The beauty giant generated $3.7 billion in first-quarter sales, raised its full-year growth outlook, and recorded a 20% jump in fragrance revenue, led by some of its most established luxury brands.

Estée Lauder Companies (ELC) is showing further signs of recovery, reporting 6% organic net sales growth in its first quarter, with revenue reaching $3.7 billion. The company also raised its full-year fiscal 2027 growth forecast to between 4% and 5.5%, up from its previous projection of 3% to 5%.

The latest results reflect continued progress under Beauty Reimagined, the turnaround strategy launched in February 2025 with a focus on consumer-led growth. ELC reported an adjusted operating margin of 12.1%, a significant improvement from 7.3%.

CEO Stéphane de La Faverie said the company is prioritizing investment in consumer-facing initiatives to strengthen brand awareness and desirability.

“Our strategy is really to accelerate consumer-facing investment,” he said on Monday. He added that increased investment at the top of the marketing funnel has been central to rebuilding the company’s momentum.

Moving away from heavy promotional activity has also played an important role. Rather than relying on discounts, ELC is placing greater emphasis on strengthening brand equity and creating lasting consumer demand.

Fragrance Leads Category Growth

Fragrance was the strongest-performing category, recording a 20% increase to $861 million. Growth was driven by major contributions from Le Labo, Tom Ford, Jo Malone London, and Kilian Paris.

The company has also observed a shift in fragrance purchasing habits, particularly among younger consumers. Through its direct-to-consumer channels, including standalone stores and online platforms, ELC tracks changing customer preferences.

According to de La Faverie, Gen Z consumers are building fragrance collections around different occasions, choosing scents for school, sports, dates, and other activities. He noted that younger shoppers tend to own more fragrances than previous generations.

Despite fragrance’s strong performance, the CEO emphasized that the company intends to maintain growth across multiple categories rather than depend on a single area. Upcoming innovation in skincare, particularly across La Mer and The Ordinary, is expected to support that ambition.

Skincare and Makeup Deliver Modest Gains

Skincare sales increased 4% to $1.7 billion, supported by growth at both La Mer and The Ordinary, two brands positioned at different ends of the price spectrum.

Makeup revenue rose 1% to $1 billion. MAC Cosmetics was a key contributor, continuing to gain market share in the US prestige beauty segment.

Haircare remained flat at $128 million. Growth from The Ordinary was offset by weaker performance at Aveda, which the company attributed to a supply chain disruption. ELC expects to resolve the issue before the end of its second quarter.

Asia-Pacific Leads Regional Performance

The Asia-Pacific region recorded the strongest regional growth, increasing 10%, with airport sales providing a significant boost.

Mainland China followed with 9% growth, supported by targeted efforts to expand the consumer base. Meanwhile, Europe, the UK, Ireland, and emerging markets—grouped together as EUKEM—recorded a 4% increase. The Americas also grew by 4%.

Looking ahead, de La Faverie sees considerable room for further expansion across Asia-Pacific, particularly among younger shoppers.

The CEO highlighted ELC’s leadership position in fragrance across the region and its strong presence in China as important advantages. He believes younger consumers will provide additional opportunities for growth.

A Turnaround Built on Brand Strength

The latest results suggest that Beauty Reimagined is continuing to support ELC’s recovery, with stronger margins, improved sales, and growth across several key markets.

Fragrance remains the standout performer, but the company is also looking to skincare innovation and stronger consumer engagement to sustain its momentum.

With its full-year growth forecast now raised to 4%–5.5%, Estée Lauder is signaling greater confidence in its turnaround and its ability to rebuild demand across its global beauty portfolio.