L'Oréal said Thursday that third quarter revenue increased 7.7% on an adjusted like for like basis, powered by strong demand at salons and higher end skincare. Professional Products - the division that focuses on salon professionals and beauty salons - and Dermatological Beauty both recorded double-digit gains.
Chief Executive Officer Nicolas Hieronimus told analysts, "We are outperforming in skincare, a category I was not happy with last year." He added that he expects L'Oréal to outpace the broader market this year, "albeit at a slightly more moderate rate."
North Asia, which includes China, grew 7.8% in the quarter, beating analyst estimates by more than three percentage points. That contrasts with pressure on high fashion and leather goods in the region, as Hermès reported flat sales across a similar area earlier Thursday.
The zone that covers India, South Africa and the United Arab Emirates led all regions with double digit gains that far outstripped estimates, helping offset weakness in Latin America. Jefferies analyst David Hayes called it "a very strong update," adding, "The momentum shifts in China and Europe stand out, leading up Luxe division growth rates."
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Shares responded fast. L'Oréal's American depositary receipts climbed as much as 9.2% after the update, while the Paris listed stock is up about 13% so far this year. Even with the luxury sector under pressure, price-sensitive buyers are still picking up affordable treats like skin repair products, and L'Oréal's lineup stretches from entry level Garnier shampoos to premium creams from Aesop and SkinCeuticals.
That breadth across price points has helped the company navigate a choppy global economy while leaning into categories showing the most momentum.
In plain English: growth beat expectations, with salons and dermatological brands doing the heavy lifting, North Asia running ahead of forecasts, and strength from India to the UAE balancing softer Latin America. Management also sees the company outperforming the broader market this year.
The bottom line: beauty demand is holding up as cash-strapped consumers keep spending on small indulgences like skin repair products, and L'Oréal's multi tiered portfolio is positioned to catch that spend across budgets.
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