Core Viewpoint - Estée Lauder is undergoing a gradual but clear recovery, as evidenced by its latest financial report showing a net sales increase of $4.229 billion (approximately 29.353 billion RMB), a year-on-year growth of 6%, and a net profit turnaround from a loss of $590 million (approximately 4.095 billion RMB) in the same quarter of the previous fiscal year to a profit of $162 million (approximately 1.124 billion RMB), marking a significant improvement of 127% [3][4]. Financial Performance - The company has achieved double-digit growth for the second consecutive quarter, with skincare, makeup, fragrance, and scalp care all showing growth, and the latter three categories returning to profitability [3]. - For the fiscal year 2026, Estée Lauder anticipates a return to positive revenue growth, projected between 0% and 3% [4]. - Over the past 12 months, the company's stock price has increased by 46.59% [4]. Strategic Initiatives - The recovery strategy, termed "Beauty Reimagined," focuses on cost-cutting measures such as layoffs, outsourcing non-core services, and divesting underperforming brands while reallocating resources to brands and products with growth potential [5]. - Deciem, a Canadian skincare group, has seen sales surpassing the total of all other skincare brands under Estée Lauder, marking a historic first for the company [5]. - The Ordinary, a key brand under Deciem, has been able to innovate products at a faster pace than traditional brands within the group, launching nine new products in the past year [6]. Brand Development - The luxury skincare brand La Mer is transitioning from a single star product to a more comprehensive high-end skincare system, with an increased pace of new product launches [7]. - Estée Lauder has significantly increased its investment in e-commerce platforms like Amazon, Shopify, TikTok, and Douyin, adopting an aggressive advertising strategy that matches advertising spend to revenue [7]. - Online sales now contribute nearly one-third of the company's total revenue, an increase of approximately 3 percentage points from 2024 [7]. Market Expansion - The company is seeking to rebalance growth by expanding in the Americas and emerging markets without sacrificing its position in the Chinese market [8]. - Estée Lauder has invested in two local Chinese brands, CODEMINT and Melt Season, and is consciously reducing its reliance on duty-free channels in China and South Korea [9]. Asset Management - The company is divesting brands such as Too Faced, Smashbox, and Dr. Jart due to declining growth potential in the competitive market [10]. - The estimated valuation for these assets is in the low nine-digit dollar range, significantly below historical acquisition costs [10]. Investor Focus - Investors are primarily concerned with the company's ability to achieve moderate sales growth without exacerbating balance sheet pressures and the timeline for a return to profitability [11]. - The recovery path is expected to require time, patience, and consistent execution [12].

Core Viewpoint - Estée Lauder is considering selling three brands: Dr.Jart+, Too Faced, and Smashbox, with a potential valuation significantly lower than their original acquisition prices [2] Group 1: Brand Valuation and Sale - The estimated sale price for the three brands is in the "low nine figures," approximately between $300 million to $500 million [2] - Estée Lauder acquired Smashbox for $2-3 billion in 2010, Too Faced for about $1.45 billion in 2016, and Dr.Jart+ for over $1.1 billion, totaling over $2.5 billion for all three brands [2] Group 2: Strategic Changes and Brand Performance - Since the new CEO took office in January 2025, Estée Lauder has initiated significant changes, including a new growth strategy called "Beauty Reimagined," focusing on a streamlined organizational structure and reallocating resources to brands with higher growth potential [2] - The brands in question have seen a decline in performance and competitiveness over time, leading to their consideration for sale [2][3]

Group 1: Luxury Goods Industry - The luxury goods sector is undergoing significant adjustments with management changes, capital maneuvers, and strategic optimizations as core themes, reshaping the industry landscape [1] - Givenchy and Dior have initiated management changes to enhance brand competitiveness, while Alo has hired a former Dior executive to accelerate its high-end lifestyle transformation [1][2] - LVMH continues its management reshuffle, appointing Amandine Ohayon as CEO of Givenchy and promoting Alessandro Valenti to a key role at Dior, reflecting a strategy focused on internal talent development [6][8][9] Group 2: Sportswear Industry - Anta Sports has made a bid to acquire a 29% stake in Puma, which would make it the largest single shareholder, amidst Puma's declining sales and restructuring efforts [4][5] - Puma has appointed Nadia Kokni as Global Brand Marketing Vice President to lead its marketing strategy during a critical phase of brand restructuring [10] Group 3: Beauty Industry - Estée Lauder is considering selling three brands for $300-500 million, significantly less than the $2.5 billion spent on their acquisition, as part of a strategy to focus on high-end beauty [11][12] - L'Oréal plans to launch over 20 new products in 2026, leveraging multi-channel strategies to capture market growth, following strong performance in recent years [17][18] Group 4: Market Trends - The beauty industry is shifting from incremental to stock market pressures, with high-end positioning becoming increasingly important [1] - The trend of local business autonomy is highlighted by the Shanghai New World New Maru Center ending its partnership with Japanese firms to operate independently, showcasing resilience in local commerce [1][16] Group 5: Company-Specific Developments - Alo has launched a high-end custom series and plans to expand its international presence, including a flagship store on the Champs-Élysées by 2026 [3] - The family behind the Chinese beauty brand Mao Geping plans to sell shares worth up to 1.41 billion HKD, raising concerns about the impact on the company's future despite its current growth [14][15]

Core Viewpoint - Estée Lauder is reportedly considering selling its brands Too Faced, Smashbox, and Dr.Jart+ (collectively referred to as "Tijia Ting") at a significantly reduced price, reflecting a strategic shift towards streamlining its brand portfolio amid ongoing sales declines [1][2][3]. Group 1: Brand Sale Details - The three brands are being pitched to potential buyers with an expected total sale price in the low nine figures, estimated between $300 million to $500 million (approximately 2.09 billion to 3.49 billion RMB) [3]. - Estée Lauder originally acquired these brands for over $2.5 billion (approximately 17.46 billion RMB), indicating a potential loss of around 80% if sold at the current estimated price [3]. - Dr.Jart+ has been under Estée Lauder for only six years, highlighting the rapid decline in brand value [3]. Group 2: Strategic Context - The sale aligns with Estée Lauder's broader strategy under CEO Stéphan de La Faverie, which emphasizes a streamlined brand portfolio and investment in higher-growth potential brands [6][10]. - The brands targeted for sale are positioned in the mid-market segment, which contrasts with Estée Lauder's current focus on high-growth luxury beauty brands that contribute over 70% of its revenue [7][12]. - The cosmetic market has seen a decline in demand for color cosmetics, with Estée Lauder's makeup segment experiencing a 1% drop in Q1 of fiscal year 2026, while fragrance sales surged by 13% to $721 million (approximately 5.13 billion RMB) [8][12]. Group 3: Industry Trends - The trend of major beauty companies divesting underperforming brands is becoming common, as seen with Coty and Kenvue also evaluating their brand portfolios [15][18]. - This shift indicates a broader industry move from expansion to prioritizing profitability and focusing on core brands, reflecting the changing dynamics in the beauty market [18].