Coty Inc. (COTY) · Nov 4, 2026 · Earnings
Beat — Adjusted EPS $0.16 vs ~$0.12 consensus; revenue $1.555B vs ~$1.53B
Coty earnings beat Q1 expectations on adjusted EPS, EBITDA and cash flow, but sales, gross margin and Consumer Beauty weakened.
Coty is in an early turnaround: its Coty.Curated program is concentrating investment on core prestige brands while management prepares for the Gucci Beauty exit and a strategic review of Consumer Beauty. That transition was already expected for fiscal 2027, so this quarter matters mainly for whether execution is stabilizing.
The quarter beat a lowered bar. Revenue of $1.555 billion was modestly above the published consensus of roughly $1.53 billion, while adjusted diluted EPS of $0.16 was above consensus near $0.12. Management also said adjusted EBITDA came in ahead of its guidance; the decline was 7%, better than the low-teens decline previously expected for Q1. 〔0〕
| Figure | Q1 FY27 | Q1 FY26 | Consensus / comparison |
|---|---|---|---|
| Net revenue (Financial Highlights) | $1,555.2M (-1.4%) | $1,577.2M | $1.53B |
| Adjusted diluted EPS (Financial Highlights) | $0.16 | $0.12 | ~$0.12 |
| Adjusted EBITDA (Financial Highlights) | $274.2M (-7%) | $296.1M | |
| Free cash flow (Cash Flow statement) | $84.6M | $11.2M | |
| Financial net debt (Debt reconciliation) | $2,576.4M | $2,912.1M |
The improvement is more financial than demand-driven. Like-for-like sales still fell 2%, gross margin dropped 120 basis points to 63.3%, and adjusted operating margin contracted to 14.2% from 15.2%. Prestige was broadly stable, but Consumer Beauty deteriorated sharply: adjusted operating income swung to a $15.0 million loss from $1.5 million of income, while adjusted EBITDA fell 59%. 〔1〕
Prestige is providing the credible recovery signal, but it is not broad yet. Coty’s six core prestige brands returned to 5% like-for-like growth, with five of six growing, while the overall Prestige segment still declined 1%. The company’s new Marc Jacobs makeup and fragrance launches are helping, but the broader portfolio has not yet returned to growth. 〔2〕
Cash generation materially improved the balance sheet. Free cash flow rose to $84.6 million from $11.2 million, and financial net debt fell by more than $300 million from June after the $250 million Gucci proceeds and working-capital improvement. That gives Coty more room to fund brand investment and manage the coming license transition, although the underlying earnings recovery remains incomplete.
Bottom line: Coty delivered a genuine earnings beat and a meaningful cash-flow improvement, but the core operating story is still only stabilizing: sales and margins declined, and Consumer Beauty worsened sharply. The quarter advances the turnaround modestly; it does not yet rewrite it.
Consumer Beauty strategic review decision by end of calendar 2026
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