Coty Inc. Reports $1.68 Billion Revenue with $123.6 Million Net Loss for December 2025 Quarter

Coty Inc. reported a net revenue of $1,678.6 million for the three months ended December 31, 2025, a slight increase of 1% from $1,669.9 million in the same period last year. However, the company experienced a net loss attributable to Coty Inc. of $123.6 million, compared to a net income of $23.7 million in the prior year. The loss was primarily driven by a realized loss of $201.9 million from the sale of its remaining equity interest in Wella, alongside increased costs in sales and administrative expenses. The earnings per share for the quarter were $(0.14), down from $0.02 in the previous year.

In terms of operational performance, Coty’s Prestige segment saw a revenue increase of 2% to $1,133.6 million, while the Consumer Beauty segment experienced a decline of 2% to $545.0 million. The overall revenue growth was supported by a 1% increase in unit volume, particularly in body care brands, and a positive foreign currency exchange impact of 4%. However, the company faced challenges with pricing and mix, which negatively impacted revenues by 4%, primarily due to increased trade incentives and a shift towards lower-priced products in Brazil.

Coty's cost of sales rose by 9% to $608.0 million, leading to a gross margin decrease of approximately 290 basis points to 36.2%. This decline was attributed to higher manufacturing and material costs, increased freight costs, and higher designer license fees. Selling, general, and administrative expenses also increased by 6% to $842.5 million, reflecting higher advertising costs and operational accruals. Consequently, operating income fell to $148.2 million, a 45% decrease from $268.2 million in the prior year.

Strategically, Coty completed the sale of its remaining 25.8% equity interest in Wella for $750 million in cash, which was used to redeem a portion of its outstanding Euro Senior Secured Notes. The company is also undergoing a Fixed Cost Reduction Plan aimed at streamlining operations and reducing costs, with an estimated cash cost of approximately $80 million expected to be incurred over fiscal years 2026 and 2027. Looking ahead, Coty anticipates a decline in net revenue for the third quarter of fiscal 2026, with ongoing efforts to mitigate the impact of tariffs and enhance operational efficiency.