ESTEE LAUDER COMPANIES INCEL
ESTEE LAUDER COMPANIES INC Segments Disclosure
SEGMENT DATA AND RELATED INFORMATION
Operating segments include components of an enterprise for which separate financial information is available that are regularly reviewed by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is the Chief Executive Officer (the “CEO”). As a result of the similarities in the manufacturing, marketing and distribution processes for the Company’s products, much of the information provided in the consolidated financial statements is similar to, or the same as, that reviewed on a regular basis by the CEO. While the Company’s results of operations are reviewed on a consolidated basis, the CEO also reviews data segmented on a basis that facilitates comparison to industry statistics. Although the Company operates in one business segment, beauty products, the CEO evaluates performance based on its four major product categories: skin care, makeup, fragrance and hair care. These product categories meet the definition of operating and reportable segments and, accordingly, additional financial data is provided below. Skin care products include moisturizers, serums, cleansers, toners, eye care, body care, exfoliators, acne and oil corrections, facial masks and sun care products. Makeup products include foundations, powders, concealers, and setting sprays, lipsticks, lip liners and lip glosses, and mascaras, eyeshadows and eye liners. Fragrance products include parfum, eau de parfum, eau de toilette, eau de cologne and body spray, as well as lotions, creams, powders, candles and soaps that are based on a particular fragrance. Hair care products include shampoos, conditioners, styling products, treatment, finishing sprays and hair color products. Royalty revenue associated with the license of the TOM FORD trademark as discussed in Note 15 - Revenue Recognition, as well as sales and related results of ancillary products and services that do not fit within the Company's definitions of skin care, makeup, fragrance and hair care are included in the other category.
The CEO assesses each reportable segment’s performance using their respective operating income. Segment operating income is used in developing the overall strategy and during the annual budget process, as well as considered in budget-to-actual variances on a monthly basis when making decisions about the allocation of operating and capital resources to each reportable segment. Segment net sales and operating income is before the impacts of restructuring and other activities and the impacts from the other category described above. Returns and charges associated with restructuring and other activities are not allocated to the Company's segments because they are centrally directed and controlled, are not included in internal measures of segment performance and result from activities that are deemed Company-wide initiatives to redesign, resize and reorganize select areas of the business.
The accounting policies for the Company’s reportable segments are the same as those described in the summary of significant accounting policies, with the exception that the impacts of restructuring and other activities are not allocated to the reportable segments. The assets and liabilities of the Company are managed centrally and are reported internally in the same manner as the consolidated financial statements; thus, no additional information is produced for the CEO or included herein.
Information about the Company's four operating segments is as follows:
| (in millions) | June 30, 2025 | |||||||||||||||||||||||||||||||
| Skin Care | Makeup | Fragrance | Hair Care | Total | ||||||||||||||||||||||||||||
Net sales | $ | 14,326 | ||||||||||||||||||||||||||||||
Less: Other category net sales | 100 | |||||||||||||||||||||||||||||||
Less: Returns associated with restructuring and other activities | 3 | |||||||||||||||||||||||||||||||
Segment net sales | $ | 6,962 | $ | 4,205 | $ | 2,491 | $ | 565 | $ | 14,223 | ||||||||||||||||||||||
| Cost of sales | 1,817 | 1,131 | 571 | 158 | 3,677 | |||||||||||||||||||||||||||
| Selling, general and administrative expenses | 4,196 | 3,048 | 1,749 | 448 | 9,441 | |||||||||||||||||||||||||||
Impairment of goodwill and other intangible assets | 375 | 308 | 549 | — | 1,232 | |||||||||||||||||||||||||||
Other segment items(1) | — | 159 | — | — | 159 | |||||||||||||||||||||||||||
Segment operating income (loss) | $ | 574 | $ | (441) | $ | (378) | $ | (41) | $ | (286) | ||||||||||||||||||||||
Other category operating loss | (13) | |||||||||||||||||||||||||||||||
Charges associated with restructuring and other activities | (486) | |||||||||||||||||||||||||||||||
Operating loss | (785) | |||||||||||||||||||||||||||||||
Reconciliation to loss before income taxes: | ||||||||||||||||||||||||||||||||
| Interest expense | (357) | |||||||||||||||||||||||||||||||
| Interest income and investment income, net | 114 | |||||||||||||||||||||||||||||||
| Other components of net periodic benefit cost | (12) | |||||||||||||||||||||||||||||||
Loss before income taxes | $ | (1,040) | ||||||||||||||||||||||||||||||
Segment depreciation and amortization | $ | 403 | $ | 243 | $ | 144 | $ | 33 | $ | 823 | ||||||||||||||||||||||
Other category | 6 | |||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | 829 | ||||||||||||||||||||||||||||||
(1) Other segment items include Talcum litigation settlement agreements | ||||||||||||||||||||||||||||||||
| (in millions) | June 30, 2024 | |||||||||||||||||||||||||||||||
| Skin Care | Makeup | Fragrance | Hair Care | Total | ||||||||||||||||||||||||||||
Net sales | $ | 15,608 | ||||||||||||||||||||||||||||||
Less: Other category net sales | 115 | |||||||||||||||||||||||||||||||
Less: Returns associated with restructuring and other activities | (1) | |||||||||||||||||||||||||||||||
Segment net sales | $ | 7,908 | $ | 4,470 | $ | 2,487 | $ | 629 | $ | 15,494 | ||||||||||||||||||||||
| Cost of sales | 2,278 | 1,290 | 624 | 191 | 4,383 | |||||||||||||||||||||||||||
| Selling, general and administrative expenses | 4,424 | 3,087 | 1,598 | 490 | 9,599 | |||||||||||||||||||||||||||
Impairment of goodwill and other intangible assets | 471 | — | — | — | 471 | |||||||||||||||||||||||||||
Segment operating income (loss) | $ | 735 | $ | 93 | $ | 265 | $ | (52) | $ | 1,041 | ||||||||||||||||||||||
Other category operating income | 53 | |||||||||||||||||||||||||||||||
Charges associated with restructuring and other activities | (124) | |||||||||||||||||||||||||||||||
Operating income | 970 | |||||||||||||||||||||||||||||||
Reconciliation to earnings before income taxes: | ||||||||||||||||||||||||||||||||
| Interest expense | (378) | |||||||||||||||||||||||||||||||
| Interest income and investment income, net | 167 | |||||||||||||||||||||||||||||||
| Other components of net periodic benefit cost | 13 | |||||||||||||||||||||||||||||||
| Earnings before income taxes | $ | 772 | ||||||||||||||||||||||||||||||
Segment depreciation and amortization | $ | 418 | $ | 236 | $ | 132 | $ | 33 | $ | 819 | ||||||||||||||||||||||
Other category | 6 | |||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | 825 | ||||||||||||||||||||||||||||||
| (in millions) | June 30, 2023 | |||||||||||||||||||||||||||||||
| Skin Care | Makeup | Fragrance | Hair Care | Total | ||||||||||||||||||||||||||||
Net sales | $ | 15,910 | ||||||||||||||||||||||||||||||
Less: Other category net sales | 53 | |||||||||||||||||||||||||||||||
Less: Returns associated with restructuring and other activities | (27) | |||||||||||||||||||||||||||||||
Segment net sales | $ | 8,249 | $ | 4,532 | $ | 2,451 | $ | 652 | $ | 15,884 | ||||||||||||||||||||||
| Cost of sales | 2,397 | 1,319 | 617 | 188 | 4,521 | |||||||||||||||||||||||||||
| Selling, general and administrative expenses | 4,475 | 3,127 | 1,464 | 500 | 9,566 | |||||||||||||||||||||||||||
Impairment of other intangible assets | 100 | 107 | — | — | 207 | |||||||||||||||||||||||||||
Segment operating income (loss) | $ | 1,277 | $ | (21) | $ | 370 | $ | (36) | $ | 1,590 | ||||||||||||||||||||||
Other category operating income | 4 | |||||||||||||||||||||||||||||||
Charges associated with restructuring and other activities | (85) | |||||||||||||||||||||||||||||||
Operating income | 1,509 | |||||||||||||||||||||||||||||||
Reconciliation to earnings before income taxes: | ||||||||||||||||||||||||||||||||
| Interest expense | (255) | |||||||||||||||||||||||||||||||
| Interest income and investment income, net | 131 | |||||||||||||||||||||||||||||||
| Other components of net periodic benefit cost | 12 | |||||||||||||||||||||||||||||||
| Earnings before income taxes | $ | 1,397 | ||||||||||||||||||||||||||||||
Segment depreciation and amortization | $ | 383 | $ | 211 | $ | 117 | $ | 31 | $ | 742 | ||||||||||||||||||||||
Other category | 2 | |||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | 744 | ||||||||||||||||||||||||||||||
For the Company’s geographic region presentation, as disclosed in Note 15 – Revenue Recognition, net sales are attributed to a country based on the legal entity sale location, and this predominantly aligns with the location of the customer, with the primary exception related to the Company’s net sales from the travel retail business. The net sales from the Company’s global travel retail business are included in the Europe, the Middle East & Africa geographic region, with the exception of net sales of Dr.Jart+ in the travel retail channel that are reflected in Korea in the Asia/Pacific geographic region. For the presentation of net sales by country below, the Company has presented this based on the location of the customer (e.g., the customer is the retailer in the wholesale business and the consumer in the direct-to-consumer business), and as such has attributed net sales from the travel retail business to the country to which the product is shipped, and not the Company’s country of legal sale.
The Company is domiciled in the United States. Net sales in the United States, including net sales from travel retail locations in the United States, as well as net sales in foreign countries, including net sales from travel retail locations in that country, that contribute 10% or more of net sales of the Company in fiscal 2025, 2024 and 2023 were as follows:
June 30, | ||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
United States | $ | 3,762 | $ | 3,887 | $ | 3,848 | ||||||||||||||
Mainland China | 3,652 | 4,019 | 4,380 | |||||||||||||||||
Korea(1) | 718 | 1,299 | 1,558 | |||||||||||||||||
All other countries | 6,194 | 6,403 | 6,124 | |||||||||||||||||
Net sales | $ | 14,326 | $ | 15,608 | $ | 15,910 | ||||||||||||||
(1)Korea contributed 10% of consolidated net sales in fiscal 2023. Fiscal 2025 and 2024 amounts were included for comparability purposes only.
The Company’s long-lived assets, consisting of property, plant and equipment, net and operating lease ROU assets, in the United States, and in foreign countries that are 10% or greater of the Company’s consolidated long-lived assets at June 30, 2025, 2024 and 2023 were as follows:
June 30, | ||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2023 | |||||||||||||||||
United States | $ | 1,956 | $ | 2,087 | $ | 2,136 | ||||||||||||||
Japan | 780 | 733 | 753 | |||||||||||||||||
All other countries | 2,388 | 2,149 | 2,087 | |||||||||||||||||
Long-lived assets | $ | 5,124 | $ | 4,969 | $ | 4,976 | ||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Aug 20, 2025 | Showing above |
| 2024 | Aug 19, 2024 | |
| 2023 | Aug 18, 2023 | |
| 2022 | Aug 24, 2022 | |
| 2021 | Aug 27, 2021 | |
| 2020 | Aug 28, 2020 | |
| 2019 | Aug 23, 2019 | |
| 2018 | Aug 24, 2018 | |
| 2017 | Aug 25, 2017 | |
| 2016 | Aug 24, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.