L’Oréal Group’s fourth-quarter sales rose 6% like-for-like to €11.2 billion, slightly below analyst expectations of a 6.3% increase. This marks an acceleration in sales growth, following a lower third-quarter revenue increase of 4.2%. For the 2025 full year, ended December 31, group sales were up 4% to €44 billion. The miss on expectations, largely due to travel retail disruption in China, sent the company’s stocks down 3.8% in Friday trading.
“The past 18 months have been challenging for L’Oréal,” wrote Bernstein analyst Callum Elliott in a note shared on February 10, ahead of the earnings. “From the heights of 2021, when global beauty growth peaked at around 8%, 2025 growth slowed to around the 4% level — its slowest pace since 2013 to 2015 in the wake of the European debt crisis. Exiting 2025, however, we see green shoots of a recovery.”
By comparison, Estée Lauder Companies sales grew 4% to $4.16 billion in its second quarter, while LVMH’s perfumes and cosmetics division reported a 1% organic sales decrease to €2.13 billion in Q4. Elliott noted the “very mixed messages from peers, with weak beauty numbers at LVMH, but stronger performance at Estée, which muddy the read-across for luxury [as a whole]”.
At L’Oréal, dermatological beauty (including Cerave and La Roche-Posay) led company growth, with sales up 11.5% in the fourth quarter. Professional products (Kerastase, Redken) were up 7.6%, consumer products (L’Oréal Paris, Maybelline) were up 4.8%, while L’Oréal Luxe (Kiehl’s, Yves Saint Laurent) was up 4.5%. From a geographic standpoint, sales in North America (up 8.6%) and Latin America (up 8.2%) offset softer sales in North Asia (up 0.6%). Europe was up 6.6%, and SAPMENA-SSA (South Asia-Pacific, the Middle East, North Africa, and Sub-Saharan Africa) was up 10.7%.
“As we had promised, organic top-line growth accelerated quarter after quarter, boosted by the step-up in our launch plan and supported by a gradually improving beauty market,” L’Oréal CEO Nicolas Hieronimus said in a statement. The executive is “optimistic” about the global beauty market in 2026, and is “confident in [L’Oréal’s] ability to keep outperforming, thanks to L’Oréal’s multi-division category strategy, and to achieve another year of growth in sales and profit”.
L’Oréal’s annual earnings conference, held at its HQ on Friday, provided further detail into the plans for Kering Beauté, after L’Oréal acquired the portfolio for €4 billion last October. The CEO was asked whether L’Oréal would be interested in taking on the Gucci license earlier — which it can assume once Coty’s current agreement expires (scheduled for 2028) — in case Coty agrees to an early termination, and whether this would require an additional payment to Kering. “It’s being discussed between Kering and Coty, so I cannot comment,” Hieronimus said. “We would be happy to get the brand sooner. There’s no extra [payment] in the deal for that.”
The deal includes the right to enter a licensing agreement with Gucci after its expiration with Coty, and a joint venture to explore the business opportunities of longevity.
Regarding the three other brands that are part of the deal (Creed, Balenciaga and Bottega Veneta), L’Oréal Luxe president Cyril Chapuy said: “As soon as non-compete [reviews] are complete, we’ll take over the brands, so it will be sometime during Q2.” The executive added that they each share strong potential. “Creed is the number three player in collectsion fragrances, which is the part of the fragrance market that grows the fastest. The brand [generates] around €350 million, and we think it can quickly become a billionaire brand,” she said. “Regarding Bottega Veneta and Balenciaga, they are solid fashion brands with distinctive territories — one is exceptional craftsmanship, and the other is disruptive high fashion statements, which is great DNA for beauty.”
Hieronimus referenced the success of the beauty license of Yves Saint Laurent, another Kering house that L’Oréal has operated beauty for since 2008: “Today, YSL beauty is bigger in size than YSL fashion, so who knows, if we could do the same for Gucci, it would be fantastic.” (Saint Laurent fashion sales were €2.6 billion in 2025, while Gucci sales were €6 billion.)
