Estée Lauder reached a deal to settle a $84 million securities class action over gray-market sales in China. The agreement was finalized on April 2, 2026, in the Southern District of New York.
The settlement follows Judge Arun Subramanian’s rejection of Estée Lauder’s bid to dismiss the case last year. Investors accused the company of several misleading omissions and forward-looking statements.
As part of its turnaround plan, Estée Lauder Companies plans to cut between 9,000 and 10,000 jobs. This is an increase from the previous announcement regarding a reduction of up to 7,000 jobs.
Key financial results:
- Estée Lauder reported a 5% growth in sales for the third quarter, totaling $3.7 billion.
- Organic net sales increased by 2% for the three months ending March 31, 2026.
- Fragrance sales surged by 13%, amounting to $628 million during the same period.
The company expects organic net sales growth of around 3% for fiscal 2026. However, the conflict in the Middle East negatively impacted Estée Lauder’s third-quarter sales growth by approximately one percentage point.
Stéphane de La Faverie stated, “2026 is promising to be the pivotal year we intended.” He also mentioned plans to accelerate organic sales growth and improve adjusted operating margins.
Akhil Shrivastava noted that recent challenges have minimized the impact on third-quarter sales. Observers are closely watching how this settlement may affect Estée Lauder’s reputation and future operations.