The Estee Lauder (0JTM.L) Q1 2025 Earnings Report

The Estee Lauder Companies Inc (0JTM.L) reported QQ1 2025 revenue of $3.361 billion with a gross profit of $2.433 billion, delivering a gross margin of 72.39%. Despite a solid gross margin, the quarter featured an operating loss of $121 million and a net loss of $156 million, translating to an EPS of -$0.43. EBITDA stood at $157 million, while the company generated negative operating cash flow of $670 million and free cash flow of -$811 million as working capital consumed a material portion of cash during the quarter. The balance sheet shows a sizable debt burden (total debt of $10.01 billion, net debt of $7.66 billion) and modest liquidity with cash and cash equivalents of $2.35 billion at quarter-end. Key leverage metrics remain tight (interest coverage ~1.47x) and the cash conversion cycle extended, signaling near-term liquidity and profitability headwinds. This combination of top-line softness, margin pressure from operating costs, and aggressive working capital deployment elevates risk while underscoring the potential for value if EL can stabilize demand, control costs, and monetize its premium brand portfolio over the mid-term.