Executive Summary
Coty’s QQ1 2025 results show a modest top-line expansion coupled with clear margin resilience. Revenue reached $1,671.5 million, up 1.83% year over year and 22.60% quarter over quarter, underscoring seasonality and improving product mix within the brand portfolio. Gross profit of $1,094.6 million yielded a gross margin near 65.5%, while operating income of $237.8 million produced an operating margin of ~14.2% and EBITDA of $297.7 million (margin ~17.8%). Net income was $82.9 million with earnings per share of $0.0917 (diluted $0.0909), illustrating meaningful operating leverage supported by disciplined SG&A spend of $808.0 million and favorable product mix in prestige and luxury tiers.
From a cash flow and balance sheet perspective, Coty generated $67.4 million of operating cash flow, spent $77.3 million on capital expenditures, and delivered free cash flow of −$9.9 million. The company ended the period with cash and cash equivalents of $283.6 million and total debt of $4,224.2 million, yielding net debt of $3,940.6 million. Total assets stood at $12.516 billion and total stockholders’ equity at $4.188 billion. The current and quick ratios were modest at 0.847x and 0.550x respectively, highlighting ongoing leverage as a structural characteristic of the business. With a dividend payout of approximately 3.98% of earnings and a relatively high valuation (P/E around 24.6x and P/S near 4.9x), investors should monitor deleveraging progress, working capital dynamics, and the margin trajectory as catalysts for sustained cash generation and earnings growth.
Overall, the QQ1 2025 print suggests Coty is stabilizing after a difficult period, with improving profitability but a need to advance deleveraging and optimize capital allocation amid a competitive, FX-sensitive consumer landscape.
Key Performance Indicators
QoQ: 553.30% | YoY:20.41%
QoQ: 185.55% | YoY:5 081.25%
QoQ: 176.42% | YoY:4 726.32%
Key Insights
Revenue: $1,671.5 million; YoY +1.83%, QoQ +22.60%.
Gross Profit: $1,094.6 million; Gross margin ~65.5% (1,094.6 / 1,671.5).
Operating Income: $237.8 million; Operating margin ~14.23%.
EBITDA: $297.7 million; EBITDA margin ~17.81%.
Net Income: $82.9 million; Net margin ~4.96%.
EPS: $0.0917; Diluted EPS: $0.0909.
Weighted average shares: 867.9 million (basic); 875.3 million (diluted).
Cash flow: Net cash from operating activities $67.4 million; Capital expenditures $77.3 million; Free cash flow ...
Financial Highlights
Revenue: $1,671.5 million; YoY +1.83%, QoQ +22.60%.
Gross Profit: $1,094.6 million; Gross margin ~65.5% (1,094.6 / 1,671.5).
Operating Income: $237.8 million; Operating margin ~14.23%.
EBITDA: $297.7 million; EBITDA margin ~17.81%.
Net Income: $82.9 million; Net margin ~4.96%.
EPS: $0.0917; Diluted EPS: $0.0909.
Weighted average shares: 867.9 million (basic); 875.3 million (diluted).
Cash flow: Net cash from operating activities $67.4 million; Capital expenditures $77.3 million; Free cash flow −$9.9 million.
Balance sheet: Cash and cash equivalents $283.6 million; Total assets $12,516.0 million; Total liabilities $8,042.9 million; Total debt $4,224.2 million; Net debt $3,940.6 million; Total stockholders’ equity $4,187.6 million.
Liquidity/ratios: Current ratio 0.847x; Quick ratio 0.550x; Cash ratio 0.117x; Interest coverage 2.70x.
Valuation/earnings: Price-to-book ~2.01x; Price-to-sales ~4.88x; P/E ~24.6x; Dividend yield ~0.04%.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.67B |
1.83% |
22.60% |
| Gross Profit |
1.09B |
5.06% |
32.26% |
| Operating Income |
237.80M |
20.41% |
553.30% |
| Net Income |
82.90M |
5 081.25% |
185.55% |
| EPS |
0.09 |
4 726.32% |
176.42% |
Key Financial Ratios
operatingProfitMargin
14.3%
operatingCashFlowPerShare
$0.08
freeCashFlowPerShare
$-0.01
dividendPayoutRatio
3.98%
Management Commentary
No earnings call transcript data was provided in the supplied materials; as such, there are no management quotes or thematic highlights to quote or analyze.
Forward Guidance
No formal forward guidance was furnished in the provided data. In absence of explicit management targets, the outlook hinges on several external and internal factors: (1) continued strength in high-margin prestige beauty and growth of e-commerce/direct-to-consumer channels, (2) currency headwinds/tailwinds given Coty’s global footprint, and (3) ongoing deleveraging efforts to reduce high leverage levels. Based on industry trends and Coty’s current profitability trajectory, a cautious to modestly constructive view suggests revenue could trend higher with stable or gradually improving margins if mix and cost controls persist. Investors should monitor currency movements, channel mix shifts (DTC vs. wholesale), gross margin progression, and the pace of debt reduction as principal drivers of the next 2–3 quarters.