Core Viewpoint - Estée Lauder Group demonstrated resilience in the Chinese market, achieving mid-single-digit growth despite a global net sales decline of 10% to $3.55 billion (approximately RMB 25.81 billion) in the third quarter of fiscal year 2025 [2][4][10]. Group 1: Financial Performance - The group reported a 10% year-over-year decline in global net sales, with a total of $3.55 billion [4][10]. - Organic sales in the Asia-Pacific region decreased by 1%, with net sales of $1.14 billion, while the Chinese mainland market showed mid-single-digit growth [10][12]. - The skincare category saw the largest sales decline of 12%, totaling $1.807 billion, primarily due to a contraction in the Asia-Pacific travel retail business and weak consumer demand [4][5][12]. Group 2: Strategic Initiatives - The company is implementing a "Profit Recovery and Growth Plan" (PRGP) to enhance gross margins, which increased to 75% despite the sales decline [4][13]. - Estée Lauder is focusing on structural changes and cost optimization to maintain profitability amid challenges such as weak demand and geopolitical risks [13][31]. - The group is accelerating consumer coverage by introducing new brands and products, such as "The Ordinary" in the Chinese market, and expanding its retail presence [25][31]. Group 3: Market Dynamics - The high-end beauty market in China is facing pressure from domestic brands and changing consumer preferences, leading to a decline in the premium segment's growth rate [29][30]. - The company is adapting its strategy to integrate travel retail with general market operations, reflecting the importance of the Chinese market in its global strategy [29][34]. - Estée Lauder's brands, including La Mer and Tom Ford, are experiencing varying degrees of sales performance, with La Mer achieving a 19.8% growth in early 2025 [17][20]. Group 4: Future Outlook - The CEO expressed confidence in restoring sales growth by fiscal year 2026, contingent on resolving tariff issues and aligning with current market trends [13][29]. - The company is committed to innovation and digital channel expansion to drive long-term growth, particularly in the high-end market [13][31][34].