Estée Lauder soared after announcing it will cut up to 3,000 jobs as part of a restructuring plan to restart one of the world’s largest beauty companies.
The owner of the Ordinary and Clinique brands has a global workforce of approximately 62,000 employees announced that it will eliminate between 3% and 5% of those positions. As a result, Estée Lauder expects to incur restructuring and other expenses of between $500 and $700., before taxes. The job cuts are expected to generate annual pre-tax gross profits of between $350 million and $500 million, the company said in a statement, a portion of which it expects to reinvest to drive growth.
Estée Lauder now expects the workforce cuts and its broader restructuring plan to generate an incremental operating profit of between $1.1 billion and $1.4 billion.
That’s an increase from the $800 million to $1 billion in profits the company said in November it expected to generate over the next two years as it restructures. Almost all of the benefits are expected in its 2025 and 2026 fiscal years, the company said.