Core Insights - Shiseido reported a sales revenue of 229.96 billion yuan for the first half of 2025, a decrease of 7.6% year-on-year, marking the largest decline in the past five years [1][4][5] - The core operating profit for the same period was 11.38 billion yuan, reflecting a year-on-year increase of 21.3% [1][2][5] - The decline in sales was observed across all five major business regions globally, with the largest drop in the China travel retail segment, which saw a 12.4% decrease [1][10][16] Financial Performance - The sales revenue for the first half of 2025 was 229.96 billion yuan, down 7.6% year-on-year, and down 6.1% when adjusted for local currency [2][5] - Core operating profit increased to 11.38 billion yuan, up approximately 2 billion yuan from the previous year, representing a 21.3% growth [2][5] - Operating profit turned from a loss of 1.33 billion yuan in the previous year to a profit of 8.81 billion yuan [2][5] Historical Performance - The first half of 2025 marked the largest sales decline for Shiseido in the past five years, with previous years showing either growth or minimal decline [4][5] - In 2021, Shiseido recorded the highest sales growth of 21.5% in the first half, while other years had growth rates below 3% [4][5] Regional Performance - The China travel retail segment's sales were 84.76 billion yuan, down 12.4%, making it the most significant decline among all regions [10][16] - The Americas region saw a 10.1% decrease in sales, while the Asia-Pacific and European regions experienced declines of 2.3% and 5.3%, respectively [10][16] - Japan's sales decreased by 0.6%, indicating a broad downturn across all major markets [10][16] Brand Performance - Among Shiseido's brands, CPB, NARS, and ELISE showed positive growth, with ELISE achieving a 12% increase in sales [6][9] - The overall brand sales declined by 4%, but excluding the China travel retail area, the brand's sales increased by 4% [9][16] - The brand "Zui Xiang" experienced a significant drop in sales by 57% [9][16] Strategic Initiatives - Shiseido aims to achieve a core operating profit of 36.5 billion yen (approximately 17.77 billion yuan) for the year, despite the sales decline [17][18] - The company plans to cut costs globally, having already reduced 13.5 billion yen (approximately 6.57 billion yuan) in the first half of the year, with a target of 50 billion yen (approximately 24.34 billion yuan) in total cost reductions over the next two years [18] - Shiseido is focusing on brand optimization, management efficiency, and cost control to navigate the challenging market environment [17][18]