Overview
Coty Inc. (NYSE:COTY) released its fourth‑quarter 2026 results, reporting an adjusted loss per share of $0.02, versus analyst expectations of $0.01 loss. Quarterly revenue reached $1.27 billion, surpassing the consensus estimate of $1.19 billion.
Stock Reaction
Following the earnings release, Coty’s share price declined 7.9% in after‑hours trading, erasing the earlier 10.58% intraday gain recorded before the announcement.
Quarterly Financial Highlights
- Adjusted gross margin fell to 60.9%, a decline of 140 basis points year‑over‑year, reflecting lower cost absorption, higher excess and obsolescence charges, and tariff impacts.
- Adjusted operating income dropped 42% to $39.5 million, down from $67.7 million in the comparable prior‑year quarter.
- Free cash flow for fiscal 2026 increased to $348.2 million, up from $277.6 million a year earlier.
Revenue Performance
- Reported revenue grew 1% year‑over‑year on a reported basis but fell 1% on a like‑for‑like basis, with an estimated 1% headwind attributed to the Middle East conflict.
- Full‑year 2026 revenue declined 2% to $5.81 billion, compared with $5.89 billion in fiscal 2025.
Segment Breakdown
- The Prestige segment, accounting for 61% of total sales, generated $771.8 million in revenue, up 1% on a reported basis but down 0.5% on a like‑for‑like basis.
- Consumer Beauty revenue reached $497.4 million, up 1% reported while decreasing 3% on a like‑for‑like basis.
Management Commentary
Markus Strobel, Executive Chairman and Interim Chief Executive Officer, stated: “We closed FY26 on a stronger note, delivering sales and profit ahead of our targets, growing free cash flow even in the face of business headwinds.”
Outlook for FY2027 Q1
- Coty projects first‑quarter FY2027 like‑for‑like revenue to decline by a low‑ to mid‑single‑digit percentage.
- Adjusted EBITDA for the quarter is expected to fall by a low‑teens percentage.
- Adjusted earnings per share are forecast in the range of $0.11 to $0.13, excluding impacts from the equity swap.