Strobel: “We are continuing our portfolio review to identify opportunities to unlock shareholder value. Coty is well positioned to deliver consistent, profitable growth and realise its full potential.”

Coty’s new Executive Chairman and Interim CEO, Markus Strobel, told analysts during an investor call covering the company’s fiscal Q2 2026 results (ending December 2025) that he was initiating a new strategic framework called ‘Coty. Curated.’ that will drive more focused investments, improve execution, and increase support behind its core businesses.

The move from Strobel – who joined the beauty giant on 1 January, after 33 years at P&G – comes on the back of a set of weak results from the New York-listed beauty house. Six-month revenue fell by -6% like-for-like (-3% reported), with each of Coty’s three geographical regions – Americas, EMEA, and Asia-Pacific – in negative territory (see chart below), although in Q2, EMEA rebounded.

Strobel was frank: “There’s no denying that Coty’s financial results in the past 18 months have been disappointing. The stock has also been hovering around $3 for several months, which I see as a signal that investors are sceptical about our long-term ability to compete in beauty, sustain fair market share, and deliver consistent, profitable growth.” The stock fell below $3 after the latest results were announced, and today it is around $2.50.

With ‘Coty. Curated.’, Strobel is looking to tap more precisely into consumer demand with “a relentless focus on sell-out and market share”.

All regions saw revenues decline in the first half.

He said: “In parallel, we are continuing our portfolio review to identify opportunities to unlock shareholder value in both the near- and long-term, complemented by other value-driving opportunities, such as the recent divestiture of our remaining stake in Wella at the end of CY25. With greater focus and discipline, I believe Coty is well positioned to deliver consistent, profitable growth and realise its full potential.”

Travel retail and emerging markets offer some comfort

In Coty’s two category segments – prestige and consumer beauty – both saw Q2 growth improvements versus the first half. On a reported basis, second quarter consumer beauty revenue hit $545m, down -2%, while the larger prestige segment grew by +2% to $1,116m (but flat in terms of sell-out).

The prestige segment was buoyed by travel retail.

Commenting on the prestige beauty market in the investor call, Laurent Mercier, Coty’s Chief Financial Officer, said: “Against this backdrop, our total sell-out was broadly flattish, though this included weaker-than-category sell-out in key markets like the US, Germany, and the UK. This was largely balanced by strong sell-out in emerging regions like Asia-Pacific, the Middle East, Latin America, and travel retail.”

As Coty’s stock hovers at $2.50, Strobel reminded investors that the company has been a strong performer in the top-end market. Coty grew the prestige fragrance business at a +10% CAGR from FY21 to FY25, “which is no small feat”. He added that across the company’s “highly desirable fragrance brands like Hugo Boss, Burberry, Marc Jacobs, and Chloe” each had grown significantly, by between +30% and +140% from FY19 to FY25, “and there remains substantial room to expand them further”.

Coty withdraws full-year guidance

Due to a “complex beauty market backdrop” and a leadership transition, Coty has withdrawn its prior FY26 guidance for EBITDA and free cash flow, and is now only providing guidance for Q3.

The company expects like-for-like Q3 revenue to decline by a mid-single-digit percentage, primarily due to weakening consumer beauty sales trends. In prestige, Coty estimates the fragrance market will grow at a low‑to‑mid‑single‑digit rate, which is consistent with Q2 and in line with the broader beauty market.

The company said that while headwinds from retailer destocking significantly reduced in Q2, the promotional environment intensified through the holiday period, “and remains elevated across the category”, presenting further hurdles to net sales performance and gross margin.

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