of Lauren Lieberman with Barclays.

[Lauren Lieberman, Managing Director at Barclays]

Great. Thanks so much. Good morning. Really curious to hear a little bit more about M·A·C. You know, I would certainly have expected it to be key in the beginning of this makeup resurgence. But was curious what you could tell us in terms of progress on brick-and-mortar footprint in North America and EMEA, how that interacts with the online presence and how you think about the profit model for that brand or maybe from the makeup category going forward.

[Lauren Lieberman, Managing Director at Barclays]

You know, we're one quarter into the beginning of a recovery, so I don't. I recognize that looking at operating margins for the division isn't really fair game yet, but interested to hear how you think that can evolve over the next, whatever the appropriate timeframe, you know, 12+ months or so.

[Tracey Travis, EVP and CFO at Estée Lauder]

Yeah. Hi, Lauren. You faded out at the very beginning. Your question is about what specifically?

[Lauren Lieberman, Managing Director at Barclays]

About M·A·C.

[Tracey Travis, EVP and CFO at Estée Lauder]

M·A·C.

[Lauren Lieberman, Managing Director at Barclays]

M·A·C.

[Tracey Travis, EVP and CFO at Estée Lauder]

Okay.

[Lauren Lieberman, Managing Director at Barclays]

M·A·C and how the you know brick-and-mortar footprint you know where you've gotten to so far how that fits with online presence and how you're thinking about the business model going forward and what that means for profitability?

[Tracey Travis, EVP and CFO at Estée Lauder]

Yeah. No, you know, as we announced last year in our Post-COVID Business Acceleration Program, you know, we did take the opportunity last year to close some stores, and some additional stores will close this year. Not only freestanding stores, but you know, there are some counters as well that M·A·C has pulled out of.

[Tracey Travis, EVP and CFO at Estée Lauder]

We were encouraged at the end of last year and encouraged through the first quarter with M·A·C performance in both the Americas, both North America as well as Latin America, and also EMEA. We really, with return to brick-and-mortar, as we had indicated before, saw higher productivity of the remaining brick-and-mortar doors that we had open.

[Tracey Travis, EVP and CFO at Estée Lauder]

We saw a bit of softness, more in North America than in EMEA, but you know, a bit of softness in online as traffic returned to brick-and-mortar. We think that will normalize out a bit in Q2, and we'll see a bit more balance. You know, as I think all of us can imagine, I think consumers were very excited about going back to brick-and-mortar stores in markets where restrictions were lifted, and people felt more comfortable going out and socializing.

[Fabrizio Freda, President and CEO at Estée Lauder]

I can add that M·A·C has been, you know, a good start in the Ulta and Target. The experience is a great start in the preparation of the holiday season. The brand is doing very well online and is one of the brands that is benefiting from the sales acceleration online, both in the U.S. and in EMEA. Overall, very good progress on M·A·C, obviously, as you would expect in the context of the makeup acceleration for consumers in general.

[Operator]

Thank you. Our next question comes from the line of Nik Modi with RBC Capital Markets.

[Nik Modi, Managing Director at RBC Capital Markets]

Yeah. Hi, good morning, everyone. I had a question on consumer behavior. Just on online, what you're seeing there in terms of stickiness, retention. Obviously, that's an important channel from a profitability standpoint and consumer engagement. Just wanted to understand that. Then also, you know, Fabrizio, if you think about what happened during the pandemic is consumers were migrating to well-known brands.

[Nik Modi, Managing Director at RBC Capital Markets]

You know, exploration kind of came down a bit, but I suspect that that's starting to happen now as consumers are getting back out and exploring different brands. I just wanted to get your perspective on that dynamic if that's what you're seeing. How does Estée Lauder better prepare in the future to deal with all of these upstart brands that are starting up on social media? Thank you.

[Fabrizio Freda, President and CEO at Estée Lauder]

I think there are two questions. First of all, what we see online. Obviously online is doing pretty well. On a two-year stack, you know, we've doubled it. And so is a very strong acceleration versus two years. And we see the progress to continue and the growth to continues. Obviously, in the moment where there was the opening of brick-and-mortar, the amount of growth online has slowed down, but the continuous growth is what is really encouraging.

[Fabrizio Freda, President and CEO at Estée Lauder]

The most important part of your question is what happened to the consumers' behavior. What we saw during COVID, that the consumers that were already online before, like younger consumers, continued to be online even more intensively. There were many new consumers that just appeared online during the COVID period.

[Fabrizio Freda, President and CEO at Estée Lauder]

They were, well, you know, more the ageless consumer, the more adult consumers. Now, these consumers really enjoyed it, so they are staying online. That's what show that the online continues to grow, even when brick-and-mortar opens up. Obviously, the two channels growth get rebalanced in this situation. Very optimistic for online.

[Fabrizio Freda, President and CEO at Estée Lauder]

The other thing that in online continues to grow is that there are very different channels with different level of growth. We are growing in every single channel. We are growing in 3PP, we are growing in brand.com, we are growing in retail.com, we are growing in the pure play. This is very different by region because in every region, one of these channel is stronger than the others.

[Fabrizio Freda, President and CEO at Estée Lauder]

The combination of the global online growth is continue to be pretty exciting. We count this to continue even when brick-and-mortar will be fully recovered. As a result, we have reached already 28% of our business in online, and this will gradually continue to grow over time. Very strong. In terms of. Sorry, your second question, because it was a separate question on consumer behaviors in Asia.

[Nik Modi, Managing Director at RBC Capital Markets]

Yeah, no, it was around ex-

[Fabrizio Freda, President and CEO at Estée Lauder]

Could you repeat it?

[Nik Modi, Managing Director at RBC Capital Markets]

Yeah, it was around exploration, you know, kind of died down during the pandemic. Are you seeing consumers explore new brands again? What is that they are doing to, you know, try to make sure that doesn't become too much of a risk going forward?

[Fabrizio Freda, President and CEO at Estée Lauder]

No, I think the exploration of newness in the world of beauty will continue, will never stop. Personally, I don't have any data point that suggests was dependent on COVID. The exploration is not only about new brands, but this exploration is about the newness of the existing brands.

[Fabrizio Freda, President and CEO at Estée Lauder]

In fact, our percentage of newness continues to be very high, and our innovation program continues to be super exciting. We continue to be in the 30% of new products per year, which is extraordinary and has been a huge progress in the last years. We continue to see consumers to be interested in innovation, and we continue to make our innovation program one of the best drivers of growth globally.

[Operator]

Thank you. Our next question is going to come from the line of Dara Mohsenian with Morgan Stanley.

[Dara Mohsenian, Beverage, Household, and Personal Care Products Research Analyst at Morgan Stanley]

Hey, guys. Good morning.

[Tracey Travis, EVP and CFO at Estée Lauder]

Morning.

[Fabrizio Freda, President and CEO at Estée Lauder]

Good morning.

[Dara Mohsenian, Beverage, Household, and Personal Care Products Research Analyst at Morgan Stanley]

Just a question on guidance. Clearly, you came in better than expected in terms of fiscal Q1. You mentioned some green shoots, obviously a makeup recovery, Americas recovery, Asia, some softness with some of the government lockdowns inter-quarter, but sounded like that's getting better.

[Dara Mohsenian, Beverage, Household, and Personal Care Products Research Analyst at Morgan Stanley]

I'm just trying to understand the unchanged local currency top line guidance for the year. Is there something specific that's giving you more caution as you look at the balance of the year? Is it more just some conservatism given it's early in the year? How do you sort of think about that relative to the Q1 top-line delivery and some green shoots?

[Dara Mohsenian, Beverage, Household, and Personal Care Products Research Analyst at Morgan Stanley]

Maybe specifically also you can touch on the 11.11 Global Shopping Festival in China and what you're seeing there in terms of initial signs heading into that festival. Thanks.

[Tracey Travis, EVP and CFO at Estée Lauder]

Yeah. Thanks, Dara. In terms of, you know, we are encouraged obviously, as we should be by our Q1 performance. You know, we're still only a quarter in, as you mentioned. We did have some early shipments in the quarter that, you know, obviously came out of the second quarter.

[Tracey Travis, EVP and CFO at Estée Lauder]

Some of the growth, as we mentioned, about 1.5, was related to that. But as we look at the balance of the year, you know, we are also while we're seeing encouragement, there's still a lot of volatility in the market. You know, we did have some markets, you know, unexpectedly, that were shut down in the first quarter. You know, we are still managing through this pandemic.

[Tracey Travis, EVP and CFO at Estée Lauder]

We are, you know, we believe that certainly as you look at Q2 on a two-year stack basis, it is, and really versus pre-pandemic, it's really quite strong. You're seeing some of the seasonality related to 11.11 continue to impact Q1 or Q2, and that's reflected in the guidance that we've provided. We feel that the guidance that we've given for the year is incredibly strong. You know, the only difference you know between the guidance that we gave last time and this time is currency. Our outlook on currency is a bit less. That's the 1 point change in the guidance that you see.

[Tracey Travis, EVP and CFO at Estée Lauder]

From a reported EPS standpoint, our guidance actually on a constant currency basis has improved quite a bit. I would say we are seeing green shoots. We are expressing confidence in the guidance that we are providing, you know, quite a bit when you actually look at it from an EPS standpoint, even with all of the things that we're navigating through as it relates to transport, et cetera. That goes to the choices that we're making as an organization in terms of where to invest and where not to invest, along with the pricing actions that we're taking as well.

[Operator]

Thank you. Our next question is going to come from the line of Steve Powers with Deutsche Bank.

[Steve Powers, Research Analyst at Deutsche Bank]

Yes. Hey, thanks. First, just to clean up, apologies if I missed it, but were the early holiday sales in North America that you mentioned in the first quarter skewed at all to any particular brand or product category? That'd be helpful. What I really wanted to ask about was sort of picking up on something Dara mentioned, but I'm not sure you addressed, Tracey, was just the relative softness in China, Hainan and Asia that you experienced in the quarter against the

[Steve Powers, Research Analyst at Deutsche Bank]

Curtailed mobility backdrop versus the improvement that you saw in September, and what I hear is enthusiasm entering December and around the 11.11 holidays. Maybe you could just expand on a little bit on how trends evolved through the September quarter, and then what you're expecting in that Asia Pacific region as we go through fiscal 2Q. Thank you.

[Tracey Travis, EVP and CFO at Estée Lauder]

Steve, in terms of the early shipments, you know, obviously our larger brands would have comprised, you know, most of the larger, you know, most of the sales dollar volume in terms of those shipments. It was really across the board. Again, both we and our retailers wanted to make sure that we had our holiday programs as well as some of our basic product in store, recognizing the severe constraint that is being projected as it relates to transport during this holiday season. We feel very good about that.

[Tracey Travis, EVP and CFO at Estée Lauder]

In terms of Asia Pacific, inclusive of China, but other markets as well, you know, we did see some intermittent shutdowns in Asia, and that did include, you know, some traffic to Hainan being a bit curtailed in the July and August timeframe and a bit into the early part of September.

[Tracey Travis, EVP and CFO at Estée Lauder]

We saw, as we mentioned in our prepared remarks, Hainan pick up quite a bit when those travel restrictions were lifted almost immediately. So that, you know, is a positive sign, and we are, you know, still quite encouraged with respect to China and the performance that we expect to see certainly for the balance of the year, you know, both in China, in mainland China and with Chinese consumers wherever they shop.

[Operator]

Thank you. Our next question will come from the line of Stephanie Wissink with Jefferies.

[Analyst at Jefferies]

Hi. Good morning. Thank you for taking my question. This is Grace, on her behalf. I'm wondering if you could talk a little bit about the strength that you're seeing in fragrance and just touch on the sustainability there. Is there anything assumed in your guidance for fragrance? Also on a similar vein, if there's anything assumed for the makeup recovery in the second half and guidance. Thank you.

[Fabrizio Freda, President and CEO at Estée Lauder]

Yeah. No, we see obviously a very strong fragrance market, and we see great growth in every single region, so it is good. We see particularly strong fragrance traction in the high-end fragrances in what we call the luxury artisanal space of our portfolio. This is really outstanding. Brands like Jo Malone, Tom Ford, Le Labo, Kilian, Frédéric Malle, and we believe this will continue.

[Fabrizio Freda, President and CEO at Estée Lauder]

This is a trend we have identified some years ago, and we have focused the growth of our portfolio and our innovation on this kind of highly sophisticated fragrance experiences. What we have seen that during COVID, this trend has accelerated. The consumers are even more interested.

[Fabrizio Freda, President and CEO at Estée Lauder]

The other interesting thing is during COVID, the element of our fragrance brands that were, for example, you know, home, like candles or personal cleansing or pampering parts of the lineup beyond the fragrance also was accelerating, and this acceleration continues. The positives that consumers have learned, also the possibility of the pampering in-house element of products that these brands provide, they continue to buy them also after the COVID period or this COVID thing. The entire fragrance brands are strong, the fragrance category is strong, and we expect to have a good holiday season in this area. We expect continuous growth over time.

[Operator]

Thank you. Our next question comes from the line of Andrea Teixeira with JPMorgan.

[Andrea Teixeira, Head of North America Beverage, Household, and Personal Care Research at JPMorgan Chase]

Thank you. Good morning, and congrats on your results. Can you comment on the cadence of the quarter in Asia Pacific, and how you exited? It seems that you had a pickup in China consumption towards the end of the quarter. Tracey, you mentioned that in your prepared remarks, and I think that's the question.

[Andrea Teixeira, Head of North America Beverage, Household, and Personal Care Research at JPMorgan Chase]

Is the deceleration in the fiscal second quarter a function of normalizing the pull forward or more how conservative you're being, things happening? Obviously you have the seasonality that we have been calling for 11.11. If you can just kind of elaborate more on that, I would appreciate. Thank you.

[Fabrizio Freda, President and CEO at Estée Lauder]

Yeah. I mean, we achieved double-digit growth in China this quarter. Very strong double digits also on a two or three years stack basis. Despite the restrictions that we saw in July and in August. The Chinese consumer is really strong, and we are serving them. We also with a variety of locations, meaning in every channel, we see the growth online, we see the growth in brick-and-mortar, we see the growth in Hainan.

[Fabrizio Freda, President and CEO at Estée Lauder]

Our key idea is to serve the Chinese consumers wherever they are and to serve them in the best possible way. We manage this with agility. Depending what is the commercial model that is emerging in China, we focus more on one channel on another, also depending by the season and by the moment.

[Fabrizio Freda, President and CEO at Estée Lauder]

Skincare, which I think is a great sign of strength. Skincare grew strong double-digit despite the very tough comparison with the previous year, where in our case we launched the Advanced Night Repair relaunch. It was a very big innovation in the base period. Brick-and-mortar in China also saw very strong growth.

[Fabrizio Freda, President and CEO at Estée Lauder]

Our business online grew double digits despite the fact that in quarter one online is a bit normally sandwiched between the 618 big event and the 11.11 big event. Despite that, we grew double digits. The long-term fundamentals on the market in China, namely the large and growing middle class with increasing spending per person, remain intact.

[Fabrizio Freda, President and CEO at Estée Lauder]

The key idea is to be able to focus on the Chinese consumer in whatever channel they choose to shop it, depending on the moment of the year. That's what we're doing, and that's why we remain very confident for the remaining of the fiscal year.

[Tracey Travis, EVP and CFO at Estée Lauder]

Andrea, as it relates to the rest of APAC, we are expecting a pickup in the second quarter, so we are not anticipating as many of the restrictions to be in place in the rest of APAC that we saw in Q1.

[Operator]

Thank you. Our next question is going to come from the line of Olivia Tong with Raymond James.

[Olivia Tong, Managing Director of Beauty, Personal Care, and Household Products at Raymond James]

Great. Thank you. I just wanna talk a little bit about some of the new brands like The Ordinary, and if you could just give a little bit of commentary around, you know, things that you've learned since the majority stake that you've taken, you know, and how that could potentially be influencing other brands in your portfolio with respect to, you know, where you could potentially invest going forward, what retailers might your other brands work in, that you may not have thought about earlier. Thank you.

[Fabrizio Freda, President and CEO at Estée Lauder]

First of all, DECIEM is an extraordinary company, and The Ordinary is a brand with a more enormous success and traction. We are collaborating with the management team of DECIEM to continue building both The Ordinary and to continue building the overall DECIEM company with their you know, extraordinary incubation capability they have and new brands that they are creating for the future. Both of these activities. The big learning is obviously the ability to create buzz and interest, and the relationship between The Ordinary brand and the consumer is really extraordinary. Obviously, we can learn a lot from this.

[Fabrizio Freda, President and CEO at Estée Lauder]

Apart from learning, we can support them in the implementation of the global commercial strategies in increasing the reach of the brand, and obviously in leveraging their powerful connection with the consumer in the best possible way in supply chain, in R&D, in many areas.

[Fabrizio Freda, President and CEO at Estée Lauder]

We can learn, and we can support, and this exchange is proving to be very successful. On top of The Ordinary, there are other brands they're building, other ideas, and creating for the future. What we are learning is also the power of creative incubation and the creation of new brands. This will have an influence on our future ability to continue developing brands. Definitely, we will leverage the strengths of DECIEM also in this area.

[Operator]

Thank you. Our next question will come from the line of Mark Astrachan with Stifel.

[Mark Astrachan, Managing Director at Stifel]

Thanks, morning, everyone. I wanted to ask about Hainan growth. I think you'd mentioned this on some previous calls in terms of where the growth was coming from, meaning that you weren't necessarily sourcing it from sales in the mainland. I guess I'm curious, you know, if that's still the case and kinda how you think about what has driven the growth, especially as it seems like some of the duty-free operators are paying the duties to deliver product to mainland customers. You know, if that's true, kinda how do you think this all plays out in time in terms of having mainland and Hainan or kinda local duty-free work together?

[Fabrizio Freda, President and CEO at Estée Lauder]

Yeah. I mean, you know, keep in mind that in China, our most distributed brand, which is Estée Lauder, is in 140 cities. Where today with a strong social media and with a strong aspirational values of our brand, as we speak, we can have demand in more than 700 cities. There are many consumers in China that can only buy either online or traveling, and traveling domestically today, and historically also traveling internationally. It's just the market, commercially, the market is designed to have a very limited overlap between the Mainland China and the Hainan. Hainan serves an enormous amount of consumer that comes also from tier three, tier four cities, areas where there is not a lot of brick-and-mortar distribution.

[Fabrizio Freda, President and CEO at Estée Lauder]

Hainan can attract this consumer in this moment. Hainan also is a place where people go for holidays. As part of these holidays, there is a lot of the pleasure of shopping, the pleasure of discovery. The business in Hainan is proving to be a great trial builder more than any cannibalizing business.

[Fabrizio Freda, President and CEO at Estée Lauder]

It's building trial of people that otherwise would not be able to try our product, and then we'll repurchase them. We'll repurchase them maybe again in their future travel, but most of the times in their everyday life in mainland China. Obviously there is commercial competition. The market is becoming very competitive. There is a lot of players. Commercially, there is and will continue to be intense competition, but every channel serves, frankly, a very different role.

[Fabrizio Freda, President and CEO at Estée Lauder]

Our strategy is to be able to leverage each one of these channel in the best possible way with the idea of maximizing the coverage and the service to the total, consumers in China that are interested in beauty and, over time, to be able to better differentiate the scope of the channels and how the consumer will be served by the different channels.

[Fabrizio Freda, President and CEO at Estée Lauder]

Last thing I want to say, Hainan had, at least the last number I've seen, over 80 million visitors in the last year. If you think that Hainan serves the entire middle class because it's domestic travel, you don't need to have a passport. Today, in our knowledge, about 12% of Chinese consumer had a passport.

[Fabrizio Freda, President and CEO at Estée Lauder]

Even when international travel will restart, there will be even a limited cannibalization versus international travel because Hainan will serve many consumers that do not plan to travel internationally. We are very positive on the long term and very positive on the ability to serve the consumers using different channels, which is our strategy.

[Operator]

Thank you. Our next question comes from the line of Wendy Nicholson with Citi.

[Wendy Nicholson, Co-Head of Global Consumer Equity Research at Citi]

Hi. Two things, if I can. When you were running through the brands and what's growing for you and what's doing especially well, I think you called out La Mer first, and I just wanted to clarify how much of La Mer's growth is coming from China and travel retail, or is the brand also growing strongly in the U.S. and Western Europe non-travel retail? That's my first question.

[Wendy Nicholson, Co-Head of Global Consumer Equity Research at Citi]

Then second thing, I know you said, Tracey, that there was only minimal sales in the first quarter from the pipeline fill into Target and Kohl's. Now that we're kind of, you know, already into November, can you comment a little bit about what you're seeing there? Especially, I'm curious what percentage of the sales that you're getting from Target and Kohl's are in makeup as opposed to skin?

[Wendy Nicholson, Co-Head of Global Consumer Equity Research at Citi]

I'm just wondering that if those two channels really take off for you, what kind of mix effect that might have on your North American business? Thanks.

[Tracey Travis, EVP and CFO at Estée Lauder]

Thanks, Wendy. In terms of La Mer, La Mer is growing in pretty much every market. It's, you know, incredibly strong. The brand does a fantastic job of innovating. We're seeing, you know, growth from both new innovation as well as a continued expansion of new consumers with some of the strategies that the brand is deploying. We see very high loyalty and repeat with La Mer. It is, you know, all around, even during this pandemic, it has been one of the constants in terms of the performance, you know, in our portfolio. The La Mer team is just an absolute fantastic team.

[Tracey Travis, EVP and CFO at Estée Lauder]

The brand is doing incredibly well. As it relates to Kohl's and Target and Ulta within Target and Sephora within Kohl's, you know, we have seeded the initial doors. You know, we certainly expect during the upcoming holiday season that we will see increased growth, obviously, and contribution from the distribution that we have. We're pleased thus far with the partnership. We're seeing more skincare growth than makeup at the moment. Again, you know, I expect that we will certainly with some of the strong gift programs that our makeup brands have, we expect that we'll see more makeup growth in the second quarter.

[Fabrizio Freda, President and CEO at Estée Lauder]

Yeah. I just wanted to add that, you know, our North America growth this quarter, which has been extraordinary, is the result of many factors. It's definitely not yet the impact of Ulta, Target or Sephora, Kohl's. That was just at the beginning and only in the last month of the quarter. It's the result of many other very positive signs.

[Fabrizio Freda, President and CEO at Estée Lauder]

Also, we gain shares in all categories during the quarter in Clinique, in M·A·C, in La Mer, in Bobbi, in Tom Ford, in Jo Malone. It's a very broad growth across. We are really ready with our innovation, with the strong marketing programs. We had anticipated the comeback on makeup. We have strengthened our program in what we call the makeup renaissance, an anticipation on the return to back to school or back to work. We had amazing programs of that.

[Fabrizio Freda, President and CEO at Estée Lauder]

We have added, obviously, The Ordinary, which is the number four brand in skincare in prestige U.S. to our portfolio. It's a combination of factors of improvement of the strategy and improvement of the execution in our North America organization. It's a terrific quarter, and we do expect the Ulta, Target and of course Sephora to contribute more in the next quarters. It was not the key contributing factor in quarter one.

[Tracey Travis, EVP and CFO at Estée Lauder]

Yeah. I think this quarter really represents the diversification that we have within the business that we've talked about. Certainly the North America performance, to Fabrizio's point, represents that as well.

[Operator]

Thank you. With that will conclude today's question and answer session. If you were unable to join for the entire call, a playback will be available at 1:00 P.M. Eastern today through November 16th. To hear a recording of the call, please dial 855-859-2056. Enter passcode 6086324. Again, passcode 6086324. That concludes Estée Lauder conference call. I'd like to thank you all for your participation and wish you all a good day.

Participants

Executives

• Fabrizio Freda, President and CEO
• Tracey Travis, EVP and CFO

Analysts

• Laraine Mancini, SVP of Investor Relations at Estée Lauder
• Erinn Murphy, Managing Director at Piper Sandler
• Lauren Lieberman, Managing Director at Barclays
• Nik Modi, Managing Director at RBC Capital Markets
• Dara Mohsenian, Beverage, Household, and Personal Care Products Research Analyst at Morgan Stanley
• Steve Powers, Research Analyst at Deutsche Bank
• Analyst at Jefferies
• Andrea Teixeira, Head of North America Beverage, Household, and Personal Care Research at JPMorgan Chase
• Olivia Tong, Managing Director of Beauty, Personal Care, and Household Products at Raymond James
• Mark Astrachan, Managing Director at Stifel
• Wendy Nicholson, Co-Head of Global Consumer Equity Research at Citi