Estée Lauder (EL)’s China Bet Just Paid Off. Its Makeup Business Still Hasn’t Caught Up

Estée Lauder (EL)’s China Bet Just Paid Off. Its Makeup Business Still Hasn’t Caught Up Fatima Gulzar Fri, August 28, 2026 at 4:31 PM GMT+2 3 min read EL The Estée Lauder Companies Inc. (NYSE: EL ) forecast fiscal 2027 adjusted earnings per share of $3.

10 to $3. 35, above analyst estimates, after fourth-quarter net sales rose 6. 3% to $3.

63 billion on strong demand for its luxury fragrance and skincare brands. It sent shares up 11% in premarket trading on August 19, 2026. Why This Matters Estée Lauder is showing recovery in fragrance and skincare after years of turnaround work, but its makeup and hair care categories remain flat or declining.

Is this the start of a genuine company-wide turnaround, or just strength in categories that were already working while the harder problems remain unsolved? Estée Lauder (EL)'s China Bet Just Paid Off. Its Makeup Business Still Hasn't Caught Up What Drove Success for The Company Luxury perfume brands Le Labo and Tom Ford drove 10% sales growth in that category.

CEO Stéphane de La Faverie said the company will keep pushing what is working. The Estée Lauder Companies Inc. (NYSE:EL) has already cut roughly 10,000 jobs, freeing up about $1.

2 billion as it shifts toward faster-growing channels like Amazon and TikTok Shop. The company also booked a $38 million tariff-refund benefit and reported real sales growth in mainland China, and adjusted profit of 39 cents a share beat the 32-cent guess. It echoes the same tariff-refund boost that lifted results across retail this same reporting period, including at Target and Walmart.

What Missed the Mark for The Company Makeup sales stayed flat, and hair care sales dropped 1%. De La Faverie himself said the company isn't happy with either category's results. Fourth-quarter results still included a $116 million net loss, even though that shrank from a $546 million loss a year earlier.

It means steady profit hasn't fully returned despite the perfume strength. The full-year hit from added tariffs was $102 million, only partly offset by the $38 million refund, and The Estée Lauder Companies Inc. (NYSE:EL)'s turnaround costs already ran a bit above the top end of its earlier guided range of $1.

5 billion to $1. 7 billion. It is a sign the fix is costing more than first planned.

Insider Monkey's Hedge Fund Data The Estée Lauder Companies Inc. (NYSE:EL) was held by 47 hedge funds as of Q1 2026, down from 50. For comparison, rival Coty was held by 32 hedge funds, and e.

l. f. Beauty by 39.

Conclusion Estée Lauder's fragrance and skincare strength is real and durable, but the company's own admission that makeup and hair care still lag shows this turnaround remains only half finished. While we acknowledge the potential of EL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock .

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