Finance
L'Oreal CEO bullish on US as China sales stay weak
Published by Global Banking and Finance Review
Posted on February 7, 2025
3 min readLast updated: January 26, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on February 7, 2025
3 min readLast updated: January 26, 2026
L'Oreal is optimistic about US growth despite weak China sales. CEO sees potential in premium goods and new opportunities in beauty supplements.
PARIS (Reuters) -Cosmetics giant L'Oreal is upbeat on the United States for the year ahead, it said on Friday, even as its shares were dragged down by its slowest quarterly sales since the height of the pandemic, following weak Chinese demand.
L'Oreal has been popular for years among investors for outperforming peers, but persistently weak demand for consumer goods in China, where it has a significant market share, has affected its business.
The Paris-listed shares were down by over 4% around 0912 GMT, as investors were concerned that sales also stayed below expectations in North America, as well as in the firm's luxury segment.
Speaking to analysts, Chief Executive Nicolas Hieronimus said he was "bullish" L'Oreal could increase its presence in the United States, which the luxury industry expects to be the main growth engine for the foreseeable future.
"We see the potential. We have the brands," he said, adding that the company was under-exposed in the country compared to its market share in other regions. "Consumption of particularly premium goods in U.S. will be dynamic," he said.
Hieronimus added he wanted "to enter new territories", citing beauty supplements as a promising opportunity. He said the company was working with external manufacturers in the sector, but not looking at acquisitions.
L'Oreal has taken stakes in some beauty clinics in China and North America to observe and understand the medical aesthetics market, he said. Last year, it acquired a stake in dermatology company Galderma.
The company that makes products including Maybelline mascara, Lancome face cream and AirLight hairdryers, invests around 3% of its annual revenue, or 1.53 billion euros ($1.59 billion), in research and development.
The 2.5% rise in fourth-quarter sales, reported after the market close on Thursday, was a slowdown from the 3.4% rise in the third quarter, and the slowest quarterly growth since 2020. Analysts had expected quarterly sales to rise more than 4%.
Revenues in North Asia, which includes China, were down by 3.6%, after a 6.5% decline in the prior period.
Fourth-quarter sales also grew more slowly than expected in North America, rising by 1.4%, down from growth of 5.2% in the third quarter while the luxe division, which markets the Valentino and Yves Saint Laurent perfumes, also missed expectations.
Barclays analysts said the persistent weak sales at a company known for its operational excellence caused some uncertainty.
"We think investors will remain nervous around whether this is symptomatic of deeper structural problems until growth inflects," the note added.
Separately, L'Oreal said on Friday it struck a deal to produce beauty products for the popular fashion label Jacquemus which also includes taking a minority stake.
Proceeds from selling a 2.3% stake in Sanofi back to the French pharma company this month will give L'Oreal additional financial firepower for acquisitions, Finance chief Christophe Babule said.
($1 = 0.9621 euros)
(Reporting by Dominique Patton, writing by Tassilo Hummel; editing by Barbara Lewis)
The article discusses L'Oreal's focus on US market growth amid weak sales in China.
L'Oreal's sales grew slowly, with weak performance in China and North America.
L'Oreal is exploring beauty supplements and has taken stakes in beauty clinics.
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