Coty Announces Fourth Quarter Fiscal Year 2026 Results

About this update from Coty Inc.

Q4 Results Ahead of Expectations, Including Sales Growth of 1% Growth in FY26 Operating Cash Flow to $538 million and Free Cash Flow to $348 million, Despite Lower Profit Coty.Curated Sets Clear Strategic Framework to Strengthen Business Fundamentals NEW YORK, August 19, 2026 --( BUSINESS WIRE )--Regulatory News: Coty Inc. (NYSE: COTY) (Paris: COTY) ("Coty" or "the Company") today announced its results for the fourth quarter of fiscal year 2026, ended June 30, 2026. Coty delivered Q4 and FY26 sales, profit, and cash flow ahead of expectations, supported by cost control and the convergence of sales and sell-out. "We closed FY26 on a stronger note, delivering sales and profit ahead of our targets, growing free cash flow even in the face of business headwinds, all while establishing a clear strategic framework and taking decisive action to steadily strengthen our core business in FY27 and beyond," said Markus Strobel, Executive Chairman and Interim Chief Executive Officer. "We were pleased to return to reported sales growth, with Q4 sales up 1% year-over-year and a significant sequential improvement in our like-for-like (LFL) trends to down 1%, despite incurring an estimated 1% headwind to sales from the Middle East conflict. It's encouraging to see closer alignment between our sell-in and sell-out. However, we are not content with our sell-out performance, which remains below market levels in both divisions, and steadily closing that gap remains a clear priority across the organization. "Our Coty.Curated strategic framework has entered the execution phase, with tangible actions already taken and further progress ahead. We began rightsizing our commercial organization and Consumer Beauty R&D and global brand marketing functions to enhance agility and accountability. We have also incorporated concrete market share targets into our global incentive program. Our FY27 big bets have been identified, and we will support them with amplified advocacy and consumer engagement programs, while also optimizing the visibility and recommendation of our brands across AI platforms. In Consumer Beauty color cosmetics, we are simplifying the innovation calendar and SKU base, and shifting resources toward fewer, higher-impact launches and proven hero products. We will execute these actions with discipline to minimize the impact on sales. "Over the last three quarters, we have advanced our strategic objectives of simplifying our portfolio, sharpening our focus on the core of our business, and reducing our debt balance. In December 2025, we monetized our remaining stake in Wella for $750 million. In July 2026, we announced an agreement to sell the Gucci Beauty license back to Kering approximately one year ahead of its expiration for $400 million, plus additional proceeds from inventory. These favorable outcomes are fully consistent with our objectives, as we deploy the proceeds toward debt reduction, reinvestment in Coty's core prestige fragrance and beauty brands, and optimization of our organizational structure. "While the Gucci Beauty license exit will result in a step-down in sales and profit in FY28, we are developing plans to help moderate the impact. These plans include accelerating our core brands; maximizing the contribution from new portfolio additions, including makeup under Marc Jacobs Beauty and fragrances under Swarovski, Etro, and Marni; and lowering our cost structure through a significant fixed cost reduction program. These actions are designed to mitigate the FY28 impact and position Coty to accelerate growth across our core portfolio and drive profit expansion in FY29 and beyond. "In sum, our Q4 results provide early signs of stabilization, although the recovery will not be linear. FY27 will be a transition year as we strengthen our core business and continue shaping a simpler, more focused Coty, factoring in both the Gucci exit by FY28 and final portfolio decisions related to our strategic review of Consumer Beauty by the end of CY26. We have important strengths to build on, including leading brands, strong category positions, solid cash generation, and a differentiated end-to-end global platform. We are confident that our focused Coty.Curated framework will unlock Coty's significant potential and steadily translate into shareholder value in the years ahead." Three Months Ended June 30, 2026, Summary Results For the three months ended June 30, 2026, compared to the three months ended June 30, 2025: Twelve Months Ended June 30, 2026, Summary Results For the twelve months ended June 30, 2026, compared to the twelve months ended June 30, 2025: Noteworthy Developments Pipeline for FY27 and Beyond Prestige Plans Consumer Beauty Plans Outlook Consumer demand for beauty remains resilient, with continued growth in fragrances and cosmetics, although consumers are becoming increasingly selective in their purchasing decisions. Coty continues to advance its Coty.Curated strategic framework, focusing on core brands and markets, reducing portfolio complexity, increasing agility through organizational simplification, and identifying savings opportunities across the P&L to support increased investment in consumer engagement while also protecting profitability. Coty expects 1Q27 LFL revenue to decline by a low- to mid-single-digit percentage. While sell-out trends for both divisions are expected to be broadly consistent with the trends in the second half of FY26, the timing of customer orders and prior year comparisons are expected to contribute to fluctuations in year-over-year sales trends. On a reported basis, Coty expects FX to have a neutral impact on revenue in the quarter. Adjusted gross margin in 1Q27 is expected to decline by approximately 50 to 100 basis points year-over-year, reflecting cost absorption headwinds from lower shipments, partially offset by productivity initiatives and procurement actions. Coty anticipates 1Q27 adjusted EBITDA to decline by a low-teens percentage, representing a sequential improvement from the more significant declines in the second half of FY26. This is expected to result in adjusted EPS, excluding the equity swap, of $0.11 to $0.13 per share. Supported by the seasonally strong business dynamics in the first half, as well as continued disciplined capital expenditure and working capital management, Coty expects free cash flow for the first half of FY27 of over $300 million. FY27 is expected to be a transition year as Coty completes its strategic review and advances the early-stage implementation of Coty.Curated. Accordingly, at this stage Coty is providing guidance for Q1 and visibility into first-half free cash flow. Coty's Q1 EBITDA outlook reflects sequential improvement from year-over-year trends in the second half of FY26. The Company expects performance to strengthen progressively throughout FY27, supported by innovation, disciplined execution, cost savings, and strong cash flow generation. Overall, year-over-year EBITDA trends are expected to improve over the course of FY27, supported by ongoing productivity initiatives and cost discipline. Following the expected completion of the Company's strategic review by the end of CY26, and as implementation of Coty.Curated progresses, Coty expects to provide a broader outlook supported by greater visibility into Coty's growth and profitability trajectory. Fourth Quarter Fiscal 2026 Business Review by Segment Prestige Consumer Beauty Fourth Quarter Fiscal 2026 Business Review by Region Americas EMEA Asia Pacific Conference Call Coty Inc. will issue pre-recorded remarks on August 19, 2026, at approximately 4:45 PM (ET) / 10:45 PM (CET) and will hold a live question-and-answer session on August 20, 2026, beginning at 8:00 AM (ET) / 2:00 PM (CET). The pre-recorded remarks and live question-and-answer session will be available at http://investors.coty.com . The dial-in number for the live question-and-answer session is 1-800-343-5172 in the U.S. or 1-203-518-9856 internationally (conference passcode: COTY4Q26). About Coty Inc. Founded in Paris in 1904, Coty is one of the world's largest beauty companies with a portfolio of iconic brands across fragrance, color cosmetics, and skin and body care. Coty serves consumers around the world, selling prestige and mass market products in over 120 countries and territories. Coty and our brands empower people to express themselves freely, creating their own visions of beauty; and we are committed to protecting the planet. Learn more at coty.com or on LinkedIn and Instagram. Forward Looking Statements Certain statements in this Earnings Release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company's current views with respect to, among other things, strategic planning, targets and outlook for future reporting periods (including the extent and timing of revenue, expense and profit trends and changes in operating cash flows and cash flows from operating activities and investing activities, as well as the Company's expectations for the timing, scope and impact of the exit from the Gucci Beauty license), the Company's future operations and strategy (including the ongoing refinement and implementation and related impact of its global business strategies), the Company's plans to evaluate its central organization, manufacturing and asset base, and certain market structures to adjust its scope and size for its future business, the Company's ongoing and future cost efficiency, optimization and restructuring initiatives and programs (including plans to develop a significant fixed-cost savings plan in connection with the exit from the Gucci Beauty license), the ongoing strategic review of the Company's consumer beauty business, including its mass color cosmetics business and associated brands and the Company's distinct Brazil business comprised of local Brazilian brands, the timing and outcome of such strategic review and any transactions related thereto and use of proceeds of any such transactions, expectations and/or plans with respect to joint ventures (including the timing and size of any distribution related to the Wella distribution rights), the Company's capital allocation strategy and payment of dividends (including suspension of dividend payments and the duration thereof and any plans to resume cash dividends on common stock or to continue to pay dividends in cash on preferred stock) and expectations for stock repurchases or investments, expectations with respect to licenses and/or portfolio changes, product launches, relaunches or rebranding (including the expected timing or impact thereof), plans for strengthening presence in certain categories, markets and channels, expectations for the impact, cost, timing and outcome of any future divestitures, expectations for synergies, savings, performance, cost, timing and integration of any future acquisitions, expectations for future cash flows, liquidity and borrowing capacity (including any refinancing or deleveraging activities), timing and size of cash outflows and debt deleveraging, the timing and magnitude of any "true-up" payments in connection with our forward repurchase contracts and plans for the settlement of such contracts, the timing and extent of any future impairments, expected synergies, savings, impact, cost and timing of the Company's ongoing refinement and implementation of its global business strategies (including operational and organizational structure changes, operational execution and simplification initiatives, fixed cost reduction plans, continued process improvements and supply chain changes), the expected impact of geopolitical risks including the ongoing war in Ukraine and/or war in the Middle East on our business operations, sales outlook and strategy, expectations regarding the impact of tariffs (including magnitude, scope and timing) and plans to manage such impact, expectations of the impact of inflationary pressures and the timing, magnitude and impact of pricing actions to offset inflationary costs, expectations regarding economic conditions in Asia, consumer purchasing trends including in travel retail channels in the region and the related impact on sales, the expected impact of global supply chain challenges and/or inflationary pressures (including as a result of the war in Ukraine and/or the war in the Middle East (including the expected impact of elevated Brent crude oil prices), or due to a change in tariffs or trade policy impacting raw materials), and expectations regarding future service levels, inventory levels and excess and obsolescence trends (including as a result of our Coty.Curated framework), the expected impact, cost, timing and implementation of e-commerce and digital initiatives, expectations regarding the expanded use of artificial intelligence and advanced analytics in the Company's operations and the timing and impact thereof, the expected impact, cost, timing and implementation of sustainability initiatives (including progress, plans and goals), and the priorities of senior management. These forward-looking statements are generally identified by words or phrases, such as "anticipate", "are going to", "estimate", "plan", "project", "expect", "believe", "intend", "foresee", "forecast", "will", "may", "should", "outlook", "continue", "temporary", "target", "aim", "potential", "goal" and similar words or phrases. These statements are based on certain assumptions and estimates that we consider reasonable, but are subject to a number of risks and uncertainties, many of which are beyond our control, which could cause actual events or results (including our financial condition, results of operations, cash flows and prospects) to differ materially from such statements, including risks and uncertainties relating to: When used herein, the term "includes" and "including" means, unless the context otherwise indicates, "including without limitation". More information about potential risks and uncertainties that could affect the Company's business and financial results is included under the heading "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Quarterly Report on Form 10-Q for the period ended March 31, 2025 and annual report on Form 10-K for the year ended June 30, 2026 and other periodic reports the Company has filed and may file with the SEC from time to time. All forward-looking statements made in this release are qualified by these cautionary statements. These forward-looking statements are made only as of the date of this release, and the Company does not undertake any obligation, other than as may be required by applicable law, to update or revise any forward-looking or cautionary statements to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, or changes in future operating results over time or otherwise. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance unless expressed as such, and should only be viewed as historical data. Non-GAAP Financial Measures To supplement the financial measures prepared in accordance with GAAP, we use non-GAAP financial measures for Coty Inc. including Adjusted operating income (loss), Adjusted EBITDA, Adjusted net income (loss), and Adjusted net income (loss) attributable to Coty Inc. to common stockholders (collectively, the "Adjusted Performance Measures"). The reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are shown in tables below. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of the business as determined in accordance with GAAP. Other companies, including companies in the beauty industry, may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes. Despite the limitations of these non-GAAP financial measures, our management uses the Adjusted Performance Measures as key metrics in the evaluation of our performance and annual budgets and to benchmark performance of our business against our competitors. The following are examples of how these Adjusted Performance Measures are utilized by our management: In addition, our financial covenant compliance calculations under our debt agreements are substantially derived from these Adjusted Performance Measures. Our management believes that Adjusted Performance Measures are useful to investors in their assessment of our operating performance and the valuation of the Company. In addition, these non-GAAP financial measures address questions we routinely receive from analysts and investors and, in order to ensure that all investors have access to the same data, our management has determined that it is appropriate to make this data available to all investors. The Adjusted Performance Measures exclude the impact of certain items (as further described below) and provide supplemental information regarding our operating performance. By disclosing these non-GAAP financial measures, our management intends to provide investors with a supplemental comparison of our operating results and trends for the periods presented. Our management believes these measures are also useful to investors as such measures allow investors to evaluate our performance using the same metrics that our management uses to evaluate past performance and prospects for future performance. We provide disclosure of the effects of these non-GAAP financial measures by presenting the corresponding measure prepared in conformity with GAAP in our financial statements, and by providing a reconciliation to the corresponding GAAP measure so that investors may understand the adjustments made in arriving at the non-GAAP financial measures and use the information to perform their own analyses. Adjusted operating income/Adjusted EBITDA excludes restructuring costs and business structure realignment programs, amortization, acquisition- and divestiture-related costs and acquisition accounting impacts, stock-based compensation, and asset impairment charges and other adjustments as described below. For adjusted EBITDA, in addition to the preceding, we exclude adjusted depreciation as defined below. We do not consider these items to be reflective of our core operating performance due to the variability of such items from period-to-period in terms of size, nature and significance. They are primarily incurred to realign our operating structure and integrate new acquisitions, and implement divestitures of components of our business, and fluctuate based on specific facts and circumstances. Additionally, Adjusted net income attributable to Coty Inc. and Adjusted net income attributable to Coty Inc. per common share are adjusted for certain interest and other (income) expense items, as described below, and the related tax effects of each of the items used to derive Adjusted net income as such charges are not used by our management in assessing our operating performance period-to-period. Adjusted Performance Measures reflect adjustments based on the following items: The Company has provided a quantitative reconciliation of the difference between the non-GAAP financial measures and the financial measures calculated and reported in accordance with GAAP. For a reconciliation of adjusted gross profit to gross profit, adjusted EPS (diluted) to EPS (diluted), and adjusted net revenues to net revenues, see the table entitled "Reconciliation of Reported to Adjusted Results for the Consolidated Statements of Operations." For a reconciliation of adjusted operating income to operating income and adjusted operating income margin to operating income margin, see the tables entitled "Reconciliation of Reported Operating Income (Loss) to Adjusted Operating Income" and "Reconciliation of Reported Operating Income (Loss) to Adjusted Operating Income by Segment." For a reconciliation of adjusted effective tax rate to effective tax rate, see the table entitled "Reconciliation of Reported Income (Loss) Before Income Taxes and Effective Tax Rates to Adjusted Income Before Income Taxes and Adjusted Effective Tax Rates." For a reconciliation of adjusted net income and adjusted net income margin to net income (loss), see the table entitled "Reconciliation of Reported Net Income (Loss) to Adjusted Net Income." The Company also presents free cash flow, adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA"), immediate liquidity, Financial Net Debt and Economic Net Debt. Management believes that these measures are useful for investors because it provides them with an important perspective on the cash available for debt repayment and other strategic measures and provides them with the same measures that management uses as the basis for making resource allocation decisions. Free cash flow is defined as net cash provided by operating activities less capital expenditures; adjusted EBITDA is defined as adjusted operating income, excluding adjusted depreciation and non-cash stock-based compensation. Net debt or Financial Net Debt (which the Company referred to as "net debt" in prior reporting periods) is defined as total debt less cash and cash equivalents. For a reconciliation of Free Cash Flow, see the table entitled "Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow," for adjusted EBITDA, see the table entitled "Reconciliation of Adjusted Operating Income to Adjusted EBITDA" and for Financial Net Debt, see the tables entitled "Reconciliation of Total Debt to Financial Net Debt." Further, our immediate liquidity is defined as the sum of available cash and cash equivalents and available borrowings under our Revolving Credit Facility (please see table "Immediate Liquidity"). We operate on a global basis, with the majority of our net revenues generated outside of the U.S. Accordingly, fluctuations in foreign currency exchange rates can affect our results of operations. Therefore, to supplement financial results presented in accordance with GAAP, certain financial information is presented in "constant currency", excluding the impact of foreign currency exchange translations to provide a framework for assessing how our underlying businesses performed excluding the impact of foreign currency exchange translations. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We calculate constant currency information by translating current and prior-period results for entities reporting in currencies other than U.S. dollars into U.S. dollars using prior year foreign currency exchange rates. The constant currency calculations do not adjust for the impact of revaluing specific transactions denominated in a currency that is different to the functional currency of that entity when exchange rates fluctuate, or for the impacts of hyperinflation. The constant currency information we present may not be comparable to similarly titled measures reported by other companies. These non-GAAP measures should not be considered in isolation, or as a substitute for, or superior to, financial measures calculated in accordance with GAAP. To the extent that the Company provides guidance, it does so only on a non-GAAP basis and does not provide reconciliations of such forward-looking non-GAAP measures to GAAP due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, including adjustments that could be made for restructuring, integration and acquisition-related expenses, amortization expenses, non-cash stock-based compensation, adjustments to inventory, and other charges reflected in our reconciliation of historic numbers, the amount of which, based on historical experience, could be significant. - Tables Follow -

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