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Item 1A. Risk Factors

2026-08-20 compared with 2025-08-21 · 175 added, 146 removed, 469 unchanged (41% of the section changed)

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and its majority and wholly-owned subsidiaries.

These disclosures reflect the Company’s beliefs and opinions as to factors that could materially and adversely affect the Company and its securities in the future.

References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.

Risk Factor Summary

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• Changes in industry trends and consumer preferences could adversely affect our business, prospects, financial condition and results of operations.

• Our new product introductions may not be as successful as we anticipate, which could have a material adverse effect on our business, prospects, financial condition and results of operations.

• Our success depends, in part, on the quality, efficacy and safety of our products.

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• Our business is subject to seasonal variability.

• Our success depends on our ability to achieve our global business strategies.

• Our success depends on our ability to refine and achieve our global business strategies.

• Potential divestitures, and any retained liabilities from such sold businesses, could negatively impact our business and financial results.

• We have incurred significant costs in connection with the integration of acquisitions and simplifying our business, and expect to incur costs in connection with the implementation of our global business strategies, that could affect our period-to-period operating results.

• Our new product introductions may not be as successful as we anticipate, which could have a material adverse effect on our business, prospects, financial condition and results of operations.

• We may not be able to identify suitable acquisition targets and our acquisition activities and other strategic transactions may present managerial, integration, operational and financial risks, which may prevent us from realizing the full intended benefit of the acquisitions we undertake.

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• Our goodwill and other assets have been subject to impairment and may continue to be subject to impairment in the future.

• A disruption in operations could adversely affect our business.

• A disruption in our manufacturing, distribution, logistics or other operations could adversely affect our business.

• Volatility in the cost or availability of raw materials, packaging, transportation and other inputs, or disruptions involving our suppliers, could adversely affect our business.

• We outsource a number of functions to third-party service providers, and any failure to perform or other disruptions or delays at our third-party service providers could adversely impact our business, our results of operations or our financial condition.

• Evolving supply chain diligence, sourcing, packaging and product-related requirements could increase our costs, restrict sales of our products or adversely affect our reputation.

• We are increasingly dependent on information technology, and if we are unable to protect against service interruptions, corruption of our data and privacy protections, cyber-based attacks or network security breaches, our operations could be disrupted.

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• Failure of or disruption to one or more of our information technology platforms could affect our ability to execute our operating strategy.

• We use AI in our business, and challenges with properly managing its use could result in harm to our brands, reputation, business or customers.

• We use AI in our business, and challenges with properly governing, managing or monitoring its use could result in harm to our brands, reputation, business, operations or customers.

• Our success depends, in part, on our employees, including our key personnel.

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The beauty industry is highly competitive, and if we are unable to compete effectively, our business, prospects, financial condition and results of operations could suffer.

The beauty industry is highly competitive and can change rapidly due to consumer preferences and industry trends, such as the expansion of digital channels, direct-to-consumer channels, new “disruptor” trendy brands and advances in technology such as artificial intelligence (“AI”).

The beauty industry is highly competitive and can change rapidly due to consumer preferences and industry trends, such as the expansion of digital channels and advances in technology such as AI, direct-to-consumer channels, new “disruptor” trendy brands and celebrity and influencer-backed beauty companies that have garnered significant followings.

Competition in the beauty industry is based on several factors, including pricing, value and quality, product efficacy, packaging and brands, speed or quality of innovation and new product introductions, in-store presence and visibility, promotional activities (including influencers) and brand recognition, distribution channels, advertising, editorials and adaption to evolving technology and device trends, including via e-commerce initiatives.

We must compete with a high volume of new product introductions and existing products by diverse companies across several different distribution channels.

Our competitors include large multinational consumer products companies, private label brands and emerging companies, among others, and some have greater resources than we do or may be able to respond more quickly or effectively to changing business and economic conditions than we can.

It is difficult for us to predict the timing and scale of our competitors’ actions and their impact on the industry or on our business.

For example, the fragrance category is being influenced by new product introductions, niche brands and growing e-commerce distribution.

The color cosmetics category has been influenced by entry by new competitors and smaller competitors that are fast to respond to trends and engage with their customers through digital platforms, including using new or advancing technologies such as AI and data analytics and innovative in-store activations.

For example, the fragrance category is being influenced by new product

introductions, niche brands and growing e-commerce distribution.

The color cosmetics category has been influenced by entry by new competitors and smaller competitors that are fast to respond to trends and engage with their customers through digital platforms, including leveraging data analytics, AI and machine learning, and innovative in-store activations.

Furthermore, e‑commerce and the online retail industry is characterized by rapid technological evolution, changes in consumer requirements and preferences, frequent introductions of new products and services embodying new technologies and the emergence of new industry standards and practices and evolving regulatory regimes, any of which could render our existing technologies and systems obsolete.

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Further consolidation in the retail industry and shifting preferences in how and where consumers shop, including to e‑commerce, may adversely affect our business, prospects, financial condition and results of operations.

Significant consolidation in the retail industry has occurred during the last several years.

Significant consolidation in the retail industry has occurred during the last several years, including through reorganizations, restructurings, bankruptcies and ownership changes.

The trend toward consolidation, particularly in developed markets such as the U.S.

and Western Europe, has resulted in our becoming increasingly dependent on

our relationships with, and the overall business health of, fewer key retailers that control an increasing percentage of retail locations, which trend may continue.

and Western Europe, has resulted in our becoming increasingly dependent on our relationships with, and the overall business health of, fewer key retailers that control an increasing percentage of retail locations, which trend may continue.

For example, certain retailers account for over 10% of our net revenues in certain geographies, including the U.S.

We generally do not have long-term sales contracts or other sales assurances with our retail customers.

Our success is dependent on our ability to manage our retailer relationships, including offering trade terms on mutually acceptable terms.

We have been and may continue to be negatively affected by changes in the policies or practices of our customers, such as inventory destocking, automated fulfillment requirements, AI-aided category pricing pressures and algorithms, limitations on access to shelf space (including the digital shelf), delisting of our products, or sustainability, supply chain or packaging standards or initiatives.

We may not be successful in adapting or effectively reacting to the rapidly changing retail landscape, changes in consumer behavior, preferences or purchasing patterns.

Furthermore, increased online competition and declining in-store traffic has resulted, and may continue to result, in brick-and-mortar retailers closing physical stores, which could negatively impact our distribution strategies and/or sales if such retailers decide to significantly reduce their inventory levels for our products or to designate more shelf space to our competitors.

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Further consolidation and store closures, or reduction in inventory levels of our products or shelf space devoted to our products, or the financial distress of a major retailer, could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

We generally do not have long-term sales contracts or other sales assurances with our retail customers.

Consumer shopping preferences have also shifted, and may continue to shift in the future, to distribution channels other than traditional retail in which we have more limited experience, presence and development, such as direct-to-consumer sales and e-commerce.

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In addition, net revenues and margins on beauty products tend to decline as they advance in their life cycles, so our net revenues and margins could suffer if we do not successfully and continuously develop new products.

This product innovation also can place a strain on our employees and our financial resources, including incurring expenses in connection with product innovation and development, marketing and advertising that are not subsequently supported by a sufficient level of sales.

This product innovation also can place a strain on our employees and our financial resources, including incurring expenses in connection with product

innovation and development, marketing and advertising that are not subsequently supported by a sufficient level of sales.

Furthermore, we cannot predict how consumers will react to any new products that we launch or to repositioning of our brands.

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Consumer spending habits and consumer confidence have shifted and may continue to change in light of inflationary pressures, as well as changes in work practices and travel trends impacting the demand for our products.

Our new product introductions may not be as successful as we anticipate, which could have a material adverse effect on our business, prospects, financial condition and results of operations.

We must continually work to develop, produce and market new products and maintain a favorable mix of products in order to respond in an effective manner to changing consumer preferences.

We continually develop our approach as to how and where we market and sell our products.

In addition, we believe that we must maintain and enhance the recognition of our brands, which may require us to quickly and continuously adapt in a highly competitive industry to deliver desirable products and branding to our consumers.

If these or other initiatives are not successful, our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities could be adversely impacted.

We have made changes and may continue to change our process for the continuous development and evaluation of new product concepts.

In addition, each new product launch carries risks.

For example, we may incur costs exceeding our expectations, our advertising, promotional and marketing strategies may be less effective than planned or customer purchases or consumer sell-out may not be as high as anticipated, due to lack of acceptance of the products themselves, their price, or limited effectiveness of our marketing strategies.

In addition, we may experience a decrease in sales of certain of our existing products as a result of consumer preferences shifting to our newly-launched products or to the products of our competitors as a result of unsuccessful or unpopular product launches harming our brands.

Also, initially successful launches may not be sustained.

Any of these could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

As part of our ongoing business strategy we expect that we will need to continue to introduce new products in our traditional product categories and channels, while also expanding our product launches into adjacent categories and channels in which we may have less operating experience.

For example, we entered into a strategic partnership with Kylie Jenner, a digital-native beauty business and we are continuing our expansion in prestige cosmetics.

The success of product launches in these or adjacent product categories could be hampered by our relative inexperience operating in such categories and channels, the strength of our competitors or any of the other risks referred to herein.

Our inability to introduce successful products in our traditional categories and channels or in these or other adjacent categories and channels could limit our future growth and have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Our success depends, in part, on the quality, efficacy and safety of our products.

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What constitutes a reasonable basis for substantiation can vary widely based on geography, and the efforts that we undertake to support our claims may not be deemed adequate for any particular product or claim.

If we are unable to

show adequate substantiation for our product claims, or our promotional materials make claims that exceed the scope of allowed claims for the classification of the specific product, regulatory authorities could take enforcement action or impose penalties, such as monetary consumer redress, requiring us to revise our marketing materials, amend our claims or stop selling or recalling certain products, all of which could harm our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

If we are unable to show adequate substantiation for our product claims, or our promotional materials make claims that exceed the scope of allowed claims for the classification of the specific product, regulatory authorities could take enforcement action or impose penalties, such as monetary consumer redress, requiring us to revise our marketing materials, amend our claims or stop selling or recalling certain products, all of which could harm our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Any regulatory action or penalty could lead to private party actions, which could further harm our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

If our products are perceived to be defective or unsafe, or if they otherwise fail to meet our consumers’ expectations, our relationships with customers or consumers could suffer, the appeal of one or more of our brands could be diminished, and we could lose sales or become subject to liability claims.

In addition, safety or other defects in our competitors’ products could reduce consumer demand for our own products if consumers view them to be similar or view the defects as symptomatic of the product category.

In addition, safety or other defects in our competitors’ products could

reduce consumer demand for our own products if consumers view them to be similar or view the defects as symptomatic of the product category.

Any of these outcomes could result in a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

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Our brand licenses typically impose various obligations on us, including the payment of annual royalties, maintenance of the quality of the licensed products, achievement of minimum sales levels, promotion of sales and qualifications and behavior of our suppliers, distributors and retailers.

We have breached, and

may in the future breach, certain terms of our brand licenses.

We have breached, and may in the future breach, certain terms of our brand licenses.

If we breach our obligations, our rights under the applicable brand license agreements could be terminated by the licensor and we could, among other things, have to pay damages, lose our ability to sell products related to that brand, lose any upfront investments made in connection with such license and sustain reputational damage.

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We may also face difficulties in finding replacements for terminated or expired licenses.

Each of the aforementioned risks could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Upon the expiration or termination of a license, we may be unable to negotiate favorable transition arrangements, and the agreed transition parameters may require significant coordination, resources and time to implement, including with respect to inventory, distribution, sell-off rights, operational support or separation activities.

the aforementioned risks could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

If we are unable to obtain, maintain and protect our intellectual property rights, in particular trademarks, patents and copyrights, or if our brand partners and licensors are unable to maintain and protect their intellectual property rights that we use in connection with our products, our ability to compete could be negatively impacted.

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However, we cannot be certain that the conduct of our business does not and will not infringe, misappropriate or otherwise violate such rights.

Moreover, our acquisition targets and other businesses in which we make strategic investments are often smaller or younger companies with less robust intellectual property clearance practices, and we may face challenges on the use of their trademarks and other proprietary rights.

Moreover, our

acquisition targets and other businesses in which we make strategic investments are often smaller or younger companies with less robust intellectual property clearance practices, and we may face challenges on the use of their trademarks and other proprietary rights.

If we are found to be infringing, misappropriating or otherwise violating a third party trademark, patent, copyright or other proprietary rights, we may need to obtain a license, which may not be available in a timely manner on commercially reasonable terms or at all, or redesign or rebrand our products, which may not be possible or result in a significant delay to market or otherwise have an adverse commercial impact.

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Risks Related to our Business Strategy and Organization

Our success depends on our ability to achieve our global business strategies.

Our future performance and growth depends on the success of our global business strategies, including our management team’s ability to successfully implement them, including a focus on improving gross margin, deleveraging, and simplifying our business.

Our success depends on our ability to refine and achieve our global business strategies.

We continue to refine and implement our global business strategies, and our future performance and growth depends on the success of these strategies, including our management team’s ability to successfully implement them, including implementing our Coty.Curated framework, returning to market share growth, accelerating data-driven operations powered by AI, improving our advocacy capability and execution, continuing to deliver on our key sustainability priorities, while maintaining focus on deleveraging.

The multi-year implementation of our global business strategies has resulted in and is expected to continue to result in changes to business priorities and operations, capital allocation priorities, operational and organizational structure, and increased demands on management.

Such changes could result in short-term and one-time costs without any current revenues, lost customers, reduced sales volume, higher than expected restructuring costs, loss of key personnel, additional supply chain disruptions, higher costs of supply and other negative impacts on our business.

Implementation of our global business strategy may take longer than anticipated, and, once implemented, we may not realize, in full or in part, the anticipated benefits or such benefits may be realized more slowly than anticipated.

Refinement and implementation of our global business strategies may take longer than anticipated, and, once implemented, we may not realize, in full or in part, the anticipated benefits or such benefits may be realized more slowly than anticipated.

The failure to realize benefits, which may be due to our inability to execute plans, delays in the implementation of our global business strategies, global or local economic conditions, competition, changes in the beauty industry and the other risks described herein, could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Our strategy includes executing on our brand repositioning and continuing to focus our brand-building efforts on priority categories, channels and markets.

Potential divestitures, and any retained liabilities from such sold business, could negatively impact our business and financial results.

As previously announced, we are conducting an ongoing a strategic review process regarding our Company’s consumer beauty business, including its mass color cosmetics business and associated brands and the Company’s distinct Brazil business comprised of local Brazilian brands.

Our strategy also includes executing on our brand repositioning and continuing to focus our brand-building efforts on priority categories, channels and markets, including a focus on our fragrance expertise and profitable adjacent categories.

In addition, we continue to prioritize our deleveraging objectives.

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We may face risks of declines in brand performance and license terminations, due to expirations and/or allegations of breach or for other reasons, including with regard to any potentially divested or discontinued brands.

If and when we decide to divest or discontinue any brands or lines of business, we cannot be sure that we will be able to locate suitable buyers or that we will be able to complete such divestitures (including through strategic transactions or public offerings) or discontinuances successfully, timely, at appropriate valuations and on commercially advantageous terms, or without significant costs, including relating to any post-closing purchase price adjustments or claims for indemnification.

Any future divestitures and discontinuances could have a dilutive impact on our earnings, create dis-synergies, and divert significant financial, operational and managerial resources from our existing operations and make it more difficult to achieve our operating and strategic objectives.

We also cannot be sure of the effect such divestitures or discontinuances would have on the performance of our remaining business or the ability to execute our global business strategies.

If and when we decide to divest or discontinue any brands or lines of business, we cannot be sure that we will be able to locate suitable buyers or that we will be able to complete such divestitures (including through strategic transactions or public offerings) or discontinuances successfully, timely, at appropriate valuations and on commercially advantageous terms (including with respect to retained liabilities), or without significant costs, including relating to any post-closing purchase price adjustments or claims for indemnification.

Divestitures or discontinuations (including as a result of the termination of licenses) involve significant challenges and risks, including the need to provide transition services, and the separation of operations, systems and personnel.

Any future divestitures and discontinuances could have a dilutive impact on our earnings, create dis-synergies, result in stranded costs, result in retained liabilities, structurally increase our leverage ratio through loss of earnings, reduce diversification across our

brand portfolio and increase concentration risk in our remaining business, and divert significant financial, operational and managerial resources from our existing operations and make it more difficult to achieve our operating and strategic objectives.

We also cannot be sure of the effect such divestitures or discontinuances would have on the performance of our remaining business or the ability to execute our global business strategies, and we may not be successful in restructuring the remaining business to address such impacts.

For example, in connection with the early termination of the Gucci Beauty license, we are evaluating our central organization, manufacturing and asset base, and certain market structures to adjust our scope and size following the transition period.

If we are unable to successfully or timely achieve sufficient savings, core business acceleration and portfolio expansion, we may not be able to fully mitigate the impact of the license termination on our business and performance.

We have incurred significant costs in connection with the integration of acquisitions and simplifying our business, and expect to incur costs in connection with the implementation of our global business strategies, that could affect our period-to-period operating results.

We have incurred significant restructuring costs in the past, and, as we continue to implement our global business strategies and any future restructuring initiatives, we expect to continue to incur one-time cash costs.

In the past, as we integrated acquisitions, including the transformational acquisition of the P&G Beauty Business, we experienced challenges, including supply chain disruptions, higher than expected costs and lost customers and related revenue and profits, and we could experience these or other challenges arising from the implementation of our global business strategies and any future restructuring initiatives.

We have incurred significant restructuring costs in the past, and, as we continue to refine and implement our global business strategies, brand portfolio management and any future divestiture or restructuring initiatives, we expect to continue to incur one-time cash costs.

The cash usage associated with such, and similar, expenses has impacted and could continue to impact our ability to execute our business strategies, improve operating results and deleverage our balance sheet.

If our management is not able to effectively manage these initiatives, address fixed and other costs, we incur additional operating expenses or capital expenditures to realize synergies, simplifications and cost savings, or if any significant business activities are interrupted as a result of these initiatives, our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities may be materially adversely affected.

If our management is not able to effectively manage these initiatives, address fixed and other costs, if we incur additional operating expenses or capital expenditures to realize synergies, simplifications and cost savings, or if any significant business activities are interrupted as a result of these initiatives, our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities may be materially adversely affected.

The amount and timing of the above-referenced charges and management distraction could further adversely affect our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

In addition, the implementation of our global business strategies, any continuing or future restructuring initiatives and the integration of acquisitions may impact our ability to anticipate future business trends and accurately forecast future results.

The diversion of resources to the integration of the P&G Beauty Business, together with changes and turnover in our management teams as we reorganized our business, negatively impacted our fiscal 2018 and 2019 results.

The implementation of our global business strategies could result in similar challenges.

In addition, the implementation of our global business strategies, any continuing or future restructuring initiatives, divestitures and brand portfolio management or the integration of future acquisitions may impact our ability to anticipate future business trends and accurately forecast future results.

Although our global business strategies are intended to deliver meaningful, sustainable expense and cost management improvement, events and circumstances such as financial or strategic difficulties, significant employee turnover, business disruption and delays may occur or continue, resulting in new, unexpected or increased costs that could result in us not realizing all of the anticipated benefits of our global business strategies on our expected timetable or at all.

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Any failure to implement our global business strategies and other initiatives in accordance with our expectations could adversely affect our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Our new product introductions may not be as successful as we anticipate, which could have a material adverse effect on our business, prospects, financial condition and results of operations.

We must continually work to develop, produce and market new products and maintain a favorable mix of products in order to respond in an effective manner to changing consumer preferences.

We continually develop our approach as to how and where we market and sell our products.

For example, as part of our global business strategies, we are instituting new objectives for our innovation efforts to support expansion of category coverage and sustainability.

We have made changes and may continue to change our process for the continuous development and evaluation of new product concepts.

In addition, each new product launch carries risks.

For example, we may incur costs exceeding our expectations, our advertising, promotional and marketing strategies may be less effective than planned or customer purchases may not be as high as anticipated.

Also, initially successful launches may not be sustained.

Any of these could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

For example, we entered into a strategic partnership with Kylie Jenner, a digital-native beauty business;

we are continuing our expansion in prestige cosmetics, and we are building a comprehensive skincare portfolio leveraging existing and new brands.

Our inability to introduce successful products in our traditional categories and channels or in these

or other adjacent categories and channels could limit our future growth and have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

We may not be able to identify suitable acquisition targets and our acquisition activities and other strategic transactions may present managerial, integration, operational and financial risks, which may prevent us from realizing the full intended benefit of the acquisitions we undertake.

Our acquisition activities and other strategic transactions expose us to certain risks related to integration, including diversion of management attention from existing core businesses and substantial investment of resources to support integration.

In the past, we have explored and undertaken opportunities to acquire other companies and assets as part of our growth strategy.

For example, we completed five significant acquisitions in fiscal 2016 through fiscal 2018 (including the acquisition of the P&G Beauty Business in October 2016), and we entered into a joint venture with Kylie Jenner in fiscal 2020.

These assets represent a significant portion of our net assets, particularly the P&G Beauty Business.

As we consider growth opportunities, we may seek acquisitions that we believe strengthen our competitive position in our key segments and geographies or accelerate our ability to grow into adjacent product categories and channels and emerging markets or which otherwise fit our strategy.

In the past, we grew our business through significant acquisitions and strategic transactions, including the acquisition of the P&G Beauty Business in October 2016 and the joint venture with Kylie Jenner in fiscal 2020.

There can be no assurance that we will be able to identify suitable acquisition candidates, be the successful bidder or consummate acquisitions on favorable terms, have the funds to acquire desirable acquisitions or otherwise realize the full intended benefit of such transactions.

In addition, acquisitions could adversely impact our deleveraging strategy.

Our acquisition activities and other strategic transactions also expose us to certain risks related to integration, including diversion of management attention from existing core businesses and substantial investment of resources to support integration.

Acquisition activities may also result in slower progress toward environmental, social and governance goals given challenges with data acquisition and integration, the difficulty of accessing and disclosing sufficient environmental, social and governance data to comply with current and emerging regulations, and integration of environmental, social and governance initiatives overall.

The assumptions we use to evaluate acquisition opportunities may prove to be inaccurate, and intended benefits may not be realized.

Our due diligence investigations may fail to identify all of the problems, liabilities or other challenges associated with an acquired business which could result in increased risk of unanticipated or unknown issues or liabilities, including with respect to environmental, competition and other regulatory matters, and our mitigation strategies for such risks that are identified may not be effective.

Our due diligence investigations may fail to identify all of the problems, liabilities or other challenges associated with

an acquired business which could result in increased risk of unanticipated or unknown issues or liabilities, including with respect to environmental, competition and other regulatory matters, and our mitigation strategies for such risks that are identified may not be effective.

As a result, we may not achieve some or any of the benefits, including anticipated synergies or accretion to earnings or other financial measures, that we expect to achieve in connection with our acquisitions and joint ventures, or we may not accurately anticipate the fixed and other costs associated with such acquisitions and joint ventures, or the business may not achieve the performance we anticipated, which may materially adversely affect our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

In some cases, acquired businesses, brands or strategic investments may underperform our expectations, require additional investment or restructuring, or ultimately be divested on terms that do not allow us to recover our original investment.

Any financing for an acquisition could increase our indebtedness or result in a potential violation of the debt covenants under our existing facilities requiring consent or waiver from our lenders, which could delay or prevent the acquisition, or dilute the interests of our stockholders.

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We have experienced impairment charges with respect to goodwill, intangible assets or other items in connection with past acquisitions, and we may experience such charges in connection with such acquisitions or future acquisitions, particularly if business performance declines or expected growth is not realized or the applicable discount rate changes adversely.

For example, in fiscal 2022, we incurred impairment charges of $31.4, primarily related to impairments on indefinite-lived other intangible assets.

In the third quarter of fiscal 2025, we incurred impairment charges of $212.8, related to indefinite-lived intangible assets for certain trademarks within the Consumer Beauty Segment and for our Philosophy trademark within the Prestige Segment.

For example, in fiscal 2025, we incurred impairment charges of $212.8, related to indefinite-lived intangible assets for certain trademarks within the Consumer Beauty Segment and for our Philosophy trademark within the Prestige Segment.

In fiscal 2026, we incurred $362.8 of asset impairment charges of which $237.1 related to goodwill within the Consumer Beauty segment, and $50.6, $48.5, $22.5, $4.1 related to the CoverGirl , Sally Hansen , Max Factor , and Bourjois trademarks, respectively, within the Consumer Beauty Segment.

It is possible that material changes in our business, market conditions, or market assumptions could occur over time.

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Risks related to our Business Operations

A disruption in operations could adversely affect our business.

As a company engaged in manufacturing and distribution on a global scale, we are subject to the risks inherent in such activities, including industrial accidents, environmental events, strikes and other labor disputes (including as to works councils), disruptions in supply chain or information systems, loss or impairment of key manufacturing sites or distribution centers, product quality control, safety, licensing requirements and other regulatory issues, as well as natural disasters, pandemics or outbreaks of contagious diseases, border disputes, acts of terrorism, armed conflicts such as the war in Ukraine and other geopolitical tensions, possible dawn raids, and other external factors over which we have no control.

For example, in fiscal 2022, limited driver capacity and transportation delays impacted our U.S.

distribution centers resulting in increased costs, including penalty payments to retailers for delayed product delivery.

A disruption in our manufacturing, distribution, logistics or other operations could adversely affect our business.

As a company engaged in manufacturing and distribution on a global scale, we are subject to the risks inherent in such activities, including industrial accidents, environmental events, strikes and other labor disputes (including works council-related matters), disruptions in supply chain or information systems, loss or impairment of key manufacturing sites or distribution centers, product quality control, safety, licensing requirements and other regulatory issues, as well as natural disasters, pandemics or outbreaks of contagious diseases, border disputes, acts of terrorism, armed conflicts such as the war in Ukraine and the war in the Middle East and other geopolitical tensions, possible dawn raids, and other external factors over which we have no control.

For example, limited driver capacity, transportation delays or other logistics disruptions have impacted, and may impact in the future, our distribution centers and result in increased costs, including penalty payments to retailers for delayed product delivery.

As we continue our implementation of our global business strategies (including our cost discipline activities and sustainability initiatives) and other restructuring activities, any additional or ongoing supply chain disruptions or delay in securing applicable approvals or consultations for such activities may impact our quarterly results.

The loss of, or damage or disruption to, any of our manufacturing facilities or distribution centers could have a material adverse effect on our business, prospects, results of operations, financial condition, results of operations, cash flows, as well as the trading price of our securities.

Volatility in the cost or availability of raw materials, packaging, transportation and other inputs, or disruptions involving our suppliers, could adversely affect our business.

We manufacture and package a majority of our products.

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The loss of multiple suppliers or a significant disruption or interruption in the supply chain, or our relationships with key suppliers due to our payment terms or otherwise, could have a material adverse effect on the manufacturing and packaging of our products.

In fiscal 2023, inflationary pressures as well as global supply chain disruptions caused significant volatility in the cost and availability of the raw materials and services (such as transportation) that we need to manufacture and distribute our products.

In particular, increases in energy costs due to global geopolitical conditions, particularly in Europe, impacted the cost and availability of raw materials, including glass and glass components and certain resins.

Inflationary pressures as well as global supply chain disruptions and geopolitical events have caused and may continue to cause significant volatility in the cost and availability of the raw materials and services (such as transportation) that we need to manufacture and distribute our products.

In particular, increases in energy costs due to global geopolitical conditions have impacted the cost and availability of raw materials, including glass and glass components and certain resins.

Although inflationary pressures have eased, future increases in the costs of raw materials or other commodities and transportation services may adversely affect our profit margins if we are unable to pass along any higher costs in the form of price increases or otherwise achieve cost efficiencies in manufacturing and distribution.

In addition, failure by our third-party suppliers to comply with ethical, social, product, labor and environmental laws, regulations or standards, or their engagement in politically or socially controversial conduct, such as animal testing, could negatively impact our reputations and lead to various adverse consequences, including decreased sales and consumer boycotts.

We are also subject to reporting requirements under The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 regarding the use of certain minerals mined from the Democratic Republic of Congo and adjoining countries and procedures pertaining to a manufacturer’s efforts in identifying the source of such minerals.

SEC rules implementing these requirements may have the effect of reducing the pool of suppliers who may supply “conflict free” products, and we may not be able to obtain conflict free products or supplies in sufficient quantities for our operations.

Likewise, we have faced, and may continue to face, constraints in the availability of certain raw materials that align with our sustainability goals, including responsibly sourced palm oil, mica and recycled materials.

Since our supply chain is complex, we may face operational obstacles and reputational challenges with our customers and stockholders if we are unable to continue to sufficiently verify the origins for materials used in our products and packaging or if we are subject to additional supply chain diligence and disclosure regulations or other reporting obligations.

The above risks have been and may continue to be exacerbated by the impact of inflationary pressures, global supply chain disruptions on our business, and our efforts to manage and remedy these impacts to the Company may not achieve results in accordance with our expectations or on the timelines we anticipate.

We may not be able to obtain sufficient quantities of materials that satisfy applicable regulatory requirements, customer expectations or our sustainability goals, and we have faced, and may continue to face, constraints in the availability of certain raw materials, including responsibly sourced palm oil, mica and recycled materials.

Any inability to obtain required materials or services on commercially reasonable terms, or at all, could result in operational disruptions, increased costs, supply constraints, product launch or distribution delays or reputational harm.

We outsource a number of functions to third-party service providers, and any failure to perform or other disruptions or delays at our third-party service providers could adversely impact our business, our results of operations or our financial condition.

We have outsourced and may continue to outsource certain functions, including outsourcing of distribution functions, outsourcing of business processes (including certain finance and accounting functions), and third-party manufacturers, logistics and supply chain suppliers, and other suppliers, including third-party software providers, web-hosting and e‑commerce providers, and we are dependent on the entities performing those functions.

As we evaluate our operations to adjust our scope

and size for our future business, we may outsource additional functions, such as certain research and development, and we may increasingly rely on third party manufacturers.

The failure of one or more such providers to provide the expected services, provide them on a timely basis or provide them at the prices we expect, the failure of one or more of such providers to meet our performance standards and expectations, including with respect to data security, compliance with data protection and privacy laws, disruptions arising from the transition of functions to an outsourcing provider, or the costs incurred in returning these outsourced functions to being performed under our management and direct control, may have a material adverse effect on our results of operations or financial condition.

Evolving supply chain diligence, sourcing, packaging and product-related requirements could increase our costs, restrict sales of our products or adversely affect our reputation.

We are subject to evolving supply chain diligence, sourcing, packaging and product-related reporting requirements in the U.S., E.U.

and other jurisdictions, including requirements relating to “conflict” minerals, deforestation-linked commodities, and packaging design, recyclability, recycled content, labeling, extended producer responsibility and waste reduction.

Compliance with these requirements may require additional supplier diligence and engagement, changes to sourcing, product or packaging specifications, enhanced chain-of-custody and composition data, and increased reporting, operational and compliance costs.

Continued uncertainty regarding the scope, interpretation, timing and implementation of these requirements may also delay our ability, and the ability of certain suppliers, to complete required diligence, provide necessary data or certifications, or make operational or sourcing changes.

In some instances, a failure to comply with applicable requirements could restrict or prevent the sale of our products in the relevant jurisdiction.

In addition, failure by our third-party suppliers to comply with ethical, social, product, labor and environmental laws, regulations or standards, or their engagement in politically or socially controversial conduct, such as animal testing, could negatively impact our reputation and lead to various adverse consequences, including decreased sales and consumer boycotts.

Given the complexity of our supply chain, any inability to sufficiently verify the origin, composition or compliance status for materials used in our products and packaging, or to comply with additional supply chain diligence, packaging and disclosure regulations or reporting obligations, could result in operational disruptions, increased costs, enforcement risk, reputational harm or other adverse effects on our business.

We are increasingly dependent on information technology, and if we are unable to protect against service interruptions, corruption of our data and privacy protections, cyber-based attacks or network security breaches, our operations could be disrupted.

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If not managed and mitigated effectively, these risks could increase in the future as we expand our digital capabilities and e-commerce activities, including through the use of new digital applications and technologies.

There are further risks associated with the information systems of our joint ventures and of the companies we acquire, both in terms of systems compatibility, process controls, level of security and functionality.

our existing systems, our financial condition, results of operations and cash flows, as well as the trading price of our securities, may be adversely affected.

There are further risks associated with the information

systems of our joint ventures and of the companies we acquire, both in terms of systems compatibility, process controls, level of security and functionality.

It may cost us significant time, money and resources to address these risks and if our systems were to fail or we are unable to successfully expand the capacity of these systems, or we are unable to integrate new technologies into our existing systems, our financial condition, results of operations and cash flows, as well as the trading price of our securities, may be adversely affected.

We must continue to maintain and make requisite or critical upgrades to our information technology systems, and our failure to do so could have a material adverse effect on our business, financial condition and results of operations.

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The failure of one or more systems could lead to operating inefficiencies or disruptions and a resulting decline in revenue or profitability.

As we continue the implementation and the migration to SaaS and cloud-based technology solutions, there can be no assurance that we will be successful in our efforts or that the implementation of the remaining stages of these initiatives in the Company's global operations will not involve disruptions in our systems or processes having a short term adverse impact on our operations and ability to serve customers and business partners.

the Company’s global operations will not involve disruptions in our systems or processes having a short term adverse impact on our operations and ability to serve customers and business partners.

Our e-commerce operations are important to our business, and our digital marketing strategies rely on the use of online and mobile applications, including third-party social media platforms.

Due to the importance of our e-commerce operations, we are

vulnerable to website or application downtime and other technical failures, as well as disruptions beyond our control.

For example, recent and future regulatory measures restricting or otherwise impacting the use of the web sites, mobile applications or social media platforms that we use in connection with our digital marketing and e-commerce activities could impact the development of our digital advocacy strategy.

Due to the importance of our e-commerce operations, we are vulnerable to website or application downtime and other technical failures, as well as disruptions beyond our control.

For example, regulatory measures restricting or otherwise impacting the use of the web sites, mobile applications or social media platforms that we use in connection with our digital marketing and e-commerce activities could impact the development of our digital advocacy strategy.

Our failure to successfully respond to these risks in a timely manner could reduce e-commerce sales, damage our brands’ reputations or reduce the impact of our digital marketing strategies.

The risks described here are heightened due to the increase in remote working and the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks.

The risks described here are heightened due to the prevalence of remote working and the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks.

If a natural disaster, power outage, connectivity issue, or other event occurs that impacts our employees’ ability to work remotely, it may be difficult or, in certain cases, impossible, for us to continue our business for a substantial period of time.

The increase in remote working may also result in heightened consumer privacy, IT security and fraud concerns, potentially disrupting our operations for a prolonged period of time.

We use AI in our business, and challenges with properly managing its use could result in harm to our brands, reputation, business or customers.

We are starting to implement the use of AI solutions, including machine learning and generative AI tools that collect, aggregate, and analyze data to assist in the development of our products and in the use of internal tools that support our business.

These applications may become increasingly important in our operations over time.

This emerging technology presents a number of risks inherent in its use.

AI algorithms trained with noisy data may create accuracy issues, unintended biases, and discriminatory outcomes that could harm our brand, reputation, business, or customers.

Additionally, no assurance can be made that the usage of AI will assist us in being more efficient.

Further, dependence on AI without adequate safeguards to make certain business decisions may introduce additional operational vulnerabilities by producing inaccurate outcomes, recommendations, or other suggestions based on flaws in the underlying data or other unintended results.

Our competitors or other third parties may incorporate AI into their business, services, and products more rapidly or more successfully than us, which could hinder our ability to compete effectively and adversely affect our results of operations.

Implementing the use of AI successfully, ethically and as intended, will require significant resources.

In addition, the use of AI may increase cybersecurity and data privacy risks, such as intended, unintended, or inadvertent transmission of proprietary or sensitive information.

The technologies underlying AI and their use cases are rapidly developing, and it is not possible to predict all of the legal, operational or technological risks related to the use of AI.

While new AI initiatives, laws, and regulations are emerging and evolving, uncertainty will remain, and our obligation to comply with the evolving regulatory landscape could entail significant costs, negatively affect our business, or limit our ability to incorporate certain AI capabilities into our business.

We use AI in our business, and challenges with properly governing, managing or monitoring its use could result in harm to our brands, reputation, business, operations or customers.

We are expanding the use of AI solutions, including machine learning and generative AI tools and related technologies in our operations, including to support marketing, media allocation, content creation and optimization, translation, demand planning, supply chain optimization, customer engagement, internal productivity tools and other business processes.

These applications may become increasingly important in our operations over time and will require significant resources to implement successfully.

The use of AI presents a number of evolving legal, operational, commercial, intellectual property, cybersecurity, privacy, regulatory, ethical and reputational risks, many of which are uncertain or may develop rapidly.

AI systems may produce inaccurate, incomplete, biased, misleading, offensive, discriminatory or otherwise harmful outputs, including because of limitations, biases or errors in underlying models, training data, prompts, third-party tools, integrations or human review processes.

AI outputs may also fail to reflect current facts, applicable legal or regulatory requirements, brand standards, product substantiation requirements, consumer expectations or our policies and procedures.

If we or our third-party service providers, vendors, agencies, partners or employees rely on AI outputs without appropriate human review, validation and controls, we may make operational, marketing, product, employment, consumer-facing or other decisions that adversely affect our business, brands, reputation, customers, employees, suppliers or other stakeholders.

Further, our competitors or other third parties may incorporate AI into their business, services, and products more rapidly or more successfully than us, which could hinder our ability to compete effectively.

The use of AI may also increase the risk of unauthorized disclosure, misuse or loss of confidential, proprietary, personal, regulated or otherwise sensitive information, including through prompts, uploads, model training, logs, integrations or vendor systems.

If such information is provided to or processed by an AI tool without appropriate authorization, contractual protections or technical safeguards, we may lose valuable intellectual property or trade secret protections, breach contractual confidentiality obligations, violate privacy, cybersecurity, consumer protection or employment laws, or otherwise expose the Company to regulatory scrutiny, litigation, remediation costs or reputational harm.

In addition, AI-generated content or content modified using AI may infringe, misappropriate or otherwise violate third-party intellectual property, privacy, publicity or other rights, may be difficult to protect under existing intellectual property laws, or may create uncertainty regarding ownership, authorship or enforceability of rights in such content.

We have adopted internal governance processes and policies for AI use, including review and approval requirements for AI initiatives, restrictions on use of confidential or sensitive information, legal and compliance review for certain use cases, contractual requirements for certain vendors, human oversight expectations, and monitoring and reporting obligations.

However, these controls may not be effective in all circumstances, may not be followed by employees, contractors, agencies, vendors or other third parties, may not identify or mitigate all risks, and may require significant resources to maintain and evolve.

In particular, unauthorized, unapproved or inconsistent use of AI tools may be difficult to detect or prevent, especially as AI capabilities become embedded in commonly used software, vendor offerings and business processes.

In addition, approved AI initiatives may expand beyond their original scope, may not perform as expected, may be deployed without adequate testing, monitoring, documentation or escalation, or may become non-compliant as laws, regulations, industry standards, platform terms and stakeholder expectations evolve.

The legal and regulatory framework applicable to AI is rapidly evolving globally, including with respect to transparency, automated decision-making, data protection, employment, consumer protection, advertising, intellectual property, cybersecurity and high-risk AI systems.

Compliance with new or changing AI-related laws, regulations, guidance, enforcement priorities, industry standards or contractual requirements may require us to modify, limit, suspend or discontinue certain AI uses, incur

additional costs, implement new governance processes, complete additional assessments, provide disclosures, enhance monitoring and documentation, or obtain additional contractual protections from vendors and other third parties.

Failure by us or by third parties acting on our behalf to comply with such requirements, or to use AI in a manner consistent with our policies, contractual obligations, brand standards or stakeholder expectations, could result in regulatory investigations, fines, penalties, litigation, indemnity claims, intellectual property disputes, loss of proprietary rights, cybersecurity incidents, business disruption, reputational harm, consumer or customer dissatisfaction, reduced effectiveness of our operations and marketing activities, or other adverse impacts on our business, financial condition, results of operations, cash flows and the trading price of our securities.

Our success depends, in part, on our employees, including our key personnel.

Our success depends, in part, on our ability to identify, hire, train and retain our employees, including our key personnel, such as our executive officers and senior management team and our research and development and marketing personnel.

Over the past few years, we have experienced several changes to senior management and the composition of our board of directors, as well as the separation of the Wella Business, and we are still in the process of implementing our global business strategies, including cost reduction activities.

Over the past few years, we have experienced several changes to senior management and the composition of our board of directors, and we are still in the process of refining and implementing our global business strategies, including cost reduction activities and right-sizing the organization for our future business.

Transition periods accompanying changes in leadership and changes due to business reorganization may result in uncertainty, impact business performance and strategies and retention of personnel.

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These challenges have resulted in, and could continue to result in, increased costs and could impact our ability to meet consumer demand, each of which may adversely affect our business and financial results.

As we continue to restructure our workforce from time to time (including with respect to our global business strategies and other business restructuring initiatives, as well as acquisitions and our overall growth strategy) and work with more brand partners and licensors, the risk of potential employment-related claims and disputes will also increase.

As we continue to restructure our workforce from time to time (including with respect to our global business strategies and other business restructuring initiatives, as well as changes to our brand portfolio) and work with more brand partners and licensors, the risk of potential employment-related claims and disputes will also increase.

As such, we or our partners may be subject to claims, allegations or legal proceedings related to employment matters including discrimination, harassment (sexual or otherwise), wrongful termination or retaliation, local, state, federal and non-U.S.

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In addition, our employees in certain countries in Europe are subject to works council arrangements, exposing us to associated delays, works council claims and associated litigation.

In the event we or our partners

are subject to one or more employment-related claims, allegations or legal proceedings, we or our partners may incur substantial costs, losses or other liabilities in the defense, investigation, settlement, delays associated with, or other disposition of such claims.

In the event we or our partners are subject to one or more employment-related claims, allegations or legal proceedings, we or our partners may incur substantial costs, losses or other liabilities in the defense, investigation, settlement, delays associated with, or other disposition of such claims.

In addition to the economic impact, we or our partners may also suffer reputational harm as a result of such claims, allegations and legal proceedings and the investigation, defense and prosecution of such claims, allegations and legal proceedings could cause substantial disruption in our or our partners’ business and operations, including delaying and reducing the expected benefits of any associated restructuring activities.

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If we underestimate or overestimate demand for our products and do not maintain appropriate inventory levels, our net revenues or working capital could be negatively impacted.

We are currently implementing initiatives to improve control over our product demand and inventories.

We continue to implement initiatives to improve control over our product demand planning and inventories.

We have identified, and may continue to identify, inventories that are not saleable in the ordinary course, but our existing program or any future inventory management program may not be successful in improving our inventory control.

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We also could have inadequate inventories which could hinder our ability to meet demand.

I n addition, due to changes in our strategy, including the Coty.Curated initiatives aimed at reducing portfolio complexity and focusing investment on core activations, we have incurred and will continue to incur excess and obsolete inventory charges.

We have sought and continue to seek to improve our payable terms, which could adversely affect our relations with our suppliers.

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Additional tariffs or other restrictions placed on imports, retaliatory trade measures taken by other countries and resulting trade wars may have a material adverse impact on our financial condition and results of operations.

prevailing quota, duty or tariff levels, which can affect both the materials that we use to manufacture or package our products and the sale of finished products.

and the other countries in which our products are manufactured or sold have imposed and may impose additional quotas, duties, tariffs, retaliatory or trade protection measures, or other restrictions or regulations, or may adversely adjust prevailing quota, duty or tariff levels, which can affect both the materials that we use to manufacture or package our products and the sale of finished products.

For example, in 2018, the E.U.

imposed tariffs on certain prestige category products imported from the U.S., which impact the sale in the E.U.

of certain of our products that are manufactured in the U.S.

imposed tariffs on certain prestige category products imported from the U.S., which, while in effect, impacted the sale in the E.U.

of certain of our products manufactured in the U.S.

Similarly, the tariffs imposed by the U.S.

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In addition, since early 2025, the U.S.

administration has announced a series of additional tariffs on products from countries worldwide, including products manufactured in the E.U.

and in China.

Although some of these tariffs have been paused or reduced, there is significant uncertainty as trade negotiations are ongoing and outcomes are unpredictable.

administration, under various authorities, has announced, imposed, modified, expanded and in certain cases replaced tariffs on imported goods from countries worldwide, including products manufactured in the E.U.

and in China, while other countries have implemented or may implement responsive trade measures.

Although some of these tariffs have been paused, reduced or invalidated, there is significant uncertainty as trade negotiations are ongoing and outcomes are unpredictable.

Measures to reduce the impact of tariff increases or trade restrictions, including shifts of production among countries and manufacturers, geographical diversification of our sources of supply, adjustments in product or packaging design and fabrication, or increased prices, could increase our costs and delay our time to market or decrease sales.

In addition, uncertainty regarding future trade policies may make it more difficult for us, our customers and our suppliers to plan and execute business activities and investments, forecast costs, manage inventory, and plan pricing strategies.

For a further discussion of our estimated impact of tariffs, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Overview-Global Economic Landscape and Business Impact”.

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The beauty industry has been impacted by ongoing uncertainty surrounding tariffs and import duties, and international trade relations generally.

While we actively review existing and proposed measures to seek to assess the impact of them on our business, changes in tariff rates, import duties and other new or augmented trade restrictions could have a number of negative impacts on our business, including higher consumer prices and reduced demand for our products and higher input costs.

While we actively review existing and proposed measures to seek to assess the impact of them on our

business, changes in tariff rates, import duties and other new or augmented trade restrictions could have a number of negative impacts on our business, including higher consumer prices and reduced demand for our products and higher input costs.

Changes in tax laws or regulations, or challenges to our tax positions, could significantly increase our tax liabilities.

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and foreign governmental agencies maintain focus on the taxation of multinational companies, including statutory tax rates, digital taxes, global minimum taxes (such as the Pillar Two framework agreed to by members of the Organization for Economic Cooperation and Development which has been adopted in many jurisdictions), country-by-country reporting, and transactions between affiliated companies.

Such changes may negatively impact our effective tax rate and may increase tax compliance and reporting costs, and our future income tax provisions could increase or be adversely affected by changes in the mix of income earned or losses incurred in jurisdictions with differing statutory rates, changes in the valuation of our deferred tax assets or liabilities, successful challenges to our tax positions or by other factors.

Such changes may negatively impact our effective tax rate and have increased and may continue to increase tax compliance and reporting costs, and our future income tax provisions could increase or be adversely affected by changes in the mix of income earned or losses incurred in jurisdictions with differing statutory rates, changes in the valuation of our deferred tax assets or liabilities, successful challenges to our tax positions, changes to the location of our tax principal or by other factors.

Risks related to our Indebtedness.

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In addition, we are required to maintain certain financial ratios calculated pursuant to a financial maintenance covenant under the 2018 Coty Credit Agreement on a quarterly basis.

For a further description of the 2018 Coty Credit Agreement and

the covenants thereunder, as well as the indentures governing our senior secured notes, please refer to Note 12, “Debt” in the notes to our Consolidated Financial Statements.

For a further description of the 2018 Coty Credit Agreement and the covenants thereunder, as well as the indentures governing our senior secured notes, please refer to Note 13, “Debt” in the notes to our Consolidated Financial Statements.

Our debt burden and the restrictions in the agreements that govern our debt could have important consequences, including increasing our vulnerability to general adverse economic and industry conditions;

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The terms of the indentures governing our senior secured notes, the 2018 Coty Credit Agreement or any existing debt instruments or future debt instruments that we may enter into may restrict us from adopting some of these alternatives.

Our ability to restructure or refinance our debt, including our senior secured notes maturing in April 2026, will depend on the capital markets and other macroeconomic conditions and our financial condition at such time.

Our ability to restructure or refinance our debt, including our senior secured notes maturing in May 2027 and our 2023 Coty Revolving Credit Facility maturing in July 2028, will depend on the capital markets and other macroeconomic conditions and our financial condition at such time.

Recent refinancings of our debt have resulted, and future refinancings or modifications of our debt, could result in higher interest rates and may require us to comply with more onerous covenants or reduce our borrowing capacity, which could further restrict our business operations.

For example, the refinancing of certain portions of our debt in 2021 resulted in higher interest rates applicable to the newly issued senior secured notes, in part due to prevailing macroeconomic conditions and a decline in our credit ratings since our previous refinancing transactions in 2018.

In addition, the ratings downgrade in July 2026 resulted in the reinstatement of certain covenants and collateral provisions for applicable outstanding senior secured notes.

The inability of our subsidiaries to generate sufficient cash flow to satisfy our covenants and debt service obligations, including the inability to service our senior secured notes and the 2018 Coty Credit Agreement, or to refinance our obligations on commercially reasonable terms, could have a material adverse effect on our business, financial condition, results of operations, profitability, cash flows or liquidity, as well as the trading price of our securities, and may impact our ability to satisfy our obligations in respect of our senior secured notes and the 2018 Coty Credit Agreement.

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Risks related to Macroeconomic Conditions and Market Risks

We must successfully manage the impact of a general economic downturn, credit constriction, uncertainty in global economic or political conditions or other global events or a sudden disruption in business conditions which may affect consumer spending, global supply chain conditions and inflationary pressures and adversely affect our financial results.

Global events may impact our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities, and, as demonstrated by the impacts of regional wars and armed conflicts, such as in Ukraine and in the Middle East, such events can evolve rapidly and cause significant and pervasive disruptions to global economic and business conditions.

We operate in an environment of slow overall growth in the segments and geographies in which we compete with increasing competitive pressure and changing consumer preferences, and global economic activity has been in decline as a result of higher levels of unemployment, unprecedented levels of inflation, rising interest rates, recessionary conditions and geopolitical conditions including the war in Ukraine and/or the armed conflicts in the Middle East .

While prestige fragrances and skin care categories have experienced strong growth, declines in the retail mass color cosmetics, mass nail and mass fragrance categories in the U.S.

and certain key markets in Western Europe continue to impact our business and financial results.

Deterioration of social or economic conditions in Europe or elsewhere could reduce sales and could also impair collections on accounts receivable.

For example, political and economic developments in the U.S., the U.K., Europe, Brazil and China have introduced uncertainty in the regulatory and business environment in which we operate (including increases in tariffs and uncertainties about future tariff scenarios).

These political and economic developments have resulted and could continue to result in changes to legislation or reformation of government policies, rules and regulations pertaining to trade.

Such changes could have a significant impact on our business by increasing the cost of doing business, affecting our ability to sell our products and negatively impacting our profitability.

Abrupt political change, terrorist activity, and armed conflict, such as the ongoing war in Ukraine and/or the armed conflicts in the Middle East and any escalation or expansion thereof, pose a risk of further general economic disruption in affected regions.

Geopolitical change may result in changing regulatory systems and requirements and market interventions that could impact our operating strategies, access to national, regional and global markets (due to sanctions, tariffs or otherwise), hiring, and profitability.

For example, changes in the regulatory environment in China or geopolitical tensions impacting trade or operations in China could impact our growth strategy.

Any of these changes may negatively impact our revenues.

In addition, our sales are affected by the overall level of consumer spending.

The general level of consumer spending is affected by a number of factors, including general economic conditions (including potential recessions in one or more significant economies), inflation, interest rates, government policies that affect consumers (such as those relating to medical insurance or income tax), energy costs and consumer confidence, each of which is beyond our control.

A general economic downturn, credit constriction, inflationary pressures or other adverse macroeconomic conditions could reduce consumer spending and adversely affect our financial results.

We operate in an environment of slow overall growth in the segments and geographies in which we compete, with increasing competitive pressure and changing consumer preferences.

Our sales are affected by the overall level of consumer spending, which is affected by a number of factors beyond our control, including general economic conditions, potential recessions in one or more significant economies, inflation, interest rates, energy costs, government policies affecting consumers and consumer confidence.

Consumer purchases of discretionary and other items and services, including beauty products, tend to decline during recessionary periods, periods of high inflation and otherwise weak economic environments, when disposable income is lower.

A decline in consumer spending would likely have a negative impact on our direct sales and could cause financial difficulties at our retailer and other customers.

If consumer purchases decrease, we may not be able to generate enough cash flow to meet our debt obligations and other commitments and may need to refinance our debt, dispose of assets or issue equity to raise necessary funds.

We cannot predict whether we would be able to undertake any of these actions to raise funds on a timely basis or on satisfactory terms or at all.

The financial difficulties of a customer or retailer could also cause us to curtail or eliminate business with that customer or retailer.

We may also decide to assume more credit risk relating to the receivables from our customers or retailers, which increases the possibility of late or non-payment of receivables.

Our inability to collect receivables from a significant retailer or customer, or from a group of these customers, could have a material adverse effect on our business, prospects, results of operations, financial condition, results of operations, cash flows, as well as the trading price of our securities.

A decline in consumer spending would likely have a negative impact on our direct sales as well as sales to retailers and could cause financial difficulties for retail customers.

Deterioration of social or economic conditions in our major markets, including the U.S., Europe or elsewhere could reduce sales and could also impair collections on accounts receivable.

If direct consumer and retail customer purchases decrease, we may not be able to generate sufficient cash flow to meet our debt obligations and other commitments and may need to refinance our debt, dispose of assets or issue equity to raise necessary funds.

We cannot predict whether we would be able to undertake any of these actions on a timely basis, on satisfactory terms or at all.

The financial difficulties of a retail customer could also cause us to curtail or eliminate business with that customer.

We may also decide to assume more credit risk relating to receivables from our customers, which increases the possibility of late or non-payment.

Our inability to collect receivables from a significant retailer, or from a group of such customers, could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows and the trading price of our securities.

If a retailer or customer were to go into liquidation, we could incur additional costs if we choose to purchase the retailer’s or customer’s inventory of our products to protect brand equity.

These risks have been, and may continue to be, amplified by the war in Ukraine, the armed conflicts in the Middle East, and related geopolitical conditions.

Geopolitical instability, armed conflicts, terrorist activity and other global events could disrupt our business, affect our access to markets and adversely affect our results.

Global events may impact our business, prospects, financial condition, results of operations, cash flows and the trading price of our securities, and, as demonstrated by the impacts of regional wars and armed conflicts, such as the war in Ukraine and the war in the Middle East, such events can evolve rapidly and cause significant and pervasive disruptions to global economic and business conditions.

Abrupt political change, terrorist activity, armed conflict and any escalation or expansion of existing conflicts pose a risk of further general economic disruption in affected regions.

Geopolitical change may result in changing regulatory systems and requirements, market interventions and other developments that could impact our operating strategies, access to national, regional and global markets, hiring, supply chain conditions and profitability.

For example, the war in the Middle East has impacted transportation costs as well as sales in the region, and these impacts may continue.

In addition, changes in the regulatory environment in China or geopolitical tensions impacting trade or operations in China could also impact our strategy in the region.

Any of these developments could negatively impact our revenues or otherwise materially adversely affect our business, prospects, financial condition, results of operations, cash flows and the trading price of our securities .

Price inflation for labor, materials and services, further exacerbated by volatility in energy and commodity markets by geopolitical events, could adversely affect our business, results of operations and financial condition.

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Our ability to raise prices to reflect increased costs may also be limited by competitive conditions in the market for our products.

The war in Ukraine and/or the armed conflicts in the Middle East and prolonged geopolitical conflict globally may continue to result in increased price inflation, escalating energy and commodity prices and increasing costs of materials and services (together with shortages or inconsistent availability of materials and services) , which may also have the effect of heightening many of our other risks, such as those relating to cyber security, supply chain disruption, volatility in prices and market conditions, our ability to forecast demand, and our ability to successfully implement our global business strategies, any of which could negatively affect our business, results of operations and financial condition.

The war in Ukraine and/or the war in the Middle East and prolonged geopolitical conflict globally may continue to result in increased price inflation, escalating energy and commodity prices and increasing costs of materials and services, including transportation and insurance, together with shortages or inconsistent availability of materials and services, which may also have the effect of heightening many of our other risks, such as those relating to cyber security, supply chain disruption, volatility in prices and market conditions, our ability to forecast demand, and our ability to successfully implement our global business strategies, any of which could negatively affect our business, results of operations and financial condition.

Volatility in the financial markets could have a material adverse effect on our business, prospects, financial condition, results of operations, cash flows, as well as the trading price of our securities.

While we currently generate significant cash flows from our ongoing operations and have access to global credit markets through our various financing activities, credit markets may experience significant disruptions.

Deterioration in global financial markets, including as a result of global and regional economic conditions, the war in Ukraine and/or the armed conflicts in the Middle East and related geopolitical conditions, could make future financing or refinancing difficult or more expensive.

Deterioration in global financial markets, including as a result of global and regional economic conditions, the war in Ukraine and/or the war in the Middle East and related geopolitical conditions, could make future financing or refinancing difficult or more expensive.

If any financial institutions that are parties to our credit facilities or other financing arrangements, such as interest rate or foreign currency exchange hedging instruments, were to declare bankruptcy or become insolvent, or experience other financial difficulty, they may be unable to perform under their agreements with us.

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A depreciation of these currencies against the U.S.

dollar would decrease the U.S.

decrease the U.S.

dollar equivalent of the amounts derived from foreign operations reported in our consolidated financial statements and an appreciation of these currencies would result in a corresponding increase in such amounts.

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While we believe that we have valid defenses to these lawsuits, these risks will continue to exist with respect to our business, and additional legal proceedings and other contingencies, the outcome and impact of which (including legal fees) cannot be predicted with certainty, will arise from time to time.

Any negative resolution of litigation to which we are subject to could have an adverse effect on our business, prospects, financial condition, results of operations and cash flows.

In particular, the potential impact of talc-related litigation is highly uncertain, as nationwide trial results in similar cases filed against Coty and other manufacturers or retailers of cosmetic talc products have ranged from outright dismissals to very large settlements and jury awards of both compensatory and punitive damages.

Additionally, our continued production and sale of talc-based cosmetic products could in the future subject us to additional legal claims related to the sale of one or more of our talc-based cosmetics products, including potential governmental inquiries, investigations, claims and consumer protection cases from state attorneys general.

Any negative resolution of litigation to which we are subject to could have an adverse effect on our business, prospects, financial condition, results of operations and cash flows.

In previous fiscal years the value of settlements made by the Company, both individually and in the aggregate, has not been material;

however, due to the rising number of filed and pending cases against the Company, as well as the evolving litigation landscape, inclusive of significant judgments and settlements by third party companies, settlement values and other costs associated with these cases have increased substantially and are likely to increase in the future.

In addition, the Company has experienced higher recent settlement demands and volumes driven in part by the maturation of cases that have been previously filed and are now reaching the trial stage as well as the general nature of litigation in this area which sometimes involves expedited trial dates and substantial settlements or judgments involving third parties.

Settlements paid as well as accruals related to probable and estimable claims during the period have substantially increased year-over-year and are expected to continue to increase.

Such amounts, however, are not necessarily indicative of future settlement values or the number of future cases due to the uncertainties described above as well as various factors related to individual claims.

Additional liabilities or increases in estimates, or a range of either, could vary significantly from period to period and could materially and adversely affect our results of operations and/or financial position.

In addition, we are subject to pending tax assessment matters in Brazil relating to local sales tax credits for the 2016-2020 tax periods.

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For example, in connection with a Goiás State tax ICMS assessment received in August 2020, we received unfavorable rulings in fiscal 2024 in a related judicial case about an additional claim for fees over the tax incentive.

which we have appealed to the Superior Court of Justice for review and are awaiting a decision.

Although the Superior Court of Justice rendered a favorable verdict on appeal, granting the Company’s request to remand the case to the state court in Goiás, the judicial process is ongoing.

See Note 23— Legal and Other Contingencies for more information regarding our potential tax obligations in Brazil.

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Changes in the laws (both foreign and domestic), regulations and policies, including the interpretation or enforcement thereof, that affect, or will affect, our business or products, including those related to intellectual property, marketing, antitrust and competition, product liability, restrictions or requirements related to product content or formulation, labeling and packaging (including end-of-product-life responsibility), corruption, the environment or climate change (including increasing focus on the climate, water and waste impacts of operations and products), shifts in immigration and work permit policies, privacy, data protection, taxes, tariffs, trade and customs (including, among others, import and export license requirements, sanctions, boycotts, quotas, trade barriers, and other measures imposed by U.S.

and foreign countries), restrictions on foreign investment, the outcome and expense of legal or regulatory proceedings, and any action we may take as a result, and changes in accounting standards, could adversely affect our financial results as well as the trading price of our securities.

and other countries), restrictions on foreign investment, the outcome and expense of legal or regulatory proceedings, and any action we may take as a result, and changes in accounting standards, could adversely affect our financial results as well as the trading price of our securities.

See “—We are subject to risks related to our international operations”.

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We face legal and regulatory risks in the U.S.

and abroad and, in particular, cannot predict with certainty the outcome of various contingencies or the impact that pending or future legislative and regulatory changes may have on our business.

and abroad and, in particular, cannot predict with certainty the outcome of various contingencies or the impact that pending or future legislative and regulatory changes may have on our

It is not possible to gauge what any final regulation may provide, its effective date or its impact at this time.

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In addition, the timing and actual number of any shares repurchased will depend on a variety of factors including the timing of open trading windows, price, corporate and regulatory requirements, an assessment by management and our Board of Directors of cash availability, capital allocation priorities, including deleveraging, and other market conditions.

In addition, in 2022 and 2023 we entered into

forward repurchase transactions to begin hedging for a potential $200 million repurchase under our stock repurchase program planned for the end of 2024, an additional potential $196 million repurchase under our stock repurchase program planned for the end of 2025 and an additional potential $294 million repurchase planned for 2026.

In addition, in 2022 and 2023 we entered into forward repurchase transactions to begin hedging for a potential $200 million repurchase under our stock repurchase program planned for the end of 2024, an additional potential $196 million repurchase under our stock repurchase program originally planned for the end of 2025 and an additional potential $294 million repurchase originally planned for 2026.

In February 2024, we elected to physically settle one of the forward repurchase contracts for a cash payment of $200.0 in exchange for 27.0 million shares of our Class A Common Stock.

Our decision to physically settle the outstanding forward repurchase contracts on their existing terms, or to extend the maturity or unwind such transactions, will depend on a variety of factors including market conditions and our capital allocation priorities and internal cash management considerations at the time.

We extended the maturity of the outstanding forward repurchase transactions

until January 2027.

Our decision to physically settle the outstanding forward repurchase contracts on their existing terms, or to extend the maturity or unwind such transactions, will depend on a variety of factors including market conditions, open trading windows, and our capital allocation priorities and internal cash management considerations at the time.

These forward repurchase transactions expose us to additional risks related to the price of our common stock, including potential true-up payments in cash upon specified changes in the price of our common stock.

Declines in the price of our common stock during fiscal 2025 resulted in the payment of $191.1 in connection with these true-up obligations.

Declines in the price of our common stock during fiscal 2025 and fiscal 2026 resulted in the payment of $191.1 and $194.4, respectively, in connection with these true-up obligations.

JAB Beauty B.V.

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JAB Holdings B.V.

(“JABH”), through an affiliate, JAB Beauty B.V., may be deemed to beneficially own approximately 54% of the outstanding shares of our Class A Common Stock (inclusive of all voting interests of Peter Harf, the Company's Chairman, and HFS Holdings S.à r.l, (“HFS”), which is beneficially owned by Mr.

(“JABH”), through an affiliate, JAB Beauty B.V., may be deemed to beneficially own approximately 54% of the outstanding shares of our Class A Common Stock (inclusive of all voting interests of Peter Harf, the Company's former Chairman, and HFS Holdings S.à r.l, (“HFS”), which is beneficially owned by Mr.

As a result, JABH has the ability to exercise control over certain decisions requiring stockholder approval, including the election of directors, amendments to our certificate of incorporation and approval of significant corporate transactions, such as a merger or other sale of the Company or our assets.

In addition, several of the members of our Board of Directors are affiliated with JABH.

In addition, three members of our Board of Directors are affiliated with JABH.

Accordingly, JAB has significant influence over us and our decisions, including the appointment of management and any other action requiring a vote of our Board of Directors.

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JABH or its affiliates may also pursue acquisition opportunities that are complementary to our business, and, as a result, those acquisition opportunities may not be available to us.

In addition, JABH’s obligations under its credit facility may cause JABH to take actions which may be inconsistent with your interests.

In addition, JABH’s obligations under its credit facility or other financing arrangements may cause JABH to take actions which may be inconsistent with your interests.

Accordingly, the interests of JABH may not always coincide with our interests or the interests of other stockholders, and JABH may seek to cause us to take courses of action that, in its judgment, could enhance its investment in the Company but which might involve risks to our other stockholders or adversely affect us or our other stockholders.

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Our Class A Common Stock is listed on Euronext Paris’s Professional Segment (“Euronext Paris”).

While the dual-listing of our Class A Common Stock was intended to promote additional liquidity for investors and provide greater access to our Class A Common Stock among investors in Europe who may be required to invest in Eurozone markets or certain currencies only, this dual-listing may dilute the liquidity of these securities in one or both markets and may adversely affect the

development of an active trading market for Class A Common Stock on Euronext Paris.

The price of our Class A Common Stock listed on Euronext Paris could also be adversely affected by trading in our Class A Common Stock on the NYSE.

In addition, currency fluctuations between the Euro and U.S.

addition, currency fluctuations between the Euro and U.S.

dollar may have an adverse impact on the value of our Class A Common Stock traded on Euronext Paris.

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On this basis, the liquidity of our Class A Common Stock traded on Euronext Paris may be uncertain and investors on the Euronext Paris market may need to assess their ability to adjust the size of their position given the then trading liquidity prior to investing in our securities.

We incur additional auditing, legal, reporting and other expenses in order to maintain a dual - listing on both NYSE and Euronext Paris, including the costs of listing on two exchanges.

If our Board of Directors determines that the cost of maintaining our listing on Euronext Paris outweighs the benefits of such listing, we may incur costs associated with delisting from that exchange.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors