Core Viewpoint - Estée Lauder's Q3 FY2025 financial performance reflects a strategic shift towards a consumer-centric, efficient, and globally competitive high-end beauty enterprise despite ongoing macroeconomic challenges [1] Financial Performance - The overall financial performance met expectations, with organic net sales declining by 9%, and a 3% decline when excluding travel retail, showing improvement from a 4% decline in Q2 [1] - The diluted earnings per share decreased by 33%, but this was better than expected, indicating effective cost management [1] - Gross margin increased for the fourth consecutive quarter by over 300 basis points, attributed to cost control and product mix optimization [1] Regional Performance - Organic net sales in the Asia-Pacific region decreased by 1%, but the mainland China market achieved mid-single-digit growth, offsetting declines in Hong Kong and South Korea [2] - Innovative products like La Mer's Concentrate and Tom Ford's Lip Color contributed to double-digit growth in the Chinese market [2] Product Category Performance - High-end fragrance brands saw low single-digit growth, driven by strong double-digit growth from Le Labo, while skincare and haircare sales declined by 12% and 12% respectively [2] - Skincare sales fell to $1.807 billion, haircare sales to $126 million, and makeup sales to $1.035 billion [2] Strategic Initiatives - The company is focused on "Reinventing Beauty" with five priority initiatives, including optimizing consumer reach and launching The Ordinary in mainland China [2] - New product launches in Q3 received positive feedback, with plans for continued innovation in Q4 [3] Operational Efficiency - The Profit Recovery and Growth Plan (PRGP) has made significant progress, including a 20% reduction in middle management positions and a 30% cost reduction through streamlined execution teams [3] - A new executive team has been established to enhance accountability and efficiency starting from April 1 [3] Market Environment - The company is closely monitoring trade and tariff dynamics, which add uncertainty to the global operating environment [4] - The company has confidence in restoring sales growth in FY2026 if tariff issues are effectively resolved [4]