Coty Inc. reported fourth-quarter revenue of $1.27 billion, exceeding Wall Street’s $1.19 billion estimate by $80 million, as the beauty company posted a 6.72% year-over-year increase. Adjusted loss per share narrowed to $0.02 from a forecasted loss of $0.01, while like-for-like sales declined 1%, outperforming expectations of a mid-single-digit drop. The results were released alongside the company’s full fiscal 2026 earnings report on Aug. 19.
The company’s adjusted gross margin contracted to 60.9% in the quarter, down 140 basis points from the prior year, while adjusted EBITDA fell 26% year-over-year. For the full fiscal year, adjusted gross margin declined to 63%, a 190-basis-point decrease, and adjusted EBITDA dropped 22%. Free cash flow rose to $348 million, up $70 million from the prior year, and net debt fell to $2.9 billion, a reduction of nearly $840 million.
Shares of Coty (COTY) rose 10.58% to $3.03 during regular trading but slipped 4.62% in after-hours activity to $2.89. The stock has traded between $1.82 and $4.935 over the past 52 weeks.
Executive Chairman and Interim CEO Markus Strobel noted that the quarter’s results were "ahead of expectations," adding that the company remains focused on improving execution consistency. CFO Laurent Mercier highlighted strong free cash flow despite a $200 million decline in adjusted EBITDA for the full year, while acknowledging that recent fragrance launches have not yet delivered the expected halo effect across the portfolio.
Management characterized fiscal 2027 as a "transition year," with guidance pointing to a low-to-mid-single-digit percentage decline in like-for-like revenue for the first quarter. Adjusted gross margin is expected to fall by 50 to 100 basis points year-over-year, while adjusted EBITDA is projected to decline in the low-teens percentage range. Adjusted EPS, excluding equity swap impacts, is forecast between $0.11 and $0.13 for Q1.
Full-year fiscal 2027 guidance was withheld as Coty continues restructuring efforts and prepares for the exit of its Gucci fragrance license. The company’s "All-in to Win" cost-savings program generated more than $250 million in fiscal 2026, supporting its deleveraging efforts toward a long-term target of approximately 2 times net debt to EBITDA.
