Cosmetics company Estee Lauder (EL) saw its stock plummet on Tuesday after announcing plans to cut up to 7,000 jobs. The skincare and beauty products maker said these cuts will result in 5,800 to 7,000 employees being laid off by the end of 2026. The layoffs are an extension of the company’s plan to reduce its headcount by 5%. It expects to suffer $1.2 billion to $1.6 billion in restructuring charges tied to these layoffs.
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Estee Lauder President and CEO Stéphane de La Faverie also announced the company’s Beauty Reimagined restructuring plan. This change will overhaul the makeup maker’s organizational structure and executive team. The goal is to create a “flatter, leaner organization and simplified operations across the business to better serve our consumers.”
Starting April 1, 2025, Estee Lauder will consolidate its regional operations into four groups. Nadine Graf will lead its EMEA, UK&I, and the newly created Emerging Markets division, Tara Simon and Amber English will manage its Americas cluster, Joy Fan will oversee mainland China operations, and Matthew Growdon will cover the Asia-Pacific region outside mainland China.
How This Affects EL Stock Today
Investors aren’t excited about the restructuring and layoffs, with shares of EL stock down 19.08% today. That builds on a 10.66% drop year-to-date and a 54.43% decrease over the past 52 weeks. This drop comes amid a selloff of EL shares with more than 4.36 million traded as of this writing, surpassing the company’s three-month daily average trading volume of 3.24 million units.
Is EL Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for Estee Lauder is Moderate Buy based on four Buy and 11 Hold ratings over the last three months. With that comes an average price target of $82.60, a high of $107, and a low of $71. This represents a potential 23.84% upside for EL stock.
