The Estée Lauder Companies is incorporating a new strategic plan for profitability and growth amid announcements the beauty giant will lay off up to 11% of its workforce after sales dropped by $200 million in last year’s golden quarter.
The company’s new CEO, Stéphane de la Faverie, said during a recent earnings call that a freshly restructured Executive Team will carry out the company’s strategic plan, “Beauty Reimagined,” to create “a flatter, leaner organization and simplified operations.”
Among other initiatives, the plan will consolidate the company’s global regions from seven geographic clusters to four, and will drop between 5,800 to 7,000 jobs from its 62K workforce by the end of June next year.
The goal is to return the company to “sustainable sales growth” and to deliver double-digit adjusted operating margin over the next several years.
The announcement comes after Estée Lauder reported that net sales dropped 6% to $4 billion in the second quarter ending in December 2024, compared to $4.2 billion the previous year.
Beauty Reimagined is de la Faverie’s iteration of the Profit Recovery and Growth Plan that his predecessor, Fabrizio Freda, introduced before stepping down at the end of 2024.
Leading the company’s brand portfolio is Jane Hertzmark Hudis as Executive Vice President, Chief Brand Officer. Updates to brand clusters include:
- Shane Wolf continuing to manage the haircare brand cluster, including Aveda and Bumble and bumble;
- Justin Boxford continuing to lead Estée Lauder and AERIN Beauty;
- Sandra Main will oversee the skincare brand cluster, including La Mer, Clinique, Origins, The Ordinary, Darphin, and Lab Series;
- The makeup cluster, which includes MAC Cosmetics, Bobbi Brown, Too Faced, and Smashbox, will be overseen by a leader to be named at a later date.