The Estée Lauder Companies Inc. (NYSE:EL) shares climbed 5.2% in pre-market trading after the beauty products group reported stronger-than-expected first-quarter fiscal 2027 results and raised its full-year earnings and sales guidance.
The company reported adjusted earnings of $0.72 per share for the quarter ended September 30, exceeding analysts’ expectations of $0.51 by $0.21.
Quarterly revenue increased 7% year over year to $3.72 billion, compared with $3.48 billion in the corresponding period last year. The result also exceeded the market consensus estimate of $3.64 billion.
Organic net sales grew 6%, supported by stronger demand across most product categories and geographic markets.
The performance reflected continued progress under the company’s Beauty Reimagined strategy, with improvements in profitability and momentum across its luxury fragrance and skincare brands.
Estée Lauder’s first-quarter results demonstrated stronger revenue growth and profitability than analysts had anticipated.
Adjusted earnings per share of $0.72 exceeded the consensus forecast of $0.51, representing an earnings beat of approximately 41%.
Revenue reached $3.72 billion, surpassing the $3.64 billion estimate by $80 million.
The 7% increase in reported revenue was accompanied by 6% organic net sales growth, indicating that underlying business activity contributed to the improvement.
The company attributed its performance to growth across nearly all product categories and geographic regions.
The results provided further evidence of progress in Estée Lauder’s efforts to strengthen its operating performance following the introduction of its Beauty Reimagined strategy.
Fragrance was the strongest-performing product category during the quarter, recording organic sales growth of 20%.
The increase was supported by Estée Lauder’s portfolio of luxury brands, including Le Labo, TOM FORD and Jo Malone London.
Demand for premium fragrance products contributed significantly to the company’s overall sales performance.
The skincare category also recorded growth, with organic sales increasing 4% year over year.
The Ordinary maintained positive momentum, contributing to the performance of the company’s skincare portfolio.
Growth across these brands helped support Estée Lauder’s broader recovery and reflected demand across different segments of the prestige beauty market.
The company also reported improvements across nearly all geographic regions, although the announcement did not provide individual regional growth figures.
Chief Executive Officer Stéphane de La Faverie described the first quarter of fiscal 2027 as another important stage in Estée Lauder’s business transformation.
“Our first quarter of fiscal 2027 marks another powerful step forward for The Estée Lauder Companies. Growth is accelerating, profitability is strengthening significantly, and the impact of Beauty Reimagined is becoming increasingly evident across our business,” de La Faverie said.
The Beauty Reimagined strategy is intended to support stronger growth and improve the company’s operating performance.
The latest results indicate that the programme is contributing to improved profitability alongside higher sales.
Management’s comments also reflected confidence in the company’s ability to maintain momentum during the remainder of the financial year.
Estée Lauder reported a substantial improvement in operating profitability during the quarter.
Adjusted operating margin increased to 12.1%, compared with 7.3% in the corresponding period last year.
The improvement represented an expansion of 480 basis points, or 4.8 percentage points.
The company attributed the increase to operational efficiencies and improved sales leverage.
Higher revenue allowed the business to spread certain operating costs across a larger sales base, while efficiency measures also supported profitability.
The margin improvement was an important component of the stronger-than-expected financial results and contributed to management’s decision to raise its full-year outlook.
Following the first-quarter performance, Estée Lauder increased its organic net sales growth forecast for fiscal 2027.
The company now expects organic sales to increase between 4.0% and 5.5%, compared with its previous guidance of 3% to 5%.
The midpoint of the revised range is 4.75%, above the previous midpoint of 4%.
The higher forecast reflects improved expectations for the company’s underlying sales performance during the financial year.
The revised outlook follows the 6% organic growth recorded in the first quarter, supported by the strength of the fragrance business and continued improvements in skincare.
Estée Lauder also raised its adjusted earnings per share guidance for fiscal 2027.
The company now expects adjusted EPS between $3.20 and $3.45, compared with its previous forecast of $3.10 to $3.35.
The midpoint of the new range is approximately $3.33, up from the previous midpoint of approximately $3.23.
Management also increased its adjusted operating margin forecast.
The company now expects an adjusted operating margin between 12.9% and 13.7%, compared with its earlier guidance of 12.7% to 13.5%.
The revised forecasts indicate that Estée Lauder expects continued improvements in profitability as it progresses through fiscal 2027.
The combination of higher sales expectations and stronger anticipated margins suggests that management expects operational improvements to continue contributing to earnings growth.
Alongside its financial results, Estée Lauder declared a quarterly dividend of $0.35 per share.
The dividend is scheduled for payment on December 15, 2026.
The announcement maintains the company’s quarterly cash distribution to shareholders as it continues implementing its business transformation strategy.
No additional changes to the company’s dividend policy were disclosed in the results announcement.
Estée Lauder’s first-quarter fiscal 2027 results demonstrated improvements in sales growth, earnings and operating margins.
Adjusted earnings of $0.72 per share exceeded expectations, while revenue increased 7% to $3.72 billion.
Fragrance sales growth of 20%, continued skincare momentum and a 480-basis-point improvement in adjusted operating margin contributed to the stronger performance.
The company responded by raising its full-year organic sales growth, adjusted earnings and operating margin guidance.
The 5.2% pre-market share price increase reflected investor optimism following the earnings beat and improved financial outlook.
Looking ahead, investors will monitor whether Estée Lauder can sustain growth across its luxury brands, maintain profitability improvements and deliver the higher expectations established for fiscal 2027.
Estee Lauder stock price
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