Perfume sales thrive as U.S. beauty brands struggle with sluggish demand in 2025

Ulta Beauty

31/12/2025 18:10

** U.S. beauty sector remained under pressure in 2025 due to tariff-led uncertainty, while focus on prestige brands and younger shoppers revived performance of cosmetics maker Estee Lauder EL.N and retailer Ulta Beauty ULTA.O

** Coty COTY.N,  Elf Beauty ELF.N and Bath & Body Works BBWI.N logged the biggest decline since 2018

** COTY grappled with slowing demand for its products and rising competition; it also plans on selling its cosmetics business to focus on more profitable fragrance segment, also faces leadership changes

**  Elf Beauty struggled with tariff uncertainty, as about 75% of the cosmetics maker’s global production comes from China

** Ulta Beauty  up ~39% this year, driven by steady demand from younger shoppers for its affordable, trendy offerings and celebrity-owned brands

** Luxury beauty brand Estee Lauder shares climbed this year driven by its turnaround efforts focused on strong fragrance sales, improving China demand and supply-chain shifts

** Analysts at Jefferies expect "Still, beauty spending is expected to top 2025 levels next year, driven by demand for prestige brands, Jefferies analysts write in a note

** Brokerage also expects the industry to focus on makeup after several years of fragrance taking centerstage

** *  S&P 500 Personal Care Products industry sub-index .SPLRCPEPR down 0.7% YTD, while broader S&P 500 .SPX is up 17.3%

Companies
RIC
2025 YTD
2024
2023
Ulta Beauty
ULTA.O
39.3%
-11.2%
4.46%
Coty
COTY.N
-55.6%
-43.9%
45.%
Bath & Body Works
BBWI.N
-47.9%
-10.2%
2.4%
Elf Beauty
ELF.N
-38.8%
-13%
161%
Estee Lauder
EL.N
41.2%
-48.7%
-41%

 (Reporting by Sanskriti Shekhar and Koyena Das in Bengaluru)

 ((Sanskriti.Shekhar@thomsonreuters.com))