Coty (NYSE:COTY) Releases Earnings Results, Misses Estimates By $0.04 EPS

Coty (NYSE:COTY) released its earnings results on Thursday. The company reported $0.14 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.18 by ($0.04), FiscalAI reports. The business had revenue of $1.68 billion during the quarter, compared to the consensus estimate of $1.66 billion. Coty had a negative net margin of 6.60% and a positive return on equity of 4.74%.

Here are the key takeaways from Coty’s conference call:

• New leadership and “Coty Curated” strategy — Markus Strobel (36 days in) is refocusing the company on fewer brands/markets, disciplined investment, and scaling winners to improve operational execution over time.
• Guidance withdrawn and weak near-term outlook — Coty pulled full FY guidance and expects Q3 like‑for‑like sales to decline mid‑single digits with EBITDA of $100–$110M vs $204M a year ago, signaling material near‑term profit pressure.
• Balance sheet and cash generation strength — H1 free cash flow was $524M, Coty closed the Wella divestiture for $750M upfront, and net debt fell to $2.6B (2.7x leverage), giving the company more financial flexibility.
• Margin headwinds persist — Adjusted gross margin dropped ~260 bps in Q2 and management expects another 200–300 bps headwind from promotions, tariffs, mix and lower volumes into the second half.
• Consumer beauty turnaround and portfolio pruning underway — The “Color the Future” plan, SKU rationalization, reallocated A&CP, AI content initiatives, ending the Aveda license, and halting small lifestyle projects aim to restore share and profits but improvements are expected to take time.

Coty Price Performance

COTY traded down $0.26 on Thursday, reaching $3.18. The stock had a trading volume of 15,810,259 shares, compared to its average volume of 7,597,091. The company has a current ratio of 0.85, a quick ratio of 0.54 and a debt-to-equity ratio of 1.05. The company has a market capitalization of $2.78 billion, a price-to-earnings ratio of -6.90, a price-to-earnings-growth ratio of 0.22 and a beta of 0.95. Coty has a fifty-two week low of $2.94 and a fifty-two week high of $7.10. The firm has a 50-day moving average of $3.21 and a 200-day moving average of $3.85.

Trending Headlines about Coty

Here are the key news stories impacting Coty this week:

• Positive Sentiment: Coty announced a companywide partnership with OpenAI to scale AI tools across its global operations — a potential productivity and cost-efficiency tailwind if execution succeeds. OpenAI Partnership
• Positive Sentiment: Royal Bank of Canada reiterated an “Outperform” rating on COTY, which can lend analyst support to the shares despite near-term weakness. RBC Reiterates Outperform
• Positive Sentiment: Unusual options activity: roughly 10,652 call contracts were bought (≈430% above normal daily call volume), signaling bullish speculative interest or hedging ahead of moves.
• Neutral Sentiment: Revenue for the quarter was $1.68B, slightly above the $1.66B consensus — a modest operational beat but not enough to offset the EPS shortfall. Quarterly Press Release
• Neutral Sentiment: Market commentary and valuation pieces are circulating (earnings outlook / valuation reviews), which may shape medium-term sentiment but don’t change the immediate fundamental drivers. Earnings Outlook
• Negative Sentiment: Coty missed EPS expectations: reported $0.14 vs. $0.18 consensus (a $0.04 miss) and still shows a negative net margin (~‑6.6%), which raises near-term profitability concerns. Quarterly Press Release
• Negative Sentiment: Coty withdrew its full-year outlook and named Markus Strobel as interim CEO while refocusing on core brands and operational discipline — a sign management sees execution risk and requires a reset, which typically pressures the stock near term. Guidance Withdrawal / CEO Change

Institutional Investors Weigh In On Coty

Several hedge funds have recently added to or reduced their stakes in the business. Credit Agricole S A acquired a new position in shares of Coty during the third quarter worth $63,824,000. Two Sigma Investments LP lifted its holdings in Coty by 793.5% during the 3rd quarter. Two Sigma Investments LP now owns 4,401,554 shares of the company’s stock worth $17,782,000 after buying an additional 3,908,955 shares during the period. Squarepoint Ops LLC bought a new stake in shares of Coty in the 2nd quarter valued at about $15,829,000. Qube Research & Technologies Ltd acquired a new stake in shares of Coty in the second quarter valued at about $11,015,000. Finally, Man Group plc lifted its stake in shares of Coty by 62.1% in the second quarter. Man Group plc now owns 5,978,817 shares of the company’s stock worth $27,801,000 after acquiring an additional 2,289,649 shares during the period. 42.36% of the stock is currently owned by institutional investors and hedge funds.

Analyst Upgrades and Downgrades

A number of analysts have commented on the stock. Weiss Ratings reiterated a “sell (d)” rating on shares of Coty in a research note on Wednesday, January 21st. Redburn Partners set a $3.60 price objective on shares of Coty in a research report on Tuesday, November 25th. Royal Bank Of Canada reaffirmed an “outperform” rating and issued a $10.00 target price on shares of Coty in a research report on Tuesday. Rothschild Redb upgraded Coty to a “hold” rating in a research report on Tuesday, November 25th. Finally, Canaccord Genuity Group set a $3.50 price objective on Coty in a report on Monday. Three analysts have rated the stock with a Buy rating, eighteen have issued a Hold rating and three have given a Sell rating to the company. According to MarketBeat.com, Coty has a consensus rating of “Hold” and an average target price of $5.20.

About Coty

Coty Inc is a multinational beauty company specializing in the development, manufacturing and marketing of fragrances, color cosmetics and skin and body care products. Established in 1904 by François Coty in Paris, the company has grown through a blend of organic innovation and strategic acquisitions to become one of the leading players in the global beauty industry. Coty’s portfolio encompasses a broad range of consumer and luxury brands, reflecting its commitment to catering to diverse consumer preferences and market segments.

The company’s product offerings span three main divisions: Coty Luxury, Coty Consumer Beauty and Coty Professional Beauty.