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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________________________________________

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March~~September 3130, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-14064

The Estée Lauder Companies Inc.

(Exact name of registrant as specified in its charter)

Delaware

11-2408943

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer Identification No.)

767 Fifth Avenue, New York, New York

10153

(Address of principal executive offices)

(Zip Code)

212-572-4200

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, $.01 par value	EL	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At October 23, 2025, 234,818,211 shares of the registrant’s Class A Common Stock, $.01 par value, and 125,542,029 shares of the registrant’s Class B Common Stock, $.01 par value, were outstanding.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

INDEX

			Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Statements of Earnings (Loss) — Three and Nine Months Ended March 31, 2025 and 2024			2
Consolidated Statements of Earnings (Loss) — Three Months Ended September 30, 2025 and 2024			2
Consolidated Statements of Comprehensive Income (Loss) — Three and Nine Months Ended March 31, 2025 and 2024			3
Consolidated Statements of Comprehensive Income (Loss) — Three Months Ended September 30, 2025 and 2024			3
Consolidated Balance Sheets — March 31, 2025 and June 30, 2024			4
Consolidated Balance Sheets — September 30, 2025 and June 30, 2025			4
Consolidated Statements of Cash Flows — Nine Months Ended March 31, 2025 and 2024			5
Consolidated Statements of Cash Flows — Three Months Ended September 30, 2025 and 2024			5
Notes to Consolidated Financial Statements			6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			3733
Item 3. Quantitative and Qualitative Disclosures About Market Risk			7154
Item 4. Controls and Procedures			7155
Part II. Other Information
Item 1. Legal Proceedings			7155
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			7255
Item 5. Other Information			7256
Item 6. Exhibits			7256
Signatures			7357

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

THE ESTÉE LAUDER COMPANIES INC.

CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

(Unaudited)

	Three Months EndedMarch 31,			Nine Months EndedMarch 31,
		Three Months EndedSeptember 30,
(In millions, except per share data)		~~2025~~		~~2024~~		2025		2024
Net sales		$	~~3,550~~	$	~~3,940~~	$	103,~~915~~481	$	113,~~737~~361
Cost of sales		~~889~~		~~1,107~~		~~2,774~~927		~~3,331~~928
Gross profit		~~2,661~~		~~2,833~~		82,~~141~~554		82,~~406~~433
Operating expenses
Selling, general and administrative		~~2,258~~		~~2,284~~		72,~~141~~296		72,~~177~~298
Restructuring and other charges		97		18		~~375~~89		2697
Impairment of goodwill and other intangible assets		—		—		861		—
Talcum litigation settlement agreements						—		159
Talcum litigation settlement agreements		—		—		159		—
Total operating expenses						2,385		2,554
Total operating expenses		2,355		2,302		8,536		7,203
Operating income (loss)						169		(121)
Operating income (loss)		306		531		(395)		1,203
Interest expense						86		92
Interest expense		87		94		269		287
Interest income and investment income, net						30		35
Interest income and investment income, net		27		45		85		126
Other components of net periodic benefit cost						4		2
Other components of net periodic benefit cost		5		(4)		10		(9)
Earnings (loss) before income taxes						109		(180)
Earnings (loss) before income taxes		241		486		(589)		1,051
Provision (benefit) for income taxes						62		(24)
Provision (benefit) for income taxes		82		151		(2)		356
Net earnings (loss)						$	47	$	(156)
Net earnings (loss)		159		335		(587)		695
Net earnings (loss) per common share
Net earnings attributable to redeemable noncontrolling interest		—		(5)		—		(21)
Basic						$	.13	$	(.43)
Net earnings (loss) attributable to The Estée Lauder Companies Inc.		$	159	$	330	$	(587)	$	674
Diluted						$	.13	$	(.43)
Net earnings (loss) attributable to The Estée Lauder Companies Inc. per common share
Basic		$	.44	$	.92	$	(1.63)	$	1.88
Diluted		$	.44	$	.91	$	(1.63)	$	1.87
Weighted average common shares outstanding
Basic		~~360.3~~		~~359.1~~		~~359~~361.92		~~358~~359.86
Diluted		~~361.4~~		~~360.8~~		~~359~~363.93		~~360~~359.46

See notes to consolidated financial statements.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
			Three Months EndedSeptember 30,
(In millions)	~~2025~~		~~2024~~		2025		2024
Net earnings (loss)	$	~~159~~	$	~~335~~	$	~~(587)~~47	$	~~695~~(156)
Other comprehensive income (loss):
Other comprehensive (loss) income:
Net cash flow hedge gain (loss)	~~(24)~~		21		~~(26)~~16		(757)
Cross-currency swap contract - fair value hedge gain (loss)	7		(4)		14		10
Cross-currency swap contract - fair value hedge gain					3		12
Retirement plan and other retiree benefit adjustments	3		24		74		222
Translation adjustments	68		~~(185)~~		(~~133~~27)		~~(89)~~108
Benefit (provision) for income taxes on components of other comprehensive income	14		(29)		5		(29)
(Provision) benefit for income taxes on components of other comprehensive (loss) income					(10)		18
Total other comprehensive income (loss), net of tax	68		(173)		(133)		(93)
Total other comprehensive (loss) income, net of tax					(14)		83
Comprehensive income (loss)	~~227~~		~~162~~		~~(720)~~$	33	~~602~~$	(73)
Comprehensive loss (income) attributable to redeemable noncontrolling interest:
Net earnings	—		(5)		—		(21)
Translation adjustments	—		15		—		13
Total comprehensive loss (income) attributable to redeemable noncontrolling interest	—		10		—		(8)
Comprehensive income (loss) attributable to The Estée Lauder Companies Inc.	$	227	$	172	$	(720)	$	594

See notes to consolidated financial statements.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions, except share and per share data)

~~March~~September 3130, 2025

June 30, ~~2024~~2025

ASSETS

Current assets

Cash and cash equivalents

2,~~631~~219

32,~~395~~921

Accounts receivable, net

1,~~792~~884

1,~~727~~530

Inventory and promotional merchandise

12,~~959~~062

2,~~175~~074

Prepaid expenses and other current assets

~~635~~549

~~625~~544

Total current assets

76,~~017~~714

7,~~922~~069

Property, plant and equipment, net

3,~~059~~065

3,~~136~~172

Other assets

Operating lease right-of-use assets

1,~~875~~889

1,~~833~~952

Goodwill

2,~~080~~119

2,~~143~~135

Other intangible assets, net

43,~~129~~706

53,~~183~~759

Other assets

1,~~726~~836

1,~~460~~805

Total other assets

9,~~810~~550

109,~~619~~651

Total assets

19,~~886~~329

2119,~~677~~892

LIABILITIES AND EQUITY

Current liabilities

Current debt

~~504~~3

Accounts payable

1,~~214~~289

1,~~440~~497

Operating lease liabilities

~~399~~415

~~354~~406

Other accrued liabilities

3,~~348~~376

3,~~404~~529

Total current liabilities

45,~~964~~083

5,~~702~~435

Noncurrent liabilities

Long-term debt

7,~~298~~320

7,~~267~~314

Long-term operating lease liabilities

1,~~682~~684

1,~~701~~744

Other noncurrent liabilities

1,~~597~~352

1,~~693~~534

Total noncurrent liabilities

10,~~577~~356

10,~~661~~592

Commitments and contingencies

Equity

Common stock, $.01 par value; Class A shares authorized: 1,300,000,000 at March 31, 2025 and June 30, 2024; shares issued: 472,522,958 at March 31, 2025 and 471,018,569 at June 30, 2024; Class B shares authorized: 304,000,000 at March 31, 2025 and June 30, 2024; shares issued and outstanding: 125,542,029 at March 31, 2025 and June 30, 2024

Common stock, $.01 par value; Class A shares authorized: 1,300,000,000 at September 30, 2025 and June 30, 2025; shares issued: 473,216,446 at September 30, 2025 and 472,541,563 at June 30, 2025; Class B shares authorized: 304,000,000 at September 30, 2025 and June 30, 2025; shares issued and outstanding: 125,542,029 at September 30, 2025 and June 30, 2025

Paid-in capital

67,~~966~~141

67,~~685~~012

Retained earnings

1211,~~344~~591

1311,~~427~~672

Accumulated other comprehensive loss

(1,~~273~~141)

(1,~~140~~127)

18,043

18,978

17,597

17,563

Less: Treasury stock, at cost; 238,313,007 Class A shares at March 31, 2025 and 237,871,995 Class A shares at June 30, 2024

(13,698)

(13,664)

Less: Treasury stock, at cost; 238,401,382 Class A shares at September 30, 2025 and 238,316,738 Class A shares at June 30, 2025

(13,707)

(13,698)

Total equity

43,~~345~~890

53,~~314~~865

Total liabilities and equity

19,~~886~~329

2119,~~677~~892

See notes to consolidated financial statements.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months EndedMarch 31,
	Three Months EndedSeptember 30,
(In millions)	2025		2024
Cash flows from operating activities
Net earnings (loss)	$	~~(587)~~47	$	~~695~~(156)
Adjustments to reconcile net earnings (loss) to net cash flows from operating activities:
Depreciation and amortization	~~619~~200		~~614~~208
Deferred income taxes	(~~334~~34)		(~~165~~79)
Non-cash stock-based compensation	~~255~~88		~~276~~74
Net loss on disposal of property, plant and equipment	5—		71
Non-cash restructuring and other charges	173		611
Pension and post-retirement benefit expense	5821		3818
Pension and post-retirement benefit contributions	(6928)		(7532)
Impairment of goodwill and other intangible assets	861		—
Other adjustments and non-cash items	(2)		1
Other non-cash items	11		13
Changes in operating assets and liabilities:
Increase in accounts receivable, net	(77358)		(~~404~~219)
Decrease in inventory and promotional merchandise	215		653
Decrease (increase) in inventory and promotional merchandise	6		(10)
Decrease (increase) in other assets, net	(33)		19
Increase in other assets, net	(11)		(47)
Decrease in accounts payable	(~~230~~204)		(~~289~~337)
Increase (decrease) in other accrued and noncurrent liabilities	(19)		106
Decrease in other accrued and noncurrent liabilities	(79)		(100)
Decrease in operating lease assets and liabilities, net	(21)		(23)
Increase (decrease) in operating lease assets and liabilities, net	11		(3)
Net cash flows provided by operating activities	671		1,471
Net cash flows used for operating activities	(340)		(670)
Cash flows from investing activities
Capital expenditures	(395)		(702)
Purchases of investments	—		(1)
Proceeds from sale of property, plant and equipment	3		—
Capital expenditures	(96)		(141)
Purchases of investments	(1)		(8)
Proceeds from the disposition of investments	3		—
Settlement of net investment hedges	(1523)		(2518)
Net cash flows used for investing activities	(~~408~~116)		(~~735~~160)
Cash flows from financing activities
Repayments of current debt, net	—		(215)
Repayments of long-term debt	(1)		(1)
Proceeds from issuance of long-term debt, net	—		649
Settlement of cross-currency swaps	9		10
Debt issuance costs	—		(4)
Net proceeds from stock-based compensation transactions	39		15
Repayments of commercial paper (maturities after three months)	—		(785)
Dividends paid to stockholders	(127)		(240)
Repayments of long-term debt	(503)		(7)
Payments to acquire treasury stock	(9)		(10)
Net proceeds from stock-based compensation transactions	15		29
Payment of deferred consideration	(150)		—
Payments to acquire treasury stock	(35)		(34)
Net cash flows used for financing activities	(239)		(226)
Settlement of cross-currency swaps	20		18
Effect of exchange rate changes on Cash and cash equivalents	(7)		11
Dividends paid to stockholders	(492)		(710)
Net decrease in Cash and cash equivalents	(702)		(1,045)
Payment for acquisition of noncontrolling interest	(21)		—
Cash and cash equivalents at beginning of period	2,921		3,395
Net cash flows used for financing activities	(1,016)		(1,059)
Cash and cash equivalents at end of period	$	2,219	$	2,350
Effect of exchange rate changes on Cash and cash equivalents	(11)		(5)
Net decrease in Cash and cash equivalents	(764)		(328)
Cash and cash equivalents at beginning of period	3,395		4,029
Cash and cash equivalents at end of period	$	2,631	$	3,701

See notes to consolidated financial statements.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements include the accounts of The Estée Lauder Companies Inc. and its subsidiaries (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated.

The unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP ~~for~~in ~~complete~~annual financial statements. The unaudited interim consolidated financial statements ~~furnished~~ reflect all normal and recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. The results of operations of any interim period are not necessarily indicative of the results of operations to be expected for the full fiscal year. The interim consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, ~~2024~~2025.

Certain prior-year amounts in the notes to the consolidated financial statements have been reclassified to conform to current-year presentation.

Management Estimates

The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses reported in those financial statements. Descriptions of the Company’s significant accounting policies are discussed in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, ~~2024~~2025. Management evaluates the related estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, as relevant, and makes adjustments when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from those estimates and assumptions. Significant changes, if any, in those estimates and assumptions will be reflected in the consolidated financial statements in future periods.

Currency Translation and Transactions

All assets and liabilities of foreign subsidiaries and affiliates are translated at period-end rates of exchange, while revenue and expenses are translated at monthly average rates of exchange for the period. Unrealized translation ~~gains~~ (losses) gains, net of tax, reported as translation adjustments through other comprehensive income (loss) (“OCI”) ~~attributable to The Estée Lauder Companies Inc.~~ were $~~78 million and $~~(~~192~~32) million, ~~net of tax, during the three months ended March 31, 2025~~ and ~~2024, respectively, and~~ $~~(130)~~115 million ~~and $(103) million~~, net of tax, during the ~~nine~~three months ended ~~March~~September 3130, 2025 and 2024, respectively. For the Company’s subsidiaries operating in highly inflationary economies, the U.S. dollar is the functional currency, and these subsidiaries are not material to the Company's consolidated financial statements or liquidity as of and for the three months ended September 30, 2025 and 2024. Remeasurement adjustments in financial statements in a highly inflationary economy and other transactional gains and losses are reflected in earnings ~~(loss)~~.

The Company enters into foreign currency forward contracts ~~and may enter into option contracts~~ to hedge foreign currency transactions for periods consistent with its identified exposures. The Company also uses cross-currency swap contracts to hedge the impact of foreign currency changes on certain intercompany foreign currency denominated debt. Additionally, the Company enters into foreign currency forward contracts ~~and cross-currency swap contracts~~ to hedge a portion of its net investment in certain foreign operations, which are designated as net investment hedges. See Note 4 – Derivative Financial Instruments for further discussion. The Company categorizes these instruments as entered into for purposes other than trading.

The accompanying consolidated statements of earnings (loss) include net exchange (losses) gains on foreign currency transactions of $11(6) million and $2319 million during the three months ended ~~March~~September 3130, 2025 and 2024, respectively~~, and $55 million and $52 million during the nine months ended March 31, 2025 and 2024, respectively~~.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Concentration of Credit Risk

The Company is a worldwide manufacturer, marketer and seller of skin care, makeup, fragrance and hair care products. The Company’s sales subject to credit risk are made primarily to ~~retailers~~department instores, ~~its~~duty-free ~~travel~~retailers, ~~retail~~specialty ~~business~~multi retailers, ~~department~~online ~~stores~~pure players, ~~specialty~~perfumeries ~~multi-brand~~and ~~retailers~~pharmacies, and ~~perfumeries~~salons and spas. The Company grants credit to qualified customers. While the Company does not believe it is exposed significantly to any undue concentration of credit risk at this time, it continues to monitor its customers' abilities, individually and collectively, to make timely payments.

The Company’s largest customer for the three and nine months ended March 31, 2025 sells products primarily in China travel retail. This customer accounted for $218 million, or 12%, and $206 million, or 12%, of the Company's accounts receivable at March 31, 2025 and June 30, 2024, respectively.

Inventory and Promotional Merchandise

Inventory and promotional merchandise consists of the following:

(In millions)

~~March~~September 3130, 2025

June 30, ~~2024~~2025

Raw materials

~~617~~593

~~696~~631

Work in process

~~277~~250

~~308~~283

Finished goods

~~846~~1,062

~~903~~996

Promotional merchandise

~~219~~157

~~268~~164

Total inventory and promotional merchandise

12,~~959~~062

2,~~175~~074

Property, Plant and Equipment

Property, plant and equipment consists of the following:

(In millions)

March 31, 2025

June 30, 2024

($ in millions)

September 30, 2025

June 30, 2025

Assets (Useful Life)

Land and improvements(1)

7174

6875

Buildings and improvements (10 to 40 years)

~~998~~1,051

~~929~~1,057

Machinery and equipment (3 to 20 years)

1,~~354~~431

1,~~253~~429

Computer hardware and software (4 to 10 years)

12,~~911~~077

1,~~861~~926

Furniture and fixtures (5 to 10 years)

~~138~~143

~~137~~145

Leasehold improvements

2,~~534~~646

2,~~418~~631

Construction in progress

~~418~~319

~~500~~462

Total property, plant and equipment, gross

7,~~424~~741

7,~~166~~725

Less accumulated depreciation and amortization

(4,~~365~~676)

(4,~~030~~553)

Total property, plant and equipment, net

3,~~059~~065

3,~~136~~172

(1)Land improvements are depreciated over a 10 year useful life.

Depreciation and amortization of property, plant and equipment was $~~167~~170 million and $~~166~~168 million during the three months ended ~~March~~September 3130, 2025 and 2024, respectively~~, and $503 million and $491 million during the nine months ended March 31, 2025 and 2024, respectively~~. Depreciation and amortization related to the Company’s manufacturing process is included in Cost of sales, and all other depreciation and amortization is included in Selling, general and administrative expenses in the accompanying consolidated statements of earnings (loss).

Income Taxes

The effective rate for income taxes was 56.9% and 13.3% for the three months ended September 30, 2025 and 2024, respectively. The increase in the effective tax rate of 4,360 basis points was attributable in part to the loss before income taxes in the fiscal 2025 first quarter as well as the estimated unfavorable impact of the newly enacted U.S. tax legislation, a higher effective tax rate on the Company's foreign operations due to the Company's full year geographical mix of earnings in the current and prior-year periods and an unfavorable impact associated with the establishment of a valuation allowance against current period foreign tax credit and research and development tax credit U.S. deferred tax assets.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~Income~~On ~~Taxes~~July 4, 2025, new U.S tax legislation was enacted known as the One Big Beautiful Bill Act. This legislation includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of certain business tax provisions. The legislation has multiple effective dates, with certain provisions becoming effective in fiscal 2026. The most impactful provision effective beginning in fiscal 2026 relates to the expansion of the business interest expense deduction limitation. The resulting increase in tax deductible interest expense reduced U.S. taxable income and increased the excess foreign tax credits generated which require a valuation allowance. The estimated unfavorable fiscal 2026 impact of the One Big Beautiful Bill Act has been included in the provision for income taxes, and the impact for the three months ended September 30, 2025 was $8 million.

	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
	2025		2024		2025		2024
Effective rate for income taxes	34.0	%	31.1	%	0.3	%	33.9	%
Basis-point change from the prior-year period	290				(3,360)

In December 2021, the Organization for Economic Cooperation and Development issued "Pillar Two" Global Anti-Base Erosion model rules for countries to enact into domestic law that would establish a 15% global minimum tax applied on a country-by-country basis for multinational companies. In certain countries that have enacted legislation incorporating the global minimum tax, it became effective for the Company at the beginning of fiscal 2025. The estimated tax impact of such legislation has been included in the provision for income taxes for the three months ended September 30, 2025 and was not material.

~~For~~As of September 30, 2025 and June 30, 2025, the ~~three~~gross ~~months~~amount ~~ended~~of ~~March~~unrecognized 31tax benefits, exclusive of interest and penalties, totaled $141 million and $140 million, respectively. The total amount of unrecognized tax benefits at September 30, 2025 that, ~~the~~if ~~increase~~recognized, inwould affect the effective tax rate was ~~primarily~~$134 ~~attributable~~million. toThe atotal ~~higher~~gross ~~effective~~interest ~~tax~~and ~~rate~~penalties onaccrued ~~the~~related ~~Company's~~to ~~foreign~~unrecognized ~~operations~~tax ~~due~~benefits toduring the ~~Company's~~three ~~full~~months ~~year~~ended ~~geographical~~September 30, ~~mix~~2025 in the accompanying consolidated statements of earnings (loss) was $2 million. The total gross accrued interest and penalties in the ~~current~~accompanying consolidated balance sheets at September 30, 2025 and ~~prior-year~~June 30, ~~periods~~2025, aswas ~~well~~$21 million and $19 million, respectively. On the basis of the information available as anof ~~unfavorable~~September 30, ~~impact~~2025, ~~associated~~the ~~with~~Company ~~previously~~does ~~issued~~not ~~stock-based~~expect ~~compensation~~significant changes to the total amount of unrecognized tax benefits within the next twelve months.

~~For~~At ~~the~~September 30, ~~nine~~2025 ~~months~~and ~~ended March 31~~June 30, 2025, ~~the~~total ~~decrease~~Other inassets ~~the effective tax rate was primarily attributable to the impact~~ of ~~the~~$1,836 ~~discrete~~million ~~treatment~~and of$1,805 ~~charges~~million ~~associated~~included ~~with~~$1,366 million ~~restructuring~~ and ~~other activities~~$1,339 million ~~the impairment~~ of ~~goodwill~~deferred ~~and~~tax ~~other intangible~~ assets, the charge associated with the talcum litigation settlement agreements (See Note 8 - Commitments and Contingencies for further discussion) and an unfavorable impact associated with previously issued stock-based compensationrespectively.

On August 16, 2022, the U.S. federal government enacted the Inflation Reduction Act, including a tax provision implementing a 15% corporate alternative minimum tax based on global adjusted financial statement income. The corporate alternative minimum tax did not have an impact on the Company's consolidated financial statements for the three and nine months ended March 31, 2025 and 2024.

On August 26, 2024, the U.S. Tax Court issued a decision in Varian Medical Systems, Inc. v. Commissioner. The decision related to the Tax Cuts and Jobs Act deduction for certain deemed foreign dividends otherwise subject to the Transition Tax on unrepatriated earnings of applicable foreign subsidiaries. Based on the Company's evaluation of the technical merits of this decision, the Company intends to timely file a protective refund claim with the U.S. Internal Revenue Service in fiscal 2025 claiming a Transition Tax payable reduction of approximately $73 million. Although the Company has accrued the $73 million estimated tax benefit in the provision for income taxes and reduced the Transition Tax payable in the fiscal 2025 first quarter by $73 million, at this time the Company believes it is more-likely-than-not that the intended Transition Tax payable reduction claim will not be sustained. As such, in the fiscal 2025 first quarter the Company correspondingly increased the provision for income taxes for the estimated $73 million tax benefit to establish an uncertain tax position reserve accrual for the estimated $73 million Transition Tax at issue. As a result, there was no net impact from this development in the provision for income taxes and accompanying consolidated statement of earnings (loss) for the three and nine months ended March 31, 2025. In the accompanying consolidated balance sheet as of March 31, 2025, the $73 million Transition Tax payable reduction and offsetting $73 million uncertain tax position reserve accrual are included in Other noncurrent liabilities.

In December 2021, the Organization for Economic Cooperation and Development issued "Pillar Two" Global Anti-Base Erosion model rules for countries to enact into domestic law that would establish a 15% global minimum tax applied on a country-by-country basis for multinational companies. In certain countries that have enacted legislation incorporating the global minimum tax, it became effective for the Company at the beginning of fiscal 2025. The estimated tax impact of such legislation has been included in the provision for income taxes for the three and nine months ended March 31, 2025 and was not material. We are continuing to monitor and evaluate the potential impact of newly enacted legislation incorporating the global minimum tax in additional countries.

As of March 31, 2025 and June 30, 2024, the gross amount of unrecognized tax benefits, exclusive of interest and penalties, totaled $139 million and $65 million, respectively. The total amount of unrecognized tax benefits at March 31, 2025 that, if recognized, would affect the effective tax rate was $129 million. The significant increase in the gross amount of unrecognized tax benefits as of March 31, 2025 as compared to June 30, 2024 was attributable to having established an uncertain tax position reserve accrual for the Transition Tax payable reduction position determined in the fiscal 2025 first quarter based on the August 26, 2024 U.S. Tax Court decision in Varian Medical Systems v. Commissioner, as discussed above. The total gross interest and penalties accrued related to unrecognized tax benefits during the three and nine months ended March 31, 2025 in the accompanying consolidated statements of earnings (loss) was $1 million and $4 million, respectively. The total gross accrued interest and penalties in the accompanying consolidated balance sheets at March 31, 2025 and June 30, 2024, was $21 million and $17 million, respectively. On the basis of the information available as of March 31, 2025, the Company does not expect significant changes to the total amount of unrecognized tax benefits within the next twelve months.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During the fiscal 2025 second quarter, the Company received notification of the formal conclusion of the compliance process with respect to its fiscal 2023 income tax return under the U.S. Internal Revenue Service (“IRS”) Compliance Assurance Program (“CAP”), which had no impact on the Company’s consolidated financial statements for the three and nine months ended March 31, 2025.

At March 31, 2025 and June 30, 2024, total Other assets of $1,726 million and $1,460 million included $1,298 million and $1,018 million of deferred tax assets, respectively.

Supplier Finance Programs

Under ~~the~~its ~~Company's~~ supplier finance programs, the Company agrees to pay the banks the stated amount of confirmed invoices from its designated suppliers on the due dates of the invoices. The Company may terminate the agreements upon written notice (with notice periods ranging from 30 to 60 days) or immediately upon a breach. The supplier invoices that have been confirmed as valid under the programs require payment in full within 90 days of the invoice date.

Outstanding obligations confirmed as valid totaling $6765 million and $5882 million as of ~~March~~September 3130, 2025 and June 30, ~~2024~~2025, respectively, are included in Accounts payable in the accompanying consolidated balance sheets.

Other Accrued Liabilities

Other accrued liabilities consist of the following:

(In millions)	~~March~~September 3130, 2025		June 30, ~~2024~~2025
Advertising, merchandising and sampling	$	306	$	276
Accrued employee compensation	$	432	$	551
Employee compensation	492		576
Accrued income taxes	200		282
Accrued sales incentives	328		426
Accrued payroll and other non-income taxes	351		307
Accrued restructuring	~~257~~292		86279
Deferred revenue	276		327
Accrued sales incentives	318		321
Payroll and other non-income taxes	328		333
Accrued selling, advertising, marketing, promotion and product development	311		287
Accrued income taxes	203		335
Deferred revenue	332		314
Sales return accrual	~~258~~267		~~248~~255
Other	~~900~~873		~~797~~933
Total other accrued liabilities	$	3,~~348~~376	$	3,~~404~~529

~~Recently Adopted Accounting Standards~~8

FASB ASU No. 2022-04 – Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations

In September 2022, the FASB issued authoritative guidance which is intended to enhance the transparency surrounding the use of supplier finance programs. The guidance requires companies that use supplier finance programs to make annual disclosures about the program’s key terms, the balance sheet presentation of related amounts, the confirmed amount outstanding at the end of the period and associated rollforward information. Only the amount outstanding at the end of the period must be disclosed in interim periods. The guidance does not affect the recognition, measurement or financial statement presentation of supplier finance program obligations.

Effective for the Company – The guidance became effective for the Company’s first quarter fiscal 2024 and has been applied on a retrospective basis, except for the requirement to disclose rollforward information annually which is effective prospectively for the Company beginning in fiscal 2025.

Impact on consolidated financial statements – The Company has supplier financing arrangements and applied the disclosure requirements as required by the amendments. Such information is included in Supplier Finance Programs above within Note 1 – Summary of Significant Accounting Policies.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Recently Issued Accounting Standards

FASB ASU No. 2025-06 – Targeted Improvements to the Accounting for Internal-Use Software (Subtopic 350-40)

In September 2025, the FASB issued authoritative guidance to modernize the accounting for the costs to develop software for internal use to align better with current software development methods, such as agile programming. Capitalization of eligible costs will begin when (1) management has authorized and committed to funding the software project, and (2) it is probable that the project will be completed and the software will be used to perform the function intended. In evaluating whether it is probable the project will be completed, entities are required to consider whether there is significant uncertainty associated with the development activities of the software. The new standard does not change the types of costs that are capitalizable once the threshold for capitalization is met. Capitalization ceases when the software project is substantially complete and ready for its intended use, which typically occurs after all substantial testing is completed. Furthermore, the guidance supersedes website development costs guidance and incorporates the recognition requirements for website-specific development costs into Subtopic 350-40. The guidance clarifies that existing disclosure requirements under ASC 360 for property, plant and equipment apply to capitalized costs under the new standard, regardless of how the internal-use software is classified on the balance sheet or how it was acquired.

Effective for the Company: The guidance becomes effective for the Company’s first quarter of fiscal 2029. The guidance can be applied prospectively, retrospectively or through a modified transition approach. Early adoption is permitted.

Impact on consolidated financial statements: The Company is currently evaluating the impact that this guidance will have on its consolidated financial statements.

FASB ASU No. 2025-05 – Measurement of Credit Losses for Accounts Receivable and Contract Assets (Topic 326)

In July 2025, the FASB issued authoritative guidance related to the estimation of expected credit losses for current accounts receivable and current contract assets. The guidance allows entities to elect a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset in the development of a reasonable and supportable forecast as part of estimating expected credit losses. Entities electing the practical expedient are still required to adjust historical loss information to reflect current conditions to the extent that historical loss information does not reflect current conditions. An entity that elects to use the practical expedient is required to disclose that fact.

Effective for the Company: The guidance becomes effective for the Company’s first quarter of fiscal 2027 and is applied prospectively. Early adoption is permitted.

Impact on consolidated financial statements: The Company is currently evaluating the impact that this guidance will have on its accounts receivable balance and consolidated financial statement disclosures.

FASB ASU No. 2024-03 and 2025-01 – Disaggregation of Income Statement Expenses (Subtopic 220-40)

In November 2024 and January 2025, the FASB issued authoritative guidance requiring disclosures, in a tabular format in the notes to the consolidated financial statements, on the disaggregation of relevant expense captions that are included on the face of the consolidated statement of earnings (loss) within continuing operations. The relevant expense captions are required to be disaggregated into natural expense categories including purchases of inventory, employee compensation, depreciation and intangible asset amortization. The guidance also requires certain expenses, gains or losses that require disclosure under existing U.S. GAAP, and that are recorded in a relevant expense caption on the face of the consolidated statement of earnings (loss), to be presented in the same tabular disclosure. Qualitative disclosures about any remaining amounts in relevant expense line items are required as well. In addition, companies are required to disclose the total amount of selling expenses and, on an annual basis, how it defines selling expenses.

Effective for the Company: The guidance is effective for the Company’s fiscal year ending June 30, 2028 Form 10-K and then in interim periods beginning in the Company’s first quarter of fiscal 2029. Early adoption is permitted. The guidance should be applied on a prospective basis; however, retrospective application is permitted.

Impact on ~~the~~ consolidated financial statements: The Company is currently evaluating the impact that this guidance will have on its consolidated financial statement disclosures.

FASB ASU No. 2023-07 – Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued authoritative guidance to improve reportable segment disclosure requirements. Companies are required to disclose significant segment expenses by reportable segment if they are regularly provided to the chief operating decision maker (CODM). Companies are also required to disclose other segment items by reportable segment. The guidance clarifies that companies may disclose more than one measure of segment profit or loss used by the CODM, provided that at least one of the reported measures includes the segment profit or loss measure that is most consistent with U.S. GAAP measurement principles. All existing annual disclosures about segment profit or loss, as well as the new requirements, must now be provided on an interim basis. Additionally, on an annual basis, the CODM’s title and position is required, as well as an explanation of how the CODM uses the reported measure(s) and other disclosures. The guidance does not change how companies identify their operating segments, aggregate those operating segments, or apply the quantitative thresholds to determine their reportable segments.

Effective for the Company – The guidance is effective for the Company’s fiscal year ending June 30, 2025 Form 10-K and then in interim periods beginning in the Company’s first quarter of fiscal 2026. Early adoption is permitted. The guidance should be applied retrospectively unless impracticable.

Impact on consolidated financial statements – The Company is currently evaluating the impact that this guidance will have on its consolidated financial statement disclosures.

FASB ASU No. 2023-09 – Income Taxes (Topic 740): Improvements to Income Tax Disclosures

In December 2023, the FASB issued authoritative guidance to amend and enhance existing annual income tax disclosures primarily focusing on two reporting areas: (1) greater disaggregation of information in the effective tax rate reconciliations and (2) disclosure of income taxes paid, disaggregated by applicable jurisdiction.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Companies are required to use specific categories to prepare and disclose a tabular rate reconciliation (using both percentages and reporting currency amounts) of:

•the reported income tax expense (or benefit) from continuing operations and the product of the income (or loss) from continuing operations before income taxes and the applicable statutory federal income tax rate of the jurisdiction of domicile; and

•reconciling items within certain categories that are equal to or greater than a specified quantitative threshold, including the nature, effect, and underlying causes of the reconciling items and the judgment used in categorizing the reconciling items.

The guidance also requires companies to disclose the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign jurisdictions including individual jurisdictions with amounts paid equal to or greater than a specified quantitative threshold. The guidance also codifies existing SEC rules that require companies to disclose income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign as well as income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign jurisdictions.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Effective for the Company – The guidance is effective for the Company’s fiscal year ending June 30, 2026 Form 10-K. Early adoption is permitted. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively.

Impact on consolidated financial statements – The Company is currently evaluating the impact that this guidance will have on its consolidated financial statement disclosures.

SEC Final Rule Release No. 33-11275 – The Enhancement and Standardization of Climate-Related Disclosures for Investors

In March 2024, the SEC adopted rules intended to enhance and standardize climate-related disclosures in registration statements and annual reports. The rules require significant effects of severe weather events and other natural conditions, amounts related to carbon offsets and renewable energy credits or certificates, as well as material impacts on financial estimates and assumptions that are due to severe weather events and other natural conditions or disclosed climate-related targets or transition plans to be disclosed in the annual financial statements in certain circumstances.

Effective for the Company – On April 4, 2024, the SEC issued an order staying the final rule on climate-related disclosures pending certain legal challenges. Under the rule as currently issued, the disclosure requirements related to the annual financial statements are expected to be effective for the Company's fiscal year ending June 30, 2026 Form 10-K. The Company is not required to provide comparative information in the year of adoption.

Impact on consolidated financial statements – The Company is currently evaluating the impact that this guidance will have on its annual consolidated financial statement disclosures.

NOTE 2 – GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

The Company assigns goodwill at the time of acquisition to a reporting unit, which is one level below the Company's operating segments. The skin care, makeup, fragrance and hair care product categories are the Company's operating segments.

The following table presents goodwill by product category and the related change in the carrying amount:

(In millions)	Skin Care		Makeup		Fragrance		Hair Care		Total
Balance as of June 30, 2024
Balance as of June 30, 2025
Goodwill, gross carrying amount	$	1,612	$	1,116	$	253	$	353	$	3,334
Goodwill	$	1,616	$	1,116	$	260	$	353	$	3,345
Accumulated impairments	(~~429~~435)		(~~732~~745)		(30)		—		(1,~~191~~210)
Total goodwill	1,183		384		223		353		2,143
	1,181		371		230		353		2,135
Impairment charges	—		(13)		—		—		(13)
Translation adjustments, goodwill	(24)		—		—		—		(24)
Translation adjustments, goodwill	(67)		—		—		—		(67)
Translation adjustments, accumulated impairments	8		—		—		—		8
Translation adjustments, accumulated impairments	17		—		—		—		17
	(16)		—		—		—		(16)
	(50)		(13)		—		—		(63)
Balance as of September 30, 2025
Balance as of March 31, 2025
Goodwill	1,592		1,116		260		353		3,321
Goodwill, gross carrying amount	1,545		1,116		253		353		3,267
Accumulated impairments	(427)		(745)		(30)		—		(1,202)
Accumulated impairments	(412)		(745)		(30)		—		(1,187)
Total goodwill	$	1,165	$	371	$	230	$	353	$	2,119
Total goodwill	$	1,133	$	371	$	223	$	353	$	2,080

1110

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Intangible Assets

Other intangible assets consist of the following:

March 31, 2025

June 30, 2024

September 30, 2025

June 30, 2025

(In millions)

GrossCarryingValue

AccumulatedAmortization

Total NetBookValue

GrossCarryingValue

AccumulatedAmortization

Total NetBookValue

Amortizable intangible assets:

Customer lists and other

1,~~899~~954

~~976~~1,355

~~923~~599

1,~~971~~984

~~895~~1,348

~~1,076~~636

Non-amortizable intangible assets:

Trademarks

3,~~206~~107

43,~~107~~123

Total other intangible assets, net

43,~~129~~706

53,~~183~~759

The aggregate amortization expense related to amortizable intangible assets was $3426 million and $36 million for the three months ended ~~March~~September 3130, 2025 and 2024, respectively~~, and $105 million and $109 million for the nine months ended March 31, 2025 and 2024, respectively~~.

The estimated aggregate amortization expense for the remainder of fiscal ~~2025~~2026 and for each of the next four fiscal years is as follows:

	Fiscal
(In millions)	~~2025~~2026		~~2026~~2027		~~2027~~2028		~~2028~~2029		~~2029~~2030
Estimated aggregate amortization expense	$	3178	$	~~136~~87	$	~~119~~71	$	9469	$	9367

Impairment Analysis During the Nine Months Ended March 31, 2025

During the fiscal 2025 second quarter, the TOM FORD brand experienced lower-than-expected growth within key geographic regions and channels, including in mainland China, Asia travel retail and Hong Kong SAR. Also during the fiscal 2025 second quarter, the Too Faced reporting unit experienced lower-than-expected results in key geographic regions and channels. As a result, the Company made revisions to the internal forecasts relating to its TOM FORD brand and Too Faced reporting unit. Additionally, there were increases in the weighted average cost of capital for both the TOM FORD brand and Too Faced reporting unit as compared to the prior-year annual goodwill and other indefinite-lived intangible asset impairment testing as of April 1, 2024.

The Company concluded that the changes in circumstances in the TOM FORD brand and Too Faced reporting unit, along with increases in the weighted average cost of capital, triggered the need for interim impairment reviews of the TOM FORD trademark and the Too Faced trademark and goodwill. These changes in circumstances were also an indicator that the carrying amounts of Too Faced’s long-lived assets, including customer lists, may not be recoverable. Accordingly, the Company performed interim impairment tests for the TOM FORD and Too Faced trademarks and Too Faced goodwill as well as a recoverability test for the Too Faced long-lived assets as of December 31, 2024. The Company concluded that the carrying value of the trademark intangible assets exceeded their estimated fair values, which were determined utilizing the relief-from-royalty method, and recorded an impairment charge of $773 million for TOM FORD and $75 million for Too Faced. The Company concluded that the carrying amounts of the long-lived assets for Too Faced were recoverable. Additionally, as a result of the interim impairment review, the remaining carrying value of Too Faced’s goodwill was not recoverable and the Company recorded an impairment charge of $13 million, reducing the carrying value to zero. The significant assumptions used in the relief-from-royalty method include revenue growth rates and profit margins, terminal values, weighted average cost of capital used to discount future cash flows and royalty rates. The most significant unobservable input used to estimate the fair value of the TOM FORD and Too Faced trademark intangible assets was the weighted average cost of capital, which was 11.5% and 14%, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A summary of the impairment charges for the nine months ended March 31, 2025 and the remaining trademark and goodwill carrying values as of March 31, 2025, for the TOM FORD brand and Too Faced reporting unit, are as follows:

		Impairment Charges(1)			Carrying Value
(In millions)		Nine Months EndedMarch 31, 2025	As of March 31, 2025
Brand/Reporting Unit	Geographic Region		Trademark			Goodwill		Trademark(2)		Goodwill
TOM FORD	The Americas		$	773		$	—	$	1,805	$	—
Too Faced	The Americas		75			13		112		—
Total			$	848		$	13	$	1,917	$	—

(1)The date of the fair value measurement for the TOM FORD and Too Faced trademark intangible assets and Too Faced reporting unit was December 31, 2024.

(2)The carrying values of the trademark intangible assets, immediately subsequent to the impairment charges, are equal to their fair values.

The impairment charge related to the TOM FORD trademark intangible asset for the nine months ended March 31, 2025 of $773 million was reflected in the fragrance, makeup and other product categories of $549 million, $170 million and $54 million, respectively. The trademark and goodwill impairment charges related to Too Faced were reflected in the makeup product category.

NOTE 3 – CHARGES ASSOCIATED WITH RESTRUCTURING AND OTHER ACTIVITIES

Restructuring Program Component of the Profit Recovery and Growth Plan

As announced on November 1, 2023, the Company launched the Profit Recovery and Growth Plan ("PRGP") to help progressively rebuild its profit margins in fiscal years 2025 and 2026.

~~The~~As ~~PRGP~~a iscomponent ~~focused~~of onthe ~~rebuilding stronger~~PRGP, ~~more~~on ~~sustainable~~February ~~profitability~~5, ~~supporting sales growth acceleration and increasing speed and agility. The plan is designed to improve gross margin~~2024, ~~lower~~ the ~~cost~~Company ~~base~~announced ~~and~~a ~~reduce overhead expenses, while increasing investments in key consumer~~two-~~facing~~year ~~activities~~restructuring program. ~~Upon~~The ~~completion of this plan, the~~ Company ~~expects~~committed to ~~have~~this ~~improved~~course ~~its~~of ~~gross~~action ~~margin~~on ~~and~~February ~~expense~~1, ~~base to drive greater operating leverage for the future~~2024.

As a component of the PRGP, on February 5, 2024, the Company announced a two-year restructuring program. The restructuring program’s main focus included the reorganization and rightsizing of certain areas of the Company as well as simplification and acceleration of processes. The Company committed to this course of action on February 1, 2024.

In connection with the restructuring program, the Company estimated a net reduction in the range of approximately 1,800 to 3,000 positions globally, which was about 3-5% of its positions including temporary and part-time employees as of June 30, 2023. This reduction took into account the elimination of some positions as well as retraining and redeployment of certain employees in select areas.

The Company planned to substantially complete specific initiatives under the restructuring program through fiscal 2026. The Company expected that the restructuring program would result in restructuring and other charges totaling between $500 million and $700 million, before taxes, consisting of employee-related costs, contract terminations, asset write-offs and other costs associated with implementing these initiatives.

After reviewing additional potential initiatives and the progress of previously approved initiatives, on February 3, 2025, the Company committed to the expansion of the PRGP, including an expansion of the restructuring program.

The ~~expansion~~expanded component of the ~~overall~~restructuring ~~PRGP~~program isbegan ~~focused~~during onthe ~~three~~Company’s ~~key~~fiscal ~~areas~~2025 third quarter. ~~First,~~The focus of the ~~Company~~overall ~~plans~~expanded torestructuring ~~adopt~~program a(collectively ~~more~~the ~~competitive~~“Restructuring ~~approach~~Program”) toincludes ~~procurement,~~(i) areorganization ~~key~~and ~~pillar~~rightsizing of ~~savings~~certain areas, by(ii) ~~further~~simplification ~~consolidating~~and ~~spending~~acceleration ~~and~~of ~~strategically~~processes, ~~re-evaluating~~(iii) ~~key~~outsourcing ~~supplier~~of ~~relationships.~~select ~~Second,~~services ~~the~~and ~~Company~~(iv) ~~plans~~evolution of go-to-market ~~further~~footprint ~~improve~~and ~~efficiencies~~selling ~~within~~models. ~~its~~Cumulative ~~supply~~initiatives ~~chain~~under ~~network~~the ~~through~~Restructuring aProgram ~~zero-waste~~are ~~approach,~~expected ~~aiming~~ to ~~improve~~be ~~demand~~approved ~~forecasting~~by ~~and~~the ~~innovation~~end ~~planning~~of tofiscal ~~minimize~~2026 ~~excess inventory~~ and ~~product~~substantially ~~destruction.~~completed ~~Third,~~by the ~~Company~~end isof ~~outsourcing~~fiscal ~~select services to proven global partners~~2027.

13In connection with the Restructuring Program, as of September 30, 2025, the Company estimates a net reduction in the range of approximately 5,800 to 7,000 positions globally, which is about 9-11% of its positions including temporary and part-time employees as of June 30, 2023. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

The Company expects that the Restructuring Program will result in restructuring and other charges totaling between $1,200 million and $1,600 million, before taxes, consisting of employee-related costs, asset-related costs, contract terminations and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~The~~Additional ~~expanded~~information ~~component~~relating ofto the ~~restructuring program began during the~~ Company’'s ~~fiscal~~Profit ~~2025~~Recovery ~~third~~and ~~quarter~~Growth ~~with~~Plan ~~all~~and ~~initiatives~~related toRestructuring beProgram ~~approved~~is byincluded ~~the~~in ~~end of fiscal 2026. Specific initiatives under~~ the ~~expanded~~notes ~~component of the restructuring program are expected~~ to beconsolidated ~~substantially~~financial ~~completed~~statements byin the ~~end~~Company’s ofAnnual ~~fiscal~~Report ~~2027.~~on ~~The~~Form 10-K ~~focus~~for of the ~~now~~fiscal ~~expanded~~year ~~restructuring~~ended ~~program (now~~June 30, collectively the “Restructuring Program”) includes (i) reorganization and rightsizing of certain areas and (ii) simplification and acceleration of processes, along with the newly added focus on (i) outsourcing of select services and (ii) evolution of go-to-market footprint and selling models2025.

~~In connection with the~~ Restructuring Program, ~~the~~Approvals Company now estimates a net reduction in the range of approximately 5,800 to 7,000 positions globally, which is about 9-11% of its positions including temporary and part-time employees as of June 30, 2023. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

~~The~~Cumulative ~~Company~~charges ~~now~~for ~~expects~~initiatives ~~that~~approved by the ~~Restructuring~~Company ~~Program will result~~ in ~~restructuring~~connection ~~and~~with ~~other~~the ~~charges~~Restructuring ~~totaling~~Program ~~between~~as ~~$1,200 million and $1,600 million, before taxes, consisting~~ of ~~employee-related~~September ~~costs~~30, ~~contract~~2025 ~~terminations, asset write-offs~~ and ~~other~~through ~~costs~~October ~~associated with implementing these initiatives~~26, ~~which other than the non-cash charges~~2025, ~~are expected to result in future cash expenditures funded from cash provided by operations.~~ were:

Restructuring Program Component of the Profit Recovery and Growth Plan Approvals


	Sales Returns (included in Net Sales)		Cost of Sales		Operating Expenses				Total
(In millions)					Restructuring Charges		Other Charges
Total Charges Approved
Cumulative charges approved through June 30, 2025	$	4	$	10	$	552	$	114	$	680
Three months ended September 30, 2025	1		—		107		39		147
Cumulative charges approved through September 30, 2025	5		10		659		153		827
October 1, 2025 - October 26, 2025	(1)		—		24		2		25
Cumulative charges approved through October 26, 2025	$	4	$	10	$	683	$	155	$	852

~~Cumulative~~Included in the above table, cumulative restructuring charges for initiatives approved by the Company in connection with the Restructuring Program as of ~~March~~September 3130, 2025 and through ~~April~~October 2426, 2025, by major cost type were:

	SalesReturns(included inNet Sales)		Cost of Sales		Operating Expenses				Total
(In millions)	Employee-RelatedCosts		Asset-RelatedCosts		ContractTerminations		Other ExitCosts		Total
(In millions)					RestructuringCharges		OtherCharges
Restructuring Charges Approved
Total Charges Approved
Cumulative charges approved through June 30, 2025	$	512	$	14	$	3	$	23	$	552
Cumulative charges approved through June 30, 2024	$	—	$	—	$	109	$	78	$	187
Three months ended September 30, 2025	64		39		1		3		107
Nine months ended March 31, 2025	5		10		351		42		408
Cumulative charges approved through September 30, 2025	576		53		4		26		659
Cumulative charges approved through March 31, 2025	5		10		460		120		595
October 1, 2025 - October 26, 2025	23		—		—		1		24
April 1, 2025 - April 24, 2025	—		—		28		—		28
Cumulative charges approved through October 26, 2025	$	599	$	53	$	4	$	27	$	683
Cumulative charges approved through April 24, 2025	$	5	$	10	$	488	$	120	$	623

~~Included~~Specific inactions ~~the~~taken ~~above~~since ~~table, cumulative restructuring charges for initiatives approved by~~ the ~~Company~~Restructuring inProgram ~~connection~~inception ~~with~~to ~~the~~drive ~~Restructuring~~future ~~Program~~sales asgrowth ofand ~~March~~productivity ~~31,~~to ~~2025~~rebuild gross and ~~through~~operating ~~April~~margin ~~24,~~profitability ~~2025 were~~include:

(In millions)	Employee-RelatedCosts		Asset-RelatedCosts		ContractTerminations		Other ExitCosts		Total
Restructuring Charges Approved
Cumulative charges approved through June 30, 2024	$	93	$	7	$	—	$	9	$	109
Nine months ended March 31, 2025	330		6		3		12		351
Cumulative charges approved through March 31, 2025	423		13		3		21		460
April 1, 2025 - April 24, 2025	26		—		—		2		28
Cumulative charges approved through April 24, 2025	$	449	$	13	$	3	$	23	$	488

•Value Chain Optimization – The Company approved initiatives to reduce spans and layers and right-size organizational capability within its supply chain and research and development functions. These actions will primarily result in employee severance through a net reduction in workforce, as well as asset-related costs and costs to decommission and relocate activities.

14•Enabling Function Re-Invention – The Company approved initiatives to reorganize and right-size various corporate functions. These activities will primarily result in employee severance through a net reduction in workforce.

•Future of Brand-led Model – The Company approved initiatives to redesign spans and layers in its marketing, creative and other functions within the brand and product category structures to make them leaner, faster and more agile. These activities will primarily result in employee severance through a net reduction in workforce.

•Go-to-Market Operating Model Acceleration – The Company approved initiatives to optimize and right-size the organizational structure within its geographic regions to drive greater efficiency and effectiveness, as well as exit unprofitable brands from specific markets and distribution channels. These activities will primarily result in employee severance through a net reduction in workforce, inventory write-offs, as well as costs associated with sales returns.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~Specific~~•Digital ~~actions~~Organization ~~taken~~Transformation ~~since~~– ~~the~~The ~~Restructuring~~Company ~~Program~~approved ~~inception~~initiatives to ~~drive~~begin ~~future~~to ~~sales~~reorganize ~~growth~~and right-size its technology functions, which support its internal enterprise and ~~productivity~~commercial capabilities, to ~~rebuild~~create ~~gross~~a leaner, faster, more effective and ~~operating~~more ~~margin~~agile ~~profitability~~technology ~~include:~~organization. These activities will primarily result in employee severance through a net reduction in workforce, as well as asset-related costs.

~~•Value~~Once ~~Chain~~the ~~Optimization~~relevant –accounting ~~The~~criteria ~~Company~~have ~~approved~~been ~~initiatives~~met, tothe ~~reduce~~Company ~~spans~~expects ~~and~~to ~~layers~~record ~~and~~cumulative ~~right-size~~restructuring ~~organizational~~and ~~capability~~other ~~within~~charges ~~its~~of ~~supply~~approximately ~~chain~~$852 ~~and~~million ~~research~~(before ~~and~~tax) ~~development~~in ~~functions.~~connection ~~These~~with ~~actions~~these ~~will~~initiatives, ~~primarily~~which ~~result~~other inthan ~~employee~~the ~~severance~~non-cash ~~through~~charges, aare ~~net~~expected ~~reduction~~to result in ~~workforce,~~future ascash ~~well~~expenditures asfunded ~~costs~~from tocash ~~decommission~~provided ~~and~~by ~~relocate activities, and asset write-offs~~operations.

•Enabling Function Re-Invention – The Company approved initiatives to reorganize and right-size various corporate functions. These activities will primarily result in employee severance through a net reduction in workforce.

•Future of Brand-led Model – The Company approved initiatives to redesign spans and layers in its marketing and creative organization to make it leaner, faster, and more agile. These activities will primarily result in employee severance through a net reduction in workforce.

•Go-to-Market Operating Model Acceleration – The Company approved initiatives to optimize and right-size the organizational structure within its geographic regions to drive greater efficiency and effectiveness, as well as exit unprofitable brands from specific markets and distribution channels. These activities will result in employee severance through a net reduction in workforce, inventory write-offs, as well as costs associated with sales returns.

•Digital Organization Transformation – The Company approved initiatives to begin to reorganize and right-size its technology functions, which support its internal enterprise and commercial capabilities, to create a leaner, faster, more effective and more agile technology organization. These activities will primarily result in employee severance through a net reduction in workforce.

Once the relevant accounting criteria have been met, the Company expects to record restructuring and other charges of approximately $623 million (before tax) in connection with these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

Restructuring Program Restructuring and Other Charges

The Company classifies restructuring charges as follows:

Employee-Related Costs – Employee-related costs are primarily comprised of severance and other post-employment benefit costs, calculated based on salary levels, prior service and other statutory minimum benefits, if applicable.

Asset-Related Costs – Asset-related costs primarily consist of asset write-offs or accelerated depreciation related to long-lived assets (including ~~rights associated with commercial~~ operating ~~leases and operating~~ lease right-of-use assets) that will be taken out of service prior to their existing useful life as a direct result of a restructuring initiative.

Contract Terminations – Costs related to contract terminations include continuing payments to a third party after the Company has ceased benefiting from the rights conveyed in the contract, or a payment made to terminate a contract prior to its expiration.

Other Exit Costs – Other exit costs related to restructuring activities generally include costs to relocate facilities or employees, recruiting to fill positions as a result of relocation of operations, and outplacement for separated employees.

The Company classifies other charges associated with restructuring activities as follows:

Sales Returns and Cost of Sales – Product returns (offset by the related cost of sales) and inventory write-offs or write-downs as a direct result of an approved restructuring initiative to exit certain businesses or locations will be recorded as a component of Net sales and/or Cost of sales when estimable and reasonably assured.

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Other Charges – Other charges related to the design and implementation of approved initiatives, which are charged to Operating expenses as incurred and primarily include the following:

•Consulting and other professional services for organizational design of the future structures and processes as well as the implementation thereof;

•Temporary labor backfill;

•Costs to establish and maintain a Project Management Office for the duration of the Restructuring Program, including internal costs for employees dedicated solely to project management activities, and consulting services to assist with business case development and execution; and

•Recruitment and training costs for new and reskilled employees to acquire and apply the capabilities needed to perform responsibilities as a direct result of an approved restructuring initiative.

The Company records approved charges associated with restructuring and other activities once the relevant accounting criteria have been met.

~~Total cumulative charges recorded associated with restructuring and other activities for the Restructuring Program were:~~13

	SalesReturns(included inNet Sales)		Cost of Sales		Operating Expenses				Total
(In millions)					RestructuringCharges		OtherCharges
Total Cumulative Charges
Cumulative charges through June 30, 2024	$	—	$	—	$	92	$	23	$	115
Six months ended December 31, 2024	—		9		256		23		288
Three months ended March 31, 2025	—		—		81		14		95
Cumulative charges through March 31, 2025	$	—	$	9	$	429	$	60	$	498

(In millions)	Employee-RelatedCosts		Asset-RelatedCosts		ContractTerminations		Other ExitCosts		Total
Restructuring Charges
Cumulative charges through June 30, 2024	$	90	$	2	$	—	$	—	$	92
Six months ended December 31, 2024	247		7		—		2		256
Three months ended March 31, 2025	78		—		3		—		81
Cumulative charges through March 31, 2025	$	415	$	9	$	3	$	2	$	429

For the three and nine months ended March 31, 2024, charges recorded associated with restructuring and other activities for the Restructuring Program were $17 million.

Changes in accrued restructuring charges from the Restructuring Program for the nine months ended March 31, 2025 were:

(In millions)	Employee-RelatedCosts		Asset-RelatedCosts		ContractTerminations		Other ExitCosts		Total
Balance at June 30, 2024	$	88	$	—	$	—	$	—	$	88
Charges	325		7		3		2		337
Cash payments	(70)		—		—		(2)		(72)
Non-cash asset write-offs	—		(7)		—		—		(7)
Translation and other adjustments	(8)		—		—		—		(8)
Balance at March 31, 2025	$	335	$	—	$	3	$	—	$	338

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~Accrued~~Total ~~restructuring~~cumulative charges atrecorded ~~March~~associated ~~31,~~with ~~2025~~restructuring ~~relating to the Restructuring Program are expected to result in cash expenditures funded from cash provided by operations of approximately $122 million, $150 million, $61 million~~ and ~~$5 million~~other activities for the ~~remainder~~Restructuring ofProgram ~~fiscal 2025 and for fiscal 2026, 2027 and 2028, respectively.~~were:


	Sales Returns (included in Net Sales)		Cost of Sales		Operating Expenses				Total
(In millions)					Restructuring Charges		Other Charges
Total Charges
Cumulative charges through June 30, 2025	$	—	$	9	$	524	$	77	$	610
Three months ended September 30, 2025	—		(2)		72		17		87
Cumulative charges through September 30, 2025	$	—	$	7	$	596	$	94	$	697

Included in the above table, cumulative restructuring charges recorded by the Company in connection with the Restructuring Program as of September 30, 2025, by major cost type were:


(In millions)	Employee- Related Costs		Asset- Related Costs		Contract Terminations		Other Exit Costs		Total
Restructuring Charges
Cumulative charges through June 30, 2025	$	503	$	13	$	3	$	5	$	524
Three months ended September 30, 2025	66		5		—		1		72
Cumulative charges through September 30, 2025	$	569	$	18	$	3	$	6	$	596

Changes in accrued restructuring charges from the Restructuring Program for the three months ended September 30, 2025 were:


(In millions)	Employee- Related Costs		Asset- Related Costs		Contract Terminations		Other Exit Costs		Total




Balance at June 30, 2025	$	369	$	—	$	2	$	—	$	371

Charges	66		5		—		1		72
Cash payments	(66)		—		—		(1)		(67)
Non-cash asset-related costs	—		(5)		—		—		(5)
Translation and other adjustments	(2)		—		—		—		(2)
Balance at September 30, 2025	$	367	$	—	$	2	$	—	$	369

Accrued restructuring charges at September 30, 2025 relating to the Restructuring Program are expected to result in cash expenditures funded from cash provided by operations of approximately $248 million, $104 million and $17 million for the remainder of fiscal 2026 and for fiscal 2027 and 2028, respectively.

Charges associated with restructuring and other activities are not allocated to the Company's product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed Company-wide initiatives to redesign, resize and reorganize select areas of the business.

Post-COVID Business Acceleration Program

The Company approved specific initiatives under the Post-COVID Business Acceleration Program (the “PCBA Program”) through fiscal 2022 and has substantially completed those initiatives. Additional information about the PCBA Program is included in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

NOTE 4 – DERIVATIVE FINANCIAL INSTRUMENTS

The Company addresses certain financial exposures through a controlled program of risk management that includes the use of derivative financial instruments. The Company does not utilize derivative financial instruments for trading or speculative purposes. Costs associated with entering into derivative financial instruments have not been material to the Company’s consolidated financial results. At ~~March~~September 3130, 2025, the notional amount of derivatives not designated as hedging instruments was $3,~~704~~ 314 million.

~~Fair Value Hedges~~14

The Company enters into interest rate derivative contracts to manage the exposure to interest rate fluctuations on its funded indebtedness. At March 31, 2025, the Company has interest rate swap agreements, with notional amounts totaling $700 million and $300 million to effectively convert the fixed rate interest on its 2030 Senior Notes and 2031 Senior Notes, respectively, to variable interest rates based on the three-month fallback Secured Overnight Financing Rate ("SOFR") plus a margin. These interest rate swap agreements are designated as fair value hedges of the related long-term debt, and the changes in the fair value of the interest rate swap agreements are exactly offset by the change in the fair value of the underlying long-term debt.

The Company enters into cross-currency swap contracts to manage the exposure of foreign exchange rate fluctuations on its intercompany foreign currency denominated debt. At March 31, 2025, the Company has cross-currency swap contracts with notional amounts totaling $491 million, to hedge the impact of foreign currency changes on certain intercompany foreign currency denominated debt. The cross-currency swap contracts are designated as fair value hedges of the related intercompany debt, and the gains and losses representing hedge components included in the assessment of effectiveness are presented in the same line item as the earnings effect of the hedged transaction in the consolidated statements of earnings (loss). Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis. The earnings recognition of excluded components is presented in the same line item as the earnings effect of the hedged transaction in the consolidated statements of earnings (loss). Any difference between the changes in the fair value of the excluded components and amounts recognized in earnings (loss) will be recognized in Accumulated Other Comprehensive Loss ("AOCI").

The estimated net gain on the Company’s derivative instruments designated as fair value hedges as of March 31, 2025 that is expected to be reclassified from AOCI into earnings (loss), net of tax, within the next twelve months is $14 million. The accumulated net gain (loss) on derivative instruments designated as fair value hedges in AOCI was $7 million and $(7) million as of March 31, 2025 and June 30, 2024, respectively.

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Hedges

The Company enters into interest rate derivative contracts to manage the exposure to interest rate fluctuations on its funded indebtedness. At September 30, 2025, the Company has interest rate swap agreements, with notional amounts totaling $700 million, $300 million and $300 million, to effectively convert the fixed rate interest on its 2030 Senior Notes, 2031 Senior Notes and 2034 Senior Notes, respectively, to variable interest rates based on the Secured Overnight Financing Rate ("SOFR") plus a margin. These interest rate swap agreements are designated as fair value hedges of the related long-term debt, and the changes in the fair value of the interest rate swap agreements are exactly offset by the change in the fair value of the underlying long-term debt.

The Company enters into cross-currency swap contracts to manage the exposure of foreign exchange rate fluctuations on its intercompany foreign currency denominated debt. At September 30, 2025, the Company has cross-currency swap contracts with notional amounts totaling $491 million, to hedge the impact of foreign currency changes on certain intercompany foreign currency denominated debt. The cross-currency swap contracts are designated as fair value hedges of the related intercompany debt, and the gains and losses representing hedge components included in the assessment of effectiveness are presented in the same income statement line item as the earnings effect of the hedged transaction in the consolidated statements of earnings (loss). Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis. The earnings recognition of excluded components is presented in the same income statement line item as the earnings effect of the hedged transaction in the consolidated statements of earnings (loss). Any difference between the changes in the fair value of the excluded components and amounts recognized in earnings (loss) will be recognized in Accumulated Other Comprehensive Loss ("AOCI").

The estimated net gain on the Company’s derivative instruments designated as fair value hedges as of September 30, 2025 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $14 million. The accumulated net gain on derivative instruments designated as fair value hedges in AOCI was $10 million and $7 million as of September 30, 2025 and June 30, 2025, respectively.

Cash Flow Hedges

The Company enters into foreign currency forward contracts, ~~and may enter into foreign currency option contracts,~~ to hedge anticipated transactions and receivables and payables denominated in foreign currencies, for periods consistent with the Company’s identified exposures. The purpose of the hedging activities is to minimize the effect of foreign exchange rate movements on the cash flows that the Company receives from foreign subsidiaries. The foreign currency forward contracts entered into to hedge anticipated transactions and receivables and payables denominated in foreign currencies have been designated as cash flow hedges and have varying maturities through the end of ~~December~~March ~~2026~~2027. Hedge effectiveness of the foreign currency forward contracts is based on the forward method, which includes forward points in the effectiveness assessment. At ~~March~~September 3130, 2025, the Company had cash flow hedges outstanding with a notional amount totaling $21,~~129~~270 million.

For foreign currency hedge contracts that are no longer deemed highly effective, hedge accounting is discontinued and gains and losses in AOCI are reclassified to Net sales when the underlying forecasted transaction occurs. If it is probable that the forecasted transaction will no longer occur, then any gains or losses in AOCI are reclassified to current-period Net sales. As of ~~March~~September 3130, 2025, the Company’s foreign currency cash flow hedges were highly effective.

The Company may enter into interest rate forward contracts to hedge anticipated issuance of debt for periods consistent with the Company’s identified exposures. The purpose of the hedging activities is to minimize the effect of interest rate movements on the cost of debt issuance.

The estimated net ~~gain~~loss on the Company’s derivative instruments designated as cash flow hedges as of ~~March~~September 3130, 2025 that is expected to be reclassified from AOCI into earnings ~~(loss)~~, net of tax, within the next twelve months is $1324 million. The accumulated net gain (loss) on derivative instruments designated as cash flow hedges in AOCI was $503 million and $76(13) million as of ~~March~~September 3130, 2025 and June 30, ~~2024~~2025, respectively.

~~Net Investment Hedges~~15

The Company enters into foreign currency forward contracts and cross-currency swap contracts, designated as net investment hedges, to hedge a portion of its net investment in certain foreign operations. Forward points and cross-currency basis spreads, respectively, are excluded from the effectiveness assessment and are recognized under a systematic and rational method over the life of the hedging instrument in Selling, general and administrative expenses. The purpose of the hedging activities is to minimize the effect of foreign exchange rate movements on the Company’s net investment in these foreign operations. The net investment hedge contracts have varying maturities through the end of September 2025. Hedge effectiveness of the net investment hedge contracts is based on the spot method. At March 31, 2025, the Company had net investment hedges outstanding with a notional amount totaling $1,296 million.

Credit Risk

As a matter of policy, the Company enters into derivative contracts only with counterparties that have a long-term credit rating of at least A- or higher by at least two nationally recognized rating agencies. The counterparties to these contracts are major financial institutions. Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of contracts in asset positions, which totaled $119 million at March 31, 2025. To manage this risk, the Company has strict counterparty credit guidelines that are continually monitored. Accordingly, management believes risk of loss under these hedging contracts is remote.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Net Investment Hedges

The Company enters into foreign currency forward contracts and cross-currency swap contracts, designated as net investment hedges, to hedge a portion of its net investment in certain foreign operations. Forward points and cross-currency basis spreads, respectively, are excluded from the effectiveness assessment and are recognized under a systematic and rational method over the life of the hedging instrument in Selling, general and administrative expenses. The purpose of the hedging activities is to minimize the effect of foreign exchange rate movements on the Company’s net investment in these foreign operations. The net investment hedge contracts have varying maturities through the end of November 2029. Hedge effectiveness of the net investment hedge contracts is based on the spot method. At September 30, 2025, the Company had net investment hedges outstanding with notional amounts totaling $1,077 million.

Credit Risk

As a matter of policy, the Company enters into derivative contracts only with counterparties that have a long-term credit rating of at least A- or higher by at least two nationally recognized rating agencies. The counterparties to these contracts are major financial institutions. Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of contracts in asset positions, which totaled $74 million at September 30, 2025. To manage this risk, the Company has strict counterparty credit guidelines that are continually monitored. Accordingly, management believes risk of loss under these hedging contracts is remote.

The fair values of the Company’s derivative financial instruments included in the consolidated balance sheets are presented as follows:

Asset Derivatives

Liability Derivatives

Fair Value (1)

(In millions)

Balance SheetLocation

~~March~~September 3130, 2025

June 30, ~~2024~~2025

Balance SheetLocation

~~March~~September 3130, 2025

June 30, ~~2024~~2025

Derivatives Designated as Hedging Instruments:

Foreign currency forward contracts(2)

Prepaid expenses and other current assets; Other assets

496

497

Other accrued liabilities

1737

482

Cross-currency swap contracts(3)

Prepaid expenses and other current assets; Other assets

8050

Other accrued liabilities

—15

Interest rate contracts

Prepaid expenses and other current assets

—

Other accrued liabilities

~~118~~100

~~145~~104

Total Derivatives Designated as Hedging Instruments

~~113~~70

~~129~~57

~~139~~138

~~149~~201

Derivatives Not Designated as Hedging Instruments:

Foreign currency forward contracts

Prepaid expenses and other current assets

1925

Other accrued liabilities

323

1715

Total derivatives

~~119~~74

~~148~~82

~~171~~141

~~166~~216

(1)See Note 5 – Fair Value Measurements for further information about how the fair value of derivative assets and liabilities are determined.

(2)Included in the asset derivatives for the foreign currency forward contracts at ~~March 31~~September 30, 2025 ~~and June 30, 2024~~ is $2 1 million, classified within Other assets in the accompanying consolidated balance sheets. There were no amounts classified in Other assets at June 30, 2025.

(3)Included in the asset derivatives for the cross-currency swap contracts at ~~March 31~~September 30, 2025 and June 30, ~~2024~~2025 is approximately $50 million and $70 40 million, respectively, classified within Other assets in the accompanying consolidated balance sheets.

1916

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amounts of the gains and losses related to the Company’s derivative financial instruments designated as hedging instruments that are included in the assessment of effectiveness are as follows:

	Amount of Gain (Loss)Recognized in OCI onDerivatives				Location of Gain (Loss) Reclassifiedfrom AOCI intoEarnings ~~(Loss)~~	Amount of Gain (Loss)Reclassified from AOCI into Earnings (Loss)(1)
	Three Months EndedMarch 31,					Three Months EndedMarch 31,
	Three Months EndedSeptember 30,					Three Months EndedSeptember 30,
(In millions)	2025		2024			2025		2024
Derivatives in Cash Flow Hedging Relationships:
Foreign currency forward contracts	$	~~(17)~~16	$	36(47)	Net sales	$	7—	$	1510
Interest rate contracts	—		—		Interest expense	—		—
Total cash flow hedges	16		(47)			—		10
Total cash flow hedges	(17)		36			7		15
Derivatives in Net Investment Hedging Relationships(2):
Derivatives in Net Investment Hedging Relationships(2)(3):
Foreign currency forward contracts(3)	—		(64)			—		—
Foreign currency forward contracts	(29)		11			—		—
Cross-currency swap contracts(4)	15		—			—		—
Cross-currency swap contracts	(6)		—			—		—
Total net investment hedges	15		(64)			—		—
Total net investment hedges	(35)		11			—		—
Total derivatives	$	31	$	(111)		$	—	$	10
Total derivatives	$	(52)	$	47		$	7	$	15

(1)~~The~~There was no amount reclassified into the accompanying consolidated statements of earnings (loss) as a result of the discontinuance of cash flow hedges because it is probable that forecasted transactions will not occur by the end of the original time period ~~was not material~~.

(2)~~During~~Included ~~the~~within ~~three~~translation ~~months~~adjustments ~~ended~~as ~~March 31,~~a ~~2025~~component ~~and~~of ~~2024,~~AOCI ~~the~~on ~~gain recognized in earnings (loss) from net investment hedges related to~~ the ~~amount~~Company’s ~~excluded~~consolidated ~~from~~balance ~~effectiveness testing was $7 million and $3 million, respectively~~sheets.

(3)~~Included~~During ~~within~~the ~~translation~~three ~~adjustments~~months asended aSeptember 30, ~~component~~2025 ofand ~~AOCI~~2024, onthe gain recognized in the ~~Company’s~~accompanying consolidated ~~balance~~statements ~~sheets~~of earnings (loss) from foreign currency forward contracts related to the amount excluded from effectiveness testing was $3 million and $7 million, respectively.

	Amount of Gain (Loss)Recognized in OCI onDerivatives				Location of Gain (Loss) Reclassifiedfrom AOCI intoEarnings (Loss)	Amount of Gain (Loss)Reclassified from AOCI into Earnings (Loss)(1)
	Nine Months EndedMarch 31,					Nine Months EndedMarch 31,
(In millions)	2025		2024			2025		2024
Derivatives in Cash Flow Hedging Relationships:
Foreign currency forward contracts	$	6	$	28	Net sales	$	31	$	36
Interest rate contracts	—		—		Interest expense	1		(1)
Total cash flow hedges	6		28			32		35
Derivatives in Net Investment Hedging Relationships(2)(3):
Foreign currency forward contracts	(7)		(6)			—		—
Cross-currency swap contracts	(4)		—			—		—
Total net investment hedges	(11)		(6)			—		—
Total derivatives	$	(5)	$	22		$	32	$	35

(4)During the three months ended September 30, 2025, the gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing was $3 million.

(1)The amount reclassified into earnings (loss) as a result of the discontinuance of cash flow hedges because it is probable that forecasted transactions will not occur by the end of the original time period was not material.


			Amount of Gain (Loss) Recognized in Earnings (Loss) on Derivatives
	Location of Gain (Loss) Recognized in Earnings (Loss) on Derivatives
		Three Months Ended September 30,
(In millions)			2025		2024
Derivatives in Fair Value Hedging Relationships:


Cross-currency swap contracts (1)	Selling, general and administrative		$	12	$	(53)
Interest rate contracts (2)	Interest expense		$	4	$	41

(21)~~During~~Changes in the ~~nine~~fair ~~months~~value ~~ended~~representing ~~March 31,~~hedge ~~2025~~components ~~and~~included ~~2024,~~in the assessment of effectiveness of the cross-currency swap contracts are exactly offset by the change in the fair value of the underlying intercompany foreign currency denominated debt. The gain recognized in the accompanying consolidated statements of earnings (loss) from ~~net~~cross-currency ~~investment~~swap ~~hedges~~contracts related to the amount excluded from effectiveness testing during the three months ended September 30, 2025 and 2024 was $22 5 million and $13 4 million, respectively.

(3)Included within translation adjustments as a component of AOCI on the Company’s consolidated balance sheets.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

		Amount of Gain (Loss) Recognized in Earnings (Loss) onDerivatives
	Location of Gain (Loss) Recognized in Earnings (Loss) on Derivatives
		Three Months EndedMarch 31,				Nine Months EndedMarch 31,
(In millions)		2025		2024		2025		2024
Derivatives in Fair Value Hedging Relationships:
Cross-currency swap contracts(1)	Selling, general and administrative	$	(20)	$	30	$	(29)	$	19
Interest rate contracts(2)	Interest expense	$	21	$	(17)	$	28	$	3

(1)Changes in the fair value representing hedge components included in the assessment of effectiveness of the cross-currency swap contracts are exactly offset by the change in the fair value of the underlying intercompany foreign currency denominated debt. The gain recognized in earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing during each of the three months ended March 31, 2025 and 2024 was $5 million, and during each of the nine months ended March 31, 2025 and 2024 was $14 million.

(2)Changes in the fair value of the interest rate contracts are exactly offset by the change in the fair value of the underlying long-term debt.

Additional information regarding the cumulative amount of fair value hedging gain (loss) recognized in earnings (loss) for items designated and qualifying as hedged items in fair value hedges is as follows:17

(In millions)
Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included	Carrying Amount of theHedged Liabilities		Cumulative Amount of FairValue Hedging Gain (Loss)Included in the Carrying Amount of the Hedged Liability
	March 31, 2025		March 31, 2025
Long-term debt	$	877	$	(118)
Intercompany debt	$	—	$	58

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Additional information regarding the cumulative amount of fair value hedging gain (loss) recognized in the accompanying consolidated statements of earnings (loss) for items designated and qualifying as hedged items in fair value hedges is as follows:


(In millions)
Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included	Carrying Amount of the Hedged Liabilities		Cumulative Amount of Fair Value Hedging Gain (Loss) Included in the Carrying Amount of the Hedged Liability
	September 30, 2025		September 30, 2025

Long-term debt	$	1,185	$	(100)
Intercompany debt	$	—	$	54

Additional information regarding the effects of fair value and cash flow hedging relationships for derivatives designated and qualifying as hedging instruments is as follows:

	Three Months Ended March 31,
	Three Months Ended September 30,
	2025						2024
(In millions)	Net Sales		Selling, General and Administrative		InterestExpense		Net Sales		Selling, General and Administrative		InterestExpense
Total amounts of income and expense line items presented in the consolidated statements of earnings (loss) in which the effects of fair value and cash flow hedges are recorded	$	3,550	$	2,258	$	87	$	3,940	$	2,284	$	94
Total amounts of income and expense line items presented in the accompanying consolidated statements of earnings (loss) in which the effects of fair value and cash flow hedges are recorded	$	3,481	$	2,296	$	86	$	3,361	$	2,298	$	92
The effects of fair value and cash flow hedging relationships:
Gain (loss) on fair value hedge relationships – interest rate contracts:
Hedged item	N/A		N/A		(214)		N/A		N/A		17(41)
Derivatives designated as hedging instruments	N/A		N/A		214		N/A		N/A		~~(17)~~41
Gain (loss) on fair value hedge relationships – cross-currency swap contracts:
Hedged item	N/A		20(12)		N/A		N/A		~~(30)~~53		N/A
Derivatives designated as hedging instruments	N/A		~~(20)~~12		N/A		N/A		30(53)		N/A
Gain (loss) on cash flow hedge relationships – interest rate contracts:
Gain (loss) on cash flow hedge relationships – foreign currency forward contracts:
Amount of gain (loss) reclassified from AOCI into earnings (loss)	N/A		N/A		—		N/A		N/A		—
Amount of gain (loss) reclassified from AOCI	—		N/A		N/A		10		N/A		N/A
Gain on cash flow hedge relationships – foreign currency forward contracts:
Amount of gain reclassified from AOCI into earnings (loss)	7		N/A		N/A		15		N/A		N/A

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Nine Months Ended March 31,

2025

2024

(In millions)

Net Sales

Selling, General and Administrative

InterestExpense

Net Sales

Selling, General and Administrative

InterestExpense

Total amounts of income and expense line items presented in the consolidated statements of earnings (loss) in which the effects of fair value and cash flow hedges are recorded

10,915

7,141

269

11,737

7,177

287

The effects of fair value and cash flow hedging relationships:

Gain (loss) on fair value hedge relationships – interest rate contracts:

Hedged item

N/A

(28)

N/A

(3)

Derivatives designated as hedging instruments

N/A

Gain (loss) on fair value hedge relationships – cross-currency swap contracts:

Hedged item

N/A

(19)

N/A

Derivatives designated as hedging instruments

N/A

(29)

N/A

Gain (loss) on cash flow hedge relationships – interest rate contracts:

Amount of gain (loss) reclassified from AOCI into earnings (loss)

N/A

(1)

Gain on cash flow hedge relationships – foreign currency forward contracts:

Amount of gain reclassified from AOCI into earnings (loss)

N/A

N/A (Not applicable)

2318

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The amount of gains and losses related to the Company’s derivative financial instruments not designated as hedging instruments are presented as follows:

~~Amount of Gain (Loss)Recognized in Earnings (Loss) on Derivatives~~

Amount of Gain (Loss)Recognized in Earnings (Loss) on Derivatives

Location of Gain (Loss) Recognized in Earnings (Loss) onDerivatives

Three Months EndedMarch 31,

Nine Months EndedMarch 31,

Location of Gain (Loss) Recognized in Earnings (Loss) on Derivatives

Three Months EndedSeptember 30,

(In millions)

~~2025~~

~~2024~~

2025

2024

Derivatives Not Designated as Hedging Instruments:

Foreign currency forward contracts

Selling, general and administrative

~~(6)~~

~~(25)~~16

31(50)

The Company's derivative instruments are subject to enforceable master netting agreements. These agreements permit the net settlement of these contracts on a per-institution basis; however, the Company records the fair value on a gross basis on its consolidated balance sheets based on maturity dates, including those subject to master netting arrangements. The following table provides information as if the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of netting arrangements with each of the counterparties:

	As of March 31, 2025						As of June 30, 2024
	As of September 30, 2025						As of June 30, 2025
(In millions)	Gross Amounts of Assets / (Liabilities) Presented in Balance Sheet		Contracts Subject to Netting		Net Amounts of Assets / (Liabilities)		Gross Amounts of Assets / (Liabilities) Presented in Balance Sheet		Contracts Subject to Netting		Net Amounts of Assets / (Liabilities)
Derivative Financial Contracts
Derivative Financial Instruments
Derivative assets	$	~~119~~74	$	(6030)	$	5944	$	~~148~~82	$	(4960)	$	9922
Derivative liabilities	(~~171~~141)		6030		(111)		(~~166~~216)		4960		(~~117~~156)
Total derivatives	$	(5267)	$	—	$	(5267)	$	(18134)	$	—	$	(18134)

NOTE 5 – FAIR VALUE MEASUREMENTS

The Company records certain of its financial assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. The accounting for fair value measurements must be applied to nonfinancial assets and nonfinancial liabilities that require initial measurement or remeasurement at fair value, which principally consist of assets and liabilities acquired through business combinations and goodwill, indefinite-lived intangible assets and long-lived assets for the purposes of calculating potential impairment. The Company is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are as follows:

Level 1: Inputs based on quoted market prices for identical assets or liabilities in active markets at the measurement date.

Level 2: Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instrument’s valuation.

2419

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of ~~March~~September 3130, 2025:

(In millions)	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	~~961~~448	$	—	$	—	$	~~961~~448
Foreign currency forward contracts	—		5510		—		5510
Cross-currency swap contracts	—		64		—		64
Total	$	~~961~~448	$	~~119~~74	$	—	$	~~1,080~~522
Liabilities:
Foreign currency forward contracts	$	—	$	4940	$	—	$	4940
Interest rate contracts	—		~~118~~100		—		~~118~~100
Cross-currency swap contracts	—		41		—		41
Total	$	—	$	~~171~~141	$	—	$	~~171~~141

The following table presents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, ~~2024~~2025:

(In millions)	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	~~1,507~~727	$	—	$	—	$	~~1,507~~727
Foreign currency forward contracts	—		6832		—		6832
Cross-currency swap contracts	—		8050		—		8050
Total	$	~~1,507~~727	$	~~148~~82	$	—	$	~~1,655~~809
Liabilities:
Foreign currency forward contracts	$	—	$	2197	$	—	$	2197
Interest rate contracts	—		~~145~~104		—		~~145~~104
Total	$	—	$	166	$	—	$	166
Cross-currency swap contracts	—		15		—		15
Total	$	—	$	216	$	—	$	216

The estimated fair values of the Company’s financial instruments not measured at fair value on a recurring basis are as follows:

	March 31, 2025				June 30, 2024
	September 30, 2025				June 30, 2025
(In millions)	CarryingAmount		FairValue		CarryingAmount		FairValue
Nonderivatives
Current and long-term debt	$	7,323	$	6,903	$	7,317	$	6,794
Cash and cash equivalents	$	2,631	$	2,631	$	3,395	$	3,395
Deferred consideration payable	$	172	$	174	$	322	$	323
Current and long-term debt	7,301		6,728		7,771		7,174
Deferred consideration payable	321		322		341		340
Derivatives
Foreign currency forward contracts – asset (liability), net	6		6		47		47
Cross-currency swap contracts - asset (liability), net	60		60		80		80
Interest rate contracts – liability	(118)		(118)		(145)		(145)

2520

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following methods and assumptions were used to estimate the fair value of the Company’s financial instruments for which it is practicable to estimate that value:

Cash and cash equivalents – Cash and all highly-liquid securities with original maturities of three months or less are classified as cash and cash equivalents, primarily consisting of cash deposits in interest bearing accounts, time deposits and money market funds (classified within Level 1 of the valuation hierarchy). Cash deposits in interest bearing accounts and time deposits are carried at cost, which approximates fair value, due to the short maturity of cash equivalent instruments.

Foreign currency forward contracts – The fair values of the Company’s foreign currency forward contracts were determined using an industry-standard valuation model, which is based on an income approach. The significant observable inputs to the model, such as swap yield curves and currency spot and forward rates, were obtained from an independent pricing service. To determine the fair value of contracts under the model, the difference between the contract price and the current forward rate was discounted using SOFR forward curves.

Cross-currency swap contracts – The fair values of the Company’s cross-currency swap contracts were determined using an industry-standard valuation model, which is based on the income approach. The significant observable inputs to the model, such as swap yield curves and currency spot and forward rates, were obtained from independent pricing services.

Interest rate contracts – The fair values of the Company’s interest rate contracts were determined using an industry-standard valuation model, which is based on the income approach. The significant observable inputs to the model, such as treasury yield curves, swap yield curves and SOFR forward curves, were obtained from independent pricing services.

Current and long-term debt – The fair value of the Company’s debt was estimated based on the current rates offered to the Company for debt with the same remaining maturities. To a lesser extent, debt also includes finance lease obligations for which the carrying amount approximates the fair value. The Company’s debt is classified within Level 2 of the valuation hierarchy.

Deferred consideration payable – The deferred consideration payable consists primarily of deferred payments associated with the fiscal 2023 fourth quarter acquisition of TOM FORD. The fair value of the payments treated as deferred consideration payable are calculated based on the net present value of cash payments using an estimated borrowing rate based on quoted prices for a similar liability. The Company’s deferred consideration payable is classified within Level 2 of the valuation hierarchy.

Nonfinancial assets measured at fair value on a nonrecurring basis

In connection with its interim goodwill and other indefinite-lived intangible asset impairment testing, the Company has measured certain nonfinancial assets at fair value on a nonrecurring basis, classified as Level 3 of the fair value hierarchy. Refer to Note 2 – Goodwill and Other Intangible Assets for discussion of the valuation techniques used to measure fair value, the description of the inputs and information used to develop those inputs.

NOTE 6 – REVENUE RECOGNITION

~~Accounts~~Disaggregation ~~Receivable~~of net sales by the Company's geographic regions(1) are as follows:

Accounts receivable, net is stated net of the allowance for doubtful accounts, including credit losses, and customer deductions totaling $37 million and $26 million as of March 31, 2025 and June 30, 2024, respectively. Payment terms are short-term in nature and are generally less than one year.


	Three Months Ended September 30,
(In millions)	2025		2024


The Americas	$	1,174	$	1,197
Europe, United Kingdom and Ireland and Emerging Markets ("EUKEM")	901		868
Asia/Pacific(2)	873		806
Mainland China	532		490
	3,480		3,361
Returns associated with restructuring and other activities	1		—
Net sales	$	3,481	$	3,361

~~Changes~~(1)The inCompany has reorganized its geographic regions, effective July 1, 2025 and has presented the ~~allowance~~information for ~~credit~~the ~~losses~~three ~~are~~months asended ~~follows:~~September 30, 2025 and 2024 under this new basis.

(In millions)	March 31, 2025
Balance at June 30, 2024	$	14
Provision for expected credit losses	12
Write-offs, net & other	(1)
Balance at March 31, 2025	$	25

(2)The net sales from the Company’s travel retail business are included in the Asia/Pacific region.

2621

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~The~~Accounts remaining balance of the allowance for doubtful accounts and customer deductions of $12 million as of March 31, 2025 and June 30, 2024 relates to non-credit losses, which are primarily due to customer deductions. Receivable

Accounts receivable, net is stated net of the allowance for doubtful accounts, including credit losses, and customer deductions totaling $39 million and $38 million as of September 30, 2025 and June 30, 2025, respectively. Payment terms are short-term in nature and are generally less than one year.

Changes in the allowance for credit losses are as follows:


(In millions)	September 30, 2025
Balance at June 30, 2025	$	26

Provision for expected credit losses	2
Write-offs, net & other	(1)
Balance at September 30, 2025	$	27

The remaining balance of the allowance for doubtful accounts and customer deductions of $12 million as of September 30, 2025 and June 30, 2025, relates to non-credit losses, which are primarily due to customer deductions.

Deferred Revenue

Changes in deferred revenue are as follows:

	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
			Three Months EndedSeptember 30,
(In millions)	~~2025~~		~~2024~~		2025		2024
Deferred revenue, beginning of period	$	~~562~~	$	~~610~~	$	~~560~~533	$	~~572~~560
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	~~(38)~~		~~(26)~~		(~~293~~127)		(~~275~~148)
Revenue deferred (released) during the period	(29)		(38)		229		255
Revenue deferred during the period					141		154
Other	1		~~(4)~~		—1		~~(10)~~1
Deferred revenue, end of period	$	~~496~~	$	~~542~~	$	~~496~~548	$	~~542~~567

Transaction Price Allocated to the Remaining Performance Obligations

At ~~March~~September 3130, 2025, the combined estimated revenue expected to be recognized in the next twelve months related to performance obligations for customer loyalty programs, gift with purchase promotions, purchase with purchase promotions, gift card liabilities and the Marcolin license arrangement related to TOM FORD that are unsatisfied (or partially unsatisfied) is $~~276~~332 million. The remaining balance of deferred revenue at ~~March~~September 3130, 2025 will be recognized beyond the next twelve months, of which $~~214~~ 207 million relates to the non-refundable upfront payment received as part of the Marcolin licensing arrangement that is being recognized on a straight-line basis over the estimated economic life of the license, which is 20 years ending in fiscal 2043.

Royalty Revenue – License Arrangements

The Company’s contractually guaranteed minimum royalty amounts due during future periods under its existing license arrangements is disclosed in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, ~~2024~~2025.

NOTE 7 – PENSION AND POST-RETIREMENT BENEFIT PLANS

The Company maintains pension plans covering substantially all of its full-time employees for its U.S. operations and a majority of its international operations. The Company also maintains post-retirement benefit plans that provide certain medical and dental benefits to eligible employees. Descriptions of these plans are included in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, ~~2024~~2025.

~~The components of net periodic benefit cost for the three months ended March 31, 2025 and 2024 consisted of the following:~~22

	Pension Plans								Other thanPension Plans
	U.S.				International				Post-retirement
(In millions)	2025		2024		2025		2024		2025		2024
Service cost	$	8	$	9	$	6	$	7	$	1	$	—
Interest cost	13		12		5		5		1		2
Expected return on plan assets	(13)		(14)		(6)		(7)		—		—
Amortization of:
Actuarial loss (gain)	5		1		(1)		(2)		—		—
Prior service cost	—		—		—		(1)		(1)		(1)
Special termination benefits	—		—		3		—		—		—
Net periodic benefit cost	$	13	$	8	$	7	$	2	$	1	$	1

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The components of net periodic benefit cost for the ~~nine~~three months ended ~~March~~September 3130, 2025 and 2024 consisted of the following:

	Pension Plans								Other thanPension Plans
	U.S.				International				Post-retirement
(In millions)	2025		2024		2025		2024		2025		2024
Service cost	$	269	$	279	$	207	$	207	$	1—	$	1—
Interest cost	3814		3513		144		145		52		62
Expected return on plan assets	(3813)		(4113)		(197)		(197)		—		—
Amortization of:
Actuarial loss (gain)	155		35		~~(4)~~—		(61)		—		—
Prior service cost	—		—		—		~~(1)~~—		(41)		(12)
Special termination benefits	—		—		41		—		—		—
Net periodic benefit cost	$	4115	$	2414	$	155	$	84	$	21	$	6—

The amounts recognized in the consolidated balance sheets related to the Company’s pension and post-retirement benefit plans consist of the following:

(In millions)

~~March~~September 3130, 2025

June 30, ~~2024~~2025

Other assets

~~127~~128

~~125~~128

Other accrued liabilities

(44)

Other noncurrent liabilities

(~~320~~340)

(~~339~~349)

Funded status

(~~237~~256)

(~~258~~265)

Accumulated other comprehensive loss

~~236~~264

~~243~~268

Net amount recognized

~~(1)~~8

~~(15)~~3

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is involved, from time to time, in litigation and other legal proceedings incidental to its business, including product liability matters (including asbestos-related claims), advertising, regulatory, employment, intellectual property, real estate, environmental, trade relations, securities, tax, and privacy. Management believes that the outcome of current litigation and legal proceedings will not have a material adverse effect upon the Company’s business, results of operations, financial condition or cash flows. However, management’s assessment of the Company’s current litigation and other legal proceedings could change in light of the discovery of facts with respect to legal actions or other proceedings pending against the Company not presently known to the Company or determinations by judges, juries or other finders of fact which are not in accord with management’s evaluation of the possible liability or outcome of such litigation or proceedings.

The Company establishes accruals for loss contingencies when it has determined that a loss is probable and that the amount of loss, or range of loss, can be reasonably estimated. Amounts accrued for legal contingencies often result from a complex series of judgments about future events and uncertainties that rely on estimates and assumptions including timing of related payments. Any such accruals are adjusted thereafter as appropriate to reflect changes in circumstances. The Company also determines estimates of reasonably possible losses or ranges of reasonably possible losses in excess of related accrued liabilities, if any, when it has determined that a loss is reasonably possible, and it is able to determine such estimates. Legal defense costs are recognized as incurred when the legal services are provided.

~~Reasonably~~Refer ~~possible~~below ~~losses in addition to the amounts accrued~~ for ~~such litigation and legal proceedings are not expected to be material to~~ the ~~Company’s~~assessment ~~consolidated~~of ~~financial~~loss ~~statements~~contingencies ~~(refer~~associated ~~below~~with ~~for~~ the Company’'s Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters ~~and related assessment of these loss contingencies)~~.

2823

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Management believes that the outcome of all remaining current litigation and other legal proceedings will not have a material adverse effect upon the Company’s business, results of operations, financial condition or cash flows. Reasonably possible losses in addition to the amounts accrued for the Company's remaining litigation and legal proceedings are not expected to be material to the Company’s consolidated financial statements. However, management's assessment of the Company's current litigation and other legal proceedings, including the Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters, could change in light of the discovery of facts with respect to legal actions or other proceedings pending against the Company not presently known to the Company or determinations by judges, juries or other finders of fact which are not in accord with management's evaluation of the possible liability or outcome of such litigation or proceedings.

Securities Class Action and Derivative Matters

On December 7, 2023 and January 22, 2024, the Company and its then Chief Executive Officer and Chief Financial Officer were named as defendants in separate purported securities class action complaints filed in the United States District Court for the Southern District of New York. On February 20, 2024, those two purported securities class actions were consolidated into one action. On March 22, 2024, plaintiffs filed their consolidated amended class action complaint, which alleges that defendants made materially false and misleading statements during the period February 3, 2022 to October 31, 2023 in press releases, the Company’s public filings and during conference calls with analysts that artificially inflated the price of the Company’s stock in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. On March 31, 2025, the Court denied defendants' motion to dismiss. Defendants intend to defend the action vigorously.

On February 1, 2024 and March 15, 2024, stockholder derivative action complaints were filed against certain of the Company’s officers as of those dates, all the Company’s directors as of those dates and certain of the Company’s former directors as of those dates in the United States District Court for the Southern District of New York. In April 2024, both complaints were voluntarily dismissed without prejudice. Subsequently, the Company's Board of Directors ("the Board") received stockholder litigation demands, requesting, among other things, that the Board investigate potential claims on behalf of the Company based on the same alleged course of conduct identified in the securities case complaint (which were also the subject of the voluntarily dismissed stockholder derivative actions complaints) described above. A committee of the Board has been formed to review the stockholder demands and make recommendations, as appropriate in its discretion, to the Board.

AsIn offiscal ~~March~~2025, 31on May 8, 2025, two additional stockholder derivative action complaints were filed in the United States District Court for the Southern District of New York against certain of the Company’s ~~does~~current ~~not~~and ~~believe~~former itofficers isand ~~probable~~directors ~~that~~alleging itbreach ~~will~~of ~~incur~~fiduciary ~~losses~~duty asand aunjust ~~result~~enrichment from the sale of stock by certain individual defendants during the time period surrounding the allegations of false and misleading statements in the purported securities class action ~~and~~described ~~derivative~~above. ~~matters~~Then, ~~and~~on ~~cannot~~June ~~reasonably~~23, ~~estimate~~2025, another stockholder derivative action complaint was filed in the ~~loss~~Supreme orCourt ~~range~~of the State of ~~losses~~New ~~that~~York ~~are~~in ~~reasonably~~Kings ~~possible~~County toagainst becertain ~~incurred~~of inthe ~~connection~~Company’s ~~with~~current ~~these~~and ~~matters~~former officers and directors, also alleging breach of fiduciary duty and unjust enrichment as well as claims of waste, gross mismanagement and insider trading.

In fiscal 2026, on September 15 and September 26, 2025, two additional stockholder derivative action complaints were filed in Delaware Chancery Court against certain of the Company’s current and former officers and directors, also alleging breach of fiduciary duty and unjust enrichment as well as claims of waste, gross mismanagement and insider trading.

The Company believes that it is not possible at this time to reasonably assess the outcome of these matters or to estimate the loss or range of losses, if any, as the matters are in their early stages.

Cosmetic Talcum Powder Matters

The Company has been named as a defendant in civil actions alleging that certain cosmetic talcum powder products sold by the Company were contaminated with asbestos. Most of these actions involve a number of co-defendants from a variety of different industries. As of ~~March~~September 3130, 2025, there were 8491 individual cases pending against the Company in state and federal courts throughout the United States, as compared to ~~273~~84 cases as of June 30, ~~2024~~2025. During the ~~nine~~three months ended ~~March~~September 3130, 2025, 5715 new cases were filed and ~~246~~8 cases were resolved by settlement or voluntary dismissal ~~(including pursuant to the cases that were settled in the talcum litigation settlement agreements described below)~~.

Due to the rising number of cases against the Company, as well as the evolving litigation landscape, there is an expectation that claims may increase in the future. In order to mitigate our future exposure, from the end of August 2024 through October 2024, the Company reached agreements with certain plaintiff law firms (collectively, the “talcum litigation settlement agreements”) for: (i) the resolution of over 200 pending cosmetic talcum powder matters handled by those firms as well as (ii) a process for resolving potential future cosmetic talcum powder claims expected to be brought on behalf of plaintiffs by those firms from January 1, 2025 through December 31, 2029, with annual capped amounts per year for each participating law firm. 24

To account for the talcum litigation settlement agreements, the Company recorded a charge of $159 million during the fiscal 2025 first quarter for the amount agreed to settle the current and potential future claims (amounts recorded for potential future claims is based on the best estimate of the probable loss and a reasonably possible loss beyond the amounts recorded is not expected to be material). As of March 31, 2025, $23 million is recorded in Other accrued liabilities and $89 million is recorded in Other noncurrent liabilities in the accompanying consolidated balance sheet related to the talcum litigation settlement agreements.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

~~There~~In ~~are~~view ~~and could be other plaintiff law firms outside~~ of ~~those included in~~ the ~~talcum~~number ~~litigation~~of ~~settlement~~cases ~~agreements~~pending ~~that bring claims~~ against the Company. ~~The~~at ~~value~~June of30, ~~other settlements outside of the talcum litigation settlement agreements~~2024, ~~either~~as ~~individually~~well oras in the ~~aggregate,~~evolution ~~for~~of the ~~three~~litigation ~~and~~landscape ~~nine months ended March 31, 2025~~ and ~~2024~~expectations ~~was~~regarding ~~not~~future ~~material.~~claims ~~Given~~at ~~the~~that ~~inherent uncertainties of litigation~~time, ~~it is not possible to predict~~ the ~~outcome~~Company oftook ~~all~~action ~~individual~~from ~~cases pending against~~ the ~~Company~~end ~~or potential unasserted claims, and therefore a specific estimate and associated provision is made for a small number~~ of ~~individual~~August ~~cases~~2024 ~~that~~through ~~have~~October ~~advanced~~2024 to ~~the~~mitigate ~~later~~its ~~stages~~future ~~of legal proceedings~~exposure. ~~For~~During ~~the~~that ~~remaining filed cases~~period, wethe ~~record~~Company anreached ~~estimate~~agreements ofwith ~~exposure~~certain ~~loss~~plaintiff onlaw anfirms ~~aggregated~~(collectively, ~~and~~the ~~ongoing~~“talcum ~~basis,~~litigation ~~which~~settlement ~~takes~~agreements”) ~~into~~for: ~~account~~(i) the ~~historical~~resolution ~~outcomes~~ of ~~cases~~over we200 ~~have~~pending ~~resolved~~cosmetic totalcum ~~date.~~powder ~~Any~~matters ~~adverse~~handled ~~outcomes,~~by ~~either~~those infirms anas ~~individual~~well ~~case~~as or(ii) ina ~~the~~process ~~aggregate,~~for ~~could~~resolving bepotential ~~material.~~future ~~While~~cosmetic ~~the~~talcum ~~Company~~powder ~~and~~claims ~~its~~expected ~~legal counsel intend~~ to ~~continue to defend these cases vigorously, there can~~ be nobrought ~~assurances~~on ~~regarding~~behalf ~~the ultimate resolution~~ of ~~these~~plaintiffs ~~matters.~~by ~~The~~those ~~amounts~~firms ~~recorded~~from ~~during~~January ~~the three and nine months ended March 31~~1, 2025 ~~for~~through ~~such~~December ~~litigation~~31, ~~outside of the talcum litigation settlement agreements~~2029, ~~are~~with ~~not~~annual ~~material~~capped toamounts ~~the~~per ~~Company's~~year ~~consolidated~~for ~~financial~~each ~~statements.~~participating ~~The~~law ~~range of reasonably possible losses in excess of accrued liabilities currently cannot be reasonably estimated~~firm.

~~The~~To ~~Company~~account ~~believes~~for ~~that~~the talcum litigation settlement agreements, the Company recorded a ~~portion~~charge of ~~its~~$159 million ~~costs~~during ~~incurred~~the infiscal ~~defending~~2025 first quarter for the amount agreed to settle the current and ~~resolving~~potential ~~these~~future claims ~~may~~(amounts berecorded ~~covered~~for bypotential ~~insurance~~future ~~policies~~claims ~~issued~~were bybased ~~several~~on ~~insurance~~the ~~carriers~~best estimate of the probable loss at that time, ~~subject~~and actual additional charges and any further reasonably possible losses beyond the amounts recorded during the three months ended September 30, 2024 has not been and is not expected to ~~deductibles~~be material). As of September 30, ~~exclusions~~2025, ~~retentions~~$28 million is recorded in Other accrued liabilities and ~~policy~~$85 million ~~limits.~~is recorded in Other noncurrent liabilities in the accompanying consolidated balance sheet related to the talcum litigation settlement agreements.

There are and could be other plaintiff law firms outside of those included in the talcum litigation settlement agreements that bring claims against the Company. The value of other settlements outside of the talcum litigation settlement agreements, either individually or in the aggregate, for the three months ended September 30, 2025 and 2024 was not material. Given the inherent uncertainties of litigation, it is not possible to predict the outcome of all individual cases pending against the Company or potential unasserted claims, and therefore a specific estimate and associated provision is made, as needed, for a small number of individual cases that have advanced to the later stages of legal proceedings. For the remaining filed cases, the Company records an estimate of exposure loss on an aggregated and ongoing basis, which takes into account the historical outcomes of cases the Company has resolved to date. Any adverse outcomes, either in an individual case or in the aggregate, could be material. While the Company and its legal counsel intend to continue to defend these cases vigorously, there can be no assurances regarding the ultimate resolution of these matters. The amounts recorded during the three months ended September 30, 2025 and 2024 for such litigation, outside of the talcum litigation settlement agreements, are not material to the Company's consolidated financial statements. The range of reasonably possible losses in excess of accrued liabilities currently cannot be reasonably estimated for cosmetic talcum matters, outside of the talcum litigation settlement agreements.

The Company believes that a portion of its costs incurred in defending and resolving these claims may be covered by insurance policies issued by several insurance carriers, subject to deductibles, exclusions, retentions and policy limits. Amounts received to date have not been material.

NOTE 9 – STOCK PROGRAMS

Additional information relating to the Company's stock programs are included in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, ~~2024~~2025.

Total net stock-based compensation expense is attributable to the granting of, and the remaining requisite service periods of stock options, restricted stock units (“RSUs”), performance share units (“PSUs”), long-term PSUs, including long-term price-vested units and share units. Compensation expense attributable to net stock-based compensation was $7588 million and $8774 million for the three months ended ~~March~~September 3130, 2025 and 2024, respectively~~, and was $255 million and $276 million for the nine months ended March 31, 2025 and 2024, respectively~~.

Stock Options

During the ~~nine~~three months ended ~~March~~September 3130, 2025, the Company granted stock options in respect of approximately 01.91 million shares of Class A Common Stock with a weighted average exercise price per share of $9091.9377 and a weighted average grant date fair value per share of $2934.2480. The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model.

Restricted Stock Units

During the ~~nine~~three months ended ~~March~~September 3130, 2025, the Company granted RSUs in respect of approximately 3.45 million shares of Class A Common Stock with a weighted average grant date fair value per share of $91.8266 that, at the time of grant, are scheduled to vest at 1.2 million, 1.2 5 million, and 1.0 .8 million shares per year, in fiscal ~~2026~~2027, fiscal ~~2027~~2028 and fiscal ~~2028~~2029, respectively. Vesting of RSUs is generally subject to the continued employment or the retirement of the grantees. The RSUs are generally accompanied by dividend equivalent rights, payable upon settlement of the RSUs either in cash or shares (based on the terms of the particular award) and, as such, were generally valued at the closing market price of the Company’s Class A Common Stock on the date of grant.

~~Performance Share Units~~25

During the nine months ended March 31, 2025, the Company granted PSUs with a target payout of approximately 0.4 million shares of Class A Common Stock with a grant date fair value per share of $92.02, which will be settled in stock subject to the achievement of the Company’s net sales, diluted net earnings per common share and return on invested capital goals for the three fiscal years ending June 30, 2027, all subject to continued employment or the retirement of the grantees. For PSUs granted, no settlement will occur for results below the applicable minimum threshold. PSUs are accompanied by dividend equivalent rights that will be payable in cash upon settlement of the PSUs and, as such, were valued at the closing market value of the Company’s Class A Common Stock on the date of grant.

For the PSUs with a performance period ended June 30, 2024, the target goals set at the time of issuance were not achieved, resulting in no shares of the Company’s Class A Common Stock issued related to these awards.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Included in the above are one-time grants in respect of approximately 0.5 million shares of Class A Common Stock scheduled to cliff vest in fiscal 2028 with a weighted average grant-date fair value per share of $91.77 made under the Profit Recovery and Growth Plan Incentive Program which was implemented in an effort to incentivize and retain leaders who are critical to the success of the PRGP.

Performance Share Units

For the PSUs granted in fiscal 2023 with a performance period ended June 30, 2025, the target goals set at the time of issuance were not achieved, resulting in no shares of the Company’s Class A Common Stock issued related to these awards.

Long-term Performance Share Units

On September 32, ~~2024~~2025, the Company issued ~~195~~68,~~940~~578 shares of the Company’s Class A Common Stock to its ~~then~~former Chief Executive Officer in accordance with the terms of PSUs granted in ~~February~~March ~~2018~~2021. AtThe ~~the~~total ~~time~~fair value of ~~issuance,~~PSUs at the ~~total~~time ~~fair value~~ of ~~PSUs~~issuance was $18 6.2 million.

~~NOTE~~On 10September –3, ~~NET~~2024, ~~EARNINGS~~the ~~(LOSS)~~Company ~~ATTRIBUTABLE~~issued TO195,940 ~~THE~~shares ~~ESTÉE~~of ~~LAUDER~~the ~~COMPANIES~~Company’s ~~INC~~Class A Common Stock to its former Chief Executive Officer in accordance with the terms of PSUs granted in February 2018. ~~PER~~The ~~COMMON~~total ~~SHARE~~fair value of PSUs at the time of issuance was $18 million.

Net earnings (loss) attributable to The Estée Lauder Companies Inc. per common share (“basic EPS”) is computed by dividing net earnings (loss) attributable to The Estée Lauder Companies Inc. by the weighted average number of common shares outstanding and shares underlying PSUs and RSUs where the vesting conditions have been met. Net earnings (loss) attributable to The Estée Lauder Companies Inc. per common share assuming dilution (“diluted EPS”) is computed by reflecting potential dilution from stockLong-~~based~~term awards using the treasury stock method. For the nine months ended March 31, 2025, the effects of potentially dilutive stock options, PSUs and RSUs were excluded from the computation of diluted EPS as they were antiPrice-~~dilutive~~Vested ~~due~~Units ~~to the net loss incurred during the period.~~

On September 2, 2025, the Company issued 85,927 shares of the Company’s Class A Common Stock to its former Chief Executive Officer in accordance with the terms of price-vested unit awards ("PVUs") granted in March 2021. The total fair value of PVUs at the time of issuance was $7.7 million.

NOTE 10 – NET EARNINGS (LOSS) PER COMMON SHARE

Net earnings (loss) per common share (“basic EPS”) is computed by dividing net earnings (loss) by the weighted average number of common shares outstanding and shares underlying PSUs and RSUs where the vesting conditions have been met. Net earnings (loss) per common share assuming dilution (“diluted EPS”) is computed by reflecting potential dilution from stock-based awards using the treasury stock method. For the three months ended September 30, 2024, the effects of potentially dilutive stock options, PSUs and RSUs were excluded from the computation of diluted EPS as they were anti-dilutive due to the net loss incurred during the period.

Table of Contents

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A reconciliation between the numerator and denominator of the basic and diluted EPS computations is as follows:

	Three Months EndedMarch 31,			Nine Months EndedMarch 31,
		Three Months EndedSeptember 30,
(In millions, except per share data)		~~2025~~		~~2024~~		2025		2024
Numerator:
Net earnings (loss) attributable to The Estée Lauder Companies Inc.		$	159	$	330	$	(587)	$	674
Net earnings (loss)						$	47	$	(156)
Denominator:
Weighted average common shares outstanding – Basic		~~360.3~~		~~359.1~~		~~359~~361.92		~~358~~359.86
Effect of dilutive stock options		—		~~0.8~~		—		~~0.9~~—
Effect of PSUs		~~0.2~~		~~0.2~~		—		~~0.1~~—
Effect of RSUs		~~0.9~~		~~0.7~~		—2.1		~~0.6~~—
Weighted average common shares outstanding – Diluted		~~361.4~~		~~360.8~~		~~359~~363.93		~~360~~359.46
Net earnings (loss) attributable to The Estée Lauder Companies Inc. per common share:
Net earnings (loss) per common share:
Basic		$	~~.44~~	$	~~.92~~	$	(1.~~63)~~13	$	1(.8843)
Diluted		$	~~.44~~	$	~~.91~~	$	(1.~~63)~~13	$	1(.8743)

The shares of Class A Common Stock underlying stock options, RSUs and PSUs that were excluded in the computation of diluted EPS because their inclusion would be anti-dilutive were as follows:

Three Months EndedMarch 31,

Nine Months EndedMarch 31,

Three Months EndedSeptember 30,

(In millions)

~~2025~~

~~2024~~

2025

2024

Stock options

~~8.9~~

~~5.8~~

8.45

5.7.6

RSUs and PSUs

~~0.2~~

~~0.1~~

10.87

01.52

As of ~~March 31~~September 30, 2025 and 2024, 0.6 5 million and 0.4 6 million shares, respectively, of Class A Common Stock underlying PSUs have been excluded from the computation of diluted EPS as the number of shares ultimately issued is contingent on the achievement of applicable performance targets of the Company, as discussed in Note 919 – Stock Programs in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2025.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 – EQUITY ~~AND REDEEMABLE NONCONTROLLING INTEREST~~

Total Stockholders’ Equity

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
					Three Months EndedSeptember 30,
(In millions, except per share data)	~~2025~~		~~2024~~				2025		2024
Common stock, beginning of the period	$	6	$	6			$	6	$	6
Stock-based compensation	—		—				—		—
Common stock, end of the period	6		6				6		6
Paid-in capital, beginning of the period	~~6,889~~		~~6,367~~				67,~~685~~012		6,~~153~~685
Common stock dividends	2		2				63		53
Stock-based compensation	75		96				~~275~~126		~~307~~90
Paid-in capital, end of the period	~~6,966~~		~~6,465~~				67,~~966~~141		6,~~465~~778
Retained earnings, beginning of the period	~~12,313~~		~~13,858~~				1311,~~427~~672		13,~~991~~427
Common stock dividends	~~(128)~~		~~(238)~~				(~~496~~128)		(~~715~~240)
Net earnings (loss) attributable to The Estée Lauder Companies Inc.	159		330				(587)		674
Net earnings (loss)							47		(156)
Retained earnings, end of the period	~~12,344~~		~~13,950~~				1211,~~344~~591		13,~~950~~031
Accumulated other comprehensive loss, beginning of the period	~~(1,341)~~		~~(856)~~				(1,~~140~~127)		(~~934~~1,140)
Other comprehensive earnings (loss) attributable to The Estée Lauder Companies Inc.	68		(158)				(133)		(80)
Other comprehensive (loss) earnings							(14)		83
Accumulated other comprehensive loss, end of the period	~~(1,273)~~		~~(1,014)~~				(1,~~273~~141)		(1,~~014~~057)
Treasury stock, beginning of the period	~~(13,698)~~		~~(13,663)~~				(13,~~664~~698)		(13,~~631~~664)
Stock-based compensation	—		—				(349)		(3210)
Treasury stock, end of the period	~~(13,698)~~		~~(13,663)~~				(13,~~698~~707)		(13,~~663~~674)
Total equity	$	~~4,345~~	$	~~5,744~~			$	43,~~345~~890	$	5,~~744~~084
Redeemable noncontrolling interest, beginning of the period	$	—	$	850			$	—	$	832
Cash dividends declared per common share							$	.35	$	.66
Net earnings attributable to redeemable noncontrolling interest	—		5				—		21
Translation adjustments	—		(15)				—		(13)
Redeemable noncontrolling interest, end of the period	$	—	$	840			$	—	$	840
Cash dividends declared per common share	$	.35	$	.66			$	1.36	$	1.98

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following is a summary of quarterly cash dividends declared per share on the Company’s Class A and Class B Common Stock during the ~~nine~~three months ended ~~March~~September 3130, 2025:

Date Declared

Record Date

Payable Date

Amount per Share

August 16, 2024

August 30, 2024

September 16, 2024

.66

August 19, 2025

September 2, 2025

September 16, 2025

.35

October 30, 2024

November 29, 2024

December 16, 2024

.35

February 3, 2025

February 28, 2025

March 17, 2025

.35

On ~~April~~October 3029, 2025, a dividend was declared in the amount of $.35 per share on the Company’s Class A and Class B Common Stock. The dividend is payable in cash on ~~June~~December 1615, 2025 to stockholders of record at the close of business on ~~May~~November 3028, 2025.

Common Stock

Beginning in December 2022, the Company suspended the repurchase of shares of its Class A Common Stock under its publicly announced program. The Company may resume repurchases in the future.

Accumulated Other Comprehensive Loss

The following table represents changes in accumulated other comprehensive loss, net of tax, by component for the ~~nine~~three months ended ~~March~~September 3130, 2025:

(In millions)	Net CashFlow HedgeGain (Loss)		Cross-Currency Swap Contracts - Fair Value Hedge Gain(2)		AmountsIncluded in Net Periodic Benefit Cost		TranslationAdjustments			Total
Balance at June 30, 2024	$	57	$	(5)	$	(183)	$	(1,009)		$	(1,140)
Balance at June 30, 2025	$	(11)	$	6	$	(204)	$	(918)		$	(1,127)
OCI before reclassifications (3)	513		226		—		(~~130~~32)		(1)	(~~103~~13)
Amounts reclassified to Net loss	(25)		(11)		6		—			(30)
Amounts reclassified to Net earnings	—		(4)		3		—			(1)
Net current-period OCI	~~(20)~~13		112		63		(~~130~~32)			(~~133~~14)
Balance at March 31, 2025	$	37	$	6	$	(177)	$	(1,139)		$	(1,273)
Balance at September 30, 2025	$	2	$	8	$	(201)	$	(950)		$	(1,141)

(1)See Note 4 – Derivative Financial Instruments for gains (losses) relating to net investment hedges.

(2)The gain recognized in AOCI, net of tax from cross-currency swap contracts represents the amount excluded from effectiveness testing.

(3)The tax provision ~~(benefit)~~ included in Net Cash Flow Hedge Gain (Loss), Cross-Currency Swap Contracts - Fair Value Hedge Gain and Translation Adjustments are $13 million, $62 million, and $~~(3)~~5 million, respectively.

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table represents the effects of reclassification adjustments from AOCI into net earnings (loss) for the three ~~and nine~~ months ended ~~March~~September 3130, 2025 and 2024:

	~~Amount Reclassified from AOCI~~				Amount Reclassified from AOCI				Affected Line Item inConsolidatedStatements of Earnings (Loss)
	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
			Three Months EndedSeptember 30,
(In millions)	~~2025~~		~~2024~~		2025		2024
Gain on Cash Flow Hedges
Gain (Loss) on Cash Flow Hedges
Foreign currency forward contracts	$	7	$	15	$	31—	$	3610	Net sales
Interest rate contracts	—		—		1		(1)		Interest expense
Provision for income taxes					—		(3)		Provision (benefit) for income taxes
Total gain on cash flow hedges, before tax	7		15		32		35
Total gain on cash flow hedges, net of tax					—		7		Net earnings (loss)
Provision for income taxes	(1)		(5)		(7)		(9)		Provision (benefit) for income taxes
Gain on Cross-Currency Swap Contracts - Fair Value Hedge
Total gain on cash flow hedges, net of tax	6		10		25		26		Net earnings (loss)
Cross-currency swap contracts					5		4		Selling, general and administrative
Cross-Currency Swap Contracts - Fair Value Hedge
Provision for income taxes					(1)		(1)		Provision (benefit) for income taxes
Gain on cross-currency swap contracts, before tax	5		5		14		14		Selling, general and administrative
Total gain on cross-currency swap contracts - fair value hedge, net of tax					4		3		Net earnings (loss)
Provision for income taxes	(1)		(1)		(3)		(3)		Provision (benefit) for income taxes
Total gain on cross-currency swap contracts - fair value hedge, net of tax	4		4		11		11		Net earnings (loss)
Retirement Plan and Other Retiree Benefit Adjustments
Amortization of prior service cost	1		2		41		2		Other components of net periodic benefit cost
Amortization of actuarial gain (loss)	(4)		1		(11)		3		Other components of net periodic benefit cost
Amortization of actuarial loss					(5)		(4)		Other components of net periodic benefit cost
Total retirement plan and other retiree benefit adjustments, before tax	~~(3)~~		3		(74)		5(2)		Other components of net periodic benefit cost
Benefit (provision) for income taxes	—		(1)		1		(2)		Provision (benefit) for income taxes
Benefit for income taxes					1		—		Provision (benefit) for income taxes
Total retirement plan and other retiree benefit adjustments, net of tax	~~(3)~~		2		(63)		3(2)		Net earnings (loss)
Total reclassification adjustments, net of tax	$	7	$	16	$	30	$	40	Net earnings (loss)
Total reclassification adjustments, net					$	1	$	8	Net earnings (loss)

34NOTE 12 – STATEMENT OF CASH FLOWS

Supplemental cash flow information for the three months ended September 30, 2025 and 2024 is as follows:


(In millions)	2025		2024
Cash:
Cash paid during the period for interest	$	62	$	63
Cash paid during the period for income taxes	$	148	$	195

Non-cash investing and financing activities:

Property, plant and equipment accrued but unpaid	$	24	$	26



Right-of-use assets obtained in exchange for new/modified operating lease liabilities	$	53	$	210

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 – STATEMENT OF CASH FLOWS

Supplemental cash flow information for the nine months ended March 31, 2025 and 2024 is as follows:

(In millions)	2025		2024
Cash:
Cash paid during the period for interest	$	243	$	244
Cash paid during the period for income taxes	$	468	$	441
Non-cash investing and financing activities:
Property, plant and equipment accrued but unpaid	$	26	$	35
Right-of-use assets obtained in exchange for new/modified operating lease liabilities	$	401	$	351

NOTE 13 – SEGMENT DATA AND RELATED INFORMATION

~~Reportable~~Operating ~~operating~~ segments include components of an enterprise ~~about~~for which separate financial information is available that isare ~~evaluated~~ regularly reviewed by the chief operating decision maker ~~(the “Chief Executive”)~~ in deciding how to allocate resources and in assessing performance. Although the Company operates in one business segment, beauty products, ~~management~~the ~~also~~chief ~~evaluates~~operating ~~performance~~decision onmaker aevaluates ~~product category basis. Product category~~ performance isbased ~~measured~~on ~~based~~its ~~upon~~four ~~net~~major ~~sales~~product ~~before~~categories: ~~returns~~skin ~~associated~~care, ~~with~~makeup, ~~restructuring~~fragrance and ~~other~~hair ~~activities,~~care. ~~and~~These ~~operating~~product ~~income~~categories ~~(loss)~~meet ~~before~~the ~~charges~~definition ~~associated~~of ~~with~~operating ~~restructuring~~ and ~~other~~reportable ~~activities.~~segments ~~Returns~~ and, ~~charges~~accordingly, ~~associated~~additional ~~with~~financial ~~restructuring~~data ~~and~~is ~~other~~provided ~~activities~~below. ~~are~~Royalty ~~not~~revenue ~~allocated~~associated towith the ~~Company's~~license ~~product~~of ~~categories~~the orTOM ~~geographic~~FORD ~~regions~~trademark ~~because~~as ~~they~~well ~~are~~as ~~centrally~~sales ~~directed~~ and ~~controlled,~~related ~~are~~results ~~not included in internal measures~~ of ~~product~~ancillary ~~category~~products orand ~~geographic~~services ~~region~~that ~~performance,~~do ~~and~~not ~~result~~fit ~~from~~within ~~activities~~the ~~that~~Company's ~~are~~definitions ~~deemed~~of ~~Company-wide~~skin ~~initiatives~~care, ~~to redesign~~makeup, ~~resize~~fragrance and ~~reorganize~~hair ~~select~~care ~~areas~~are ofincluded in the ~~business~~other category.

~~The~~Segment ~~accounting~~net ~~policies~~sales ~~for~~and ~~the~~operating ~~Company’s~~income ~~reportable~~is ~~segments~~before ~~are~~the ~~substantially~~impacts ~~the~~of ~~same~~restructuring asand ~~those~~other ~~for~~activities and the ~~consolidated~~impacts ~~financial~~from ~~statements,~~the asother category described inabove. ~~the~~Returns ~~notes~~and tocharges ~~consolidated~~associated ~~financial~~with ~~statements~~restructuring inand ~~the~~other ~~Company’s~~activities ~~Annual~~are ~~Report~~not onallocated ~~Form~~to ~~10-K for~~ the ~~fiscal~~Company's ~~year~~segments ~~ended~~because ~~June 30,~~they ~~2024.~~are ~~The~~centrally ~~assets~~directed and ~~liabilities~~controlled, ofare ~~the~~not ~~Company~~included ~~are~~in ~~managed~~internal ~~centrally~~measures ~~and~~of ~~are~~segment ~~reported~~performance ~~internally~~and inresult ~~the~~from ~~same~~activities ~~manner~~that asare ~~the~~deemed ~~consolidated~~Company-wide ~~financial~~initiatives ~~statements;~~to ~~thus~~redesign, noresize ~~additional~~and ~~information~~reorganize isselect ~~produced~~areas ~~for~~of the ~~Chief Executive or included herein~~business.

35The assets and liabilities of the Company are managed centrally and are reported internally in the same manner as the consolidated financial statements; thus, no additional information is produced for the chief operating decision maker or included herein.

Information about the Company's four operating segments is as follows:


(In millions)	Three Months Ended September 30, 2025
	Skin Care		Makeup		Fragrance		Hair Care		Total
Net sales									$	3,481
Less: Other category net sales									25
Less: Returns associated with restructuring and other activities									1
Segment net sales	$	1,575	$	1,030	$	721	$	129	$	3,455

Cost of sales	419		280		180		36		915
Selling, general and administrative expenses	969		765		455		105		2,294


Segment operating income (loss)	$	187	$	(15)	$	86	$	(12)	$	246
Other category operating income									9
Charges associated with restructuring and other activities									(86)
Operating income									169

Reconciliation to earnings before income taxes:
Interest expense									(86)
Interest income and investment income, net									30
Other components of net periodic benefit cost									(4)

Earnings before income taxes									$	109

Segment depreciation and amortization	$	90	$	59	$	41	$	8	$	198
Other category									2
Depreciation and amortization									$	200

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THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

	Three Months EndedMarch 31,						Nine Months EndedMarch 31,
(In millions)	Three Months EndedSeptember 30, 2024
(In millions)	2025		2024						2025		2024
	Skin Care		Makeup		Fragrance		Hair Care		Total
PRODUCT CATEGORY DATA
Net sales									$	3,361
Net sales:
Less: Other category net sales									25
Skin Care	$	1,807	$	2,060					$	5,257	$	5,873
Less: Returns associated with restructuring and other activities									—
Makeup	1,035		1,136						3,223		3,365
Segment net sales	$	1,529	$	1,038	$	630	$	139	$	3,336
Fragrance	557		575						1,931		1,948
Cost of sales	424		295		149		40		908
Hair Care	126		143						424		464
Selling, general and administrative expenses	988		769		421		117		2,295
Other	25		26						80		88
Other segment items(1)	—		159		—		—		159
	3,550		3,940						10,915		11,738
Segment operating income (loss)	$	117	$	(185)	$	60	$	(18)	$	(26)
Returns associated with restructuring and other activities	—		—						—		(1)
Other category operating income									11
Net sales	$	3,550	$	3,940					$	10,915	$	11,737
Charges associated with restructuring and other activities									(106)
Operating income (loss) before charges associated with restructuring and other activities:
Operating loss									(121)
Skin Care	$	361	$	468					$	784	$	920
Reconciliation to loss before income taxes:
Makeup	14		66						(382)		56
Interest expense									(92)
Fragrance	32		29						(354)		267
Interest income and investment income, net									35
Hair Care	(13)		(25)						(34)		(50)
Other components of net periodic benefit cost									(2)
Other	9		11						(25)		38
Loss before income taxes									$	(180)
	403		549						(11)		1,231
Segment depreciation and amortization	$	95	$	64	$	39	$	9	$	207
Reconciliation:
Other category									1
Charges associated with restructuring and other activities	(97)		(18)						(384)		(28)
Depreciation and amortization									$	208
Interest expense	(87)		(94)						(269)		(287)
(1) Other segment items include Talcum litigation settlement agreements
Interest income and investment income, net	27		45						85		126
Other components of net periodic benefit cost	(5)		4						(10)		9
Earnings (loss) before income taxes	$	241	$	486					$	(589)	$	1,051
GEOGRAPHIC DATA(1)
Net sales:
The Americas	$	1,052	$	1,117					$	3,462	$	3,567
Europe, the Middle East & Africa	1,358		1,647						4,082		4,488
Asia/Pacific	1,140		1,176						3,371		3,683
	3,550		3,940						10,915		11,738
Returns associated with restructuring and other activities	—		—						—		(1)
Net sales	$	3,550	$	3,940					$	10,915	$	11,737
Operating income (loss):
The Americas	$	8	$	(6)					$	(983)	$	(243)
Europe, the Middle East & Africa	239		302						645		825
Asia/Pacific	156		253						327		649
	403		549						(11)		1,231
Charges associated with restructuring and other activities	(97)		(18)						(384)		(28)
Operating income (loss)	$	306	$	531					$	(395)	$	1,203

(1) The net sales from the Company's travel retail business are included in the Europe, the Middle East & Africa region, and operating income attributable to these net sales are included in that region and in The Americas. The exception is for net sales and operating income of Dr.Jart+ in the travel retail channel in Korea that are reflected in Korea in the Asia/Pacific region. During the fiscal 2025 second quarter, the Company exited Dr.Jart+ from the travel retail channel in Korea.32

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THE ESTÉE LAUDER COMPANIES INC.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

RESULTS OF OPERATIONS

WeThe ~~manufacture,~~Estée ~~market~~Lauder ~~and~~Companies ~~sell~~Inc. ~~beauty~~is ~~products~~one ~~including~~of ~~those~~the inworld’s ~~the~~leading manufacturers, marketers and sellers of quality skin care, makeup, fragrance and hair care ~~categories,~~products. ~~which~~We are ~~distributed~~a insteward ~~approximately~~of ~~150~~over ~~countries~~20 luxury and ~~territories~~prestige brands globally. Our ~~The~~products ~~following~~are ~~table~~sold isin aapproximately ~~comparative~~150 ~~summary~~countries ofand ~~operating~~territories. ~~results~~We ~~for~~operate ~~the~~as ~~three~~a ~~and~~wholesaler, ~~nine~~with ~~months~~our ~~ended~~products ~~March 31,~~sold ~~2025~~in brick-and-mortar ~~2024,~~locations and ~~reflects~~on ~~the~~various ~~basis~~e-commerce ofplatforms, ~~presentation~~including ~~described~~those inoperated ~~Notes~~by todepartment ~~Consolidated~~stores, ~~Financial~~duty-free ~~Statements~~retailers, ~~Note~~specialty-multi 1retailers, –online ~~Summary~~pure ofplayers, ~~Significant~~upscale ~~Accounting~~perfumeries ~~Policies~~and ~~for~~pharmacies, ~~all~~and ~~periods~~top-tier ~~presented.~~salons ~~Products~~ and ~~services~~spas. Additionally, ~~that~~we dooperate ~~not~~a ~~meet~~direct-to-consumer ~~our~~business ~~definition~~across offreestanding ~~skin care~~stores, ~~makeup,~~our ~~fragrance~~brands' websites and ~~hair~~third-party ~~care~~online ~~have been included in the “other” category~~platforms.

	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
			Three Months EndedSeptember 30,
(In millions)	2025		2024		2025		2024
					2025					2024
NET SALES
($ in millions)					$		%			$		%
By Product Category:
Net sales					$	3,481	100.0		%	$	3,361	100.0	%
Skin Care	$	1,807	$	2,060	$	5,257	$	5,873
Cost of sales					927		26.6			928		27.6
Makeup	1,035		1,136		3,223		3,365
Gross profit					2,554		73.4			2,433		72.4
Fragrance	557		575		1,931		1,948
Operating expenses:
Hair Care	126		143		424		464
Selling, general and administrative					2,296		66.0			2,298		68.4
Other	25		26		80		88
Restructuring and other charges					89		2.6			97		2.9
	3,550		3,940		10,915		11,738
Talcum litigation settlement agreements					—		—			159		4.7
Returns associated with restructuring and other activities	—		—		—		(1)
Total operating expenses					2,385		68.5			2,554		76.0
Net sales	$	3,550	$	3,940	$	10,915	$	11,737
Operating income (loss)					169		4.9			(121)		(3.6)
By Region(1):
Interest expense					86		2.5			92		2.7
The Americas	$	1,052	$	1,117	$	3,462	$	3,567
Interest income and investment income, net					30		0.9			35		1.0
Europe, the Middle East & Africa	1,358		1,647		4,082		4,488
Other components of net periodic benefit cost					4		0.1			2		0.1
Asia/Pacific	1,140		1,176		3,371		3,683
Earnings (loss) before income taxes					109		3.1			(180)		(5.4)
	3,550		3,940		10,915		11,738
Provision (benefit) for income taxes					62		1.8			(24)		(0.7)
Returns associated with restructuring and other activities	—		—		—		(1)
Net earnings (loss)					$	47	1.4		%	$	(156)	(4.6)	%
Net sales	$	3,550	$	3,940	$	10,915	$	11,737
OPERATING INCOME (LOSS)
By Product Category:
Skin Care	$	361	$	468	$	784	$	920
Makeup	14		66		(382)		56
Fragrance	32		29		(354)		267
Hair Care	(13)		(25)		(34)		(50)
Other	9		11		(25)		38
	403		549		(11)		1,231
Charges associated with restructuring and other activities	(97)		(18)		(384)		(28)
Operating income (loss)	$	306	$	531	$	(395)	$	1,203
By Region(1):
The Americas	$	8	$	(6)	$	(983)	$	(243)
Europe, the Middle East & Africa	239		302		645		825
Asia/Pacific	156		253		327		649
	403		549		(11)		1,231
Charges associated with restructuring and other activities	(97)		(18)		(384)		(28)
Operating income (loss)	$	306	$	531	$	(395)	$	1,203

~~(1)~~Not ~~The~~adjusted net sales from the Company's travel retail business are included in the Europe, the Middle East & Africa region, and operating income attributable to these net sales are included in that region and in The Americas. The exception is for ~~net~~differences ~~sales~~caused ~~and~~by operating income of Dr.Jart+ in the travel retail channel in Korea that are reflected in Korea in the Asia/Pacific region. During the fiscal 2025 second quarter, the Company exited Dr.Jart+ from the travel retail channel in Korea.rounding

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The following table ~~presents~~is ~~certain~~a ~~consolidated~~comparative ~~earnings~~summary ~~(loss)~~of ~~data~~operating asresults afor ~~percentage~~the three months ended September 30, 2025 and 2024, for our product categories and geographic regions and reflects the basis of ~~net~~presentation ~~sales:~~described in Notes to Consolidated Financial Statements, Note 1 – Summary of Significant Accounting Policies and Note 13 – Segment Data and Related Information, for our product categories that meet the definition of reportable segments, for all periods presented. Royalty revenue from license arrangements, and products and services that do not fit within our definitions of skin care, makeup, fragrance and hair care have been included in the “other” category.

	Three Months EndedMarch 31,				Nine Months EndedMarch 31,
			Three Months EndedSeptember 30,
	2025		2024		2025			2024
(In millions)					2025			2024
Net sales	100.0	%	100.0	%	100.0		%	100.0		%
NET SALES
Cost of sales	25.0		28.1		25.4			28.4
By Product Category:
Gross profit	75.0		71.9		74.6			71.6
Skin Care					$	1,575		$	1,529
Operating expenses:
Makeup					1,030			1,038
Selling, general and administrative	63.6		58.0		65.4			61.1
Fragrance					721			630
Restructuring and other charges	2.7		0.5		3.4			0.2
Hair Care					129			139
Impairment of goodwill and other intangible assets	—		—		7.9			—
Other					25			25
Talcum litigation settlement agreements	—		—		1.5			—
					3,480			3,361
Total operating expenses	66.3		58.4		78.2			61.4
Returns associated with restructuring and other activities					1			—
Operating income (loss)	8.6		13.5		(3.6)			10.2
Net sales					$	3,481		$	3,361
Interest expense	2.5		2.4		2.5			2.4
By Geographic Region(1):
Interest income and investment income, net	0.8		1.1		0.8			1.1
The Americas					$	1,174		$	1,197
Other components of net periodic benefit cost	0.1		(0.1)		0.1			(0.1)
Europe, United Kingdom and Ireland and Emerging Markets ("EUKEM")					901			868
Earnings (loss) before income taxes	6.8		12.3		(5.4)			9.0
Asia/Pacific					873			806
Provision (benefit) for income taxes	2.3		3.8		—			3.0
Mainland China					532			490
Net earnings (loss)	4.5		8.5		(5.4)			5.9
					3,480			3,361
Net earnings attributable to redeemable noncontrolling interest	—		(0.1)		—			(0.2)
Returns associated with restructuring and other activities					1			—
Net earnings (loss) attributable to The Estée Lauder Companies Inc.	4.5	%	8.4	%	(5.4)		%	5.7		%
Net sales					$	3,481		$	3,361
OPERATING INCOME (LOSS)
By Product Category:
Skin Care					$	187		$	117
Makeup					(15)			(185)
Fragrance					86			60
Hair Care					(12)			(18)
Other					9			11
					255			(15)
Charges associated with restructuring and other activities					(86)			(106)
Operating income (loss)					$	169		$	(121)
By Geographic Region(1)(2):
The Americas					$	87		$	(85)
EUKEM					6			10
Asia/Pacific					150			76
Mainland China					12			(16)
					255			(15)
Charges associated with restructuring and other activities					(86)			(106)
Operating income (loss)					$	169		$	(121)

~~Not~~(1) ~~adjusted~~The ~~for~~net ~~differences~~sales ~~caused~~and byoperating ~~rounding~~results from the Company’s travel retail business are included in the Asia/Pacific region.

~~Period-over-period~~(2) ~~changes~~Operating inresults ~~our~~by ~~net~~geographic ~~sales~~region ~~are~~for ~~generally~~the ~~attributable~~fiscal to2025 ~~the~~first ~~impacts~~quarter ~~from~~have ~~(i)~~been ~~pricing~~adjusted onto ~~our~~reflect ~~base~~the ~~portfolio,~~correction ~~including~~of ~~changes~~a regional misclassification in ~~mix~~the ~~and~~amounts ~~those~~furnished ~~due~~in tothe ~~strategic~~Form ~~pricing~~8-K ~~actions,~~on ~~(ii)~~October ~~volume~~2, ~~including~~2025 ~~changes~~related ~~driven~~to bya one-time charge during the ~~impact~~fiscal of2025 ~~new~~first ~~product~~quarter. ~~innovation,~~The misclassification was offset in the fiscal 2025 second quarter (~~iii~~quarter-to-date period) ~~acquisitions~~furnished ~~and/or divestitures~~amounts, and~~/or~~ ~~(iv)~~the ~~foreign~~adjusted ~~currency~~amounts ~~translation~~will be reflected in the fiscal 2026 second quarter Form 10-Q. ~~The~~No ~~percentages~~other ~~disclosed~~periods ~~for~~were ~~these~~impacted ~~impacts~~and ~~are~~there ~~calculated~~is no impact on anthe ~~individual~~consolidated ~~basis~~financial results or results by product category.

The net sales impact from pricing consists of changes in list prices, due to strategic pricing actions, and mix shifts within and among product categories, geographic regions, brands and distribution channels. The prices at which we sell our products vary by brand, distribution channel (e.g., wholesale or direct-to-consumer) and may also vary by country. Our brands and products cover a broad array of pricing tiers. Prices of skin care and fragrance products are typically higher than makeup and hair care products. 34

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THE ESTÉE LAUDER COMPANIES INC.

~~New~~Period-over-period ~~product innovation includes the introduction of new products, as well as~~ changes ~~related~~in toour ~~existing~~net ~~products~~sales ~~or where they~~ are ~~sold,~~generally ~~including~~attributable ~~reformulations,~~to ~~regional expansion, repackaging and sets. A product is considered "new innovation" for~~ the ~~twelve-month~~impacts ~~period~~from ~~following~~(i) ~~the~~pricing ~~initial~~on ~~shipment~~our ~~date.~~base ~~Our~~portfolio, ~~innovation~~including ischanges ~~launched~~in atmix ~~different price points than existing products~~ and ~~value~~those ~~derived~~due ~~from innovation may vary from year-~~to~~-year.~~ Westrategic ~~continually~~pricing ~~introduce new products~~actions, ~~support~~(ii) ~~new and established products through advertising~~volume, ~~merchandising~~including ~~and~~changes ~~sampling~~driven ~~and~~by ~~phase out existing products that no longer meet~~ the ~~needs~~impact of ~~our~~new ~~consumers~~product ~~or our objectives. The economics of developing~~innovation, ~~producing,~~(iii) ~~launching,~~acquisitions ~~supporting~~ and/or ~~discontinuing~~divestitures, ~~products impact our sales~~ and/or ~~operating~~(iv) ~~performance~~foreign ~~each~~currency ~~period~~translation. The ~~introduction~~percentages ofdisclosed ~~new~~for ~~products~~these ~~often~~impacts ~~has~~are ~~some~~calculated ~~cannibalizing effect~~ on ~~sales~~an ofindividual ~~existing products, which we take into account in our business planning~~basis. ~~The impact of new product introductions, including timing compared to introductions in prior periods, also affects our results.~~

New product innovation includes the introduction of new products, as well as changes related to existing products or where they are sold, including reformulations, regional expansion, repackaging and sets. A product is considered "new innovation" for the twelve-month period following the initial shipment date. Our innovation is launched at different price points than existing products and value derived from innovation may vary from year to year. We continually introduce new products, support new and established products through advertising, merchandising and sampling and phase out existing products that no longer meet the needs of our consumers or our objectives. The economics of developing, producing, launching, supporting and discontinuing products impact our sales and operating performance each period. The introduction of new products often has some cannibalizing effect on sales of existing products, which we take into account in our business planning. The impact of new product introductions, including timing compared to introductions in prior periods, also affects our results.

Non-GAAP Financial Measures

We use certain non-GAAP financial measures, among other financial measures, to evaluate our operating performance, which represent the manner in which we conduct and view our business. Management believes that excluding certain items that are not comparable from period- to- period helps investors and others compare operating performance between periods. While we consider the non-GAAP measures useful in analyzing our results, they are not intended to replace, or act as a substitute for, any presentation included in the consolidated financial statements prepared in conformity with U.S. GAAP. See Reconciliations of Non-GAAP Financial Measures beginning on page 5946 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

We operate on a global basis, with the majority of our net sales generated outside the United States. Accordingly, fluctuations in foreign currency exchange rates affect our results of operations. Therefore, we present certain net sales, operating results and diluted net earnings (loss) per common share information excluding the effect of foreign currency rate fluctuations to provide a framework for assessing the performance of our underlying business outside the United States. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We calculate constant currency information by translating current-period results using prior-year monthly average foreign currency exchange rates and adjusting for the period-over-period impact of foreign currency cash flow hedging activities.

~~Overview~~Outlook

We ~~are~~have aexperienced ~~leader~~challenges inwithin ~~prestige~~our ~~beauty,~~business ~~which~~and ~~combines~~we ~~the~~expect ~~repeat~~volatility ~~purchase~~ and ~~relative~~uncertainty ~~affordability~~to ~~of consumer goods with high quality products and services~~continue. ~~Within~~Although ~~prestige~~there ~~beauty, we~~ are ~~diversified~~signs byof ~~product~~stabilization ~~category,~~in ~~geography,~~Mainland ~~brand~~China, ~~product~~travel ~~sub-category,~~retail ~~channel,~~conversion ~~consumer~~continues ~~segment and price point. We also leverage consumer analytics and insights by deploying our brands~~ to ~~grow~~be ~~sales~~weak and ~~pursue~~challenges ~~profitable~~persist ~~opportunities.~~in ~~These~~Western ~~analytics and insights~~Europe, ~~combined~~including ~~with~~subdued ~~our~~sentiment. ~~creativity~~Additionally, ~~inform~~within ~~our innovation to provide a broad, locally-relevant and inclusive range of prestige products with~~ the ~~aim~~United ofStates ~~competing~~we ~~effectively~~continue ~~for~~to aexperience ~~greater~~headwinds ~~share~~from ofchallenges ain ~~consumer's~~department ~~beauty routine~~stores. ~~Elements~~These ofchallenges ~~our strategy~~ are ~~described~~collectively ~~below,~~expected asto ~~well~~impact asnet insales ~~the~~and ~~Overview~~profitability, onincluding ~~page~~impacts 31to of our ~~Annual~~effective ~~Report~~tax onrate ~~Form~~from ~~10-K~~changes ~~for~~to ~~the~~our ~~year~~geographical ~~ended~~mix ~~June~~of ~~30, 2024~~earnings.

~~•Our~~We ~~skin~~are ~~care~~continuing ~~net~~to ~~sales~~monitor ~~decreased~~and ~~12%~~assess ~~for~~ the ~~three~~potential ~~months~~effects ~~ended~~of ~~March~~new ~~31,~~and ~~2025,~~existing ~~primarily~~tariffs ~~driven~~in bythe ~~lower~~United ~~net~~States ~~sales~~as ~~from~~well ~~Estée~~as ~~Lauder~~in ~~and~~other Lamarkets ~~Mer.~~in ~~The~~which ~~decrease~~we inoperate. ~~net~~These ~~sales~~tariffs ~~from~~have ~~Estée~~led ~~Lauder~~to significant volatility and Launcertainty ~~Mer~~in ~~was~~global ~~primarily~~markets ~~driven~~and bydifficulty ~~our~~in ~~Asia~~forecasting ~~travel~~demand. ~~retail~~We ~~business,~~have ~~reflecting~~implemented ~~the~~and ~~ongoing~~are ~~subdued~~continuing ~~sentiment~~to implement and ~~lower~~consider ~~conversion~~additional ~~from~~mitigation ~~Chinese~~measures. ~~consumers,~~The ~~the~~impact ~~difficult~~was ~~comparison~~not material to ~~the~~fiscal ~~prior-year~~2026 ~~period~~first ~~due~~quarter toprofitability ~~our~~and ~~resumption~~cash offlows, ~~replenishment~~however, ~~orders~~even inif ~~the~~we ~~fiscal~~can ~~2024~~minimize ~~third~~some ~~quarter~~of ~~and~~these ~~our~~impacts, ~~strategic~~we ~~decision~~anticipate tohigher ~~reduce~~tariff ~~our~~rates ~~exposure~~ to ~~reseller~~have ~~activity,~~an asadverse ~~well~~effect ason ~~retailer~~fiscal ~~shifts~~2026 inprofitability ~~strategies~~and ~~toward~~cash ~~more~~flows, ~~profitable~~and ~~duty-free~~depending ~~business~~on ~~models~~actual inrates ~~both Korea~~ and ~~mainland~~countries ~~China,~~imposing ~~which~~tariffs ~~led~~such toadverse ~~lower~~impacts ~~replenishment~~could ~~orders.~~be material.

•Our makeup net sales decreased 9% for the three months ended March 31, 2025, primarily reflecting lower net sales from M·A·C and Estée Lauder. The decrease in net sales from M·A·C was primarily driven by lower net sales in the face and eye subcategories and reflected softness in the brand's retail sales which led to elevated levels of inventory, resulting in retailer destocking. Net sales from Estée Lauder decreased, primarily driven by lower net sales in the face subcategory. 35

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THE ESTÉE LAUDER COMPANIES INC.

~~•Our~~We ~~fragrance~~continue ~~net~~to ~~sales~~believe ~~decreased~~that ~~3% for~~ the ~~three~~best ~~months~~way ~~ended~~to ~~March~~increase ~~31,~~long-term ~~2025,~~stockholder ~~reflecting~~value ~~lower~~is ~~net~~to ~~sales~~provide ~~from~~superior Joproducts ~~Malone London, Clinique, TOM FORD~~ and ~~Estée~~services ~~Lauder.~~in ~~The~~the ~~decrease~~most inefficient ~~net~~and ~~sales~~effective ~~from~~manner Jowhile ~~Malone~~recognizing ~~London~~shifts ~~was~~in ~~primarily~~consumers’ ~~driven~~behaviors byand ~~lower~~shopping ~~net~~practices. ~~sales~~Accordingly, inour ~~the~~long-term ~~cologne~~strategy ~~and~~has ~~home~~numerous ~~subcategories.~~initiatives ~~Net~~across ~~sales~~product ~~from~~categories, ~~Clinique decreased~~brands, ~~primarily~~geographic ~~driven~~regions, bychannels ~~lower~~of ~~net~~distribution ~~sales~~and ~~from~~functions ~~the~~designed ~~Clinique~~to ~~Happy~~grow ~~franchise~~our ~~line~~sales, ofprovide ~~products.~~cost ~~The~~efficiencies, ~~decrease~~leverage inour ~~net~~strengths, ~~sales~~such ~~from~~as ~~TOM~~our ~~FORD~~history ~~was~~of ~~primarily~~outstanding ~~driven~~creativity byand ~~lower~~innovation, ~~net~~high ~~sales~~quality inproducts ~~North~~and ~~America~~services, ~~reflecting~~and ~~softness~~engaging incommunications, ~~the~~and ~~brand's~~make ~~retail~~us ~~sales~~more ~~which~~productive ~~led~~and toprofitable. ~~elevated~~With ~~levels~~the transition of ~~inventory,~~leadership ~~resulting~~ in ~~retailer~~the ~~destocking,~~second and anthird ~~unfavorable~~quarters ~~year-over-year impact~~ of ~~prior-year~~fiscal ~~launches.~~2025, ~~Net~~we ~~sales~~have ~~from~~embarked ~~Estée~~on ~~Lauder~~"Beauty ~~decreased~~Reimagined," ~~across~~a ~~the~~strategic ~~fragrance~~vision ~~portfolio,~~which ~~led~~focuses byon ~~lower~~accelerating ~~net~~best-in-class ~~sales~~consumer ~~from~~coverage, ~~the~~creating ~~Beautiful~~transformative ~~franchise.~~innovation, ~~Partially~~boosting ~~offsetting~~consumer-facing ~~the~~investments, ~~fragrance~~fueling ~~net~~sustainable ~~sales~~growth ~~decrease~~through ~~were~~bold ~~higher~~efficiencies ~~net~~and ~~sales~~reimagining ~~from~~the Leway ~~Labo~~we work, ~~primarily~~including ~~reflecting~~through ~~growth~~the expansion of ~~hero~~the ~~products,~~Profit ~~including~~Recovery ~~growth~~and ~~through~~Growth ~~targeted~~Plan ~~expanded consumer reach~~("PRGP"), ~~and~~as ~~new~~discussed ~~product launches~~below.

~~•Our~~We ~~hair~~continue ~~care~~to ~~net~~monitor ~~sales~~the ~~decreased~~effects ~~12%~~of ~~for~~the global macro environment, including the ~~three~~risk ~~months~~of ~~ended~~recession; ~~March~~currency ~~31,~~volatility; ~~2025~~inflationary ~~primarily~~pressures; ~~attributable~~supply tochain ~~lower~~challenges; ~~net~~social ~~sales~~and ~~from~~political ~~Aveda~~issues; competitive pressures; legal and regulatory matters, ~~reflecting~~including the imposition of tariffs and sanctions; geopolitical tensions; and global security issues. We are also mindful of inflationary pressures (including those caused by tariffs) on our ~~softness~~cost inbase and are monitoring the ~~Europe~~impact on consumer preferences, the ~~Middle~~impact ~~East~~of &changes ~~Africa~~being ~~and~~made ~~North~~in ~~America~~the ~~salon~~organization, ~~channels~~including those related to Beauty Reimagined and the PRGP, as well as ~~softness~~the inpotential impact of changes expected to be made as part of the PRGP on suppliers, retailers and others, and challenges relating to successfully outsourcing select services. In our ~~direct-~~outlook, we have made assumptions relating to~~-consumer~~ ~~business~~these and other internal and external factors and challenges. Declines in net sales and profitability have, and may continue to, adversely impact the goodwill and other intangible assets associated with our brands, as well as long-lived assets, potentially resulting in impairments.

~~Our~~In ~~global~~December ~~distribution capability and operations allow us to focus on targeted expanded consumer reach wherever consumer demographics and trends are attractive. Our regional organizations~~2021, ~~and~~ the ~~expertise~~Organization offor ~~our~~Economic ~~people~~Cooperation ~~there, enable our brands to be more locally~~ and ~~culturally~~Development ~~relevant~~issued in"Pillar ~~both~~Two" ~~product~~Global ~~assortment~~Anti-Base ~~and~~Erosion ~~communications.~~model Werules ~~are~~for ~~continually~~countries ~~evolving~~to ~~the~~enact ~~way~~into wedomestic ~~connect~~law ~~with~~that ~~our~~would ~~consumers~~establish ina ~~stores,~~15% ~~online~~global ~~and~~minimum ~~where~~tax ~~they~~applied ~~travel,~~on ~~including~~a country-by-country ~~expanding~~basis ~~our~~for ~~digital~~multinational ~~and social media presence and the engagement of global and local influencers to amplify brand or product stories~~companies. We ~~tailor~~are ~~implementation~~continuing ~~of our strategy by market~~ to ~~drive~~monitor ~~consumer~~and ~~engagement,~~evaluate ~~recruitment~~the ~~and~~potential ~~loyalty.~~impact Weof ~~strive~~incorporating tothe ~~strengthen~~global ~~our~~minimum ~~presence~~tax in ~~large,~~additional ~~image-building~~countries ~~core~~that ~~markets,~~have ~~while~~yet ~~broadening~~to ~~our~~enact ~~presence~~the ~~in emerging markets~~legislation.

~~•Net~~On ~~sales~~July ~~in The Americas decreased 6% for the three months ended March 31~~4, 2025, ~~primarily~~new ~~driven~~U.S bytax ~~lower~~legislation ~~net~~was ~~sales~~enacted inknown ~~North~~as ~~America,~~the ~~reflecting~~One ~~ongoing~~Big ~~retail~~Beautiful ~~softness~~Bill ~~for~~Act. ~~some~~This ~~brands~~legislation ~~and~~includes ~~declines~~significant inprovisions, ~~consumer~~such ~~confidence~~as ~~and~~the ~~sentiment,~~permanent ~~which~~extension ~~led~~of tocertain ~~elevated~~expiring ~~inventory~~provisions ~~levels~~of ~~and~~the ~~destocking~~Tax atCuts ~~certain~~and ~~retailers~~Jobs Act, asmodifications ~~well~~to asthe ~~operational~~international ~~challenges~~tax atframework ~~certain retailers~~ and the ~~timing~~restoration of ~~shipments,~~certain ~~which~~business ~~further~~tax ~~pressured~~provisions. ~~net~~The ~~sales~~legislation ~~compared~~has tomultiple ~~the~~effective ~~prior-year~~dates, ~~period.~~and ~~Partially~~we ~~offsetting~~are ~~the~~continuing ~~net~~to ~~sales~~evaluate ~~decline for North America was~~ the potential impact ~~from~~of the ~~launch~~provisions ofthat ~~nine~~are ~~brands~~expected to~~-date~~ inbe ~~Amazon's~~effective ~~U.S.~~in ~~Premium~~future ~~Beauty~~fiscal ~~store~~years.

~~•Net~~Our ~~sales~~ability into ~~Europe,~~recognize ~~the~~deferred ~~Middle~~tax ~~East~~assets, &inclusive ~~Africa~~of ~~decreased~~utilizing ~~18%~~net ~~for~~operating ~~the~~loss ~~three~~carryforwards, ~~months~~tax ~~ended~~credits, ~~March~~and ~~31,~~other ~~2025,~~carryforwards ~~primarily~~is ~~driven~~dependent byon ~~lower~~the ~~net~~generation ~~sales~~of insufficient ~~our~~taxable ~~Asia~~income ~~travel~~in ~~retail~~future ~~business~~periods. Accordingly, ~~reflecting~~there ~~the~~can ~~ongoing~~be ~~subdued~~no ~~sentiment~~assurance ~~and~~that ~~lower~~additional ~~conversion~~valuation ~~from~~allowances ~~Chinese~~on ~~consumers,~~our ~~the~~deferred ~~difficult~~tax ~~comparison~~assets towill ~~the~~not ~~prior-year~~be ~~period~~required ~~due~~should to our ~~resumption~~financial ofperformance ~~replenishment~~be ~~orders~~negatively impacted in the ~~fiscal~~future. ~~2024~~Such ~~third~~valuation ~~quarter~~allowance ~~and~~could ~~our~~be ~~strategic~~material. ~~decision~~We toare ~~reduce~~also ~~our~~monitoring ~~exposure~~certain toprovisions ~~reseller activity, as well as retailer shifts~~ in ~~strategies~~global ~~toward~~tax ~~more~~regulations ~~profitable~~that ~~duty-free~~may ~~business~~expire ~~models~~during infiscal ~~both~~2026, ~~Korea~~which, ~~and~~if ~~mainland~~not ~~China~~extended, ~~which~~could ~~led~~increase toour ~~lower~~effective ~~replenishment~~tax ~~orders~~rate.

•Net sales in Asia/Pacific decreased 3% for the three months ended March 31, 2025, primarily driven by lower net sales from Korea, Hong Kong SAR, Singapore, Taiwan and Australia, partially offset by higher net sales from mainland China and Japan. The decrease in net sales from Korea reflected the impact of political and social unrest, which reduced retail traffic and dampened retail sales, as well as the exit of Dr.Jart+ from the travel retail channel in Korea during the fiscal 2025 second quarter. Net sales from Hong Kong SAR and Singapore decreased, reflecting our strategic decision to reduce our exposure to reseller activity. The net sales decline from Taiwan reflected the temporary closure of a key retailer during the fiscal 2025 third quarter. Net sales from Australia decreased, reflecting lower net sales across all product categories. The increase in net sales in mainland China reflected the favorable timing of key shopping moments compared to the prior-year period, which contributed to prestige beauty stabilization, the partial recapture of consumer demand in mainland China from Asia travel retail, Hong Kong SAR and Singapore, as well as online net sales growth and the success of new product launches from La Mer. Partially offsetting the increase in net sales in mainland China, were lower shipments to some retailers due to retail softness, reflecting subdued consumer sentiment, and their efforts to manage working capital. The net sales increase from Japan reflected higher net sales in fragrance, driven by Le Labo and in skin care, driven by Estée Lauder and La Mer, including growth through tourism demand.

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Outlook

We have experienced challenges within our business and we expect volatility and uncertainty to continue, including from ongoing, subdued consumer sentiment in China and the United States and the impact of political and social unrest in Korea. In addition, in our Asia travel retail business, the pressures from changes in strategies by certain retailers have impacted, and are expected to continue to impact, our business. These challenges are collectively expected to impact net sales and profitability, including impacts to our effective tax rate from changes to our geographical mix of earnings.

We are continuing to monitor and assess the potential effects of new and existing tariffs in the United States as well as in other markets in which we operate. These tariffs have led to significant volatility and uncertainty in global markets and difficulty in forecasting demand. We are implementing and considering additional mitigation measures. We do not anticipate a material impact to fiscal 2025 profitability, however, even if we can minimize some of the impacts, and unless meaningful resolution of trade negotiations is achieved, we anticipate a high rate of tariffs to have a material adverse effect on fiscal 2026 profitability and cash flows.

We continue to believe that the best way to increase long-term stockholder value is to provide superior products and services in the most efficient and effective manner while recognizing shifts in consumers’ behaviors and shopping practices. Accordingly, our long-term strategy has numerous initiatives across geographic regions, product categories, brands, channels of distribution and functions designed to grow our sales, provide cost efficiencies, leverage our strengths, such as our history of outstanding creativity and innovation, high quality products and services, and engaging communications, and make us more productive and profitable. With the transition of leadership in the second and third quarters of fiscal 2025, we have embarked on “Beauty Reimagined,” a strategic vision that aims to accelerate best-in-class consumer coverage, create transformative innovation, boost consumer-facing investments and enable growth through more efficiencies expected through the expansion of the Profit Recovery and Growth Plan ("PRGP"), as discussed below.

We continue to monitor the effects of the global macro environment, including the risk of recession; currency volatility; inflationary pressures; supply chain challenges; social and political issues; competitive pressures; legal and regulatory matters, including the imposition of tariffs and sanctions; geopolitical tensions; and global security issues. We are also mindful of inflationary pressures (including those caused by tariffs) on our cost base and are monitoring the impact on consumer preferences, the impact of changes being made in the organization, including those related to Beauty Reimagined and the PRGP, as well as the potential impact of changes expected to be made as part of the PRGP on suppliers, retailers and others, and challenges relating to successfully outsourcing select services. In our outlook, we have made assumptions regarding these internal and external factors and challenges. Declines in net sales and profitability have, and may continue to, adversely impact the goodwill and other intangible assets associated with our brands, as well as long-lived assets, potentially resulting in impairments.

Restructuring Program Component of the Profit Recovery and Growth Plan

As announced on November 1, 2023, we launched the PRGP to help progressively rebuild our profit margins in fiscal years 2025 and 2026.

~~The~~As ~~PRGP~~a iscomponent ~~focused~~of onthe ~~rebuilding stronger~~PRGP, ~~more~~on ~~sustainable~~February ~~profitability~~5, ~~supporting~~2024, ~~sales~~we ~~growth~~announced ~~acceleration~~a ~~and~~two-year ~~increasing~~restructuring ~~speed and agility~~program. ~~The~~We ~~plan~~committed ~~is designed~~ to ~~improve~~this ~~gross~~course ~~margin,~~of ~~lower~~action ~~the~~on ~~cost~~February ~~base and reduce overhead expenses~~1, ~~while increasing investments in key consumer-facing activities~~2024. ~~Upon completion of this plan, we expect to have improved our gross margin and expense base to drive greater operating leverage for the future.~~

AsAfter areviewing ~~component~~additional ofpotential initiatives and the ~~PRGP~~progress of previously approved initiatives, on February 53, ~~2024~~2025, we ~~announced~~committed ato ~~two-year restructuring program. The restructuring program’s main focus included~~ the ~~reorganization~~expansion ~~and rightsizing~~ of ~~certain~~the ~~areas~~PRGP, ofincluding ~~our~~an ~~business~~expansion ~~as well as simplification and acceleration~~ of ~~processes.~~the Werestructuring ~~committed to this course of action on February 1, 2024~~program.

InThe ~~connection~~expanded ~~with~~component of the restructuring program, webegan ~~estimated~~during aour ~~net~~fiscal ~~reduction~~2025 inthird ~~the~~quarter. ~~range~~The focus of ~~approximately~~the ~~1,800~~overall toexpanded ~~3,000~~restructuring ~~positions~~program ~~globally,~~(collectively ~~which~~the ~~was~~“Restructuring ~~about~~Program”) ~~3-5%~~includes (i) reorganization and rightsizing of ~~our~~certain ~~positions~~areas, ~~including~~(ii) ~~temporary~~simplification and ~~part-time~~acceleration ~~employees~~of asprocesses, (iii) outsourcing of ~~June~~select ~~30,~~services ~~2023.~~and ~~This~~(iv) ~~reduction~~evolution ~~took~~of ~~into~~go-to-market ~~account~~footprint and selling models. Specific initiatives under the ~~elimination~~Restructuring ofProgram ~~some~~are ~~positions~~expected asto ~~well~~be asapproved ~~retraining~~by ~~and~~the ~~redeployment~~end of ~~certain~~fiscal ~~employees~~2026 inand ~~select~~substantially ~~areas~~completed by the end of fiscal 2027.

41In connection with the Restructuring Program, as of September 30, 2025 we estimate a net reduction in the range of approximately 5,800 to 7,000 positions globally, which is about 9-11% of our positions including temporary and part-time employees as of June 30, 2023. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

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THE ESTÉE LAUDER COMPANIES INC.

We ~~planned~~expect ~~to substantially complete specific initiatives under the restructuring program through fiscal 2026. We expected~~ that the ~~restructuring~~Restructuring ~~program~~Program ~~would~~will result in restructuring and other charges totaling between $~~500~~ 1,200 million and $~~700~~ 1,600 million, before taxes, consisting of employee-related costs, ~~contract~~asset-related ~~terminations~~costs, ~~asset~~contract ~~write-offs~~terminations and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

~~After~~Once ~~reviewing~~fully ~~additional~~implemented, ~~potential~~we ~~initiatives~~expect ~~and~~ the ~~progress~~restructuring program to yield annual target gross benefits of ~~previously~~between ~~approved~~$800 ~~initiatives,~~million onand ~~February~~$1,000 3million, ~~2025~~before taxes, wea ~~committed~~portion of which is expected to ~~the~~be ~~expansion~~reinvested in consumer-facing activities. The net benefits of the PRGP, ~~including~~which anincludes ~~expansion~~the ofRestructuring Program, are expected to enable a return to a double-digit operating margin over the ~~restructuring~~next ~~program.~~few years.

The expansion of the overall PRGP is focused on three key areas. First, we plan to adopt a more competitive approach to procurement, a key pillar of savings, by further consolidating spending and strategically re-evaluating key supplier relationships. Second, we plan to further improve efficiencies within our supply chain network through a zero-waste approach, aiming to improve demand forecasting and innovation planning to minimize excess inventory and product destruction. Third, we are outsourcing select services to proven global partners.

The expanded component of the restructuring program began during our fiscal 2025 third quarter with all initiatives to be approved by the end of fiscal 2026. Specific initiatives under the expanded component of the restructuring program are expected to be substantially completed by the end of fiscal 2027. The focus of the now expanded restructuring program (now, collectively the “Restructuring Program”) includes (i) reorganization and rightsizing of certain areas and (ii) simplification and acceleration of processes, along with the newly added focus on (i) outsourcing of select services and (ii) evolution of go-to-market footprint and selling models.

In connection with the Restructuring Program, we now estimate a net reduction in the range of approximately 5,800 to 7,000 positions globally, which is about 9-11% of our positions including temporary and part-time employees as of June 30, 2023. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

We now expect that the Restructuring Program will result in restructuring and other charges totaling between $1,200 million and $1,600 million, before taxes, consisting of employee-related costs, contract terminations, asset write-offs and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

Once fully implemented, we now expect the Restructuring Program to yield annual target gross benefits of between $800 million and $1,000 million, before taxes, a portion of which is expected to be reinvested in consumer-facing activities. The net benefits of the PRGP, which includes the Restructuring Program, are expected to enable a return to a double-digit operating margin over the next few years.

Further information about the Restructuring Program Component of the Profit Recovery and Growth Plan, is described in Notes to Consolidated Financial Statements, Note 3 – Charges Associated with Restructuring and Other Activities herein.

NET SALES

Talcum Litigation Settlement Agreements


	Three Months Ended September 30,
($ in millions)		2025			2024
As Reported:
Net sales		$	3,481		$	3,361
$ Change from prior-year period		120
% Change from prior-year period		4		%

Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency		3		%

~~From the end of August 2024 through October 2024, we reached agreements with certain plaintiff law firms~~ (~~collectively, the~~ 1)See “~~talcum~~Reconciliations ~~litigation settlement agreements”) for: (i) the resolution~~ of ~~pending~~Non-GAAP ~~cosmetic~~Financial ~~talcum~~Measures” beginning ~~powder matters handled by those firms as well as (ii) a process for resolving potential future cosmetic talcum powder claims expected to be brought~~ on ~~behalf~~page 46 ~~of plaintiffs by those firms from January 1, 2025 through December 31, 2029, with annual capped amounts per year~~ for ~~each~~reconciliations ~~participating~~between ~~law~~non-GAAP ~~firm.~~financial Tomeasures ~~account~~and ~~for~~ the ~~talcum~~most ~~litigation~~directly ~~settlement~~comparable ~~agreements, we recorded a charge of $159 million during the fiscal 2025 first quarter for the amount agreed to settle the current claims and an estimated amount for potential future claims~~U.S. ~~Further~~GAAP ~~information about the talcum litigation settlement agreements, is described in Notes to Consolidated Financial Statements, Note 8 – Commitments and Contingencies herein~~measures.

42Reported net sales increased for the three months ended September 30, 2025, driven by an increase in net sales in the fragrance and skin care product categories.

By geographic region, reported net sales increased across all geographic regions, with the exception of The Americas. The increase in net sales was primarily driven by higher net sales in our travel retail business, and to a lesser extent, in Mainland China.

Reported net sales were impacted by approximately $25 million of favorable foreign currency translation for the three months ended September 30, 2025.

Reported net sales increased 4% for the three months ended September 30, 2025, driven by the increase from pricing of 2% reflecting the favorable impact from strategic price actions and changes in mix, the increase from volume of 1%, and the favorable impact from foreign currency translation of 1%.

Returns associated with restructuring and other activities are not allocated to our product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed a Company-wide initiative to redesign, resize and reorganize select areas of the business. Accordingly, the following discussions of Net sales by Product Categories and Geographic Regions exclude the impacts of return adjustments associated with restructuring and other activities of $1 million for the three months ended September 30, 2025. There were no returns associated with restructuring and other activities for the three months ended September 30, 2024.

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THE ESTÉE LAUDER COMPANIES INC.

Impairment Analysis During the Nine Months Ended March 31, 2025

During the fiscal 2025 second quarter, the TOM FORD brand experienced lower-than-expected growth within key geographic regions and channels, including in mainland China, Asia travel retail and Hong Kong SAR. Also during the fiscal 2025 second quarter, the Too Faced reporting unit experienced lower-than-expected results in key geographic regions and channels. As a result, we made revisions to the internal forecasts relating to our TOM FORD brand and Too Faced reporting unit. Additionally, there were increases in the weighted average cost of capital for both the TOM FORD brand and Too Faced reporting unit as compared to the prior-year annual goodwill and other indefinite-lived intangible asset impairment testing as of April 1, 2024.

We concluded that the changes in circumstances in the TOM FORD brand and Too Faced reporting unit, along with increases in the weighted average cost of capital, triggered the need for interim impairment reviews of the TOM FORD trademark and the Too Faced trademark and goodwill. These changes in circumstances were also an indicator that the carrying amounts of Too Faced’s long-lived assets, including customer lists, may not be recoverable. Accordingly, we performed interim impairment tests for the TOM FORD and Too Faced trademarks and Too Faced goodwill as well as a recoverability test for the Too Faced long-lived assets as of December 31, 2024. We concluded that the carrying value of the trademark intangible assets exceeded their estimated fair values, which were determined utilizing the relief-from-royalty method, and recorded an impairment charge of $773 million for TOM FORD and $75 million for Too Faced. We concluded that the carrying amounts of the long-lived assets for Too Faced were recoverable. Additionally, as a result of the interim impairment review, the remaining carrying value of Too Faced’s goodwill was not recoverable and we recorded an impairment charge of $13 million, reducing the carrying value to zero. The significant assumptions used in the relief-from-royalty method include revenue growth rates and profit margins, terminal values, weighted-average cost of capital used to discount future cash flows and royalty rates. The most significant unobservable input used to estimate the fair value of the TOM FORD and Too Faced trademark intangible assets was the weighted average cost of capital, which was 11.5% and 14%, respectively.

			Impairment Charges(1)					Carrying Value
(In millions)		Nine Months EndedMarch 31, 2025				As of March 31, 2025
Brand/Reporting Unit	Geographic Region			Trademark		Goodwill		Trademark(2)		Goodwill
TOM FORD	The Americas			$	773	$	—	$	1,805	$	—
Too Faced	The Americas			75		13		112		—
Total				$	848	$	13	$	1,917	$	—

(1)The date of the fair value measurement for the TOM FORD and Too Faced trademark intangible assets and Too Faced reporting unit was December 31, 2024.

(2)The carrying values of the trademark intangible assets, immediately subsequent to the impairment charges, are equal to their fair values.

The fair value of the TOM FORD and Too Faced trademarks were equal to their carrying values subsequent to the impairment charges taken as of December 31, 2024. The key assumptions used to determine the estimated fair value of the trademarks are primarily predicated on the success of future new product launches, the ability to secure strategic price increases, the achievement of distribution expansion plans, and the realization of cost reduction and other efficiency efforts. If such plans do not materialize, or if there are further challenges in the business environments in which the TOM FORD brand or Too Faced reporting unit operates, resulting changes in the key assumptions could have negative impacts on the estimated fair value of the trademarks, and it is possible we could recognize additional impairment charges in the future.

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THE ESTÉE LAUDER COMPANIES INC.

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024			2025			2024
As Reported:
Net sales	$	3,550		$	3,940		$	10,915		$	11,737
$ Change from prior-year period	(390)						(822)
% Change from prior-year period	(10)		%				(7)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(8)		%				(7)		%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 59 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales decreased for the three and nine months ended March 31, 2025, driven by a decrease across all product categories, primarily reflecting lower net sales in skin care and makeup.

By geographic region, reported net sales decreased for the three and nine months ended March 31, 2025, reflecting lower net sales across all geographic regions, primarily driven by Europe, the Middle East & Africa for the three-month period, reflecting lower net sales in our Asia travel retail business, and for the nine months ended March 31, 2025, primarily driven by Europe, the Middle East & Africa, reflecting lower net sales in our Asia travel retail business, and Asia/Pacific, reflecting lower net sales in mainland China, Hong Kong SAR and Korea.

Reported net sales decreased 10% for the three months ended March 31, 2025, driven by the decrease from volume of 9% and the unfavorable impact from foreign currency translation of 1%. Partially offsetting these decreases was an increase from pricing of 1% due to the favorable impact from strategic pricing actions, partially offset by changes in mix.

Reported net sales decreased 7% for the nine months ended March 31, 2025, driven by the decrease from volume of 9%. Partially offsetting this decrease was an increase from pricing of 3% due to the favorable impact from strategic pricing actions, partially offset by changes in mix.

Returns associated with restructuring and other activities are not allocated to our product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed Company-wide initiatives to redesign, resize and reorganize select areas of the business. For the three and nine months ended March 31, 2025, and for the three months ended March 31, 2024, there were no returns associated with restructuring and other activities. For the nine months ended March 31, 2024, there were $1 million in returns associated with restructuring and other activities.

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THE ESTÉE LAUDER COMPANIES INC.

Product Categories

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	1,807		$	2,060	$	5,257		$	5,873
$ Change from prior-year period	(253)					(616)
% Change from prior-year period	(12)		%			(10)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(11)		%			(10)		%

Reported net sales for our product categories for the three months ended September 30, 2025 and 2024 were as follows:

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 59 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.


	Three Months Ended September 30,
($ in millions)	2025		2024		$ Change		% Change		% Change in Constant Currency(1)

Skin Care	$	1,575	$	1,529	$	46	3	%	3	%
Makeup	1,030		1,038		(8)		(1)		(2)
Fragrance	721		630		91		14		13
Hair Care	129		139		(10)		(7)		(7)
Other	25		25		—		—		—
	3,480		3,361		119		4		3
Returns associated with restructuring and other activities	1		—		1		100		100
Net sales	$	3,481	$	3,361	$	120	4	%	3	%

~~Reported~~(1)See ~~skin~~“Reconciliations ~~care~~of ~~net~~Non-GAAP ~~sales~~Financial ~~decreased~~Measures” ~~for~~beginning ~~the~~on ~~three~~page 46 ~~and~~for ~~nine~~reconciliations ~~months~~between ~~ended~~non-GAAP ~~March~~financial ~~31,~~measures ~~2025, reflecting lower net sales from Estée Lauder~~ and Lathe ~~Mer,~~most ~~combined,~~directly ofcomparable ~~approximately~~U.S. ~~$215~~GAAP ~~million and $533 million, respectively, primarily driven by declines in our Asia travel retail business~~measures.

~~The~~Skin decrease in net sales from our Asia travel retail business in both periods reflected the ongoing subdued sentiment and lower conversion from Chinese consumers, the difficult comparison to the prior-year period due to our resumption of replenishment orders in the fiscal 2024 third quarter and our strategic decision to reduce our exposure to reseller activity, as well as retailer shifts in strategies toward more profitable duty-free business models in both Korea and mainland China, which led to lower replenishment orders. Care

~~The~~Reported ~~decrease~~skin incare net sales ~~from~~increased ~~Estée~~$46 ~~Lauder~~million, or 3%, for the ~~nine~~three months ended ~~March 31~~September 30, 2025, ~~also~~reflecting ~~included~~higher ~~lower~~ net sales infrom ~~mainland~~La ~~China,~~Mer ~~reflecting~~and ~~the~~Estée ~~overall~~Lauder, ~~challenging retail environment~~combined, ~~including~~of ~~the~~approximately ~~ongoing~~$54 ~~pressure from subdued consumer sentiment~~million.

~~Skin~~Net ~~care~~sales from La Mer increased, primarily driven by higher net sales ~~were~~in ~~impacted~~our Asia travel retail business, attributable to the low prior-year period net sales base which reflected (i) the challenging retail environment, including low consumer sentiment and conversion from Chinese consumers, as well as (ii) our prior-year efforts to improve in-trade inventory levels. The increase in net sales from Estée Lauder was primarily driven by ~~approximately~~higher ~~$24~~net ~~million~~sales in our Asia travel retail business, as reflected above, and ~~$13~~higher ~~million~~net ofsales ~~unfavorable~~in ~~foreign~~Mainland ~~currency~~China, ~~translation~~primarily ~~for~~driven by the ~~three~~impacts from new product launches, and ~~nine~~reflecting ~~months~~an ~~ended~~improvement ~~March~~in 31the retail environment, ~~2025~~including improved consumer sentiment comparatively, ~~respectively~~to the prior-year period.

~~Reported~~Skin ~~skin~~ care net sales ~~decreased~~were ~~12%~~impacted ~~for the three months ended March 31, 2025, driven~~ by ~~the~~approximately ~~decrease~~$7 ~~from~~million ~~volume~~ of ~~10%,~~favorable aforeign ~~decrease~~currency ~~from~~translation ~~pricing~~for ~~of 1%, due to changes in mix, partially offset by~~ the ~~favorable~~three ~~impact~~months ~~from~~ended ~~strategic pricing actions~~September 30, ~~and the unfavorable impact from foreign currency translation of 1%~~2025.

Reported skin care net sales ~~decreased~~increased 103% for the ~~nine~~three months ended ~~March 31~~September 30, 2025, driven by the ~~decrease from volume of 11%. Partially offsetting this decrease was an~~ increase from pricing of 13% ~~due~~reflecting to the favorable impact from strategic pricing actions, ~~partially~~and ~~offset by~~ changes in mix. The impact from volume was flat period-over-period.

45Makeup

Reported makeup net sales decreased $8 million, or 1%, for the three months ended September 30, 2025, reflecting lower net sales from Bobbi Brown and Too Faced, combined, of approximately $17 million.

The decrease in net sales from Bobbi Brown was primarily driven by lower net sales in the face subcategory reflecting the unfavorable year-over-year impact of new product launch shipments and lower net sales in the eye subcategory reflecting a reduction in color palettes. Net sales from Too Faced decreased, primarily driven by North America, reflecting lower net sales in the face and eye subcategories.

Partially offsetting the makeup net sales decrease were higher net sales from Estée Lauder, primarily driven by higher net sales in our Asia travel retail business, attributable to the low prior-year period net sales base which reflected (i) the challenging retail environment, including low consumer sentiment and conversion from Chinese consumers, as well as (ii) our prior-year efforts to improve in-trade inventory levels.

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	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	1,035		$	1,136	$	3,223		$	3,365
$ Change from prior-year period	(101)					(142)
% Change from prior-year period	(9)		%			(4)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(7)		%			(3)		%

Makeup net sales were impacted by approximately $10 million of favorable foreign currency translation for the three months ended September 30, 2025.

(Reported makeup net sales decreased 1~~)See~~% for the three months ended September ~~“Reconciliations~~30, 2025, driven by the decrease from pricing of ~~Non-GAAP~~1% ~~Financial~~reflecting ~~Measures” beginning~~changes onin ~~page 59~~mix ~~for~~partially ~~reconciliations~~offset ~~between~~by ~~non-GAAP~~the ~~financial~~favorable ~~measures~~impact ~~and~~from strategic pricing actions. Partially offsetting the ~~most~~decrease ~~directly~~was ~~comparable~~the Ufavorable impact from foreign currency translation of 1%.S. ~~GAAP~~The ~~measures~~impact from volume was flat period-over-period.

Reported makeup net sales decreased for the three months ended March 31, 2025, primarily driven by lower net sales from M·A·C and Estée Lauder, combined, of approximately $85 million. The decrease in net sales from M·A·C was primarily driven by lower net sales in the face and eye subcategories and reflected softness in the brand's retail sales which led to elevated levels of inventory, resulting in retailer destocking. Net sales from Estée Lauder decreased, primarily driven by lower net sales in the face subcategory.

Reported makeup net sales decreased for the nine months ended March 31, 2025, reflecting lower net sales from M·A·C, and to a lesser extent, Estée Lauder, Smashbox and Bobbi Brown, combined, of approximately $158 million. The decrease in net sales from M·A·C was primarily driven by lower net sales in the face and eye subcategories and reflected softness in the brand's retail sales which led to elevated levels of inventory, resulting in retailer destocking. The decrease in net sales from Estée Lauder was primarily driven by lower net sales in the face subcategory. Net sales from Smashbox decreased, primarily reflecting lower net sales in the face and, to a lesser extent, eye subcategories. The decrease in net sales from Bobbi Brown was driven by lower net sales in the face subcategory.

Partially offsetting the makeup net sales decrease for the nine months ended March 31, 2025 were higher net sales from Clinique across all geographic regions, led by North America, reflecting higher net sales associated with the fiscal 2024 third quarter launch in Amazon's U.S. Premium Beauty store, as well as the success of hero products and new product launches.

Makeup net sales were impacted by approximately $19 million and $28 million of unfavorable foreign currency translation for the three and nine months ended March 31, 2025, respectively.

Reported makeup net sales decreased 9% for the three months ended March 31, 2025, driven by the decrease from volume of 10% and the unfavorable impact from foreign currency translation of 2%. Partially offsetting these decreases was an increase from pricing of 2% due to the favorable impact from strategic pricing actions, partially offset by changes in mix.

Reported makeup net sales decreased 4% for the nine months ended March 31, 2025, driven by the decrease from volume of 8% and the unfavorable impact from foreign currency translation of 1%. Partially offsetting these decreases was an increase from pricing of 5% due to the favorable impact from strategic pricing actions and changes in mix.

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THE ESTÉE LAUDER COMPANIES INC.

Fragrance

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	557		$	575	$	1,931		$	1,948
$ Change from prior-year period	(18)					(17)
% Change from prior-year period	(3)		%			(1)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(1)		%			—		%

Reported fragrance net sales increased $91 million, or 14% for the three months ended September 30, 2025, primarily driven by higher net sales from Le Labo, TOM FORD, and Jo Malone London, combined, of approximately $76 million. The increase in net sales for Le Labo reflected growth from targeted expanded consumer reach and the success of hero products. Net sales from TOM FORD increased, primarily driven by growth in the Private Blend and Signature franchises, reflecting the benefit from new product launches which created halo benefits on existing products. Net sales from Jo Malone London increased reflecting higher net sales in the cologne subcategory, including success from hero franchises and holiday campaigns, as well as new product launches.

~~(1)See “Reconciliations~~Fragrance ofnet ~~Non-GAAP~~sales ~~Financial~~were ~~Measures” beginning~~impacted onby ~~page 59~~approximately ~~for~~$8 ~~reconciliations~~million ~~between~~of ~~non-GAAP~~favorable ~~financial~~foreign ~~measures~~currency ~~and~~translation for the ~~most~~three ~~directly~~months ~~comparable~~ended ~~U.S.~~September 30, ~~GAAP measures~~2025.

Reported fragrance net sales ~~decreased~~increased 14% for the three months ended ~~March 31~~September 30, 2025, ~~reflecting~~driven ~~lower~~by ~~net~~the ~~sales~~increase from Jovolume ~~Malone~~of ~~London~~8%, ~~Clinique,~~an ~~TOM~~increase ~~FORD~~from ~~and~~pricing ~~Estée~~of ~~Lauder,~~5% ~~combined,~~reflecting ofchanges ~~approximately~~in ~~$30~~mix ~~million,~~ and ~~decreased for~~ the ~~nine~~favorable ~~months~~impact ~~ended~~from ~~March~~strategic ~~31,~~pricing ~~2025~~actions, ~~reflecting~~and ~~lower~~the ~~net~~favorable ~~sales~~impact from ~~TOM~~foreign ~~FORD,~~currency ~~Estée~~translation ~~Lauder and Clinique, combined,~~ of ~~approximately $71 million~~1%.

~~The~~Hair decrease in net sales from Jo Malone London for the three months ended March 31, 2025 was primarily driven by lower net sales in the cologne and home subcategories. Net sales from Clinique decreased in both periods, primarily driven by lower net sales from the Clinique Happy franchise line of products. The decrease in net sales from TOM FORD in both periods was primarily driven by lower net sales in North America, reflecting softness in the brand's retail sales which led to elevated levels of inventory, resulting in retailer destocking, and an unfavorable year-over-year impact of prior-year launches. In both periods, net sales from Estée Lauder decreased across the fragrance portfolio, led by lower net sales from the Beautiful franchise.Care

~~Partially~~Reported ~~offsetting~~hair ~~the~~care ~~decrease~~net insales ~~reported~~decreased ~~fragrance~~$10 ~~net~~million, ~~sales~~or 7%, for the three ~~and nine~~ months ended ~~March 31~~September 30, 2025, ~~were~~driven ~~higher~~by lower net sales from ~~Le Labo~~Aveda, ~~primarily~~ reflecting ~~growth~~the ofbrand’s ~~hero~~strategies ~~products~~to improve long-term performance, including ~~growth~~(i) ~~through~~planned ~~targeted~~reductions ~~expanded~~in ~~consumer~~online ~~reach,~~promotional activity and ~~new~~(ii) ~~product~~the ~~launches~~exit from underperforming doors, including freestanding stores. Also contributing to the decrease in Aveda net sales was continued softness in the salon channel. These declines were partially offset by the impact from its launch in Amazon's U.S. Premium Beauty store during the fiscal 2025 fourth quarter.

~~Fragrance~~Reported hair care net sales ~~were~~decreased ~~impacted~~7% byfor ~~approximately~~the ~~$10~~three ~~million~~months ~~and~~ended ~~$12~~September 30, ~~million~~2025, driven by the decrease from volume of ~~unfavorable~~14%, ~~foreign~~partially ~~currency~~offset ~~translation~~by ~~for~~an ~~the~~increase ~~three~~from pricing of 6% reflecting changes in mix and ~~nine~~the ~~months~~favorable ~~ended~~impact ~~March~~from ~~31,~~strategic ~~2025,~~pricing ~~respectively~~actions.

Reported fragrance net sales decreased 3% for the three months ended March 31, 2025, driven by the decrease from volume of 7% and the unfavorable impact from foreign currency translation of 2%. Partially offsetting these decreases was an increase from pricing of 6% due to the favorable impact from strategic pricing actions and changes in mix.

Reported fragrance net sales decreased 1% for the nine months ended March 31, 2025, driven by the decrease from volume of 6% and the unfavorable impact from foreign currency translation of 1%. Partially offsetting these decreases was an increase from pricing of 6% due to the favorable impact from strategic pricing actions and changes in mix.

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THE ESTÉE LAUDER COMPANIES INC.

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	126		$	143	$	424		$	464
$ Change from prior-year period	(17)					(40)
% Change from prior-year period	(12)		%			(9)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(10)		%			(8)		%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 59 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported hair care net sales decreased for the three and nine months ended March 31, 2025, driven by lower net sales from Aveda, primarily reflecting our softness in the Europe, the Middle East & Africa and North America salon channels, as well as softness in our direct-to-consumer business. Also contributing to the decrease in net sales for Aveda for the nine months ended March 31, 2025 was the unfavorable impact of timing of shipments compared to the prior-year period.

Hair care net sales were impacted by approximately $2 million of unfavorable foreign currency translation in each of the three and nine months ended March 31, 2025.

Reported hair care net sales decreased 12% for the three months ended March 31, 2025, driven by the decrease from volume of 10% and the unfavorable impact from foreign currency translation of 1%. The impact of pricing was flat period-over-period.

Reported hair care net sales decreased 9% for the nine months ended March 31, 2025, driven by the decrease from volume of 7% and a decrease from pricing of 1%, due to changes in mix, partially offset by the favorable impact from strategic pricing actions.

Geographic Regions

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	1,052		$	1,117	$	3,462		$	3,567
$ Change from prior-year period	(65)					(105)
% Change from prior-year period	(6)		%			(3)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(5)		%			(2)		%

Reported net sales by geographic region for the three months ended September 30, 2025 and 2024 were as follows:

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 59 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.


	Three Months Ended September 30,
($ in millions)	2025		2024		$ Change		% Change		% Change in Constant Currency(2)

The Americas	$	1,174	$	1,197	$	(23)	(2)	%	(2)	%
EUKEM	901		868		33		4		—
Asia/Pacific(1)	873		806		67		8		9
Mainland China	532		490		42		9		9
	3,480		3,361		119		4		3
Returns associated with restructuring and other activities	1		—		1		100		100
Net sales	$	3,481	$	3,361	$	120	4	%	3	%

~~Reported net sales in~~ (1)The ~~Americas decreased for the three and nine months ended March 31, 2025, primarily driven by lower~~ net sales infrom ~~North America. For~~ the ~~three~~Company’s ~~and~~travel ~~nine months ended March 31, 2025, the lower net sales in North America reflected ongoing~~ retail ~~softness~~business ~~for~~are ~~some~~included ~~brands and declines~~ in ~~consumer confidence and sentiment, which led to elevated inventory levels and destocking at certain retailers, as well as operational challenges at certain retailers and~~ the ~~timing~~Asia/Pacific ~~of shipments, which further pressured net sales compared to the prior-year periods~~region. Partially offsetting the net sales decline for North America for the three and nine months ended March 31, 2025 was the impact from the launch of nine brands to-date in Amazon's U.S. Premium Beauty store.

48(2)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 46 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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~~Net~~Reported net sales inincreased ~~The~~for ~~Americas~~the ~~were~~three ~~impacted~~months byended ~~approximately~~September 30, ~~$12~~2025, ~~million~~primarily ~~and~~driven ~~$36~~by ~~million~~higher ofnet ~~unfavorable~~sales ~~foreign~~in ~~currency~~Asia/Pacific ~~translation for the three~~ and ~~nine~~in ~~months~~Mainland ~~ended March 31~~China, ~~2025~~combined, ~~respectively~~of approximately $109 million.

~~Reported~~The increase in net sales in ~~The~~Asia/Pacific ~~Americas~~was ~~decreased~~primarily 6%driven ~~for~~by ~~the~~higher ~~three~~net ~~months~~sales ~~ended~~in ~~March~~our ~~31,~~travel ~~2025~~retail business, ~~driven~~led by Asia travel retail, attributable to the ~~decrease~~low ~~from~~prior-year ~~volume~~period ofnet 9%sales ~~and~~base which reflected (i) the ~~unfavorable~~challenging ~~impact~~retail environment, including low consumer sentiment and conversion from ~~foreign~~Chinese ~~currency~~consumers, ~~translation~~as ofwell ~~1%.~~as ~~These~~(ii) ~~decreases~~our ~~were~~prior-year ~~partially~~efforts ~~offset~~to byimprove anin-trade inventory levels. Also contributing to the increase in net sales from ~~pricing~~our oftravel ~~4%,~~retail ~~due~~business towas higher net sales from our Europe, the ~~favorable~~Middle ~~impact~~East of& ~~strategic~~Africa ~~pricing~~travel ~~actions~~retail ~~and~~business, ~~changes~~primarily driven by growth in ~~mix~~fragrance.

~~Reported~~The increase in net sales in ~~The~~Mainland ~~Americas~~China ~~decreased 3%~~ for the ~~nine~~three months ended ~~March~~September 3130, 2025, was primarily driven by the ~~decrease~~impact from ~~volume~~new ofproduct 9%launches and the ~~unfavorable~~expansion ~~impact~~of ~~from~~The ~~foreign~~Ordinary ~~currency~~into ~~translation~~the ofregion ~~1%.~~during ~~These~~the ~~decreases~~fiscal ~~were~~2025 ~~partially~~third ~~offset~~quarter, byand analso ~~increase~~reflected ~~from~~an ~~pricing~~improvement ofin ~~7%, due to~~ the ~~favorable~~retail ~~impact~~environment, ofincluding ~~strategic~~improved ~~pricing~~consumer ~~actions~~sentiment ~~and~~comparatively, ~~changes~~to inthe ~~mix~~prior-year period.

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	1,358		$	1,647	$	4,082		$	4,488
$ Change from prior-year period	(289)					(406)
% Change from prior-year period	(18)		%			(9)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(16)		%			(9)		%

Partially offsetting the reported net sales increase was lower net sales in North America, primarily reflecting continued challenges in department stores, including the impact from store closures related to a retailer bankruptcy as well as softness in certain retailers, and elevated levels of inventory for some brands that continued through the quarter. Partially offsetting the net sales decline for North America was growth from shipments in support of our Amazon Premium Beauty stores in the U.S. and Canada, including ongoing brand expansion on the platform.

~~(1)See “Reconciliations~~Reported ofnet ~~Non-GAAP~~sales ~~Financial~~in ~~Measures” beginning~~The onAmericas ~~page 59~~decreased 2% for ~~reconciliations~~the ~~between~~three ~~non-GAAP~~months ~~financial~~ended ~~measures~~September 30, 2025, driven by the decrease from volume of 3%, partially offset by an increase from pricing of 2% reflecting changes in mix and the ~~most~~favorable ~~directly~~impact ~~comparable~~from ~~U.S.~~strategic ~~GAAP~~pricing ~~measures~~actions.

Reported net sales ~~decreased~~ in ~~Europe,~~EUKEM ~~the~~increased ~~Middle~~4% ~~East & Africa~~ for the three ~~and nine~~ months ended ~~March~~September 3130, 2025, ~~primarily~~ driven by ~~lower~~the ~~net~~favorable ~~sales~~impact inof ~~our~~foreign ~~Asia~~currency ~~travel~~translation ~~retail~~of ~~business,~~4% ~~reflecting the ongoing subdued sentiment~~ and ~~lower~~an ~~conversion~~increase from ~~Chinese~~pricing ~~consumers, the difficult comparison to the prior-year period due to our resumption~~ of ~~replenishment~~3% ~~orders~~reflecting in the ~~fiscal~~favorable ~~2024~~impact ~~third~~from ~~quarter and our~~ strategic ~~decision~~pricing toactions ~~reduce~~and ~~our~~changes ~~exposure to reseller activity, as well as retailer shifts~~ in ~~strategies~~mix. ~~toward~~Partially ~~more~~offsetting ~~profitable~~these ~~duty-free~~increases ~~business~~was ~~models~~the indecrease ~~both~~from ~~Korea~~volume ~~and~~of ~~mainland China, which led to lower replenishment orders~~3%.

~~Net~~Reported net sales in ~~Europe,~~Asia/Pacific increased 8% for the ~~Middle~~three ~~East~~months &ended ~~Africa~~September ~~were~~30, ~~impacted~~2025, driven by ~~approximately~~an ~~$22~~increase ~~million~~from ~~and~~pricing $3of ~~million~~5% ofreflecting ~~unfavorable~~the ~~foreign~~favorable ~~currency~~impact ~~translation~~from ~~for~~strategic ~~the~~pricing ~~three~~actions and ~~nine~~changes ~~months~~in ~~ended~~mix, ~~March~~and ~~31,~~the ~~2025,~~increase ~~respectively.~~from volume of 4%.

Reported net sales in ~~Europe,~~Mainland ~~the~~China ~~Middle~~increased ~~East & Africa decreased 18~~9% for the three months ended ~~March~~September 3130, 2025, driven by ~~the~~an ~~decrease~~increase from volume of 12%, partially offset by a decrease ~~from~~in pricing of 43%, ~~due~~reflecting to changes in mix, partially offset by the favorable impact from strategic pricing actions~~, and the unfavorable impact from foreign currency translation of 1%~~.

Reported net sales in Europe, the Middle East & Africa decreased 9% for the nine months ended March 31, 2025, driven by the decrease from volume of 8% and a decrease from pricing of 1%, due to changes in mix, partially offset by the favorable impact from strategic pricing actions. 40

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	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
($ in millions)	2025			2024		2025			2024
As Reported:
Net sales	$	1,140		$	1,176	$	3,371		$	3,683
$ Change from prior-year period	(36)					(312)
% Change from prior-year period	(3)		%			(8)		%
Non-GAAP Financial Measure(1):
% Change from prior-year period in constant currency	(1)		%			(8)		%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 59 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales decreased in Asia/Pacific for the three months ended March 31, 2025, primarily driven by lower net sales from Korea, Hong Kong SAR, Singapore, Taiwan and Australia, combined, of approximately $69 million.

The decrease in net sales from Korea reflected the impact of political and social unrest, which reduced retail traffic and dampened retail sales, as well as the exit of Dr.Jart+ from the travel retail channel in Korea during the fiscal 2025 second quarter. Net sales from Hong Kong SAR and Singapore decreased, reflecting our strategic decision to reduce our exposure to reseller activity. The net sales decline from Taiwan reflected the temporary closure of a key retailer during the fiscal 2025 third quarter. Net sales from Australia decreased, reflecting lower net sales across all product categories.

Partially offsetting the reported net sales decrease in Asia/Pacific for the three months ended March 31, 2025 were higher net sales from mainland China and Japan, combined, of approximately $37 million. The increase in net sales in mainland China reflected the favorable timing of key shopping moments compared to the prior-year period, which contributed to prestige beauty stabilization, the partial recapture of consumer demand in mainland China from Asia travel retail, Hong Kong SAR and Singapore, as well as online net sales growth and the success of new product launches from La Mer. Partially offsetting the increase in net sales in mainland China, were lower shipments to some retailers due to retail softness, reflecting subdued consumer sentiment, and their efforts to manage working capital. The net sales increase from Japan reflected higher net sales in fragrance, driven by Le Labo and in skin care, driven by Estée Lauder and La Mer, including growth through tourism demand.

Reported net sales decreased in Asia/Pacific for the nine months ended March 31, 2025, primarily driven by lower net sales from mainland China, Hong Kong SAR, Korea and Singapore, combined, of approximately $332 million. The decrease in net sales from mainland China and Hong Kong SAR both reflected the overall challenging retail environments, including the ongoing pressure from subdued consumer sentiment. Additionally, the decline in net sales in Hong Kong SAR, as well as the decrease in net sales in Singapore reflected our strategic decision to reduce our exposure to reseller activity. The net sales decline in Korea reflects the impact of political and social unrest, which reduced retail traffic and dampened retail sales, as well as the exit of Dr.Jart+ from the travel retail channel in Korea during the fiscal 2025 second quarter.

Partially offsetting the reported net sales decrease in Asia/Pacific for the nine months ended March 31, 2025 were higher net sales from Japan, reflecting higher net sales in fragrance, driven by Le Labo and Jo Malone London, and in skin care, driven by La Mer, including growth through tourism demand.

Net sales in Asia/Pacific were impacted by approximately $21 million and $16 million of unfavorable foreign currency translation for the three and nine months ended March 31, 2025, respectively.

Reported net sales in Asia/Pacific decreased 3% for the three months ended March 31, 2025, driven by the decrease from volume of 6% and the unfavorable impact from foreign currency translation of 2%. Partially offsetting these decreases was an increase from pricing of 4% due to the favorable impact from strategic pricing actions and changes in mix.

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Reported net sales in Asia/Pacific decreased 8% for the nine months ended March 31, 2025, driven by the decrease from volume of 12%. Partially offsetting this decrease was an increase from pricing of 4% due to the favorable impact from strategic pricing actions and changes in mix.

GROSS MARGIN

Gross margin increased to 7573.04% ~~and 74.6%~~ for the three ~~and nine~~ months ended ~~March~~September 3130, 2025, as compared with 7172.94% ~~and 71.6%~~ in the prior-year ~~periods~~period.

~~Favorable (Unfavorable) Basis Points~~

Favorable (Unfavorable) Basis Points

March 31, 2025

September 30, 2025

~~Three Months Ended~~

~~Nine~~Three Months Ended

As Reported:

Mix of business

~~(95)~~

~~(5)~~50

Obsolescence charges

~~145~~20

Manufacturing costs and other

~~305~~

~~175~~20

Foreign exchange transactions

(530)

Charges associated with restructuring and other activities

—

~~(10)~~40

As Reported Gross Margin Basis Point Variance

~~310~~

~~300~~100

Non-GAAP Financial Measure Adjustments

Charges associated with restructuring and other activities

—

10(40)

Non-GAAP Gross Margin Basis Point Variance

~~310~~

~~310~~60

The increase in gross margin for the three ~~and nine~~ months ended ~~March 31~~September 30, 2025 ~~was~~reflected ~~driven~~net bybenefits ~~the impact~~ from ~~manufacturing~~the ~~costs and other~~PRGP, ~~reflecting~~which ~~the~~included favorable ~~impact~~impacts ofacross ~~the~~our ~~recognition~~mix of ~~manufacturing~~business, ~~variances~~obsolescence ~~associated~~charges ~~with~~and ~~reduced~~ manufacturing ~~volumes~~costs onand ~~our~~other. ~~standard~~The ~~cost~~favorability within ~~cost~~mix of ~~sales~~business inwas ~~the~~driven ~~fiscal 2024 third quarter, partially offset~~ by ~~the~~reductions ~~impact of a similar charge recorded~~ in ~~the~~promotional ~~fiscal 2025 third quarter~~activity, asand ~~well as~~ the ~~favorable~~favorability ~~impact of cost efficiencies~~ within ~~our global supply chain network. Also contributing to the increase in gross margin in both periods was lower~~ obsolescence charges, ~~due~~was todriven aby ~~reduction~~reductions in excess inventory. ~~Partially~~Manufacturing ~~offsetting~~costs ~~the~~and ~~increase~~other inreflects ~~gross margin for~~ the ~~three~~favorable ~~months ended March 31, 2025 was the unfavorable~~ impact ~~from our mix~~ of ~~business,~~cost ~~reflecting~~efficiencies ~~the~~within ~~impact~~our ofglobal ~~lower~~supply ~~net~~chain ~~sales~~network, partially offset by the ~~benefit~~impact of ~~net~~inflation ~~strategic~~on ~~pricing~~our costs.

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OPERATING EXPENSES

Operating expenses as a percentage of net sales ~~were~~was 6668.35% ~~and 78.2%~~ for the three ~~and nine~~ months ended ~~March~~September 3130, 2025, as compared with 5876.40% ~~and 61.4%~~ in the prior-year ~~periods~~period.

	~~Favorable (Unfavorable) Basis Points~~	Favorable (Unfavorable) Basis Points
	March 31, 2025
		September 30, 2025
	~~Three Months Ended~~	~~Nine~~Three Months Ended
As Reported:
General and administrative expenses	~~(160)~~	~~(150)~~90
Advertising, merchandising, sampling and product development	(280)	(180)
Advertising, marketing, promotion and product development		140
Selling	~~(110)~~	~~(120)~~30
Shipping	20	2030
Store operating costs	~~(70)~~	~~(30)~~10
Stock-based compensation	20	10(20)
Foreign exchange transactions	—	20(30)
Charges associated with restructuring and other activities	~~(220)~~	~~(320)~~30
Goodwill and other intangible asset impairments	—	(790)
Talcum litigation settlement agreements		470
Talcum litigation settlement agreements	—	(150)
As Reported Operating Expense Margin Basis Point Variance		750
Changes in fair value of DECIEM acquisition-related stock options	10	10
As Reported Operating Expense Margin Basis Point Variance	(790)	(1,680)
Non-GAAP Financial Measure Adjustments:
Impact of restructuring and other activities	~~220~~	~~320~~(40)
Goodwill and other intangible asset impairments	—	790
Talcum litigation settlement agreements		(470)
Talcum litigation settlement agreements	—	150
Non-GAAP Operating Expense Margin Basis Point Variance		240
Changes in fair value of DECIEM acquisition-related stock options	(10)	(10)
Non-GAAP Operating Expense Margin Basis Point Variance	(580)	(430)

The ~~unfavorable~~favorability ~~change~~ in our operating expense margin ~~for~~reflects ~~the~~lower ~~three~~expenses ~~and~~within ~~nine~~non-consumer-facing ~~months~~areas ~~ended March 31, 2025 reflects the impact~~ of the ~~decrease in net sales. Also contributing to the unfavorable change in operating expense margin for the three months ended March 31~~business, ~~2025~~primarily ~~was~~within ~~higher~~general ~~advertising,~~and ~~merchandising~~administrative, ~~sampling~~marketing and product development expenses,. ~~reflecting~~These ~~investments~~reductions towere ~~support~~driven ~~sales,~~by ~~including~~lower ~~through~~employee-related ~~key~~costs ~~shopping~~realized ~~moments,~~through ~~campaigns~~initiatives ~~and~~as ~~launches,~~part ~~and~~of ~~higher~~the ~~store operating costs~~PRGP, towith ~~support~~the ~~targeted~~general ~~expanded consumer reach. General~~ and administrative ~~expenses~~favorability ~~increased~~partially ~~for~~offset ~~the~~by ~~three and nine months ended March 31, 2025, reflecting~~ the year-over-year ~~unfavorable~~increase ~~impact of a change~~ in ~~policy~~employee ~~related~~incentive ~~to local government subsidies in China~~costs. ~~Also~~Partially ~~contributing~~offsetting tothese ~~the unfavorable change in operating~~ expense ~~margin~~reductions ~~for~~were ~~the~~increased ~~nine-month~~investments ~~period~~in ~~was higher selling expenses, reflecting higher staffing costs to support sales, targeted expanded~~ consumer-facing ~~reach~~areas ~~and key campaigns. As a result~~ of ~~our net sales performance, we were disciplined in our overall expense strategy across~~ the business to ~~manage~~drive ~~profitability~~sales, ~~which~~including ~~partially~~advertising, ~~offset~~selling, ~~the~~promotion ~~unfavorable~~and ~~change~~store in operating ~~expense margin for the three and nine months ended March 31, 2025~~expenses.

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OPERATING RESULTS

	Three Months EndedMarch 31,						Nine Months EndedMarch 31,
				Three Months EndedSeptember 30,
($ in millions)	~~2025~~			~~2024~~			2025			2024
As Reported:
Operating income (loss)	$	~~306~~		$	~~531~~		$	~~(395)~~169		$	~~1,203~~(121)
$ Change from prior-year period	~~(225)~~						~~(1,598)~~290
% Change from prior-year period	~~(42)~~		%				(100+)%
Operating margin	~~8.6~~		%	~~13.5~~		%	(34.6)9		%	10(3.26)		%
Non-GAAP Financial Measure(1):
% Change in operating income (loss) from the prior-year period adjusting for the impact of charges associated with restructuring and other activities, the impact of goodwill and other intangible asset impairments, talcum litigation settlement agreements and the change in fair value of DECIEM acquisition-related stock options	(27)		%				(19)		%
% Change in operating income (loss) from the prior-year period adjusting for the impact of charges associated with restructuring and other activities and talcum litigation settlement agreements							77		%

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 5946 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

The ~~decrease~~increase in reported operating margin for the three ~~and nine~~ months ended ~~March 31~~September 30, 2025 ~~primarily~~was ~~reflects~~driven aby ~~decrease~~the infavorable ~~net~~year-over-year ~~sales~~impact ~~and~~of anthe ~~increase~~charge in ~~operating expense margin, which for~~ the ~~nine~~fiscal ~~months ended March 31,~~ 2025 ~~was~~first ~~driven~~quarter byassociated ~~goodwill~~with ~~and~~the ~~other~~talcum ~~intangible~~litigation ~~asset~~settlement ~~impairments~~agreements ~~relating to TOM FORD and Too Faced, combined,~~ of $~~861~~159 million, ~~included~~reflected inwithin the ~~makeup~~favorable operating expense margin, ~~fragrance~~as ~~and~~well ~~other~~as ~~product~~the ~~categories,~~increase ~~partially~~in ~~offset~~net bysales anand increase in gross margin, as discussed above.

Charges associated with restructuring and other activities are not allocated to our product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed a Company-wide ~~initiatives~~initiative to redesign, resize and reorganize select areas of the business. Accordingly, the following discussions of Operating income (loss) by Product Categories and Geographic Regions exclude the impact of charges associated with restructuring and other activities for the three months ended ~~March~~September 3130, 2025 and 2024 of $9786 million and $18106 million, respectively~~, and for the nine months ended March 31, 2025 and 2024 of $384 million and $28 million, respectively~~.

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Product Categories

~~Skin~~Reported ~~Care~~Operating income (loss) for our product categories for the three months ended September 30, 2025 and 2024 were as follows:

	Three Months EndedMarch 31,					Nine Months EndedMarch 31,
	Three Months Ended September 30,
($ in millions)	2025			2024		~~2025~~$ Change			~~2024~~% Change(As reported)			% Change (Non-GAAP)(1)		Non-GAAP Financial Measure(1)
As Reported:
Skin Care	$	187		$	117	$	70		60		%	60	%
Operating income	$	361		$	468	$	784		$	920
Makeup	(15)			(185)		170			92			42		Adjusted for the impact of talcum litigation settlement agreements.
$ Change from prior-year period	(107)					(136)
Fragrance	86			60		26			43			43
% Change from prior-year period	(23)		%			(15)		%
Hair Care	(12)			(18)		6			33			33
Non-GAAP Financial Measure(1):
Other	9			11		(2)			(18)			(18)
% Change in operating income from the prior-year period adjusting for the change in fair value of DECIEM acquisition-related stock optio

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