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Coty said it expects like-for-like sales to fall in both the current and following quarter before returning to positive territory in the second half of the fiscal year
Coty reported an unexpected quarterly loss, which it blamed on retailers being “cautious.”
Like-for-like sales dropped 9% year-over-year.
Coty said it expects like-for-like sales to fall in both the current and following quarter before returning to positive territory in the second half of the fiscal year.
Shares of Coty (COTY) plunged 20% in premarket trading Thursday, a day after the cosmetics maker posted a surprise loss and gave weak guidance as retailers pulled back on orders.
The company behind its namesake brand, Max Factor, and many others reported a fiscal fourth-quarter net loss attributable to shareholders of $72.1 million and an adjusted decline of $0.05 per share. Analysts surveyed by Visible Alpha were looking for net income of $37.6 million, and an adjusted profit of $0.01 per share. Revenue fell 8% year-over-year to $1.25 billion, but that was better than forecasts. Like-for-like sales dropped 9%.
CEO Sue Nabi explained that during the fiscal year, retailers were “acting with caution in the current environment.” Nabi noted along with retailer restocking, Coty’s results were hurt by “softness” in U.S. demand, pressure in the mass cosmetics market, and slower fragrance sales after a strong fiscal 2024.
Looking ahead, the company said “broader macroeconomic and tariff uncertainty is fueling cautious retailer ordering and a more promotional competitive environment.” It sees current quarter like-for-like sales sinking 6% to 8%, and second quarter like-for-like sales down 3% to 5%. The company added that it anticipates those sales will return to positive gains in the second half of the fiscal year.
Coty shares entered Thursday down 30% year-to-date.
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