Coty (COTY) Financials

Coty’s latest results show improving cash generation but continued pressure on profitability. Revenue in Q4 2026 was $1.27 billion, down from $1.68 billion in Q2 and $1.28 billion in Q3. The company remained unprofitable, although its $142.3 million net loss was substantially better than the $405.7 million loss in Q3, which included a $362.8 million impairment charge.

• Operating cash flow recovered in Q4. Coty generated $116.0 million from operating activities in Q4 2026, compared with negative operating cash flow of $203.1 million in Q3. This suggests working-capital movements and noncash adjustments helped stabilize liquidity.
• Debt reduction has been significant from early 2026 levels. Long-term debt declined from $4.02 billion in Q1 2026 to $2.99 billion in Q2, before increasing modestly to $3.17 billion in Q3. Coty repaid $816.6 million of debt in Q4, although it also issued $695.7 million.
• Q4 losses narrowed sharply from the prior quarter. The net loss attributable to common shareholders improved to $141.0 million, or $0.16 per share, from a $408.1 million loss, or $0.47 per share, in Q3.
• Restructuring costs appear contained in the latest quarter. Q4 included a $3.6 million restructuring benefit compared with a $362.8 million impairment charge and a $400,000 restructuring benefit in Q3. Lower unusual charges could support earnings if sustained.
• Inventory declined modestly during the latest quarter. Net inventory fell from $807.5 million at Q1 2026 to $778.2 million at Q2 and $786.3 million at Q3, which may reduce some inventory-related working-capital pressure.
• Gross margins remain relatively strong but volatile. Q4 gross profit was $772.7 million on $1.27 billion of revenue, implying a margin of about 60.9%. That was below Q3’s approximately 61.8% margin and well below the roughly 64.5% margin in Q1.
• Capital spending remains steady. Coty spent $43.4 million on property, plant and equipment in Q4, following quarterly spending of approximately $46 million to $54 million earlier in fiscal 2026. This supports operations but limits free cash flow while earnings remain weak.
• Revenue has weakened from the highs seen in fiscal 2024 and 2025. Quarterly revenue reached $1.73 billion in Q2 2024 and $1.67 billion in Q1 and Q2 2025, but fell to $1.25 billion in Q4 2025 and remained near $1.27 billion in Q4 2026.
• Profitability has deteriorated substantially over the reported period. Coty posted common-shareholder profits of $514.7 million in Q4 2023 and $180.9 million in Q2 2024, but reported common-shareholder losses in Q3 2025, Q4 2025, and all three reported fiscal 2026 quarters before the Q4 improvement.
• The balance sheet remains highly leveraged and asset-heavy. At March 31, 2026, Coty had $3.17 billion of long-term debt, $2.36 billion of current liabilities and only $257.1 million of cash. Goodwill and intangible assets totaled approximately $6.67 billion, while retained earnings were negative $5.74 billion, leaving the company exposed to additional impairment or refinancing risk.

Overall, Coty’s financial profile is mixed. The latest quarter brought better operating cash flow, lower losses and continued debt-management activity. However, revenue remains well below earlier-period levels, operating income was still negative at $42.7 million, and cash generation has been inconsistent. Investors should watch whether the company can restore positive operating profitability without relying on impairment reversals, working-capital benefits or additional borrowing.