Coty has missed analyst expectations for Q4 2024, but remains optimistic for the outlook of luxury beauty.
The divestiture of its Lacoste fragrance licence impacted net revenue by 2% and the reduction of retailer inventory compared to the prior year were highlighted as reasons.
The owner of Kylie Cosmetics and CoverGirl reported a net revenue of US$1.36bn for the quarter ending 30 June, compared to the $1.38bn estimated.
Coty reported a 10% increase in revenue for the full year to $6.11bn, citing its prestige fragrance, cosmetics and skin care brands as key drivers.
"In a dynamic macroeconomic backdrop, beauty maintains its privileged position," said Sue Nabi, CEO of Coty, on a call to investors.
"Beauty is at the sweet-spot of desire, wellbeing, self-confidence, affordability, ritual, indulgence, and many new things that we and our consumers will invent.
"This is what fuels the strong global beauty growth that we continue to see to this day and which we expect to continue for the quarters and years to come."
Coty's prestige division, which includes Marc Jacobs Daisy and Burberry Goddess, grew by 13% in 2024.
The company's luxury fragrance portfolio was highlighted for its double-digit performance and strong growth in Q4 in North America, the UK, Spain, Italy and travel retail.
Consumer beauty – which includes Adidas, Beckham and Sally Hansen – was up by 6% in 2024.
Growth was reported across its mass fragrance, skin and body care lines.
Coty has identified prestige skin care and make-up brands, particularly its Lancaster, Orveda and Kylie Cosmetics brands, as key growth engines.
Ultra-luxury perfumes will also be a priority for the brand owner.
"Ultra premium fragrances still account for only 1% of our sales and are growing double digits," said Nabi.
"We are seeing growth across Chloe Atelier des Fleurs, Burberry Signature, Boss the Collection and now Infiniment Coty, which is off to a fantastic start above our expectations and has become a best-selling niche fragrance brand at a famous London department store.
"In the coming years, we aim to capture our fair share in this market, which presents a multi hundred-million-dollar opportunity."
