Coty 2025 Q4 Earnings Loss Narrows 27.5% Amid Revenue Drop

Coty (COTY) reported fiscal 2025 Q4 earnings on Aug 20, 2025, with a notable 27.5% reduction in its net loss and revenue falling short of the prior year. The results did not beat expectations, and the company issued cautious guidance, reflecting continued challenges in its recovery path.

Revenue declined 8.1% year-over-year to $1.25 billion in Q4 2025. The Prestige segment delivered $760.60 million, representing the strongest performer, while the Consumer Beauty segment contributed $491.80 million. The Corporate segment reported no revenue, bringing the total to $1.25 billion for the quarter.

Coty narrowed its net loss to $-69.30 million in Q4 2025, a 27.5% improvement from $-95.60 million a year earlier, and reduced its per-share loss to $0.08 from $0.12. Despite the narrowing losses, the earnings environment remains challenging, with the EPS still reflecting a negative outcome.

Following the earnings release, a 30-day investment strategy based on revenue growth over the past three years underperformed significantly, with a CAGR of -2.85% and a total return of -8.01%. The strategy showed poor risk-adjusted returns, with a Sharpe ratio of -0.22 and no maximum drawdown, suggesting limited downside but also a failure to capture gains.

Coty’s CEO, Sue Y. Nabi, emphasized the company’s focus on core strengths, particularly in global fragrances and scenting, where she sees long-term structural growth potential. She acknowledged underperformance in U.S. mass cosmetics but outlined strategic actions, including leadership changes and agile operating models, to return Coty to growth. Nabi’s comments reflected cautious optimism and a focus on long-term value creation.

For fiscal 2026, Coty expects continued sequential improvement in sales and profit trends, with like-for-like revenue declining by 6% to 8% in Q1 and 3% to 5% in Q2. Adjusted EBITDA is projected to fall mid- to high teens in Q1 and low to mid-teens in Q2. The company anticipates a return to growth in the second half of the year, driven by new product launches and favorable comparisons. Free cash flow is expected to exceed $350 million in H1, supporting ongoing deleveraging efforts.

In the three weeks following the earnings release, Coty made no announcements regarding M&A activity or executive changes. The company also did not disclose any new dividend or share repurchase programs. The lack of major strategic moves suggests a continued focus on internal transformation rather than external growth or capital return initiatives at this stage.