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The Estee Lauder Companies Inc. EL is likely to register a decline in its top and bottom lines when it reports second-quarter fiscal 2025 earnings on Feb. 4. The Zacks Consensus Estimate for net sales is pegged at almost $4 billion, suggesting a decrease of 6.9% from the prior-year quarter's level.
The consensus mark for fiscal second-quarter earnings has remained unchanged in the past 30 days at 32 cents per share, indicating a decline of 63.6% from the figure reported in the year-ago quarter. EL has a trailing four-quarter earnings surprise of 93.4%, on average.
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Things to Know About EL’s Upcoming Results
The Estee Lauder Companies is navigating a challenging market environment, with persistent weaknesses in Mainland China and global travel retail. A decline in consumer sentiment in China is contributing to a slowdown in the prestige beauty sector and lower conversion rates across these markets.
On its last earnings call, management highlighted that it expects significant headwinds in retail across China and Asia travel retail, as the company does not anticipate any immediate benefit from new economic stimulus measures in China. For the fiscal second quarter, The Estee Lauder Companies anticipates a reported organic net sales decline of 6-8% compared to the previous quarter’s level, along with adjusted earnings per share (EPS) decline of 60-77%, ranging from 20 to 35 cents. Our model suggests a 7% organic net sales decline in the to-be-reported quarter.
The Estee Lauder Companies Inc. Price and EPS Surprise
The Estee Lauder Companies Inc. price-eps-surprise | The Estee Lauder Companies Inc. Quote
Despite these challenges, The Estee Lauder Companies is benefiting from its Profit Recovery and Growth Plan, which focuses on three main areas: accelerating margin expansion, fueling growth through targeted investments and simplifying processes to enhance agility. The company’s expanded presence in high-growth digital channels is also a positive factor. In addition, EL is well-positioned in emerging markets, where demand is steadily increasing.
Earnings Whispers for EL Stock
Our proven model predicts an earnings beat for The Estee Lauder Companies this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The Estee Lauder Companies carries a Zacks Rank #3 and has an Earnings ESP of +1.33%.