Coty’s revenue drops to $4.6 billion in 9M 2025 under Sue Nabi

Key Points

• Coty’s revenue dropped 2.4% to $4.64 billion for the first nine months of fiscal 2025, impacted by currency challenges and a tough market environment.
• Operating income fell 55.94% to $225.6 million, and Coty posted a net loss of $309 million for the period, reversing last year’s profit.
• CEO Sue Nabi remains optimistic about recovery, targeting $370 million in savings by FY27, with a focus on innovation, e-commerce, and improved profitability.

Coty, a leading global player in the beauty industry led by Algerian-born French tycoon Sue Youcef Nabi, faced a tough financial period for the first nine months of its 2025 fiscal year. Revenue dropped to $4.64 billion, marking a 2.4 percent decline compared to the previous year. This drop was attributed to currency challenges and a difficult market environment.

The prestige segment, which accounts for 66 percent of total sales, demonstrated resilience. Net revenue grew by 2 percent on a like-for-like basis, maintaining stability year-on-year. However, this growth was somewhat muted by a sluggish U.S. fragrance market, the effects of last year’s strong innovation cycle, and high retailer inventory levels.

Operating income falls 55.94% in 2025

On the other hand, the Consumer Beauty segment, generating $1.58 billion (34 percent of total sales), saw a 3 percent decline on a like-for-like basis and a 7 percent decrease on a reported basis. The segment experienced mixed results in cosmetics and fragrances, prompting Coty to reassess its strategy. The company is now focusing on optimizing profitability, particularly within its high-margin mass fragrance category.

Coty's operating income took a hit, falling by 55.94 percent to $225.6 million in the first nine months of fiscal 2025, compared to $512 million the year before. This drop was largely due to macroeconomic uncertainty and foreign exchange challenges. The net loss for the period widened to $309 million, reversing the $176.4 million net income seen in the same period last year. A $0.21 per share negative impact from an equity swap also contributed to the loss. On an adjusted basis, earnings per share came in at $0.27, down from $0.39 in the previous year.

Coty's path to profit amid challenges

Despite these setbacks, CEO Sue Nabi expressed confidence in Coty’s future, pointing to a strengthened business foundation, a robust innovation pipeline, and leadership in both prestige and mass fragrances. She described fiscal 2025 as a transitional year, noting inventory adjustments and softer U.S. market conditions, but emphasized that Coty is entering fiscal 2026 with a more solid starting point.

Looking ahead, Nabi believes Coty is well-positioned for a strong recovery, bolstered by new product launches, cost savings from the company’s “All-in to Win” program, and strong growth in e-commerce. With these factors in place, Coty aims to outperform its peers, expand profit margins, and maintain profitability despite ongoing economic uncertainties, foreign exchange challenges, and changing consumer trends.

Coty targets $370 million in savings by FY27

Since Sue Nabi took over in 2019, Coty has undergone a significant transformation, sharpening its focus on fragrances, color cosmetics, and skincare. Although the company has faced recent challenges, it remains a dominant force in the global beauty market, holding the second spot in hair color and styling and the third position in color cosmetics. Nabi, who owns a 3.7 percent stake in Coty, has aggressively pursued growth strategies over the past three years.

Coty's “All-in to Win” initiative, which is entering its next phase, aims to generate $370 million in savings by FY27. With a strategy centered on innovation, expanding distribution channels, and strengthening leadership in the U.S. market, Nabi is positioning Coty for steady recovery.

For fiscal 2025, the company expects to generate $300 million in free cash flow, with EPS guidance set between $0.49 and $0.50, at the lower end of previous expectations. With brand strength and profitability at multi-year highs, Coty is poised to capitalize on the resilience of the beauty industry and build on this momentum into FY26 and beyond.