Q2 2026 Coty Inc Pre-recorded Earnings Call Transcript
Key Points
- Coty Inc (COTY) has significantly strengthened its fragrance innovation and execution capabilities, achieving a 10% CAGR in its prestige fragrance business from fiscal 2021 to fiscal 2025.
- The company has grown gross margins by close to 500 basis points and deleveraged by over 4 turns in the last five years.
- Coty Inc (COTY) has successfully grown key brands like Hugo Boss, Burberry, and Marc Jacobs by 30% to 140% from fiscal 2019 to fiscal 2025.
- The company has formed a strong partnership with Ulta and is delivering best-in-class execution in the prestige e-commerce channel, with strong growth on platforms like Amazon.
- Coty Inc (COTY) is leveraging AI to reduce costs and improve efficiency, with AI reducing post-production asset costs by 70% to 90% for selected brands.
- Coty Inc (COTY) has faced disappointing financial results over the past 18 months, with the stock hovering around $3, indicating investor skepticism.
- The company's performance in the US market has been inconsistent, with underperformance in both divisions accounting for nearly all of Coty’s fiscal 2025 sales decline.
- Coty Inc (COTY) has been impacted by a highly promotional environment in the prestige fragrance market, which has pressured gross margins.
- The company has faced challenges in Consumer Beauty, with a sizable gap between its sell-out and the market, and a decline in like-for-like sales.
- Operational discipline has slipped, with too many projects and initiatives diluting focus and resources, leading to insufficient investment in high-potential core franchises.
Hello, everyone. Iâm Olga Levinzon, Cotyâs Senior Vice President of Investor Relations. Thank you for joining us today for the prepared remarks portion of Cotyâs second quarter fiscal 2026 earnings. On Friday, February 6, 2026, at approximately 8:00 AM Eastern Time, or 2:00 PM Central European Time, we will hold a separate live Q&A session on our results, which you can access via our Investor Relations website. Joining me for our presentation are Markus Strobel, Cotyâs Executive Chairman of the Board and Interim Chief Executive Officer; and Laurent Mercier, Cotyâs Chief Financial Officer.
Before I hand the call over to Markus, I would like to remind you that many of the comments today may contain forward-looking statements. Please refer to Cotyâs earnings release and the reports filed with the SEC, where the company lists factors that could cause actual results to differ materially from these forward-looking statements. In addition, except where noted, the discussion of Cotyâs financial results and Cotyâs expectations
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