EL · Read the filing

el-20260630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended June 30, 2026

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)

767 Fifth Avenue, New York, New York 10153

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code 212-572-4200

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

Title of each class TradingSymbol(s) Name of each exchange on which registered

Class A Common Stock, $.01 par value EL New York Stock Exchange

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

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No☒

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 and post 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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

The aggregate market value of the registrant’s voting common equity held by non-affiliates of the registrant was approximately $26 billion at December 31, 2025 (the last business day of the registrant’s most recently completed second quarter).*

At August 12, 2026, 247,291,223 shares of the registrant’s Class A Common Stock, $.01 par value, and 114,507,344 shares of the registrant’s Class B Common Stock, $.01 par value, were outstanding.

Documents Incorporated by Reference

Document Where Incorporated

* Calculated by excluding all shares held by executive officers and directors of registrant and certain trusts without conceding that all such persons are “affiliates” of registrant for purposes of the Federal securities laws.

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THE ESTÉE LAUDER COMPANIES INC.

INDEX TO ANNUAL REPORT ON FORM 10-K

Page

Part I:

Item 1. Business 2

Item 1A. Risk Factors 16

Item 1B. Unresolved Staff Comments 23

Item 1C. Cybersecurity 23

Item 2. Properties 24

Item 3. Legal Proceedings 24

Item 4. Mine Safety Disclosures 25

Part II:

Item 6. [Reserved] 27

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 57

Item 8. Financial Statements and Supplementary Data 57

Item 9A. Controls and Procedures 57

Item 9B. Other Information 57

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 57

Part III:

Item 10. Directors, Executive Officers and Corporate Governance 58

Item 11. Executive Compensation 58

Item 14. Principal Accounting Fees and Services 59

Part IV:

Item 15. Exhibits, Financial Statement Schedules 60

Signatures 66

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Cautionary Note Regarding Forward-Looking Information and Risk Factors

This Annual Report on Form 10-K includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may address our expectations regarding sales, earnings or other future financial performance and liquidity, other performance measures, product introductions, entry into new geographic regions, information technology initiatives, new methods of sale, our long-term strategy, restructuring and other charges and resulting cost savings, and future operations or operating results. Although we believe our expectations are based on reasonable assumptions within the bounds of our knowledge of our business and operations, we cannot assure that actual results will not differ materially from our expectations. Factors that could cause actual results to differ from expectations are described herein; in particular, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Cautionary Note Regarding Forward-Looking Information.” In addition, there is a discussion of risks associated with an investment in our securities, see “Item 1A. Risk Factors.”

Unless the context requires otherwise, references to “we,” “us,” “our” and the “Company” refer to The Estée Lauder Companies Inc. and its subsidiaries.

PART I

Item 1. Business.

The Estée Lauder Companies Inc., founded in 1946 by Estée and Joseph Lauder, is one of the world’s leading manufacturers, marketers and sellers of quality skin care, makeup, fragrance and hair care products. We are a steward of over 20 luxury and prestige brands globally. Since the initial launch of the Estée Lauder brand in the United States, we have significantly expanded our consumer reach to approximately 150 countries and territories. We operate as a wholesaler, with our products sold in brick-and-mortar locations and on various e-commerce platforms, including those operated by department stores, duty-free retailers, specialty-multi retailers, online pure players, upscale perfumeries and pharmacies, and top-tier salons and spas. Additionally, we operate a direct-to-consumer business across freestanding stores, our brands' websites and third-party online platforms.

In February 2025, we embarked on “Beauty Reimagined,” a strategic vision which focuses on accelerating best-in-class consumer coverage, creating transformative innovation, boosting consumer-facing investments, fueling sustainable growth through bold efficiencies and reimagining the way we work.

As part of reimagining the way we work, we created our "One ELC" operating model, a scalable, integrated system designed to operate faster, execute with greater discipline, and drive growth. One ELC is built on three elements: One Team, One Culture, and One Operating Ecosystem. One Team is the simplification of the organization with fewer layers and silos, clearer ownership and faster decision making. One Culture is the reinforcement of how teams work every day, grounded in accountability, bold, entrepreneurial thinking, and agility. One Operating Ecosystem is the combination of shared platforms, data and strategic partners to enable consistent, scalable and effective execution across brands, regions and functions.

We have been controlled by the Lauder family since the founding of our Company. Members of the Lauder family, some of whom are directors, executive officers and/or employees, beneficially own, directly or indirectly, as of August 12, 2026, shares of our Company's Class A Common Stock and Class B Common Stock having approximately 82% of the outstanding voting power of the Common Stock.

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Products

Skin Care - Our broad range of skin care products address various skin care needs. These products include moisturizers, serums, cleansers, toners, eye care, body care, exfoliators, acne and oil correctors, facial masks and sun care products.

Makeup - We offer an extensive array of makeup products across shades and colors. Our full array of makeup products includes foundations, powders, concealers and setting sprays, lipsticks, lip liners and lip glosses, and mascaras, eyeshadows and eyeliners. We also sell related items such as compacts, brushes and other makeup tools.

Fragrance - We offer a variety of fragrance products. The fragrances are sold in various forms, including parfum, eau de parfum, eau de toilette, eau de cologne, and body spray, as well as lotions, creams, powders, candles and soaps that are based on a particular fragrance.

Hair Care - Our hair care products include shampoos, conditioners, styling products, treatment, finishing sprays and hair color products.

Other - The other category includes royalty revenue from our licensing of the TOM FORD trademark to third parties as well as sales from ancillary products and services that do not fit within the definitions of skin care, makeup, fragrance, and hair care.

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Our Brands

Given the personal nature of our products and the wide array of consumer preferences and tastes, as well as competition for the attention of consumers, our strategy has been to market and promote our products through distinctive brands seeking to address broad preferences and tastes. Each brand has a single global image that is promoted with consistent logos, packaging and advertising designed to enhance its image and differentiate it from other brands in the market. Beauty brands are differentiated by numerous factors, including quality, performance, a particular lifestyle, where they are distributed (e.g., prestige or mass) and price point. Below is a chart showing brands we sell and how we view them based on lifestyle and price point:

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Our “Luxury Brands” are prestige brands sold at luxury price points and include La Mer, Jo Malone London, TOM FORD, AERIN Beauty, Le Labo, Editions de Parfums Frédéric Malle, KILIAN PARIS and Balmain Beauty. This luxury portfolio also includes Estée Lauder's Re-Nutriv product franchise. Our “Large Brands”, defined as brands that have net sales of $1,000 million or more, are Estée Lauder, La Mer, M·A·C, Clinique, Jo Malone London and TOM FORD. Our “Scaling Brands”, defined as brands with net sales of $400 million or more, but less than $1,000 million, are The Ordinary, Le Labo, Bobbi Brown Cosmetics and Aveda. Our “Developing Brands”, defined as brands with net sales of less than $400 million, are Too Faced, KILIAN PARIS, Dr.Jart+, Origins, Bumble and bumble, Editions de Parfums Frédéric Malle, Smashbox, Darphin Paris, Lab Series, Balmain Beauty, Aramis, AERIN Beauty, NIOD, Avestan, Loopha and GLAMGLOW.

From time to time, we also make minority investments in companies, mainly in the beauty industry, including through our New Incubation Ventures, the strategic early-stage investment and incubation arm of our Company. For some of our historical minority investments, we have acquired the remaining interests (e.g., Have & Be Co. Ltd. (i.e. Dr.Jart+) and DECIEM). We have several minority investments as of June 30, 2026, including a company based in India that manufactures, markets and sells Ayurvedic skin care and other products under the Forest Essentials brand name, primarily in India, for which we have signed an agreement, subject to regulatory approvals, to acquire the remaining interest, as well as an investment in a luxury skin care brand, with proprietary formulas designed to support skin repair and resilience at the cellular level.

Social Impact and Sustainability

We continue to integrate social impact and sustainability into our strategy and business operations. Our social impact and sustainability initiatives help drive innovation, growth and operational efficiency across the business and within our brand portfolio, including through ingredient and packaging innovation and efforts to reduce cost and waste. Our initiatives also aim to enhance employee engagement and strengthen consumer trust and loyalty.

Our areas of focus include green chemistry and ingredient transparency; packaging; climate and energy; responsible sourcing; employee engagement, health and safety; philanthropic partnerships supporting women and girls; and social impact investments. We have established goals or commitments within these focus areas. For example, our climate and energy goals are intended to advance efficiency and conservation across our facilities, internal supply chain and broader value chain.

The Nominating and ESG Committee of our Board of Directors has oversight responsibility for our Company’s social impact and sustainability activities and practices, including citizenship and sustainability matters. Our social impact and sustainability efforts are led by our Chief Sustainability Officer and Chief Value Chain Officer, under the oversight of our President and Chief Executive Officer. Other members of senior management, together with employees across the organization, help to drive our strategic initiatives concerning social impact and sustainability.

Additional information related to our social impact and sustainability matters can be found at www.elcompanies.com.

Distribution

We operate as a wholesaler, with our products sold in brick-and-mortar locations and on various e-commerce platforms, including those operated by department stores, duty-free retailers, specialty-multi retailers, online pure players, upscale perfumeries and pharmacies, and top-tier salons and spas. Additionally, we operate a direct-to-consumer business across freestanding stores, our brands' websites and third-party online platforms. Our general practice is to accept returns of our products from customers if properly requested and approved.

Our online sites, including our brand.com sites as well as those operated by authorized retailers and through third-party online platforms are across our geographic regions, with a majority of these online sales generated in mainland China, the United States and the United Kingdom. As of June 30, 2026, we operated approximately 1,600 freestanding stores, which reflects the closure of freestanding stores in unproductive areas of our business and the opening of new freestanding stores during the fiscal year, as we continue to evolve our strategic focus on accelerating best-in-class consumer coverage. Most freestanding stores are operated by us under a single brand name, such as M·A·C, Jo Malone London and Le Labo. Approximately 300 of the freestanding stores are multi-branded company stores, primarily in outlet malls.

We maintain dedicated sales teams that manage our retail accounts. We have wholly-owned operations in over 50 countries through which we market, sell and distribute our products. In certain countries, we sell our products through carefully selected distributors who we believe share our commitment to protecting the image and position of our brands. For information regarding our net sales by geographic region, see Item 8. Financial Statements and Supplementary Data – Note 14 – Revenue Recognition.

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We continue to develop our strategy, assess performance and allocate resources by product category and will continue to report results by product category. To enhance accountability and streamline operations within the organization, as well as to align with our leadership changes during the second half of fiscal 2025, we have reorganized our geographic regions as of the fiscal 2026 first quarter. Accordingly, results by geographic region for fiscal 2026 and comparative fiscal 2025 and 2024 are reported under the new regional structure. Our four geographic regions effective July 1, 2025 are:

•The Americas, which includes North America and Latin America;

•Europe, the United Kingdom and Ireland and Emerging Markets ("EUKEM"), which includes the geographic markets of our previously reported Europe, the Middle East & Africa ("EMEA") region, excludes our global travel retail business previously reported in our EMEA region, and includes our Southeast Asian Emerging Markets, previously reported in our Asia/Pacific region, of Indonesia, Malaysia, the Philippines, Thailand and Vietnam;

•Asia/Pacific, which includes certain geographic markets of our previously reported Asia/Pacific region, such as Japan, Korea, Hong Kong SAR, and Australia, among others, as well as our global travel retail business, previously reported in our EMEA region; and

•Mainland China, previously reported in our Asia/Pacific region, is reported as a separate region.

Our “Emerging Markets” are Argentina, Brazil, Chile, Colombia, Mexico, Panama and Peru in The Americas, and are India, Indonesia, Israel, Malaysia, the Middle East, the Philippines, Russia, South Africa, Thailand, Turkey and Vietnam in EUKEM.

Our “Priority Emerging Markets” are Brazil and Mexico in The Americas and India, Indonesia, Malaysia, the Middle East, the Philippines, South Africa, Thailand, Turkey and Vietnam in EUKEM. Beginning in fiscal 2027, South Africa will no longer be included within our "Priority Emerging Markets".

Customers

Our strategy is to build strong relationships globally with select retailers, and our senior management works with executives of our major retail accounts on a regular basis in support of these relationships. We believe we are viewed as an important supplier to these customers. In addition, we connect with our consumers directly through freestanding stores, e-commerce sites and social media to build a robust omnichannel experience that allows consumers to shop in these and other channels.

Marketing

Our strategy to market and promote our products begins with our well-diversified portfolio of distinctive brands across four major product categories. Our portfolio can be deployed in multiple distribution channels, key travel corridors and geographies and we continue to expand consumer coverage by participating in high-growth markets, channels, price tiers and media where the strength, awareness and desirability of our brands provide a competitive advantage. Our marketing approach reflects a consumer engagement model designed to support the long-term equity and desirability of our brands while driving consumer discovery, engagement and conversion across markets and channels. By placing the consumer at the center of every engagement and leveraging our category, geographic and channel diversity, we are able to expand our consumer coverage and reach consumers across developed and emerging markets with products, services and experiences designed for local relevance, inclusiveness and appeal with tailored experiences to local consumer preferences, cultural context and shopping behaviors. This strategy is built around “Bringing the Best to Everyone We Touch.”

Our founder, Mrs. Estée Lauder, formulated this unique marketing philosophy to provide “High-Touch” service and high-quality products as the foundation for a solid and loyal consumer base. We have further expanded our “High-Touch” execution to build more personalized consumer experiences through digital and physical demonstration and tailored trial-to-loyalty pathways with an integrated consumer engagement and marketing model across evolving physical and digital environments to support discovery, consideration, conversion and loyalty across our own and our retail partners' platforms.

Our marketing strategies vary by brand, local market and distribution channel. We have a diverse portfolio of brands, and we employ different engagement models suited to each brand’s core consumer, equity, distribution, product focus, and local relevance.

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Hero products are at the core of our brand marketing strategies. They are the pillars of our brands and historically have provided strong results through high repeat sales and consumer loyalty. In addition to continuing to retain existing consumers, we are also strategically focused on attracting new consumers. Our hero products provide an opportunity for new consumers to experience our high quality products, driving consumer traffic across all channels of distribution. We aim to further strengthen our hero products, and create new ones, through continuous review of our product portfolio and creation of breakthrough, on-trend and commercial innovation that delivers fast-to-market products across prestige price tiers focused on in-demand subcategories, benefits, and occasions.

Our marketing planning approach focuses on maximizing the visibility, effectiveness and efficiency of our marketing and advertising investments across the consumer journey to accelerate new consumer acquisition. We leverage our deep category understanding and consumer intelligence and local insights to optimize allocation of resources across different media outlets and retail touch points to resonate with our most discerning consumers most effectively. This approach includes strategically deploying our brands and tailoring product assortments and communications to fit local tastes and preferences in markets and cities, and also using these insights to develop new ways to innovate, engage consumers, build brand equity and sell products. We deploy integrated marketing and media programs designed to both generate and optimize consumer demand and capture purchase intent across physical and digital environments. Our approach seeks to accelerate the impact of brand-building activities through broad reach media such as print, television and out-of-home advertising, to increase top-of mind awareness, engagement and long-term brand equity and desirability. Meanwhile, we seek to drive efficiencies with data, technology and precision of our performance and digital marketing activities, as well as leverage creator and influencer partnerships and optimize search environments and retail media networks, to better support discovery, conversion and loyalty across digital and social platforms. Together, these activities enable a full-funnel marketing approach that connects brand storytelling, consumer engagement, search and discovery, commerce and loyalty across our own platforms and those of our retail partners to meet evolving consumer shopping behaviors. Our One ELC Operating Model and unified global media model create a new enterprise operating system for growth. Powered by a single global partner and an enterprise-led approach to media planning and buying, this model unlocks greater scale, precision, and impact, thus strengthening our ability to generate and capture demand while improving media effectiveness, efficiency, and agility across markets.

As prestige beauty discovery increasingly occurs across social platforms, creator ecosystems, digital marketplaces and retailer platforms, search engines and emerging LLMs (large language models), we continue to invest in capabilities that improve the visibility, relevance and performance of our brands in these environments. This includes strengthening content, product information, digital merchandising, search optimization and media activation across both our own channels and those of our authorized retail partners. We are leveraging artificial intelligence (“AI”) to enhance personalization at scale, increase speed to market and reduce costs across the marketing value chain. As examples, we leverage AI and related technologies to help identify trends and insights, inform campaign development, test and optimize creative content, generate selected marketing content, improve targeting and search visibility, and optimize media planning and measurement. We collaborate with a range of expert partners across technology, media, creative services, commerce and data analytics. These partnerships help expand our capabilities, accelerate innovation, enable agility, and drive efficiency, while leveraging human expertise and technology to enhance the consumer experience. We also anticipate and monitor emerging platforms, balancing speed to market with brand protection to ensure readiness while safeguarding brand equity.

Promotional activities, in-store displays, digital merchandising and sampling programs are designed to attract new consumers, build demand and loyalty and introduce existing consumers to other product offerings from the respective brands. Our marketing efforts also benefit from cooperative advertising programs with some retailers, some of which are supported by coordinated promotions, such as sampling programs, including purchase with purchase and gift with purchase. Sampling is a key promotional activity as it allows consumers to experience product quality and perceived benefits directly, and as such sample products are very effective inducements to purchases by new and existing consumers. Our marketing and sales executives spend considerable time in the field meeting with consumers, retailers, beauty advisors and makeup artists at the points of sale to enable us to offer a seamless and consistent brand experience across distribution channels.

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Information Technology

Information technology, including operational technology and our websites, is a key enabler of all aspects of our business, from research and development, manufacturing and distribution, to marketing, sales and order processing, consumer experiences as well as finance and human resources. We continue to make strategic investments to align with our long-term strategy of maintaining and enhancing our information technology and cybersecurity infrastructure, keeping pace with cyber threat actors and our evolving business needs. We are focused on optimizing adoption of such investments to maximize return on investment and realized value. The modernization and simplification of our information technology ecosystem remains a key focus, as we increasingly leverage the benefits of the cloud and as the organization transforms, including through the leveraging of external organizations.

We recognize information technology presents opportunities for competitive advantage, and we continue to invest in new capabilities and the use of emerging technologies, including investments in AI, across various aspects of our business. As an example, this includes the strategic utilization of data to provide better visibility into consumer trends, to increase responsiveness in our product development.

Research and Development

We believe we are an industry leader in the development of new products, and strive to deliver breakthrough, on-trend and commercial innovation to consumers around the world. Our research and innovation team, which includes scientists, engineers, analysts, and other employees involved in product and packaging innovation, works closely with our marketing and product development teams, as well as external partners in certain cases, to develop new products and product-line extensions, improve, redesign or reformulate existing products, generate new technologies, design new testing methods, identify new materials and create new packaging concepts. In addition, these research and innovation personnel provide ongoing technical assistance and know-how to quality assurance and manufacturing personnel on a worldwide basis, to ensure consistent global standards for our products and to deliver environmentally responsible products that meet or exceed consumer expectations. The research and innovation team has research-based working relationships with several U.S. and international dermatology and medical institutions, research universities and educational facilities, which supplement internal capabilities. Members of the research and innovation team are also responsible for product safety, registration and regulatory compliance matters.

Our research and development costs totaled $278 million, $316 million and $360 million in fiscal 2026, 2025 and 2024, respectively, and are expensed as incurred. As of June 30, 2026 and 2025, we had approximately 1,000 and 1,100 employees, respectively, engaged in research and development activities. We maintain research and development programs at certain of our principal facilities and facilities dedicated to performing research and development, see Item 2. Properties.

Manufacturing, Warehousing and Raw Materials

We manufacture our products primarily in our own facilities in Belgium, Canada, Japan, Switzerland, the United Kingdom and the United States, and we also leverage global third-party manufacturing networks. We continue to evaluate our manufacturing facilities and processes and identify sourcing opportunities to improve innovation, increase efficiencies, minimize our impact on the environment, ensure supply sufficiency, reduce costs and adjust our operations to respond to external challenges (e.g., geopolitical conditions including tariffs). Our plants are modern, and our manufacturing processes are substantially automated. While we believe our manufacturing network of internal and external sites is sufficient to meet current and reasonably anticipated increased requirements, we continue to implement improvements in capacity, technology, and productivity and align our manufacturing with regional sales demand to be more agile. From time to time, demand changes may challenge our capacity for certain subcategories on a short-term basis, but we believe these changes will not impact our ability to meet our long-term strategic objectives.

We have established a flexible global distribution network that is designed to meet the changing demands of our customers while maintaining service levels. We are continuously evaluating and adjusting this physical distribution network, particularly as we work to anticipate and respond to shifts in channel and consumer preferences, external challenges (e.g., geopolitical conditions including tariffs), as well as identifying opportunities to increase efficiencies and reduce costs. We have established regional and local distribution centers, including those maintained by third parties, strategically positioned throughout the world in order to facilitate efficient delivery of our products to our customers and consumers.

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As discussed above, we continue to focus on social impact and sustainability across our operations. Focus areas include employee health and safety and minimizing our impact on the environment. This is achieved, in part, through our Environmental and Safety Management System, our system of health and safety policies and procedures, which is continually being enhanced and evolved. Additionally, we invest in our equipment, facilities and people to drive injury prevention and to enhance the work environment through continuous improvement of safe practices and capabilities. We also engage in initiatives to support and deliver our sustainability goals and reduce our impact on the environment. Environmental efforts include waste reduction, reducing industrial waste to landfills, reduced water withdrawal, investments in renewable energy sources and packaging that incorporates recyclable and recycled content.

The principal raw materials used in the manufacture of our products are essential oils, alcohols and specialty chemicals. We also purchase packaging components that are manufactured to our design specifications. Procurement of materials for all manufacturing facilities is generally made on a global basis through our Global Supplier Management function. We also partner with an extensive network of third-party manufacturers that help us access innovation and capacity. We review our supplier base periodically with the specific objectives of improving quality, increasing innovation and speed-to-market, ensuring supply sufficiency and reducing costs. In addition, we focus on supply sourcing within the region of manufacture to allow for improved supply chain efficiencies, lead-time reduction and reduced emissions.

Some current product supply chains include single-source materials from key partners; however, we believe we have a robust business continuity strategy, sophisticated capacity planning tools and strategic inventory buffer and multi-sourcing solutions. In the past, we have been able to obtain an adequate supply of essential raw materials and packaging components for virtually all materials used in the production of our products. From time to time, we may experience supply disruptions on a short-term basis, but we currently believe we have adequate resources of supply and our portfolio of suppliers has the resources and facilities to overcome most unforeseen interruptions of supply.

We are continually benchmarking the performance of our supply chain, and we augment our supply base and adjust our distribution networks and manufacturing plants and networks based upon the changing needs of the business and external challenges as previously mentioned. Additionally, in connection with our Profit Recovery and Growth Plan (“PRGP”), we have, and are continuing to focus on our levels of excess inventory and obsolescence and cost efficiencies within our global supply chain network. As we integrate acquired brands, we continually seek new ways to leverage our production and sourcing capabilities to improve our overall supply chain performance.

Competition

There is significant competition within each market where our skin care, makeup, fragrance and hair care products are sold. Brand recognition, product quality and effectiveness, distribution channels, accessibility, and price point are some of the factors that impact consumers’ choices among competing products and brands. There continues to be interest and awareness from our customers and consumers in responsibly-sourced ingredients and environmentally sustainable products, and we believe we are well-positioned to benefit from these preferences due to our social impact and sustainability efforts. Marketing, merchandising, in-store and online experiences and demonstrations, and new product innovations also have an impact on consumers’ purchasing decisions.

We compete against a number of global and local companies. Some of our competitors are large, well-known, multinational manufacturers and marketers of skin care, makeup, fragrance and hair care products, most of which market and sell their products under multiple brand names. Our competitors include L’Oreal S.A.; Unilever PLC; Procter & Gamble Co.; LVMH Moët Hennessey Louis Vuitton SE; Chanel Limited; Beiersdorf AG; Shiseido Company, Limited; Coty Inc.; and Puig Brands, S.A. We also face competition from a number of independent brands (“Indie Brands”), some of which are backed by private-equity investors, as well as some retailers that have their own beauty brands. Certain of our competitors also have ownership interests in retailers that are customers of ours.

Trademarks, Patents and Copyrights

We own the trademark rights used in connection with the manufacturing, marketing, distribution and sale of our products in the United States, China and in the other principal markets where such products are sold, including Estée Lauder, Aramis, Clinique, Lab Series, Origins, M·A·C, Bobbi Brown, La Mer, Aveda, Jo Malone London, Bumble and bumble, Darphin, TOM FORD, Smashbox, Le Labo, Editions de Parfums Frédéric Malle, GLAMGLOW, KILIAN PARIS, Too Faced, Dr.Jart+, The Ordinary, NIOD, Avestan and Loopha. We are the exclusive worldwide licensee for fragrances, cosmetics, skin care and/or related products for AERIN, Balmain, and Dr. Andrew Weil. For further discussion on license arrangements, including their duration, see Item 8. Financial Statements and Supplementary Data – Note 2 – Summary of Significant Accounting Policies – Royalty Fees - License Arrangements. We protect our trademarks in the United States, China and other principal markets worldwide. We consider the protection of our trademarks to be important to our business.

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A number of our products incorporate patented, patent-pending or proprietary technology. In addition, several products and packaging for such products are covered by design patents or copyrights. While we consider these patents and copyrights, and the protection thereof, to be important, no single patent or copyright, or group of patents or copyrights, is considered material to the conduct of our business.

Human Capital

We strive to operate responsibly and to build a sustainable business based on uncompromising ethics and integrity, consistent with our Company values. We view human capital management and the strength of our employees as integral to the long-term success and resilience of our business.

Our Board of Directors and its committees provide oversight to management on a range of human capital matters, including inclusion, health and safety, and compensation and benefits.

As of June 30, 2026 and 2025, we had approximately 55,000 and 57,000 employees worldwide, respectively, including approximately 35,000 demonstrators at points of sale who are employed by us as of June 30, 2026 and 2025. At June 30, 2026, approximately 69% of our global employees were full-time, approximately 17% were temporary and approximately 14% were part-time employees, with approximately 26% of our global employees located in the United States and approximately 74% located outside of the United States. As of June 30, 2026, approximately 81% of our employees were female and 19% were male, and approximately 63% of our employees at the level of Vice President and above were female and 37% were male. We have no employees in the United States that are covered by a collective bargaining agreement. A limited number of employees outside of the United States are covered by works council agreements or other syndicate arrangements.

Our human capital management includes the following strategic areas:

Building a Strong Culture of Belonging

We remain committed to our values and support an inclusive environment for all of our employees by encouraging a culture of fairness, equal access to opportunities and ongoing learning and growth. Our objective in creating a culture of belonging is to enhance our ability to attract and retain the best talent globally and promote an environment where employees are motivated to succeed. By maintaining an environment of inclusion and belonging, we are better equipped to create innovative products and services as we continually strive to meet the evolving needs of our global consumers.

We are proud of our history of driving awareness and acceptance around the world and for standing up for the rights of all individuals, in the workplace and beyond.

Talent Recruitment, Retention, Learning and Development

Hiring, retaining and developing the best talent globally is key to our success. Our talent strategy is focused on building organization capability, employee engagement, internal talent movement and career development, succession planning and building leadership at various levels across the organization, while recognizing and rewarding high-performance. Our investments include programs and tools to equip our employees with the right skillsets and knowledge, including through training and development programs that are focused on strengthening leadership and professional skills at various stages of an employee's career, as well as opportunities to gain on-the-job development and experiences through short-term and long-term projects and networking across brands, functions and regions. Additionally, our Grow Your Skills programming and Emerging Leaders Programs are core tenants that drive continuous development across our learning culture.

To enhance our culture and measure our human capital efforts, we regularly engage with our employees and provide several mechanisms for our employees to provide their feedback. Based on our review of employee survey results, action plans are implemented by leadership to enhance the employee experience and drive alignment with our overall human capital strategy. We believe these programs and opportunities create a pipeline of skilled talent and leadership, necessary to drive and deliver on our long-term strategy in an ever changing business environment.

Our “Internal First” hiring approach prioritizes qualified internal candidates for eligible full-time roles before external recruitment, reflecting our commitment to developing, retaining and strategically deploying talent across the enterprise. This strategy enhances career progression, strengthens leadership pipelines and preserves institutional knowledge, while enabling targeted upskilling to meet evolving business priorities across brands, regions and functions. We believe this approach supports employee engagement, succession readiness and long-term organizational resilience.

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Health and Safety

We are committed to providing a healthy and safe workplace for our employees. We establish and update safety policies and procedures, train employees on our safety guidelines and local requirements, and seek to create a culture focused on well-being and safety through ongoing communication, awareness and engagement.

Employee Rewards

We offer competitive compensation and benefit packages to attract, motivate and retain world-class talent, and we are committed to fair pay across the organization.

To support the health and well-being of our employees, our competitive benefit packages may include, depending upon position and location, pension and post-retirement benefit plans, health and wellness benefits, flexible working arrangements, parental (maternal and paternal) leave and support programs, adoption assistance and education-related benefits.

Volunteerism and Community Engagement

We support volunteer efforts by our employees as our long-term success can benefit from the vitality of the communities where we have a presence. This is done through our ELC Good Works program, our global charitable and volunteerism program which allows eligible employees to create and participate in volunteer activities, with their cash donations matched by the Company and volunteer hours rewarded through additional cash donations by the Company.

Government Regulation

We and our products are subject to regulation by numerous federal, state, local and international regulatory authorities and the regulatory authorities in the countries in which our products are produced or sold. Such laws and regulations relate to a wide range of matters including ingredients, manufacturing, labeling, packaging, marketing, advertising, transport and the sale, disposal and safety of our products, as well as environmental matters. We rely on legal and operational compliance programs, as well as in-house and outside counsel, to guide our businesses in complying with applicable laws and regulations.

Seasonality

Our results of operations in total, by product category and geographic region, are subject to seasonal fluctuations, with net sales in the first half of the fiscal year typically being slightly higher than in the second half of the fiscal year. The higher net sales that we typically recognize in the first half of the fiscal year are attributable to the increased levels of purchasing by consumers for special events and by retailers for holiday selling seasons. Fluctuations in net sales and operating results in total and by product category and geographic region in any fiscal quarter may be attributable to the level and scope of new product introductions or the particular retail calendars followed by our customers that are retailers, which may impact their order placement and receipt of goods. Additionally, gross margins and operating expenses are impacted on a quarter-by-quarter basis by holiday and key shopping moments, as well as variations in our launch calendar and the timing of promotions, including purchase with purchase and gift with purchase promotions.

Availability of Reports

We make available financial information, news releases and other information on our website: www.elcompanies.com. Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other reports, as well as any amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are available free of charge via the EDGAR database at www.sec.gov or our website, as soon as reasonably practicable after we file such reports and amendments with, or furnish them to, the U.S. Securities and Exchange Commission.

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Corporate Governance Guidelines and Code of Conduct

The Board of Directors has developed corporate governance practices to help it fulfill its responsibilities to stockholders in providing general direction and oversight of management. These practices are set forth in our Corporate Governance Guidelines. We also have a Code of Conduct (“Code”) applicable to all employees, officers and directors of the Company, including the Chief Executive Officer, the Chief Financial Officer and other senior financial officers. These documents and any waiver of a provision of the Code granted to any senior officer or director or any material amendment to the Code may be found in the “Investors” section of our website: www.elcompanies.com under the heading “Corporate Governance.” The charters for the Audit Committee, Compensation Committee and Nominating and ESG Committee may be found in the same location on our website.

Information about our Executive Officers*

Name and Title Age Business Experience in the Past Five Years**

*As of August 12, 2026

**All of the executive officers named above have been employees of the Company for more than five years, with the exception of Rashida La Lande and René Lammers.

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Item 1A. Risk Factors.

There are risks associated with an investment in our securities. Please consider the following risks and all of the other information in this annual report on Form 10-K and in our subsequent filings with the U.S. Securities and Exchange Commission (“SEC”). Our business may also be adversely affected by risks and uncertainties not presently known to us or that we currently believe to be not material. If any of the events contemplated by the following discussion of risks should occur or other risks arise or develop, our business, which includes (a) our prospects, (b) our financial condition, (c) our results of operations, (d) our reputation, and (e) the trading prices of our securities, may be adversely affected.

Risks related to our Business and our Industry

The beauty business is highly competitive, and if we are unable to compete effectively our business will suffer.

We face vigorous competition from companies throughout the world, including multinational consumer product companies. Some competitors have greater resources than we do, others are newer companies (such as Indie Brands, some of which are backed by private-equity investors), and some are competing in distribution channels where we are less represented. The beauty business can change rapidly due to consumer preferences and industry trends. In some cases, we may not be able to respond to changing business and economic conditions as quickly as our competitors. Competition in the beauty business is based on a variety of factors including pricing of products, innovation, perceived value, service to the consumer, promotional activities, advertising, special events, new product introductions, and e-commerce initiatives, including the ability to effectively leverage existing and emerging digital technologies, such as AI and data analytics, to gain more commercial insights and develop relevant marketing concepts and advertising to reach consumers. It is difficult for us to predict the timing and scale of our competitors’ actions in these areas.

Our ability to compete also depends on the continued strength of our brands, our ability to attract and retain key talent and other personnel, the efficiency of our manufacturing and distribution network, and our ability to maintain and protect our intellectual property and those other rights used in our business.

Our Company has a well-recognized and strong reputation and our ability to maintain our reputation is critical to our business. Our reputation could be negatively impacted by social media and many other factors, including, given the legal, regulatory and ethical landscape around the use of AI, our ability to adapt and use the emerging technology in an effective and ethical manner.

If our reputation is adversely affected, our ability to attract and retain customers, consumers and employees could be impacted. In addition, certain of our key retailers around the world market and sell competing brands or are owned or otherwise affiliated with companies that market and sell competing brands. Our inability to continue to compete effectively in key countries around the world (e.g., China or the United States) could have a material adverse effect on our business.

Our inability to anticipate and respond to market trends and changes in consumer preferences could adversely affect our business.

Our success depends on our ability to anticipate, gauge and react in a timely and cost-effective manner to changes in consumer preferences for skin care, makeup, fragrance and hair care products, attitudes toward our industry and brands, as well as to where and how consumers shop. We must continually work to develop, manufacture and market new products, maintain and adapt our selling, advertising, promotional and other consumer engagement activities to existing and emerging distribution channels, maintain and enhance the recognition of our brands, achieve a favorable mix of products, successfully manage our inventories, and modernize and refine our approach as to how and where we market and sell our products. We recognize consumer preferences cannot be predicted with certainty and can change rapidly, driven by the use of digital and social media by consumers and the speed by which information and opinions are shared. If we are unable to anticipate and respond to challenges that we may face in the marketplace, trends in the market for our products and changing consumer demands and sentiment, our business will suffer. In addition, from time to time, sales growth or profitability may be concentrated in a relatively small number of our brands, channels and/or countries. If such a situation persists or one or more brands, channels or countries fails to perform as expected, there could be a material adverse effect on our business.

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In certain key markets, such as the United States, we have seen a longer-term decline in retail traffic in our department store customers. Consolidation, liquidation or other changes in the retail trade, from these or other factors, may result in us becoming increasingly dependent on key retailers and could result in an increased risk related to the concentration of our customers. A severe, adverse impact on the business operations of our customers, including changes to the markets or channels in which our products are sold, could have a corresponding material adverse effect on us. If one or more of our largest customers change their strategies (including pricing or promotional activities), enter bankruptcy (or similar proceedings) or if our relationship with any large customer is changed or terminated for any reason, there could be a material adverse effect on our business.

Our future success depends, in part, on our ability to achieve our long-term strategy.

Achieving our long-term strategy will require investment in new capabilities, brands, categories, distribution channels, supply chain facilities, technologies, including AI and data analytics, and emerging and more mature geographic markets. These investments may result in short-term costs without any current sales and, therefore, may be dilutive to our earnings. In addition, we may dispose of or discontinue select brands or streamline operations and incur costs, inclusive of restructuring and other charges, in doing so. Although we believe our strategy will lead to long-term growth in sales and profitability, we may not realize the anticipated benefits. The failure to realize benefits, which may be due to our inability to execute plans, global or local economic conditions, competition, changes in the beauty industry and the other risks described herein, could have a material adverse effect on our business.

Acquisitions, divestitures and other strategic actions may expose us to additional risks.

We continuously review acquisition and strategic opportunities that would expand our current product offerings, our distribution channels, increase the size and geographic scope of our operations or otherwise offer growth and operating efficiency opportunities. There can be no assurance we will be able to identify these strategic actions, be the successful bidder, and consummate such transactions on favorable terms, or otherwise realize the full intended benefit of such transactions. In addition, we periodically review our brand portfolio, and our strategy includes potential divestitures of certain brands as we rationalize product offerings.

Acquisitions including strategic investments or other activities entail numerous risks, which may include: (i) difficulties in integrating acquired operations or products, including the loss of key employees from, or customers, consumers or suppliers of, acquired businesses; (ii) diversion of management’s attention from our existing businesses; (iii) adverse effects on existing business relationships with suppliers, customers and consumers of ours or the companies in which we invest; (iv) adverse impacts of margin and product cost structures different from those of our current mix of business; (v) reputational risks associated with the activities of the businesses that we acquire or in which we invest; and (vi) risks of entering distribution channels, categories or markets in which we have limited or no prior experience.

In addition, the assumptions we use to evaluate acquisition opportunities have in the past, and may in the future, prove to be inaccurate, and intended benefits may not be realized. If required, any financing for these transactions would result in an increase in our indebtedness, dilute the interests of our stockholders or both. The purchase price for some acquisitions may include additional amounts to be paid in cash in the future, a portion of which may be contingent on the achievement of certain future operating results of the acquired business. If the performance of any such acquired business exceeds such operating results, then we may incur additional charges and be required to pay additional amounts.

Completed acquisitions typically result in additional goodwill and/or an increase in other intangible assets on our balance sheet. We are required at least annually, or as facts and circumstances exist, to test goodwill and other intangible assets with indefinite lives to determine if impairment has occurred, as well as assess the recoverability of other intangible assets, and have recorded goodwill and other intangible asset impairment charges as required. We cannot accurately predict the amount and timing of any impairment of assets. Should the value of goodwill or other intangible assets become impaired, there could be a material adverse effect on our business.

Our failure to achieve the long-term plan for acquired businesses, as well as any other adverse consequences associated with our acquisition, divestiture and strategic activities, could have a material adverse effect on our business.

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Our business could be negatively impacted by social impact and sustainability matters.

There continues to be focus from certain investors, customers, consumers, regulators, employees, and other stakeholders regarding social impact, sustainability, and other environmental, social and governance ("ESG") matters. From time to time, we announce certain initiatives, including goals and commitments, regarding our focus areas, including environmental and climate matters; packaging; sourcing; product formulation; social investments; and inclusion. We could fail, or be perceived to fail, in our achievement of such initiatives, or in accurately reporting our progress on such initiatives. Such failures could be due to changes in our business (e.g., shifts in business among distribution channels or acquisitions). Moreover, the standards by which these efforts are measured are developing and evolving, often rely on methodologies, standards and data that are subject to varying interpretations, and certain areas are subject to assumptions that could change over time. In addition, we could be criticized for the scope of our initiatives or goals by stakeholders who support these initiatives or those that oppose them. In addition, we could be perceived as not acting responsibly in connection with these matters. Any such matters, or related ESG matters, could have a material adverse effect on our business.

We use AI, and challenges with properly managing its use could have an adverse impact on our business.

We are using AI solutions, including machine learning and generative AI tools, to assist in the development of our products, engage with consumers, and in the use of internal tools that support our business. These applications are becoming increasingly important in our operations over time. This emerging technology presents risks inherent in its use, including risks related to harmful content, inaccuracies, hallucinations, bias or discrimination, and intellectual property infringement. In addition, the use of AI may increase cybersecurity and data privacy risks, such as intended, unintended, or inadvertent access to, transmission, or leakage of proprietary or sensitive information. These risks may become more pronounced as organizational reliance on AI increases. No assurance can be made that the usage of AI will assist us in being more efficient in all cases. Our competitors or other third parties may incorporate AI into their business, services, and products more rapidly or more successfully than us, which could hinder our ability to compete effectively and adversely affect our business. The technologies underlying AI and their use cases are rapidly developing, and it is not possible to predict all the legal, reputational, operational or technological risks related to the use of AI. While new AI initiatives, laws, and regulations are emerging and evolving, uncertainty will remain, and our obligation to comply with the evolving regulatory landscape could entail significant costs, negatively affect our business, or limit our ability to incorporate certain AI capabilities into our business.

A general economic downturn, or disruption in business conditions may adversely affect our business including consumer purchases of discretionary items and/or the financial strength of our customers that are retailers.

The general level of consumer spending is affected by many factors, including general economic conditions, inflation, interest rates, energy costs, and consumer confidence and sentiment generally, all of which are beyond our control. Many of our products may be considered discretionary items for consumers, and consumer purchases of discretionary items tend to decline during recessionary periods, when disposable income is lower, and may impact sales of our products. A decline in consumer purchases of discretionary items also tends to impact our customers that are retailers. We generally extend credit to a retailer based on an evaluation of its financial condition, usually without requiring collateral. However, the financial difficulties of a retailer could cause us to curtail or eliminate business with that customer. We may also assume more credit risk relating to the receivables from that retailer. In the event of a retailer liquidation, we may incur additional costs if we choose to purchase the retailer’s inventory of our products to protect brand equity. Our inability to collect receivables from our largest customers or from a group of customers could have a material adverse effect on our business.

In addition, disruptions in local or global business conditions, for example, from events such as a pandemic or other health issues, geopolitical or local conflicts, civil unrest, terrorist attacks, adverse weather conditions, climate changes or seismic events, can have a short-term and, sometimes, long-term impact on consumer spending.

Events that impact consumers’ willingness or ability to travel or purchase our products while traveling may impact our business, including travel retail, a significant contributor to our overall results, and our strategy to market and sell products to international travelers at their destinations.

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A downturn in the economies of, or continuing recessions in, the countries where we sell our products or a disruption of business conditions in those countries could adversely affect consumer confidence and sentiment, the financial strength of our retailers and our sales and profitability. We are also cautious of foreign currency movements, including their impact on tourism. Additionally, we continue to monitor the effects of the global macroeconomic environment; social, political and human rights issues; regulatory matters, including the imposition of tariffs or sanctions; geopolitical tensions; and global security issues. For example, tariffs imposed on goods we import into the United States and/or tariffs on goods we import into other countries could have a material adverse effect on our business, as could geopolitical tensions involving countries that are key markets for us, or where we manufacture our products or source ingredients.

Volatility in the financial markets and a related economic downturn in key markets or markets generally throughout the world could have a material adverse effect on our business. While we typically generate significant cash flows from our ongoing operations and have access to global credit markets through our various financing activities, credit markets may experience significant disruptions. Deterioration in global financial markets or an adverse change in our credit ratings could make future financing difficult or more expensive. If any financial institutions that are parties to our revolving credit facilities or other financing arrangements, such as foreign exchange or interest rate hedging instruments, were to declare bankruptcy or become insolvent, they may be unable to perform under their agreements with us. This could leave us with reduced borrowing capacity or unhedged against certain foreign currency or interest rate exposures which could have a material adverse effect on our business.

Our success depends, in part, on the quality, efficacy and safety of our products.

Our success depends, in part, on the quality, efficacy and safety of our products. If our products are found to be defective or unsafe, our product claims are found to be deceptive, or our products otherwise fail to meet our consumers’ expectations, our relationships with customers or consumers could suffer, the appeal of our brands could be diminished, and we could lose sales and become subject to liability or claims, any of which could result in a material adverse effect on our business. In addition, counterfeit versions of some of our products may be sold by third parties, which may pose safety risks, may fail to meet consumers’ expectations, and may have a negative impact on our business. While we may take action to identify and remove counterfeit versions of our products from the market, these actions may not be successful.

Our success depends, in part, on our key personnel.

Our success depends, in part, on our ability to retain our key personnel, including our executive officers and senior management team. We have had, and may continue to have, changes to senior management and the composition of our Board of Directors, and we are still in the process of implementing a change in our organizational design, including through Beauty Reimagined and our Profit Recovery and Growth Plan (“PRGP”). Transition periods accompanying changes in leadership and changes due to business reorganization may result in uncertainty, impact business performance and strategies and retention of personnel. As we restructure our workforce from time to time, the risk of potential employment-related claims and disputes may also increase, resulting in potential reputational harm, costs, losses, and other liabilities. The unexpected loss of, or misconduct by, one or more of our key employees could adversely affect our business. Our success also depends, in part, on our continuing ability to identify, hire, train and retain personnel across all levels of our business. We may not be able to attract, assimilate or retain necessary personnel in the future, and our failure to do so could have a material adverse effect on our business. These risks may be exacerbated by the stresses associated with the implementation of our strategic plan and other initiatives, as well as by market conditions.

Competition for employees can be intense, and although many of our key personnel have signed non-compete agreements, it is possible that these agreements would be unenforceable, in whole or in part, in some jurisdictions, permitting employees in those jurisdictions to work for our competitors.

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We are subject to risks related to the global scope of our operations.

We operate on a global basis, and maintain offices across our geographic regions and have key operational facilities located inside and outside the United States that manufacture, warehouse or distribute goods for sale throughout the world. Our global operations are subject to many risks and uncertainties, including: (i) fluctuations in foreign currency exchange rates and the relative costs of operating in different places, which can affect our business, the value of our foreign assets, the relative prices at which we and competitors sell products in the same markets, the cost of certain inventory and non-inventory items required in our operations, and the relative prices at which we sell our products in different markets; (ii) foreign or U.S. laws, regulations and policies, including restrictions on trade, immigration and travel, operations, and investments; currency exchange controls; restrictions on imports and exports, including license requirements; tariffs; sanctions; and taxes; (iii) lack of well-established or reliable legal and administrative systems in certain countries in which we operate; (iv) adverse weather conditions and natural disasters; (v) concentration of sales growth or profitability in one or more countries; and (vi) social, economic and geopolitical conditions, such as a pandemic, terrorist attack, war or other military action. These risks could have a material adverse effect on our business.

A disruption in our operations, including supply chain, could adversely affect our business.

As a company engaged in manufacturing and distribution on a global scale, we are subject to the risks inherent in such activities. Such risks include industrial accidents, environmental events, strikes and other labor disputes, capacity constraints, disruptions in ingredient, material or packaging supply or availability of natural resources (e.g., water), global shortages, disruptions in supply chain or information technology, loss or impairment of key manufacturing or distribution sites or suppliers, product quality control, safety, increase in commodity prices and energy costs, licensing requirements and other regulatory issues, as well as natural disasters, outages due to fire, floods, power loss, telecommunications failures, break-ins and other events or external factors over which neither we nor our suppliers have control. If such an event were to occur, it could have a material adverse effect on our business.

We use a wide variety of direct and indirect suppliers of goods and services from around the world. Some of our products rely on a single or a limited number of suppliers. Changes in the financial or business condition of our suppliers could subject us to losses or adversely affect our ability to bring products to market. Further, the failure of our suppliers to deliver goods and services in sufficient quantities, in compliance with applicable standards, and in a timely manner could adversely affect our customer service levels and overall business. In addition, any increases in the costs of goods and services for our business may adversely affect our profit margins if we are unable to pass along any higher costs in the form of price increases or otherwise achieve cost efficiencies in our operations.

As we outsource functions and consolidate service providers, we become more dependent on the entities performing those functions and services.

As part of our long-term strategy, we are continually looking for opportunities to improve our essential business services, which includes finding ways to be more cost-effective and efficient. In some cases, this requires the outsourcing of functions or parts of functions that we believe can be performed more effectively by external service providers, as well as the consolidation of service providers to drive efficiencies. The failure of one or more such providers to deliver the expected services, provide them on a timely basis or to provide them at the prices or service levels that we expect, the failure of one or more of such providers to meet our performance standards and expectations, including with respect to data security, compliance with laws, disruptions arising from the transition of functions to an outsourcing provider or other service providers, or the costs incurred in returning these outsourced functions to being performed under our management and direct control, could have a material adverse effect on our business. In addition, when we transition to, from or between external service providers, we may experience challenges that could have a material adverse effect on our business.

Risks related to Legal and Regulatory Matters

Changes in laws, regulations and policies could adversely affect our business.

Our business is subject to numerous laws, regulations and policies around the world. Changes in these laws, regulations and policies, including the interpretation or enforcement thereof, that affect our business could adversely affect our business. These changes include accounting standards, as well as laws and regulations relating to tax matters, trade (including sanctions), data privacy (e.g., General Data Protection Regulation (GDPR)), cybersecurity, anti-corruption, advertising, marketing, manufacturing, distribution, customs matters, product registration, ingredients, chemicals, packaging, selective distribution, and environmental or climate change matters.

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Disputes and other legal or regulatory proceedings could adversely affect our business.

We are, and may in the future become, party to litigation, other disputes or regulatory proceedings across a wide range of matters, including ones relating to product liability matters (including asbestos-related claims), advertising, regulatory, labor and employment, pensions and benefits, intellectual property, real estate, environmental, trade relations (including tariffs and duties), securities, tax and privacy. In general, claims made by us or against us in litigation, disputes or other proceedings can be expensive and time consuming and could result in settlements, injunctions or damages that could significantly affect our business. We are mindful of the evolving litigation landscape related to asbestos-related claims, and continue to monitor trends in this area. It is not possible to predict the final resolution of the litigation, disputes or proceedings to which we currently are or may in the future become party to, and the impact of certain of these matters could have a material adverse effect on our business.

Government reviews, inquiries, investigations and actions could harm our business.

As we operate in various locations around the world, our operations are subject to governmental scrutiny and may be adversely impacted by the results of such scrutiny. The regulatory environment with regard to our business is evolving, and officials often exercise broad discretion in deciding how to interpret and apply applicable regulations. From time to time, we may receive formal and informal inquiries from various government regulatory authorities, as well as self-regulatory organizations, about our business and compliance with local laws, regulations or standards. Any determination that our operations or activities, or the activities of our employees, are not in compliance with existing laws, regulations or standards could negatively impact us in a number of ways, including the imposition of substantial fines, interruptions of business, loss of supplier, vendor or other third-party relationships, termination of necessary licenses and permits, or similar results, all of which could potentially harm our business. Regardless of the outcomes, these reviews, inquiries, investigations and actions could create negative publicity which could harm our business.

Risks related to Technology and Cybersecurity Matters

The compromise or interruption of, or damage to, our information technology (including our operational technology and websites) by cybersecurity incidents, data security breaches, other security problems, design defects or system failures could have a material negative impact on our business.

We rely on information technology that supports our business processes, including research and development, manufacturing and distribution, marketing, sales, order processing, consumer experiences, human resource management, finance and internal and external communications throughout the world. We have e-commerce and other Internet websites in the United States and many other countries. If our information technology does not function properly, or is not adequately supported or updated, it could adversely affect the Company’s business and operations.

We experience cybersecurity incidents of varying degrees on our information technology and, as a result, unauthorized parties have obtained in the past, and may obtain in the future, access to our systems and data (including unauthorized acquisition of such data). Such incidents have also caused, and may in the future cause, disruption to parts of our business operations and result in various expenses for investigation, remediation and other related matters.

Cybersecurity incidents at our Company have in the past resulted from, and may in the future result from, social engineering or impersonation of authorized users, and may also result from efforts to discover and exploit design flaws, bugs, security vulnerabilities or security weaknesses, intentional or unintentional acts by employees or other insiders with access privileges, intentional acts of vandalism or fraud by third parties and sabotage. In some instances, efforts to correct vulnerabilities or prevent incidents have in the past and may in the future reduce the functionality or performance of our information technology, which could negatively impact our business. Cybersecurity incidents can be caused by ransomware, distributed denial-of-service attacks, worms, and other malicious software programs or other attacks, including the covert introduction of malware to our information technology, and the use of techniques or processes that change frequently, may be disguised or difficult to detect, or are designed to remain dormant until a triggering event, and may continue undetected for an extended period of time. In addition, some of our suppliers, vendors, service providers, cloud solution providers and customers have in the past experienced, and may in the future experience, such incidents, which could in turn disrupt our business or compromise the security of our Company data. Our Company's continued expansion and reliance on third parties may further increase that risk. The evolution and adoption of emerging technologies, such as AI, may intensify cybersecurity risks as techniques used in cyberattacks and cybersecurity incidents continue to evolve and develop. Insurance policies that may provide coverage with regard to such events may not cover any or all of the resulting financial losses.

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As part of our normal business activities, we collect, maintain, transmit, store and otherwise process certain information that is confidential, proprietary or otherwise sensitive, including personal information of consumers, customers, suppliers, service providers and employees. We share some of this information with certain third parties who assist us with business matters. Moreover, the success of our operations depends upon the secure transmission of confidential, proprietary or otherwise sensitive data, including personal information, over networks. Any unauthorized access or data acquisition, despite security measures in place to protect such data, or other failure on the part of us or third parties to maintain the security of such data could result in business disruption, damage to our reputation, financial obligations to third parties, legal obligations, fines, penalties, regulatory proceedings and private litigation with potentially large costs, and also could result in deterioration in confidence in our Company and other competitive disadvantages, and thus could have a material adverse effect on our business.

In addition, a cybersecurity incident could require that we expend significant additional resources on remediation, restoration and enhancement of our information technology.

Risks related to our Securities and our Ownership Structure

The trading prices of our securities periodically may rise or fall based on the accuracy of predictions of our financial performance.

Our business planning process is designed to maximize our long-term strength, growth and profitability, not to achieve an earnings target in any particular fiscal quarter. We believe this longer-term focus is in the best interests of the Company and our stockholders. At the same time, however, we recognize it may be helpful to provide investors with guidance as to our expectations regarding certain aspects of our business. This could include forecasts of net sales, earnings per share and other financial metrics or projections. We assume no responsibility to provide or update guidance, and any longer-term guidance we may provide is based on goals we believe, at the time guidance is given, are reasonably attainable for growth and performance over a number of years. We historically have paid dividends on our common stock and repurchased shares of our Class A Common Stock; however, at times we have suspended the declaration of dividends and/or the repurchase of our Class A Common Stock. Going forward, at any time, we could stop, suspend or change the amounts of dividends or stop or suspend our stock repurchase program, and any such action could cause the market price of our stock to decline.

In all of our public statements when we make, or update, a forward-looking statement about our business, whether it be about net sales or earnings expectations or expectations regarding restructuring or other initiatives, or otherwise, we accompany such statements directly, or by reference to a public document, with a list of factors that could cause our actual results to differ materially from those we expect. Such a list is included, among other places, in our earnings press release and in our periodic filings with the SEC (e.g., in our reports on Form 10-K and Form 10-Q). These and other factors may make it difficult for us and for outside observers, such as research analysts, to predict what our earnings or other financial metrics, or business outcomes, will be in any given fiscal quarter or year.

Outside analysts and investors have the right to make their own predictions of our business for any future period. Outside analysts, however, have access to no more material information about our results or plans than any other public investor, and we do not endorse their predictions as to our future performance. Nor do we assume any responsibility to correct the predictions of outside analysts or others when they differ from our own internal expectations. If our actual results differ from those that outside analysts or others have been predicting, the market price of our securities could be affected. Investors who rely on the predictions of outside analysts or others when making investment decisions with respect to our securities do so at their own risk. We take no responsibility for any losses suffered as a result of such changes in the prices of our securities.

We are controlled by the Lauder family. As a result, the Lauder family has the ability to prevent or cause a change in control or approve, prevent or influence certain actions by us.

As of August 12, 2026, members of the Lauder family beneficially own, directly or indirectly, shares of the Company’s Class A Common Stock (with one vote per share) and Class B Common Stock (with 10 votes per share) having approximately 82% of the outstanding voting power of the Common Stock. In addition, four members of the Lauder family are on our Board of Directors. One other member of the Lauder family is an executive officer.

As a result of their stock ownership and positions at the Company, as well as our dual-class structure, the Lauder family has the ability to exercise significant control and influence over our business, including all matters requiring stockholder approval (e.g., the election of directors, amendments to the certificate of incorporation, and significant corporate transactions, such as a merger or other sale of our Company or its assets) for the foreseeable future. In addition, if significant stock indices decide to prohibit the inclusion of companies with dual-class stock structures, the price of our Class A Common Stock could be negatively impacted and could become more volatile.

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We are a “controlled company” within the meaning of the New York Stock Exchange rules and, as a result, are relying on exemptions from certain corporate governance requirements that are designed to provide protection to stockholders of companies that are not “controlled companies.”

The Lauder family and their related entities own more than 50% of the total voting power of our common shares and, as a result, we are a “controlled company” under the New York Stock Exchange corporate governance standards. As a controlled company, we are exempt under the New York Stock Exchange standards from the obligation to comply with certain New York Stock Exchange corporate governance requirements, including the requirements that (1) a majority of our board of directors consists of independent directors; (2) we have a nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and (3) we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.

While we have voluntarily caused our Board of Directors to have a majority of independent directors and the written charters of our Nominating and ESG Committee and Compensation Committee to have the required provisions, we are not requiring our Nominating and ESG Committee and Compensation Committee to be comprised solely of independent directors. As a result of our use of the “controlled company” exemptions, investors will not have the same protection afforded to stockholders of companies that are subject to all of the New York Stock Exchange corporate governance requirements.

Item 1B. Unresolved Staff Comments.

None.

Item 1C. Cybersecurity.

Risk Management and Strategy

Our enterprise risk management framework considers cybersecurity risk in conjunction with our other Company risks as part of the overall risk assessment process. Our enterprise risk management team collaborates with the cybersecurity function, led by the Chief Information Security Officer (“CISO”), to gather their insights and risk mitigation strategies for managing cybersecurity threats. This integrated approach helps us assess, identify, and manage cybersecurity risks along with our other operational, financial and strategic risks, assisting in more effectively managing interdependencies among risks and enhancing risk mitigation strategies.

We have implemented a cybersecurity program including processes, technologies, and controls to assess, identify, and manage material risks from cybersecurity threats. This program includes implementing and evolving new technologies to proactively identify and monitor new vulnerabilities and reduce risk, conducting due diligence of third-party vendors’ information security programs, maintaining security policies and standards and regularly updating and testing our response planning and protocols. We maintain a formal information security training program for employees that includes training on matters such as identifying phishing attempts and web browsing/email security best practices. Employees are also required to complete mandatory training on data privacy. We also have a third-party cybersecurity risk review process, including requiring key third-party service providers to complete initial and periodic security assessments, which prioritizes, monitors and assesses the risks associated with our third-party service provider interactions.

To evaluate and enhance our cybersecurity program, we periodically utilize third-party experts to undertake maturity assessments and security testing of the program.

We have also adopted a cybersecurity incident response plan that is designed to effectively identify, analyze, contain, remediate and eradicate, escalate, report, and appropriately document cybersecurity incidents. The plan also includes a materiality assessment framework that sets forth procedures and escalation protocols to support our assessment of whether a cybersecurity incident is material and subject to SEC reporting requirements. Such escalation protocols include the involvement of the CISO and other senior leaders across various functions, including finance, legal, privacy and global communications, as appropriate. We also maintain insurance coverage that, subject to its terms and conditions, is intended to address costs associated with certain aspects of cybersecurity incidents.

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We have experienced cybersecurity incidents of varying degrees on our information technology; however, we have not identified any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect our business strategy, results of operation or financial condition. However, we cannot eliminate all risks and the compromise or interruption of, or damage to, our information technology (including our operational technology and websites) by cybersecurity incidents could have a material negative impact on our business. For a more detailed discussion of the risks, see Risks related to Technology and Cybersecurity Matters within Item 1A. Risk Factors.

Governance

The Audit Committee of the Board of Directors oversees our information security program, which includes oversight of the cybersecurity program and management of cybersecurity risks. The Audit Committee receives periodic updates from the CISO, which typically address our cybersecurity strategy, initiatives, key security metrics, business response plans and the evolving cyber threat landscape and a detailed threat assessment relating to information technology risks.

At the management level, our cybersecurity program is led by the CISO, who is responsible for assessing and managing material risks from cybersecurity threats, including the prevention, mitigation, detection, and remediation of cybersecurity incidents. The CISO is informed about cybersecurity threats and incidents in accordance with the cybersecurity incident response plan as discussed above. The CISO, who reports to the Chief Technology, Data and Analytics Officer, regularly provides updates to the Chair of the Audit Committee and Chief Financial Officer. We also have protocols by which certain cybersecurity incidents are reported promptly to the Chair of the Audit Committee and Chief Financial Officer, as appropriate.The Company’s CISO has served in various cybersecurity roles for over 20 years, leading a variety of cybersecurity and risk capabilities and also holds multiple cybersecurity certifications such as Certified Information Systems Security Professional, Certified Information Systems Auditor, and Certified in Risk and Information Systems Control.

Item 2. Properties.

The following table sets forth our principal owned and leased manufacturing, assembly, research and development (“R&D”) and distribution facilities, some of which include contiguous office space, as well as our principal executive offices, as of August 12, 2026. The leases expire at various times through 2040 subject to certain renewal options.

The Americas EUKEM Asia/Pacific(1) Mainland China

Owned Leased Owned Leased Owned Leased Owned Leased

Manufacturing 2 2 4 — 1 — — —

Distribution — 6 — 3 1 — — 1

Manufacturing and R&D 1 — — — — — — —

Manufacturing and Assembly — 1 — — — — — —

Distribution and Manufacturing — — 1 — — — — —

Principal Executive Offices — 1 — — — — — —

(1) These properties are generally included in the geographic region in which they are located, with the exception of our owned Distribution facility relating to our travel retail business, which is reported within our Asia/Pacific region.

Certain of our manufacturing facilities are utilized primarily for the production of products relating to particular product categories: four for skin care and makeup; three for skin care; two for makeup; two for skin care and fragrance; and one for hair care. As demand changes, certain of our manufacturing facilities can produce products from categories other than their primary category.

We consider our properties to be generally in good condition and believe our facilities are adequate for our operations and provide sufficient capacity to meet anticipated requirements.

Item 3. Legal Proceedings.

For a discussion of legal proceedings, see Item 8. Financial Statements and Supplementary Data – Note 16 – Commitments and Contingencies.

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Item 4. Mine Safety Disclosures.

Not applicable.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market for Registrant’s Common Equity and Related Stockholder Matters

Our Class A Common Stock is publicly traded on the New York Stock Exchange under the symbol “EL.”

On August 18, 2026, a dividend was declared in the amount of $.35 per share on our Class A and Class B Common Stock. The dividend is payable in cash on September 15, 2026 to stockholders of record at the close of business on August 31, 2026. We expect to continue the payment of cash dividends in the future, but there can be no assurance as to the amounts of any dividends declared or that the Board of Directors will continue to declare them.

As of August 12, 2026, there were 3,143 record holders of Class A Common Stock and 14 record holders of Class B Common Stock.

Share Repurchase Program

We are authorized by the Board of Directors to repurchase shares of our Class A Common Stock in the open market or in privately negotiated transactions, depending on market conditions and other factors. The following table provides information relating to our repurchase of Class A Common Stock during the referenced periods:

(1)Represents shares that were repurchased by the Company to satisfy tax withholding obligations upon the payout of certain stock-based compensation arrangements.

(2)The Board of Directors has authorized the current repurchase program for up to 256.0 million shares. The total amount was last increased by the Board on October 31, 2018. Our repurchase program does not have an expiration date.

Beginning in December 2022, we suspended the repurchase of shares of our Class A Common Stock under our publicly announced program. We may resume such repurchases in the future.

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Performance Graph

The following graph compares the cumulative five-year total stockholder return (stock price appreciation plus dividends) on the Company’s Class A Common Stock with the cumulative total return of the S&P 500 Index and the S&P 500 Consumer Staples Index. The returns are calculated by assuming an investment of $100 in the Class A Common Stock and in each index on June 30, 2021.

Item 6. [Reserved]

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

RESULTS OF OPERATIONS

We manufacture, market and sell beauty products including those in the skin care, makeup, fragrance and hair care categories, which are distributed in approximately 150 countries and territories.

Year Ended June 30,

($ in millions) $ % $ % $ %

Operating expenses:

Securities class action litigation settlement 84 0.6 — — — —

Impairment of other intangible assets — — 1,273 8.9 180 1.2

Talcum litigation settlement agreements — — 159 1.1 — —

Other components of net periodic benefit cost 19 0.1 12 0.1 (13) (0.1)

Percentages not adjusted for differences caused by rounding

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The following table is a comparative summary of operating results for fiscal 2026, 2025 and 2024, for our product categories and geographic regions and reflects the basis of presentation described in Item 8. Financial Statements and Supplementary Data – Note 2 – Summary of Significant Accounting Policies and Note 23 – 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.

Year Ended June 30,

NET SALES

By Product Category:

Returns associated with restructuring and other activities(1) (12) 3 (1)

By Geographic Region(2):

Returns associated with restructuring and other activities(1) (12) 3 (1)

OPERATING INCOME (LOSS)

By Product Category:

Charges associated with restructuring and other activities(1) (823) (486) (124)

By Geographic Region(2):

Charges associated with restructuring and other activities(1) (823) (486) (124)

(1) Returns and 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 Company-wide initiatives to redesign, resize and reorganize select areas of the business. Accordingly, the discussions of Net sales and Operating results by Product Categories and Geographic Regions below exclude the impacts of returns and charges associated with restructuring and other activities.

(2) The net sales and operating results from our travel retail business are included in the Asia/Pacific region.

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Period-over-period changes in our net sales are generally attributable to the impacts from (i) pricing on our base portfolio, including changes in mix and those due to strategic pricing actions, (ii) volume, including changes driven by the impact of new product innovation, (iii) acquisitions and/or divestitures, and/or (iv) foreign currency translation. The percentages disclosed for these impacts are calculated on an individual basis.

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.

New product innovation includes the introduction of new products, as well as changes related to existing products or markets 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 often 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, inclusive of potential sales returns, 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 operate on a global basis, with the majority of our net sales generated outside the United States. Accordingly, fluctuations in foreign currency exchange rates can affect our results of operations. Therefore, we present certain net sales, operating results, provision for income taxes 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

We are a leader in prestige beauty, which combines the repeat purchase and relative affordability of consumer goods with high quality products and services. Within prestige beauty, we are diversified by product category, geography, brand, product sub-category, channel, consumer segment and price point. We also leverage consumer analytics and insights across our brand portfolio to grow sales and pursue profitable opportunities. These analytics and insights, combined with our creativity, also inform our innovation to provide a broad, locally-relevant and inclusive range of prestige products with the aim of competing effectively for a greater share of a consumer's beauty routine.

Our global distribution capability and operations allow us to focus on targeted expanded consumer reach wherever consumer demographics and trends are attractive. Our regional organizations, and the expertise of our people there, enable our brands to be more locally and culturally relevant in both product assortment and communications. We are continually evolving the way we connect with our consumers in stores, online and where they travel, including by expanding our digital and social media presence and the engagement of global and local influencers to amplify brand or product stories. We tailor implementation of our strategy by market to drive consumer engagement, recruitment and loyalty. We strive to strengthen our presence in large, image-building core markets, while broadening our presence in emerging markets.

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We approach distribution strategically by product category and location and seek to optimize distribution by matching our brands with appropriate opportunities while seeking to maintain high productivity per door. We are expanding our brands' locations as we continue to seek high-growth opportunities to reach new consumers in online, freestanding stores, specialty-multi and travel retail, which we believe will be higher growth channels in the long term. We also focus on brand-building retail activities, technology-driven activations and omnichannel capabilities that enhance the shopping experience for consumers.

Outlook

While we have seen improvements within our business, we are mindful of areas of volatility and uncertainty that may impact our results. We continue to face challenges in key markets in the West, including in some markets in Western Europe and the United States. Within our Asia travel retail business, we continue to monitor the impacts of the change in duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses. We are also monitoring the conflict in the Middle East as it relates to our business in the domestic markets and travel retail locations in the region. Net sales from locations impacted by the conflict in the Middle East accounted for approximately 2% of consolidated net sales in fiscal 2025. We continue to monitor and assess the impact that these areas of volatility and uncertainty may have on 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 changing tariff conditions 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 have implemented and are continuing to implement and consider additional mitigation measures. Our strategy remains optimizing our global supply chain network, by sourcing and manufacturing in the geography of sale where feasible. We also continue to leverage trade programs where available and monitor for additional opportunities as countries continue to update their trade programs. We anticipate tariffs to have an adverse effect on fiscal 2027 profitability and cash flows, and depending on actual rates and countries imposing tariffs such adverse impacts could be material.

On February 20, 2026, the U.S. Supreme Court ruled that the U.S. tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) on goods imported into the U.S. were unauthorized. The ruling did not address potential refunds, however on March 4, 2026, the U.S. Court of International Trade ordered U.S. Customs and Border Protection to begin refunding all tariffs imposed under IEEPA. During the fiscal 2026 fourth quarter, we submitted claims for a portion of our eligible IEEPA tariffs paid, and have begun to receive refunds. For refunds received during the period, we have recorded these as an offset to cost of sales. As of June 30, 2026, the remaining amount of potential IEEPA tariff refunds not yet submitted or for which refunds have not been received are not considered material to the consolidated financial statements.

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 product categories, brands, geographic regions, 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. Following the transition of leadership in the second and third quarters of fiscal 2025, we are executing against "Beauty Reimagined," our previously announced strategic vision which focuses on accelerating best-in-class consumer coverage, creating transformative innovation, boosting consumer-facing investments, fueling sustainable growth through bold efficiencies and reimagining the way we work, including through the expansion of the Profit Recovery and Growth Plan ("PRGP") during the fiscal 2025 third quarter, 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 actual and potential impact of changes that have been made and are expected to be made as part of the PRGP on suppliers, retailers and others, and challenges relating to successfully outsourcing select services. 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.

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. We are continuing to monitor and evaluate the potential impact of incorporating the global minimum tax in additional countries that have yet to enact the legislation.

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On July 4, 2025, 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, and we are continuing to evaluate the potential impact of the provisions that are expected to be effective in future fiscal years.

Our ability to recognize deferred tax assets, inclusive of utilizing net operating loss carryforwards, tax credits, and other carryforwards is dependent on the generation of sufficient taxable income in future periods. Accordingly, there can be no assurance that additional valuation allowances on our deferred tax assets will not be required should our financial performance be negatively impacted in the future. Such valuation allowance could be material.

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 PRGP is focused on rebuilding stronger, more sustainable profitability, supporting sales growth acceleration and increasing speed and agility. The plan is designed to improve gross margin, lower the cost base and reduce overhead expenses, while increasing investments in key consumer-facing activities. Upon completion of this plan, we expect to have improved our gross margin and expense base to drive greater operating leverage for the future.

As a component of the PRGP, on February 5, 2024, we announced a two-year restructuring program. The restructuring program’s main focus included the reorganization and rightsizing of certain areas of our business as well as simplification and acceleration of processes. We committed to this course of action on February 1, 2024 and at that time, planned to substantially complete specific initiatives under the restructuring program through fiscal 2026.

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

The expansion of the overall PRGP is focused on three key areas: (i) adopt a more competitive approach to procurement, a key pillar of savings, by further consolidating spending and strategically re-evaluating key supplier relationships; (ii) 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; and (iii) outsource select services to proven global partners.

The expanded component of the restructuring program, as noted above, began during our fiscal 2025 third quarter with all initiatives to be approved by the end of fiscal 2026. The focus of the overall expanded restructuring program (collectively the “Restructuring Program”) includes (i) reorganization and rightsizing of certain areas, (ii) simplification and acceleration of processes, (iii) outsourcing of select services and (iv) evolution of go-to-market footprint and selling models, all to help rebuild operating margin and also fuel reinvestment in consumer-facing areas to drive sustainable sales growth.

As of June 30, 2026, approvals under the Restructuring Program concluded, and by the end of fiscal 2027, the cumulative approved initiatives are expected to be substantially completed.

Based on the total approved initiatives under the Restructuring Program, as of June 30, 2026 we estimate a final net reduction of approximately 10,000 positions globally, at the high end of the previously announced range of 9,000 to 10,000. This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

The total approved initiatives under the Restructuring Program are expected to result in restructuring and other charges of $1,748 million, before taxes, slightly above the high end of the previously announced range of $1,500 million to $1,700 million, 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, have been funded from cash provided by operations for initiatives implemented to date, and for the remaining initiatives are expected to result in future cash expenditures funded from cash provided by operations.

Once fully implemented, we expect the Restructuring Program to yield annual target gross benefits of approximately $1,200 million, at the high end of the previously announced range of between $1,000 million and $1,200 million, before taxes, a portion of which is expected to be reinvested in consumer-facing activities.

Further information about the Restructuring Program Component of the Profit Recovery and Growth Plan, is described in Item 8. Financial Statements and Supplementary Data – Note 7 – Charges Associated with Restructuring and Other Activities.

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Securities Class Action Litigation Settlement

On December 7, 2023 and January 22, 2024, purported securities class action complaints were filed in the United States District Court for the Southern District of New York against the Company and its then Chief Executive Officer and Chief Financial Officer. The actions were consolidated on February 20, 2024. On March 22, 2024, plaintiffs filed a consolidated amended complaint alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on alleged materially false and misleading statements between February 3, 2022 and October 31, 2023. On March 31, 2025, the Court denied defendants’ motion to dismiss. On April 2, 2026, the parties reached an agreement in principle to settle the securities class action litigation. In light of these discussions, during the fiscal 2026 third quarter, we recorded a loss contingency of $84 million, net of the estimated probable insurance recoveries, in the consolidated statements of earnings (loss) relating to a potential settlement of the securities class action. As of June 30, 2026, the total settlement amount has been funded, including amounts paid by the insurance carriers. This matter is subject to final approval from the Court.

Annual Impairment Analysis

Aligned with our policy on Goodwill and Other Indefinite-lived Intangible Assets, as described in Item 8. Financial Statements and Supplementary Data – Note 2 – Summary of Significant Accounting Policies, we performed our annual impairment assessments as of April 1, 2026. Goodwill and trademark intangible assets were evaluated using either qualitative or quantitative assessments, as appropriate based on the reporting unit or brand. Based on the results of these assessments, no impairment charges were recorded, however, certain trademarks have limited excess fair value over carrying value.

Trademark Intangible Assets with Limited Excess Fair Value

The estimated fair value of the Dr.Jart+ trademark exceeded its carrying value of $37 million by 4%. If all other assumptions are held constant, a decrease of 4% in the estimated future net sales, inclusive of the terminal value, or an increase of 30 basis points in the weighted average cost of capital, would have caused the carrying value of the trademark to approximate its estimated fair value.

The estimated fair value of the Too Faced trademark exceeded its carrying value of $62 million by 13%. If all other assumptions are held constant, a decrease of 11% in the estimated future net sales, inclusive of the terminal value, or an increase of 130 basis points in the weighted average cost of capital, would have caused the carrying value of the trademark to approximate its estimated fair value.

The estimated fair value of the TOM FORD trademark exceeded its carrying value of $1,805 million by 19%. The excess in the current year is primarily driven by a decrease in the weighted average cost of capital as of April 1, 2026 compared to the fair value calculated in the fiscal 2025 second quarter, the period when impairment charges were taken and the estimated fair value of the trademark was equal to its carrying value. If all other assumptions are held constant, an increase of 140 basis points in the weighted average cost of capital would have caused the carrying value of the trademark to approximate its estimated fair value.

Factors That Could Impact Future Impairment Assessments

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 where the brands operate, resulting changes in the key assumptions could negatively impact the estimated fair value of the trademarks. This could potentially lead to recognizing impairment charges in the future.

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Fiscal 2026 as Compared with Fiscal 2025

NET SALES

Year Ended June 30,

As Reported:

$ Change from prior year 723 (1,282)

% Change from prior year 5 % (8) %

Non-GAAP Financial Measure(1):

% Change from prior year in constant currency 3 % (8) %

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales increased in fiscal 2026, driven by skin care and fragrance, and to a lesser extent, makeup.

By geographic region, reported net sales increased across all geographic regions in fiscal 2026, led by Mainland China and EUKEM.

The fiscal 2026 reported net sales increase was impacted by approximately $250 million of favorable foreign currency translation.

Reported net sales increased 5% in fiscal 2026, driven by the increase from volume of 2%, the favorable impact from foreign currency translation of 2% and an increase from pricing of 1%, reflecting the favorable impact from strategic pricing actions and changes in mix.

Product Categories

Reported net sales for our product categories for the years ended June 30, 2026 and 2025 were as follows:

Year Ended June 30,

($ in millions) 2026 2025 $ Change % Change % Change in Constant Currency(1)

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Skin Care

Reported skin care net sales increased $376 million, or 5%, in fiscal 2026, reflecting higher net sales from La Mer, Estée Lauder and The Ordinary, combined, of approximately $466 million.

Net sales from La Mer increased, reflecting the benefit from new product launches, as well as growth from The Treatment Lotion franchise. The increase in net sales from Estée Lauder reflected growth attributable to hero product franchises, as well as new product launches, which both drove performance during key shopping moments. Net sales from The Ordinary increased, primarily reflecting growth from targeted expanded consumer reach, as well as the benefit from key campaigns and the timing of key shopping moments.

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Skin care net sales were impacted by approximately $115 million of favorable foreign currency translation.

Reported skin care net sales increased 5% in fiscal 2026, driven by an increase from pricing of 3%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 2%. The impact from volume was flat period-over-period.

Makeup

Reported makeup net sales increased $71 million, or 2%, in fiscal 2026, including the favorable impact of foreign currency translation of 2%. Including the favorable impact of foreign currency translation, the increase in makeup net sales was primarily driven by M·A·C, reflecting higher net sales in the lip subcategory, driven by Powder Kiss Lipstick, Lip Pencil, MACximal Silky Matte Lipstick and MACximal Sleek Satin Lipstick. Also contributing to the increase in M·A·C net sales was the benefit from targeted expanded consumer reach.

Makeup net sales were impacted by approximately $84 million of favorable foreign currency translation.

Reported makeup net sales increased 2% in fiscal 2026, driven by the increase from volume of 3% and the favorable impact of foreign currency translation of 2%. Partially offsetting these increases was a decrease from pricing of 4%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions.

Fragrance

Reported fragrance net sales increased $288 million, or 12%, in fiscal 2026, reflecting higher net sales from Le Labo, TOM FORD and KILIAN PARIS, combined, of approximately $221 million.

The increase in net sales from Le Labo was led by the Classic Collection, including growth from targeted expanded consumer reach and the benefit from new product launches. Net sales from TOM FORD increased, reflecting the benefit from new product launches which created halo benefits on existing products, with overall growth in both the Signature and Private Blend franchises. Net sales from KILIAN PARIS increased, driven by the Angels' Share and Love, don't be shy franchises including growth attributable to new product launches and key campaigns, as well as growth from targeted expanded consumer reach.

Fragrance net sales were impacted by approximately $48 million of favorable foreign currency translation.

Reported fragrance net sales increased 12% in fiscal 2026, driven by the increase from volume of 7%, an increase from pricing of 3%, reflecting the favorable impact from strategic pricing actions and changes in mix, and the favorable impact from foreign currency translation of 2%.

Hair Care

Reported hair care net sales were flat in fiscal 2026, including the favorable impact of foreign currency translation of 1%. Including the favorable impact of foreign currency translation, hair care net sales results reflected higher net sales from The Ordinary and lower net sales from Aveda.

The increase in net sales from The Ordinary reflected growth of the Multi-Peptide Serum for Hair Density, as well as the benefit from targeted expanded consumer reach.

The decrease in net sales from Aveda reflects the brand’s strategies to improve long-term performance, including (i) planned rebalancing of online promotional activity and (ii) the exit from underperforming doors, including freestanding stores. 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.

Hair care net sales were impacted by approximately $3 million of favorable foreign currency translation.

Reported hair care net sales were flat in fiscal 2026, driven by the increase from pricing of 3%, reflecting changes in mix and the favorable impact of strategic pricing actions, and the favorable impact from foreign currency translation of 1%. These increases were offset by the decrease from volume of 3%.

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Geographic Regions

Reported net sales for our geographic regions for the years ended June 30, 2026 and 2025 were as follows:

Year Ended June 30,

($ in millions) 2026 2025 $ Change % Change % Change in Constant Currency(2)

(1)The net sales from our travel retail business are included in the Asia/Pacific region.

(2) See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported net sales increased in fiscal 2026, primarily driven by higher net sales in Mainland China and our travel retail business, combined, of approximately $531 million.

The increase in net sales in Mainland China reflected growth attributable to key shopping moments, including the benefits from key campaigns to drive sales and new product launches.

The increase in net sales in our travel retail business was driven by Asia travel retail, including (i) the increase in net sales in Korea travel retail and Hong Kong SAR travel retail, benefiting from retailer shifts toward more profitable duty-free business models, which helped reduce discounting, as well as the increase in traveling consumers, (ii) net sales growth in Hainan travel retail, reflecting the improvement in retail sales, benefiting from higher traffic and key campaigns to drive growth, and (iii) the net sales decline in the rest of mainland China travel retail, primarily driven by the transitory pressure from the change of duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses.

Reported net sales in The Americas increased 1% in fiscal 2026, driven by the increase from volume of 4%. Partially offsetting this increase was a decrease from pricing of 3%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions. Reported net sales in EUKEM increased 6% in fiscal 2026, driven by the favorable impact of foreign currency translation of 5% and the increase from volume of 4%. These increases were partially offset by a decrease from pricing of 3%, reflecting changes in mix, partially offset by the favorable impact from strategic pricing actions. Reported net sales in Asia/Pacific increased 4% in fiscal 2026, driven by an increase from pricing of 4%, reflecting changes in mix and the favorable impact from strategic pricing actions, partially offset by the unfavorable impact from foreign currency translation of 1%. The impact from volume was flat period-over-period. Reported net sales in Mainland China increased 12% in fiscal 2026, driven by an increase from pricing of 10%, reflecting changes in mix and the favorable impact from strategic pricing actions, and the favorable impact from foreign currency translation of 3%. Partially offsetting these increases was the decrease from volume of 1%.

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GROSS MARGIN

Gross margin in fiscal 2026 increased to 75.5% as compared with 74.0% in fiscal 2025.

Fiscal 2026 vs. Fiscal 2025Favorable (Unfavorable) Basis Points

As Reported:

Mix of business 30

Obsolescence charges 80

Manufacturing costs and other 55

Foreign exchange transactions (15)

Returns and charges associated with restructuring and other activities —

As Reported Gross Margin Basis Point Variance 150

Non-GAAP Financial Measure Adjustments:

Returns and charges associated with restructuring and other activities —

Non-GAAP Gross Margin Basis Point Variance 150

The increase in gross margin in fiscal 2026 is driven by net benefits from the PRGP, partially offset by unfavorable impacts within manufacturing costs and other, reflecting the impact of inflation on our costs, as well as tariffs. The PRGP benefits were driven by the favorable impact of cost efficiencies within our global supply chain network and reductions in excess inventory.

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OPERATING EXPENSES

Operating expenses as a percentage of net sales in fiscal 2026 decreased to 70.3% as compared with 79.4% in fiscal 2025.

Fiscal 2026 vs. Fiscal 2025Favorable (Unfavorable) Basis Points

As Reported:

Advertising 10

Promotional 10

Store operating costs (10)

Consumer-facing operating expenses(1) 30

General and administrative 40

Shipping 20

Marketing 40

Product development 40

Stock-based compensation —

Foreign exchange transactions (10)

Non-consumer-facing operating expenses 130

Charges associated with restructuring and other activities (200)

Securities class action litigation settlement (60)

Impairment of goodwill and other intangible assets 900

Talcum litigation settlement agreements 110

As Reported Operating Expense Margin Basis Point Variance 910

Non-GAAP Financial Measure Adjustments:

Impact of restructuring and other activities 210

Securities class action litigation settlement 60

Impairment of goodwill and other intangible assets (900)

Talcum litigation settlement agreements(2) (110)

Non-GAAP Operating Expense Margin Basis Point Variance 170

(1)Consumer-facing operating expenses in this table and within the operating expense margin discussion below do not include the impact of co-operative advertising expenses, however, our references to consumer-facing investments throughout the remainder of Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations include the consumer-facing operating expenses noted above as well as the impact of co-operative advertising expenses that are recorded as a reduction of revenue.

(2)From the end of August 2024 through October 2024, we entered into agreements with certain plaintiff law firms to resolve over 200 pending cosmetic talcum powder matters, which was a portion of the pending matters that existed at that time, and establish a framework for resolving potential future claims brought by these plaintiff firms from January 1, 2025 through December 31, 2029 (mitigating a portion of our future exposure), subject to annual caps (the “Talcum litigation settlement agreements”). In connection with the Talcum litigation settlement agreements, we recorded a charge of $159 million in the fiscal 2025 first quarter, representing our best estimate of probable losses for current and potential future claims under these agreements.

The favorability in our operating expense margin in fiscal 2026 reflected the impact of the increase in net sales, which offset the overall increase in investments in consumer-facing areas of the business to drive sales, including through key campaigns, new product launches and targeted expanded consumer reach. Non-consumer facing expenses were virtually flat year-over-year, with overall lower expenses within general and administrative, marketing, product development, and shipping, collectively, including lower employee-related costs realized through initiatives as part of the PRGP, with these benefits largely offset by higher employee incentive costs.

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OPERATING RESULTS

Year Ended June 30,

As Reported:

Operating income (loss) $ 780 $ (785)

% Change from prior year 100+% (100+)%

Operating Margin 5.2 % (5.5) %

Non-GAAP Financial Measure(1):

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

The reported operating margin for fiscal 2026 increased from the prior year, driven by the favorable operating expense margin, which includes the favorable year-over-year impact of goodwill and other intangible asset impairment charges in fiscal 2025 of $1,286 million, as well as the increase in net sales and increase in gross margin, as discussed above.

Product Categories

Reported operating income (loss) for our product categories for the years ended June 30, 2026 and 2025 were as follows:

Year Ended June 30,

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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Skin Care

Reported skin care operating income increased $842 million, or over 100%, in fiscal 2026, reflecting an increase in net sales and the favorable year-over-year impact of the other intangible asset impairment charge in the prior year related to Dr.Jart+ of $375 million. The increase in operating income was partially offset by an increase in consumer-facing investments, including to support key campaigns, new product launches and targeted expanded consumer reach.

Makeup

Reported makeup operating loss decreased $371 million, or 84%, in fiscal 2026, reflecting the favorable year-over-year impact of other intangible asset impairment charges in the prior year relating to TOM FORD and Too Faced, combined, of $295 million and a goodwill impairment charge relating to Too Faced of $13 million, as well as the favorable year-over-year impact of the charge in fiscal 2025 associated with the Talcum litigation settlement agreements of $159 million. Partially offsetting the increase in operating results was an increase in consumer-facing investments, including to support key campaigns, new product launches and targeted expanded consumer reach.

Fragrance

Reported fragrance operating results increased $582 million, or over 100%, in fiscal 2026, reflecting the favorable year-over-year impact of the other intangible asset impairment charge in the prior year of $549 million relating to TOM FORD, as well as an increase in net sales. Partially offsetting these increases in operating results was an increase in consumer-facing investments, including to support key campaigns, new product launches and targeted expanded consumer reach.

Hair Care

Reported hair care operating loss decreased $37 million, or 90%, in fiscal 2026, reflecting lower cost of sales and lower non-consumer-facing expenses, including the reduction in employee-related costs realized through initiatives as part of the PRGP which were partially offset by higher employee incentive costs, and lower consumer-facing investments. These increases to operating results were partially offset by the unfavorable allocated impact of the securities class action litigation settlement.

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Geographic Regions

Reported operating income (loss) for our geographic regions for the years ended June 30, 2026 and 2025 were as follows:

Year Ended June 30,

(1)See “Reconciliations of Non-GAAP Financial Measures” beginning on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

Reported operating results in The Americas increased $1,029 million, or over 100%, in fiscal 2026, reflecting the favorable year-over-year impacts of other intangible asset impairment charges in the prior year relating to TOM FORD and Too Faced, combined, of $898 million and a goodwill impairment charge in the prior year relating to Too Faced of $13 million. Also contributing to the increase was the favorable year-over-year impact of the charge in fiscal 2025 associated with the Talcum litigation settlement agreements of $159 million and higher net sales. Partially offsetting the increase in operating results is the unfavorable impact of the securities class action litigation settlement charge in the fiscal 2026 third quarter and an increase in consumer-facing investments to help drive sales growth.

Reported operating income in EUKEM increased $51 million, or 35%, in fiscal 2026, reflecting higher net sales, partially offset by an increase in consumer-facing investments, including to support targeted expanded consumer reach, key campaigns and new product launches, and an increase in non-consumer-facing expenses, due in part to higher employee incentive costs.

Reported operating income in Asia/Pacific increased $643 million, or over 100%, in fiscal 2026, reflecting the favorable year-over-year impact of the other intangible asset impairment charge in the prior year relating to Dr.Jart+ of $375 million, higher net sales and a decrease in cost of sales, including net benefits from the PRGP.

Reported operating income in Mainland China increased $179 million, or 92%, in fiscal 2026, reflecting higher net sales, as well as the favorable year-over-year timing of recognition of local government subsidies in fiscal 2026, as well as the related impact of the change in policy in fiscal 2025. Partially offsetting the increase in operating income was an increase in consumer-facing investments, including to support key campaigns, new product launches and targeted expanded consumer reach.

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INTEREST AND INVESTMENT INCOME

Year Ended June 30,

Interest income and investment income, net $ 90 $ 114

Interest expense decreased in fiscal 2026, primarily reflecting a lower average debt balance and lower average interest rates compared to the prior year. Interest income and investment income, net decreased in fiscal 2026, primarily driven by lower average interest rates earned compared to the prior year, as well as the unfavorable year-over-year impact of impairments of cost method minority investments.

PROVISION FOR INCOME TAXES

The provision for income taxes represents U.S. federal, foreign, state and local income taxes. The effective rate differs from the federal statutory rate primarily due to the effect of state and local income taxes, the tax impact of stock-based compensation, the taxation of foreign income and changes in unrecognized tax benefits, as well as changes to valuation allowances based on our assessment of the realizability of deferred tax assets. Our effective tax rate will change from year to year based on recurring and non-recurring factors including the geographical mix of earnings, enacted tax legislation, state and local income taxes, unrecognized tax benefits, the tax impact of stock-based compensation, changes to valuation allowances, the interaction of various global tax strategies and the impact from certain acquisitions.

Year Ended June 30,

Earnings (loss) before income taxes: $ 517 $ (1,040)

As Reported:

Effective rate for income taxes 64.8 % (8.9) %

Basis-point change from prior year 7,370 (5,590)

Non-GAAP Financial Measure(1):

Effective rate for income taxes 35.7 % 38.8 %

(1)Excludes the net impact on the effective tax rates of charges associated with restructuring and other activities in both periods, the securities class action litigation settlement in fiscal 2026, and in fiscal 2025 also excludes the impact of the impairment of goodwill and other intangible assets, U.S. deferred tax asset valuation allowance adjustment and the Talcum litigation settlement agreements. See “Reconciliations of Non-GAAP Financial Measures” on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

The effective tax rate for fiscal 2026 increased approximately 7,370 basis points. The extent of the year over year change was broadly impacted by the loss before income taxes in fiscal 2025. The increase was primarily attributable to the higher effective tax rate on income from our foreign operations of approximately 5,630 basis points, due to our geographical mix of earnings, including the establishment of new valuation allowances on certain foreign deferred tax assets. Further contributing to the increase in the effective tax rate was the unfavorable impact of the One Big Beautiful Bill Act, resulting from an increase in tax deductible interest expense which reduced U.S. taxable income and increased the excess foreign tax credits generated which require a valuation allowance of approximately 1,010 basis points, changes in unrecognized tax benefits related to transfer pricing matters impacting multiple tax jurisdictions of approximately 820 basis points, as well as the unfavorable impact associated with previously issued U.S. stock-based compensation of approximately 590 basis points. The overall increase in the effective tax rate is partially offset by the favorable year-over-year utilization of U.S. general foreign tax credits net of the prior year establishment of a valuation allowance against U.S. general foreign tax credits and research and development tax credit carryforwards of approximately 550 basis points.

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NET EARNINGS (LOSS) ATTRIBUTABLE TO THE ESTÉE LAUDER COMPANIES INC.

Year Ended June 30,

($ in millions, except per share data) 2026 2025

As Reported:

% Change from prior year 100+% (100+)%

Diluted net earnings (loss) per common share $ .50 $ (3.15)

% Change from prior year 100+% (100+)%

Non-GAAP Financial Measure(1):

(1)See “Reconciliations of Non-GAAP Financial Measures” on page 44 for reconciliations between non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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RECONCILIATIONS OF 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, or do not reflect the Company’s underlying ongoing business, provides transparency for such items and helps investors and others compare and analyze our operating performance from period to period. In the future, we expect to incur charges or adjustments similar in nature to those presented below; however, the impact to the Company’s results in a given period may be highly variable and difficult to predict. Our non-GAAP financial measures may not be comparable to similarly titled measures used by, or determined in a manner consistent with, other companies. 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. The following tables present Net sales, Operating income (loss), Provision for income taxes and Diluted net earnings (loss) per common share adjusted to exclude the impact of charges associated with restructuring and other activities; the securities class action litigation settlement; impairment of goodwill and other intangible assets; U.S. deferred tax asset valuation allowance adjustment; the Talcum litigation settlement agreements; and the effects of foreign currency translation. The following tables provide reconciliations between these non-GAAP financial measures and the most directly comparable U.S. GAAP measures.

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Year Ended June 30, % Change % Change in Constant Currency

($ in millions, except per share data) 2026 2025 Variance

Returns associated with restructuring and other activities 12 (3) 15

Charges associated with restructuring and other activities 823 486 337

Securities class action litigation settlement 84 — 84

Impairment of goodwill and other intangible assets — 1,286 (1,286)

Talcum litigation settlement agreements — 159 (159)

Effective rate for income taxes, as reported 64.8 % (8.9) %

Charges associated with restructuring and other activities 156 105 51

Securities class action litigation settlement 18 — 18

Impairment of goodwill and other intangible assets — 285 (285)

U.S. deferred tax asset valuation allowance adjustment — (172) 172

Talcum litigation settlement agreements — 35 (35)

Provision for income taxes, as adjusted $ 509 $ 346 $ 163 47 % 45 %

Effective rate for income taxes, as adjusted 35.7 % 38.8 %

Charges associated with restructuring and other activities 1.83 1.06 .77

Securities class action litigation settlement .18 — .18

Impairment of goodwill and other intangible assets — 2.78 (2.78)

U.S. deferred tax asset valuation allowance adjustment — .48 (.48)

Talcum litigation settlement agreements — .34 (.34)

As diluted net earnings per common share, as adjusted, is used as a measure of the Company’s performance, we consider the impact of current and deferred income taxes when calculating the per-share impact of each of the reconciling items.

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The following table reconciles the change in net sales by product category and geographic region, as reported, to the change in net sales excluding the effects of foreign currency translation:

As Reported

Year Ended June 30,

By Product Category:

Returns associated with restructuring and other activities (12) 3 (15) — (15)

By Geographic Region:

Returns associated with restructuring and other activities (12) 3 (15) — (15)

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The following table reconciles the change in operating results by product category and geographic region, as reported, to the change in operating results excluding the impact of the securities class action litigation settlement, impairment of goodwill and other intangible assets and the Talcum litigation settlement agreements:

Year Ended June 30,

EL US Equity

EL · 10-K · period ended 2026-06-30

Item 1. Business.

Item 1A. Risk Factors.

Item 1B. Unresolved Staff Comments.

Item 1C. Cybersecurity.

Item 2. Properties.

Item 3. Legal Proceedings.

Item 4. Mine Safety Disclosures.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

EL US Equity☆

EL · 10-K · period ended 2026-06-30

Item 1. Business.

Item 1A. Risk Factors.

Item 1B. Unresolved Staff Comments.

Item 1C. Cybersecurity.

Item 2. Properties.

Item 3. Legal Proceedings.

Item 4. Mine Safety Disclosures.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

EL US Equity