Estée Lauder Cos Inc on Thursday forecast a smaller fall in full-year sales than previously expected, on resilient demand for its skin care and fragrances and an expected recovery in major market China that recently eased its Covid curbs.

Even with the United States on the edge of a recession, the beauty market’s post-pandemic rebound thrives with wealthy consumers indulging in smaller luxuries like lipsticks and fragrances, as they delay big-ticket purchases in the current environment.

Analysts expect China’s move in early December to relax its toughest Covid curbs and lift some travel restrictions in the region to benefit luxury and beauty companies that had flagged a hit to sales in the country from its strict zero-Covid policy.

Estée Lauder expects 2023 net sales to fall between 5 percent and 7 percent, compared with its prior forecast of a decrease between 6 percent and 8 percent.

However, Estée sees annual adjusted profit per share to fall between 27 percent and 29 percent, compared with its prior forecast of a decrease between 19 percent and 21 percent, due to an impact from a stronger dollar.

By Ananya Mariam Rajesh; Editor: Shinjini Ganguli

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Estée Lauder Falls After Slashing Outlook on China Weakness

Estée Lauder sees net sales decreasing between 6 percent to 8 percent in the current fiscal year versus the year-ago period.