Estee Lauder Cos reported better-than-expected quarterly results on Monday, as people confined to their homes bought more of its skincare products online and sales improved in its Asian markets. The M.A.C brand owner has ramped up investments in its online business and seen growth in demand for its skincare products as customers opted for serums and moisturizers instead of make-up items during the Covid-19 pandemic.
“Before, online was mainly the destination of younger people. Now it’s for everyone. Everyone is online,” CEO Fabrizio Freda told analysts on a call.
The company’s shares rose as much as 8.3 percent to a record high on Monday as online sales soared 40 percent in the first quarter.
Its sales in the Asia-Pacific market rose 9 percent on the back of strong growth in South Korea, with demand at the company’s duty-free shops in China getting a boost from the government’s move to raise the annual tax-free shopping limit for tourists in the southern province of Hainan.
Total sales at the company’s duty-free shops were flat year over year, after dropping roughly 30 percent in the previous quarter due to widespread restrictions on air travel.
Total net sales fell 9 percent to $3.56 billion but exceeded analysts’ expectations of $3.46 billion, Refinitiv data showed.
Estee forecast net sales to decline between 3 and 5 percent in the second quarter, compared with estimates of a near 5 percent decline.