What changed in this filing

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Item 1. Financial Statements

2026-05-01 compared with 2026-02-05 · 271 added, 243 removed, 964 unchanged (35% of the section changed)

3 unchanged sentences

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions, except per share data) 2026 2025 2026 2025

8 unchanged sentences

224 97 520 375

Securities class action litigation settlement 84 — 84 —

Impairment of goodwill and other intangible assets — — — 861

23 unchanged sentences

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

1 unchanged sentence

$ 89 $ 159 $ 298 $ ( 587 )

Other comprehensive income (loss):

Net cash flow hedge gain (loss) 8 55 24 ( 2 )

Cross-currency swap contract - fair value hedge gain (loss) 2 ( 5 ) 5 7

Other comprehensive (loss) income:

Net cash flow hedge

15 ( 24 ) 39 ( 26 )

Cross-currency swap contract - fair value hedge

Retirement plan and other retiree benefit adjustments 3 3 10 7

Translation adjustments ( 87 ) 68 ( 58 ) ( 133 )

Provision for income taxes on components of other comprehensive income (loss) ( 8 ) ( 27 ) ( 18 ) ( 9 )

Total other comprehensive income (loss), net of tax

Income tax effect on components of other comprehensive (loss) income

( 4 ) 14 ( 22 ) 5

Total other comprehensive (loss) income, net of tax

( 76 ) 68 ( 29 ) ( 133 )

Comprehensive income (loss)

3 unchanged sentences

CONSOLIDATED BALANCE SHEETS

(In millions, except share and per share data) December 31, 2025 June 30, 2025

(In millions, except share and per share data) March 31, 2026 June 30, 2025

Current assets

26 unchanged sentences

Class A shares authorized:

1,300,000,000 at December 31, 2025 and June 30, 2025;

1,300,000,000 at March 31, 2026 and June 30, 2025;

shares issued:

486,114,024 at December 31, 2025 and 472,541,563 at June 30, 2025;

486,253,355 at March 31, 2026 and 472,541,563 at June 30, 2025;

Class B shares authorized:

304,000,000 at December 31, 2025 and June 30, 2025;

304,000,000 at March 31, 2026 and June 30, 2025;

shares issued and outstanding:

114,507,344 at December 31, 2025 and 125,542,029 at June 30, 2025

114,507,344 at March 31, 2026 and 125,542,029 at June 30, 2025

Paid-in capital 7,324 7,012

3 unchanged sentences

Treasury stock, at cost;

238,960,893 Class A shares at December 31, 2025 and 238,316,738 Class A shares at June 30, 2025

238,965,784 Class A shares at March 31, 2026 and 238,316,738 Class A shares at June 30, 2025

( 13,766 ) ( 13,698 )

5 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended

Nine Months Ended

(In millions) 2026 2025

13 unchanged sentences

Changes in operating assets and liabilities:

(Increase) decrease in accounts receivable, net ( 126 ) 79

Increase in accounts receivable, net

( 228 ) ( 77 )

Decrease in inventory and promotional merchandise 135 215

Decrease (increase) in other assets, net 25 ( 47 )

Increase in other assets, net

( 104 ) ( 33 )

Decrease in accounts payable ( 168 ) ( 230 )

Increase in other accrued and noncurrent liabilities 133 102

Increase (decrease) in operating lease assets and liabilities, net

Increase (decrease) in other accrued and noncurrent liabilities

Decrease in operating lease assets and liabilities, net

( 16 ) ( 21 )

Net cash flows provided by operating activities 1,197 671

1 unchanged sentence

Capital expenditures ( 306 ) ( 395 )

Proceeds from sale of property, plant and equipment

Proceeds from property, plant and equipment insurance recoveries 10 —

11 unchanged sentences

Payments to acquire treasury stock ( 70 ) ( 35 )

Payment for acquisition of noncontrolling interest

Net cash flows used for financing activities

30 unchanged sentences

All assets and liabilities of foreign subsidiaries and affiliates are translated at period-end rates of exchange, while revenue and expenses are translated at monthly average rates of exchange for the period.

Unrealized translation gains (losses), net of tax, reported as translation adjustments through other comprehensive income (loss) (“OCI”) were $ 52 million and $( 323 ) million, net of tax, for the three months ended December 31, 2025 and 2024, respectively, and $ 20 million and $( 208 ) million, net of tax, for the six months ended December 31, 2025 and 2024, respectively.

Unrealized translation (losses) gains, net of tax, reported as translation adjustments through other comprehensive (loss) income (“OCI”) were $( 88 ) million and $ 78 million, net of tax, for the three months ended March 31, 2026 and 2025, respectively, and $( 68 ) million and $( 130 ) million, net of tax, for the nine months ended March 31, 2026 and 2025, respectively.

For the Company’s subsidiaries operating in highly inflationary economies, the U.S.

dollar is the functional currency, and these subsidiaries are not material to the Company's consolidated financial statements or liquidity as of and for the three and six months ended December 31, 2025 and 2024.

dollar is the functional currency, and these subsidiaries are not material to the Company's consolidated financial statements or liquidity as of and for the three and nine months ended March 31, 2026 and 2025.

Remeasurement adjustments in financial statements in a highly inflationary economy and other transactional gains and losses are reflected in earnings.

4 unchanged sentences

The Company categorizes these instruments as entered into for purposes other than trading.

The accompanying consolidated statements of earnings (loss) include net exchange (losses) gains on foreign currency transactions of less than $( 1 ) million and $ 25 million for the three months ended December 31, 2025 and 2024, respectively, and $( 6 ) million and $ 44 million for the six months ended December 31, 2025 and 2024, respectively.

The accompanying consolidated statements of earnings (loss) include net exchange (losses) gains on foreign currency transactions of $( 10 ) million and $ 11 million for the three months ended March 31, 2026 and 2025, respectively, and $( 15 ) million and $ 55 million for the nine months ended March 31, 2026 and 2025, respectively.

THE ESTÉE LAUDER COMPANIES INC.

7 unchanged sentences

Inventory and promotional merchandise consists of the following:

(In millions) December 31, 2025 June 30, 2025

(In millions) March 31, 2026 June 30, 2025

Raw materials

7 unchanged sentences

($ in millions)

December 31, 2025 June 30, 2025

March 31, 2026 June 30, 2025

Assets (Useful Life)

12 unchanged sentences

(1) Land improvements are depreciated over a 10 year useful life.

Depreciation and amortization of property, plant and equipment was $ 168 million for the three months ended December 31, 2025 and 2024, and $ 338 million and $ 336 million for the six months ended December 31, 2025 and 2024, respectively.

Depreciation and amortization of property, plant and equipment was $ 173 million and $ 167 million for the three months ended March 31, 2026 and 2025, respectively, and $ 511 million and $ 503 million for the nine months ended March 31, 2026 and 2025, respectively.

Depreciation and amortization related to the Company’s manufacturing process is included in Cost of sales, and all other depreciation and amortization is included in Selling, general and administrative expenses in the accompanying consolidated statements of earnings (loss).

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Three Months Ended December 31, Six Months Ended December 31,

Three Months Ended March 31, Nine Months Ended March 31,

2026 2025 2026 2025

1 unchanged sentence

Basis-point change from the prior-year period 1,630 5,170

For the three months ended December 31, 2025, the increase in effective tax rate was primarily attributable to the loss before income taxes and the impact of the discrete treatment of the impairment of goodwill and other intangible assets, both during the fiscal 2025 second quarter.

Further contributing to the increase in the effective tax rate was the estimated unfavorable impact of the recently enacted U.S.

tax legislation known as the "One Big Beautiful Bill Act", and a higher effective tax rate on the Company's foreign operations due to an unfavorable impact associated with the establishment of valuation allowances against certain net deferred tax assets, partially offset by the year-over-year favorable impact associated with previously issued stock-based compensation.

For the six months ended December 31, 2025, the increase in effective tax rate was primarily attributable to the loss before income taxes, the impact of the discrete treatment of charges associated with restructuring and other activities, the impairment of goodwill and other intangible assets, and the charge associated with the talcum litigation settlement agreements, each during the six months ended December 31, 2024.

Further contributing to the increase in the effective tax rate was the estimated unfavorable impact of the recently enacted One Big Beautiful Bill Act, a higher effective tax rate on the Company’s foreign operations due to an unfavorable impact associated with the establishment of valuation allowances against certain net deferred tax assets, partially offset by the year-over-year favorable impact associated with previously issued stock-based compensation.

For the three months ended March 31, 2026, the increase in effective tax rate was primarily attributable to the estimated unfavorable impact of the recently enacted U.S.

tax legislation known as the "One Big Beautiful Bill Act", resulting from an increase in tax deductible interest expense which reduced U.S.

taxable income and increased the excess foreign tax credits generated which require a valuation allowance.

For the nine months ended March 31, 2026, the increase in effective tax rate was primarily attributable to the loss before income taxes, the impact of the discrete treatment of charges associated with restructuring and other activities, the impairment of goodwill and other intangible assets, and the charge associated with the talcum litigation settlement agreements, each during the nine months ended March 31, 2025.

Further contributing to the increase in the effective tax rate was the estimated unfavorable impact of the One Big Beautiful Bill Act, resulting from an increase in tax deductible interest expense which reduced U.S.

taxable income and increased the excess foreign tax credits generated which require a valuation allowance, a higher effective tax rate on the Company’s foreign operations due to an unfavorable impact associated with the establishment of valuation allowances against certain net deferred tax assets, partially offset by the year-over-year favorable impact associated with previously issued stock-based compensation.

On July 4, 2025, the One Big Beautiful Bill Act was enacted.

4 unchanged sentences

taxable income and increased the excess foreign tax credits generated which require a valuation allowance.

The estimated unfavorable fiscal 2026 impact of the One Big Beautiful Bill Act has been included in the provision for income taxes, and the impact for the three and six months ended December 31, 2025 was $ 20 million and $ 28 million, respectively.

The estimated unfavorable fiscal 2026 impact of the One Big Beautiful Bill Act has been included in the provision for income taxes, and the impact for the three and nine months ended March 31, 2026 was $ 23 million and $ 51 million, respectively.

In December 2021, the Organization for Economic Cooperation and Development issued "Pillar Two" Global Anti-Base Erosion model rules for countries to enact into domestic law that would establish a 15% global minimum tax applied on a country-by-country basis for multinational companies.

In certain countries that have enacted legislation incorporating the global minimum tax, it became effective for the Company at the beginning of fiscal 2025.

The estimated tax impact of such legislation has been included in the provision for income taxes for the three and six months ended December 31, 2025 and was not material.

The estimated tax impact of such legislation has been included in the provision for income taxes for the three and nine months ended March 31, 2026 and 2025 and was not material.

During the fiscal 2026 second quarter, the Company received notification of the formal conclusion of the compliance process with respect to its fiscal 2024 income tax return under the U.S.

Internal Revenue Service (“IRS”) Compliance Assurance Program (“CAP”), which had no impact on the Company’s consolidated financial statements for the three and six months ended December 31, 2025.

As of December 31, 2025 and June 30, 2025, the gross amount of unrecognized tax benefits, exclusive of interest and penalties, totaled $ 144 million and $ 140 million, respectively.

The total amount of unrecognized tax benefits at December 31, 2025 that, if recognized, would affect the effective tax rate was $ 137 million.

The total gross interest and penalties accrued related to unrecognized tax benefits for the three and six months ended December 31, 2025 in the accompanying consolidated statements of earnings (loss) was $ 1 million and $ 3 million, respectively.

The total gross accrued interest and penalties in the accompanying consolidated balance sheets at December 31, 2025 and June 30, 2025, was $ 22 million and $ 19 million, respectively.

On the basis of the information available as of December 31, 2025, the Company does not expect significant changes to the total amount of unrecognized tax benefits within the next twelve months.

At December 31, 2025 and June 30, 2025, total Other assets of $ 1,817 million and $ 1,805 million included $ 1,318 million and $ 1,339 million of deferred tax assets, respectively.

Internal Revenue Service (“IRS”) Compliance Assurance Program (“CAP”), which had no impact on the Company’s consolidated financial statements for the three and nine months ended March 31, 2026.

As of March 31, 2026 and June 30, 2025, the gross amount of unrecognized tax benefits, exclusive of interest and penalties, totaled $ 144 million and $ 140 million, respectively.

The total amount of unrecognized tax benefits at March 31, 2026 that, if recognized, would affect the effective tax rate was $ 137 million.

The total gross interest and penalties accrued related to unrecognized tax benefits for the three and nine months ended March 31, 2026 in the accompanying consolidated statements of earnings (loss) was $ 1 million and $ 4 million, respectively.

The total gross accrued interest and penalties in the accompanying consolidated balance sheets at March 31, 2026 and June 30, 2025, was $ 23 million and $ 19 million, respectively.

On the basis of the information available as of March 31, 2026, the Company does not expect significant changes to the total amount of unrecognized tax benefits within the next twelve months.

At March 31, 2026 and June 30, 2025, total Other assets of $ 1,786 million and $ 1,805 million included $ 1,335 million and $ 1,339 million of deferred tax assets, respectively.

THE ESTÉE LAUDER COMPANIES INC.

4 unchanged sentences

The supplier invoices that have been confirmed as valid under the programs require payment in full within 90 days of the invoice date.

Outstanding obligations confirmed as valid totaling $ 77 million and $ 82 million as of December 31, 2025 and June 30, 2025, respectively, are included in Accounts payable in the accompanying consolidated balance sheets.

Outstanding obligations confirmed as valid totaling $ 64 million and $ 82 million as of March 31, 2026 and June 30, 2025, respectively, are included in Accounts payable in the accompanying consolidated balance sheets.

Other Accrued Liabilities

Other accrued liabilities consist of the following:

(In millions) December 31, 2025 June 30, 2025

(In millions) March 31, 2026 June 30, 2025

Accrued employee compensation

52 unchanged sentences

Impact on consolidated financial statements :

The Company is currently evaluating the impact that this guidance will have on its accounts receivable balance and consolidated financial statement disclosures.

The Company will elect to adopt the practical expedient beginning in the first quarter of fiscal 2027 on a prospective basis.

The adoption of this practical expedient is not expected to have a material impact on the Company’s consolidated financial statements.

2024-03 and 2025-01 – Disaggregation of Income Statement Expenses (Subtopic 220-40)

25 unchanged sentences

The guidance should be applied on a prospective basis with the option to apply the standard retrospectively.

Impact on consolidated financial statement s – The Company is currently evaluating the impact that this guidance will have on its consolidated financial statement disclosures.

Impact on consolidated financial statement s – The Company will apply the disclosure requirements as required by the guidance beginning with the June 30, 2026 Form 10-K.

NOTE 2 – GOODWILL AND OTHER INTANGIBLE ASSETS

10 unchanged sentences

Translation adjustments, accumulated impairments 30 — — — 30

Balance as of December 31, 2025

( 17 ) — ( 2 ) — ( 19 )

Balance as of March 31, 2026

1,569 1,116 258 353 3,296

Accumulated impairments

6 unchanged sentences

Other intangible assets consist of the following:

December 31, 2025 June 30, 2025

March 31, 2026 June 30, 2025

(In millions) Gross

10 unchanged sentences

$ 3,635 $ 3,759

The aggregate amortization expense related to amortizable intangible assets was $ 27 million and $ 35 million for the three months ended December 31, 2025 and 2024, respectively, and $ 53 million and $ 71 million for the six months ended December 31, 2025 and 2024, respectively.

The aggregate amortization expense related to amortizable intangible assets was $ 26 million and $ 34 million for the three months ended March 31, 2026 and 2025, respectively, and $ 79 million and $ 105 million for the nine months ended March 31, 2026 and 2025, respectively.

The estimated aggregate amortization expense for the remainder of fiscal 2026 and for each of the next four fiscal years is as follows:

1 unchanged sentence

Estimated aggregate amortization expense $ 23 $ 85 $ 68 $ 67 $ 65

Impairment Analysis During the Six Months Ended December 31, 2024

Impairment Analysis During the Nine Months Ended March 31, 2025

During the fiscal 2025 second quarter, the TOM FORD brand experienced lower-than-expected growth within key geographic regions and channels, including in mainland China, Asia travel retail and Hong Kong SAR.

12 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A summary of the impairment charges for the three and six months ended December 31, 2024 and the remaining trademark and goodwill carrying values as of December 31, 2024, for the TOM FORD brand and Too Faced reporting unit, are as follows:

A summary of the impairment charges for the nine months ended March 31, 2025 and the remaining trademark and goodwill carrying values as of March 31, 2025, for the TOM FORD brand and Too Faced reporting unit, are as follows:

Impairment Charges (1)

Carrying Value

(In millions) Three and Six Months Ended

December 31, 2024

As of December 31, 2024

(In millions) Nine Months Ended

March 31, 2025

As of March 31, 2025

Brand/Reporting Unit

5 unchanged sentences

(2) The carrying values of the trademark intangible assets, subsequent to the impairment charges, are equal to their fair values.

The impairment charge related to the TOM FORD trademark intangible asset for the three and six months ended December 31, 2024 of $ 773 million was reflected in the fragrance, makeup and other product categories of $ 549 million, $ 170 million and $ 54 million, respectively.

The carrying values as of March 31, 2025 are consistent with the carrying values at the fair value measurement date.

The impairment charge related to the TOM FORD trademark intangible asset for the nine months ended March 31, 2025 of $ 773 million was reflected in the fragrance, makeup and other product categories of $ 549 million, $ 170 million and $ 54 million, respectively.

The trademark and goodwill impairment charges related to Too Faced were reflected in the makeup product category.

8 unchanged sentences

Cumulative initiatives under the Restructuring Program are expected to be approved by the end of fiscal 2026 and substantially completed by the end of fiscal 2027.

In connection with the Restructuring Program, as of December 31, 2025, the Company estimates a net reduction in the range of approximately 5,800 to 7,000 positions globally, which is about 9 %- 11 % of its positions including temporary and part-time employees as of June 30, 2023.

In connection with the Restructuring Program the Company now estimates a final net reduction in the range of approximately 9,000 to 10,000 positions globally, an increase from the previous range of 5,800 to 7,000 .

This net reduction takes into account the elimination of positions after retraining and redeployment of certain employees in select areas.

The Company expects that the Restructuring Program will result in restructuring and other charges totaling between $ 1,200 million and $ 1,600 million, before taxes, consisting of employee-related costs, asset-related costs, contract terminations and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

The Company now expects that the Restructuring Program will result in restructuring and other charges totaling between $ 1,500 million and $ 1,700 million, before taxes, an increase from the previous range of $ 1,200 million and $ 1,600 million, before taxes, consisting of employee-related costs, asset-related costs, contract terminations and other costs associated with implementing these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

Additional information relating to the Company's Profit Recovery and Growth Plan and related Restructuring Program is included in Notes to Consolidated Financial Statements, Note 8 – Charges Associated with Restructuring and Other Activities in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025.

2 unchanged sentences

Restructuring Program Approvals

Cumulative charges for initiatives approved by the Company in connection with the Restructuring Program as of December 31, 2025 and through January 30, 2026, were:

Cumulative charges for initiatives approved by the Company in connection with the Restructuring Program as of March 31, 2026 and through April 29, 2026, were:

Net Sales) Cost of Sales Operating Expenses Total

4 unchanged sentences

$ 4 $ 10 $ 552 $ 114 $ 680

Six months ended December 31, 2025

Nine months ended March 31, 2026

11 ( 7 ) 424 259 687

Cumulative charges approved through December 31, 2025

Cumulative charges approved through March 31, 2026

15 3 976 373 1,367

January 1, 2026 - January 30, 2026 2 ( 1 ) 22 ( 2 ) 21

Cumulative charges approved through January 30, 2026 $ 5 $ 9 $ 865 $ 370 $ 1,249

Included in the above table, cumulative restructuring charges for initiatives approved by the Company in connection with the Restructuring Program as of December 31, 2025 and through January 30, 2026, by major cost type were:

April 1, 2026 - April 29, 2026

5 4 42 ( 1 ) 50

Cumulative charges approved through April 29, 2026

$ 20 $ 7 $ 1,018 $ 372 $ 1,417

Included in the above table, cumulative restructuring charges for initiatives approved by the Company in connection with the Restructuring Program as of March 31, 2026 and through April 29, 2026, by major cost type were:

(In millions) Employee-

4 unchanged sentences

$ 512 $ 14 $ 3 $ 23 $ 552

Six months ended December 31, 2025

Nine months ended March 31, 2026

315 77 23 9 424

Cumulative charges approved through December 31, 2025

Cumulative charges approved through March 31, 2026

827 91 26 32 976

January 1, 2026 - January 30, 2026 22 1 — ( 1 ) 22

Cumulative charges approved through January 30, 2026 $ 721 $ 89 $ 26 $ 29 $ 865

Specific actions taken since the Restructuring Program inception to drive future sales growth and productivity to rebuild gross and operating margin profitability include:

April 1, 2026 - April 29, 2026

Cumulative charges approved through April 29, 2026

$ 862 $ 94 $ 27 $ 35 $ 1,018

Specific actions taken since the Restructuring Program inception include:

• Enterprise Business Services – The Company approved an initiative in connection with the transformation of its global operating model to (i) consolidate certain service providers, (ii) expand outsourced services, and (iii) redesign and standardize the related end-to-end business processes, leveraging advanced technology to improve productivity.

7 unchanged sentences

These activities will primarily result in employee severance through a net reduction in workforce and asset-related costs.

• Future of Brand-led Model – The Company approved initiatives to redesign spans and layers in its marketing, creative and other functions within the brand and product category structures to make them leaner, faster and more agile.

• Future of Brand-led Model – The Company approved initiatives to reorganize and simplify its global marketing and creative operating model, as well as redesign spans and layers in its marketing, creative and other functions within the brand and product category structures, to make them leaner, faster and more agile and drive greater efficiency and effectiveness.

These activities will primarily result in employee severance through a net reduction in workforce.

2 unchanged sentences

• Go-to-Market Operating Model Acceleration – The Company approved initiatives to optimize and right-size the organizational structure within its geographic regions to drive greater efficiency and effectiveness, as well as optimize the selling model and exit unprofitable brands from specific markets and distribution channels.

These activities will primarily result in employee severance through a net reduction in workforce, inventory write-offs, as well as costs associated with sales returns.

These activities will primarily result in employee severance through a net reduction in workforce, as well as costs associated with sales returns and inventory write-offs.

• Digital Organization Transformation – The Company approved initiatives to reorganize and right-size its technology functions, which support its internal enterprise and commercial capabilities, to create a leaner, faster, more effective and more agile technology organization.

These activities will primarily result in employee severance through a net reduction in workforce, as well as asset-related costs.

Once the relevant accounting criteria have been met, the Company expects to record cumulative restructuring and other charges of approximately $ 1,249 million (before tax) in connection with these initiatives, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

Once the relevant accounting criteria have been met, the Company expects to record cumulative restructuring and other charges of approximately $ 1,417 million (before tax) in connection with the initiatives approved to date, which other than the non-cash charges, are expected to result in future cash expenditures funded from cash provided by operations.

Restructuring Program Restructuring and Other Charges

5 unchanged sentences

The Company classifies other charges associated with restructuring activities as follows:

Sales Returns and Cost of Sales – Product returns (offset by the related cost of sales) and inventory write-offs or write-downs as a direct result of an approved restructuring initiative to exit certain businesses or locations will be recorded as a component of Net sales and/or Cost of sales when estimable and reasonably assured.

Other Charges – Other charges related to the design and implementation of approved initiatives, which are charged to Operating expenses as incurred and primarily include the following:

Sales Returns and Cost of Sales – Product returns (offset by the related cost of sales) and inventory write-offs or write-downs as a direct result of an approved restructuring initiative to exit certain businesses or locations are recorded as a component of Net sales and/or Cost of sales when estimable and reasonably assured.

Other Charges – Other charges related to the design and implementation of approved initiatives are charged to Operating expenses as incurred and primarily include the following:

• Consulting and other professional services for transition support, transformational organization design of the future structures and processes, as well as the implementation and execution thereof;

12 unchanged sentences

$ — $ 9 $ 524 $ 77 $ 610

Three months ended September 30, 2025 — ( 2 ) 72 17 87

Three months ended December 31, 2025

Six months ended December 31, 2025

— ( 2 ) 224 72 294

Cumulative charges through December 31, 2025

Three months ended March 31, 2026

— — 159 65 224

Included in the above table, cumulative restructuring charges recorded by the Company in connection with the Restructuring Program as of December 31, 2025, by major cost type were:

Cumulative charges through March 31, 2026

$ — $ 7 $ 907 $ 214 $ 1,128

Included in the above table, cumulative restructuring charges recorded by the Company in connection with the Restructuring Program as of March 31, 2026, by major cost type were:

(In millions) Employee-

4 unchanged sentences

$ 503 $ 13 $ 3 $ 5 $ 524

Three months ended September 30, 2025 66 5 — 1 72

Three months ended December 31, 2025

Six months ended December 31, 2025

180 20 21 3 224

Cumulative charges through December 31, 2025

Three months ended March 31, 2026

128 30 — 1 159

Changes in accrued restructuring charges from the Restructuring Program for the six months ended December 31, 2025 were:

Cumulative charges through March 31, 2026

$ 811 $ 63 $ 24 $ 9 $ 907

Changes in accrued restructuring charges from the Restructuring Program for the nine months ended March 31, 2026 were:

(In millions) Employee-

9 unchanged sentences

( 7 ) — 1 $ — ( 6 )

Balance at December 31, 2025

Balance at March 31, 2026

$ 478 $ 5 $ 22 $ — $ 505

Accrued restructuring charges at December 31, 2025 relating to the Restructuring Program are expected to result in cash expenditures funded from cash provided by operations of approximately $ 214 million, $ 197 million and $ 25 million for the remainder of fiscal 2026 and for fiscal 2027 and 2028, respectively.

Accrued restructuring charges at March 31, 2026 relating to the Restructuring Program are expected to result in cash expenditures funded from cash provided by operations of approximately $ 227 million, $ 254 million and $ 24 million for the remainder of fiscal 2026 and for fiscal 2027 and 2028, respectively.

Charges associated with restructuring and other activities are not allocated to the Company's product categories or geographic regions because they are centrally directed and controlled, are not included in internal measures of product category or geographic region performance and result from activities that are deemed Company-wide initiatives to redesign, resize and reorganize select areas of the business.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 – DERIVATIVE FINANCIAL INSTRUMENTS

1 unchanged sentence

The Company does not utilize derivative financial instruments for trading or speculative purposes.

At December 31, 2025, the notional amount of derivatives not designated as hedging instruments was $ 3,010 million.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At March 31, 2026, the notional amount of derivatives not designated as hedging instruments was $ 3,335 million.

Fair Value Hedges

The Company enters into interest rate contracts to manage the exposure to interest rate fluctuations on its funded indebtedness.

At December 31, 2025, the Company has interest rate swap contracts, with notional amounts totaling $ 700 million, $ 300 million and $ 600 million, to effectively convert the fixed rate interest on its 2030 Senior Notes, 2031 Senior Notes and 2034 Senior Notes, respectively, to variable interest rates based on the Secured Overnight Financing Rate ("SOFR") plus a margin.

These interest rate swap agreements are designated as fair value hedges of the related long-term debt, and the changes in the fair value of the interest rate swap agreements are exactly offset by the change in the fair value of the underlying long-term debt.

At March 31, 2026, the Company has interest rate swap contracts, with notional amounts totaling $ 700 million, $ 300 million and $ 600 million, to effectively convert the fixed rate interest on its 2030 Senior Notes, 2031 Senior Notes and 2034 Senior Notes, respectively, to variable interest rates based on the Secured Overnight Financing Rate ("SOFR") plus a margin.

These interest rate swap agreements are designated as fair value hedges of the related long-term debt, and the changes in the fair value of the interest rate swap contracts are exactly offset by the change in the fair value of the underlying long-term debt.

The Company enters into cross-currency swap contracts to manage the exposure of foreign exchange rate fluctuations on its intercompany foreign currency denominated debt.

At December 31, 2025, the Company has cross-currency swap contracts with notional amounts totaling $ 491 million, to hedge the impact of foreign currency changes on certain intercompany foreign currency denominated debt.

At March 31, 2026, the Company has cross-currency swap contracts with notional amounts totaling $ 491 million, to hedge the impact of foreign currency changes on certain intercompany foreign currency denominated debt.

The cross-currency swap contracts are designated as fair value hedges of the related intercompany debt, and the gains and losses representing hedge components included in the assessment of effectiveness are presented in the same income statement line item as the earnings effect of the hedged transaction in the consolidated statements of earnings (loss).

2 unchanged sentences

Any difference between the changes in the fair value of the excluded components and amounts recognized in earnings (loss) will be recognized in Accumulated Other Comprehensive Loss ("AOCI") in the accompanying consolidated balance sheet.

The estimated net gain on the Company’s derivative instruments designated as fair value hedges as of December 31, 2025 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $ 14 million.

The accumulated net gain on derivative instruments designated as fair value hedges in AOCI was $ 12 million and $ 7 million as of December 31, 2025 and June 30, 2025, respectively.

The estimated net gain on the Company’s derivative instruments designated as fair value hedges as of March 31, 2026 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $ 15 million.

The accumulated net gain on derivative instruments designated as fair value hedges in AOCI was $ 9 million and $ 7 million as of March 31, 2026 and June 30, 2025, respectively.

Cash Flow Hedges

3 unchanged sentences

Hedge effectiveness of the foreign currency forward contracts is based on the forward method, which includes forward points in the effectiveness assessment.

At December 31, 2025, the Company had cash flow hedges outstanding with a notional amount totaling $ 1,025 million.

At March 31, 2026, the Company had cash flow hedges outstanding with a notional amount totaling $ 1,747 million.

For foreign currency forward contracts that are no longer deemed highly effective, hedge accounting is discontinued and gains and losses in AOCI are reclassified to Net sales when the underlying forecasted transaction occurs.

If it is probable that the forecasted transaction will no longer occur, then any gains or losses in AOCI are reclassified to current-period Net sales.

As of December 31, 2025, the Company’s foreign currency forward contracts were highly effective.

As of March 31, 2026, the Company’s foreign currency forward contracts were highly effective.

The Company may enter into interest rate forward contracts to hedge anticipated issuance of debt for periods consistent with the Company’s identified exposures.

The purpose of the hedging activities is to minimize the effect of interest rate movements on the cost of debt issuance.

The estimated net loss on the Company’s derivative instruments designated as cash flow hedges as of December 31, 2025 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $ 18 million.

The accumulated net gain (loss) on derivative instruments designated as cash flow hedges in AOCI was $ 11 million and $( 13 ) million as of December 31, 2025 and June 30, 2025, respectively.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The estimated net loss on the Company’s derivative instruments designated as cash flow hedges as of March 31, 2026 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $ 7 million.

The accumulated net gain (loss) on derivative instruments designated as cash flow hedges in AOCI was $ 26 million and $( 13 ) million as of March 31, 2026 and June 30, 2025, respectively.

Net Investment Hedges

4 unchanged sentences

Hedge effectiveness of the net investment hedge contracts is based on the spot method.

At December 31, 2025, the Company had net investment hedges outstanding with notional amounts totaling $ 1,077 million.

At March 31, 2026, the Company had net investment hedges outstanding with notional amounts totaling $ 1,118 million.

As a matter of policy, the Company only enters into derivative contracts with counterparties that have a long-term credit rating of at least A- or higher by at least two nationally recognized rating agencies.

The counterparties to these contracts are major financial institutions.

Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of contracts in asset positions, which totaled $ 118 million at December 31, 2025.

Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of contracts in asset positions, which totaled $ 164 million at March 31, 2026.

To manage this risk, the Company has strict counterparty credit guidelines that are continually monitored.

Accordingly, management believes risk of loss under these hedging contracts is remote.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The fair values of the Company’s derivative financial instruments included in the consolidated balance sheets are presented as follows:

3 unchanged sentences

(In millions) Balance Sheet

Location December 31, 2025 June 30, 2025 Balance Sheet

Location December 31, 2025 June 30, 2025

Location March 31, 2026 June 30, 2025 Balance Sheet

Location March 31, 2026 June 30, 2025

Derivatives Designated as Hedging Instruments:

12 unchanged sentences

(1) See Note 5 – Fair Value Measurements for further information about how the fair value of derivative assets and liabilities are determined.

(2) Included in the asset derivatives for the foreign currency forward contracts at December 31, 2025 is $ 1 million, classified within Other assets in the accompanying consolidated balance sheets.

(2) Included in the asset derivatives for the foreign currency forward contracts at March 31, 2026 is $ 3 million, classified within Other assets in the accompanying consolidated balance sheets.

There were no amounts classified in Other assets at June 30, 2025.

(3) Included in the asset derivatives for the cross-currency swap contracts at December 31, 2025 and June 30, 2025 is approximately $ 87 million and $ 40 million, respectively, classified within Other assets in the accompanying consolidated balance sheets.

(3) Included in the asset derivatives for the cross-currency swap contracts at March 31, 2026 and June 30, 2025 is approximately $ 96 million and $ 40 million, respectively, classified within Other assets in the accompanying consolidated balance sheets.

THE ESTÉE LAUDER COMPANIES INC.

2 unchanged sentences

Amount of Gain (Loss)

Recognized in OCI on

Derivatives Location of Gain (Loss) Reclassified

from AOCI into

Earnings (Loss) Amount of Gain (Loss)

Reclassified from AOCI into Earnings (Loss) (1)

Recognized in OCI on Derivatives

Location of Gain (Loss) Reclassified

from AOCI into Earnings

Amount of Gain (Loss)

Reclassified from AOCI into Earnings (1)

Three Months Ended

9 unchanged sentences

Foreign currency forward contracts (3)

14 ( 29 ) — —

Cross-currency swap contracts (4)

Total net investment hedges

19 ( 35 ) — —

Total derivatives $ 26 $ ( 52 ) $ ( 8 ) $ 7

1 unchanged sentence

(2) Included within translation adjustments as a component of AOCI on the Company’s consolidated balance sheets.

(3) For the three months ended December 31, 2025 and 2024, the gain recognized in the accompanying consolidated statements of earnings (loss) from foreign currency forward contracts related to the amount excluded from effectiveness testing was $ 3 million and $ 7 million, respectively.

(4) For the three months ended December 31, 2025 and 2024, the gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing was $ 3 million and $ 1 million, respectively.

(3) For each of the three months ended March 31, 2026 and 2025, the gain recognized in the accompanying consolidated statements of earnings (loss) from foreign currency forward contracts related to the amount excluded from effectiveness testing was $ 4 million.

(4) For each of the three months ended March 31, 2026 and 2025, the gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing was $ 3 million.

THE ESTÉE LAUDER COMPANIES INC.

1 unchanged sentence

Amount of Gain (Loss)

Recognized in OCI on

Derivatives Location of Gain (Loss) Reclassified

from AOCI into

Earnings (Loss) Amount of Gain (Loss)

Recognized in OCI on Derivatives

Location of Gain (Loss) Reclassified

from AOCI into Earnings (Loss)

Amount of Gain (Loss)

Reclassified from AOCI into Earnings (Loss) (1)

Six Months Ended December 31, Six Months Ended December 31,

Nine Months Ended March 31, Nine Months Ended March 31,

(In millions) 2026 2025 2026 2025

1 unchanged sentence

Foreign currency forward contracts $ 23 $ 6 Net sales

$ ( 17 ) $ 31

Interest rate contracts — — Interest expense

5 unchanged sentences

Total net investment hedges

52 ( 11 ) — —

Total derivatives $ 75 $ ( 5 ) $ ( 16 ) $ 32

1 unchanged sentence

(2) Included within translation adjustments as a component of AOCI on the Company’s consolidated balance sheets.

(3) For the six months ended December 31, 2025 and 2024, the gain recognized in the accompanying consolidated statements of earnings (loss) from foreign currency forward contracts related to the amount excluded from effectiveness testing was $ 6 million and $ 14 million, respectively.

(4) For the six months ended December 31, 2025 and 2024, the gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing was $ 6 million and $ 1 million , respectively.

(3) For the nine months ended March 31, 2026 and 2025, the gain recognized in the accompanying consolidated statements of earnings (loss) from foreign currency forward contracts related to the amount excluded from effectiveness testing was $ 10 million and $ 18 million, respectively.

(4) For the nine months ended March 31, 2026 and 2025, the gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing was $ 9 million and $ 4 million , respectively.

Amount of Gain (Loss)

Recognized in Earnings (Loss) on Derivatives

Location of Gain (Loss) Recognized in Earnings (Loss) on Derivatives

Location of Gain (Loss)

Recognized in Earnings (Loss) on Derivatives

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

5 unchanged sentences

(1) Changes in the fair value representing hedge components included in the assessment of effectiveness of the cross-currency swap contracts are exactly offset by the change in the fair value of the underlying intercompany foreign currency denominated debt.

The gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing for the three months ended December 31, 2025 and 2024 was $ 4 million and $ 5 million, respectively, and for each of the six months ended December 31, 2025 and 2024 was $ 9 million.

The gain recognized in the accompanying consolidated statements of earnings (loss) from cross-currency swap contracts related to the amount excluded from effectiveness testing for each of the three months ended March 31, 2026 and 2025 was $ 5 million, and for each of the nine months ended March 31, 2026 and 2025 was $ 14 million.

(2) Changes in the fair value of the interest rate contracts are exactly offset by the change in the fair value of the underlying long-term debt.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Additional information regarding the cumulative amount of fair value hedging gain (loss) recognized in the accompanying consolidated statements of earnings (loss) for items designated and qualifying as hedged items in fair value hedges is as follows:

Additional information regarding the cumulative amount of fair value hedge gain (loss) recognized in the accompanying consolidated statements of earnings (loss) for items designated and qualifying as hedged items in fair value hedges is as follows:

(In millions)

Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included Carrying Amount of the

Hedged Liabilities Cumulative Amount of Fair

Hedged Liability

Cumulative Amount of Fair

Value Hedging Gain (Loss)

Included in the Carrying Amount of the Hedged Liability

December 31, 2025 December 31, 2025

Included in the Carrying Amount of the

Hedged Liability

March 31, 2026 March 31, 2026

Long-term debt $ 1,479 $ ( 111 )

1 unchanged sentence

Additional information regarding the effects of fair value and cash flow hedging relationships for derivatives designated and qualifying as hedging instruments is as follows:

Three Months Ended December 31,

Three Months Ended March 31,

(In millions) Net Sales Selling, General and Administrative Interest

11 unchanged sentences

Amount of gain reclassified from AOCI N/A N/A — N/A N/A —

Gain (loss) on cash flow hedge relationships – foreign currency forward contracts:

(Loss) gain on cash flow hedge relationships – foreign currency forward contracts:

Amount of (loss) gain reclassified from AOCI ( 8 ) N/A N/A 7 N/A N/A

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended December 31,

Nine Months Ended March 31,

(In millions) Net Sales Selling, General and Administrative Interest

11 unchanged sentences

Amount of gain reclassified from AOCI N/A N/A 1 N/A N/A 1

Gain (loss) on cash flow hedge relationships – foreign currency forward contracts:

(Loss) gain on cash flow hedge relationships – foreign currency forward contracts:

Amount of (loss) gain reclassified from AOCI ( 17 ) N/A N/A 31 N/A N/A

3 unchanged sentences

Recognized in Earnings (Loss) on Derivatives

Location of Gain (Loss) Recognized in Earnings (Loss) on Derivatives

Location of Gain (Loss)

Recognized in Earnings (Loss) on Derivatives

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

7 unchanged sentences

The following table provides information as if the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of netting arrangements with each of the counterparties:

As of December 31, 2025

As of June 30, 2025

March 31, 2026

June 30, 2025

(In millions) Gross Amounts of Assets / (Liabilities) Presented in Balance Sheet Contracts Subject to Netting Net Amounts of Assets / (Liabilities) Gross Amounts of Assets / (Liabilities) Presented in Balance Sheet Contracts Subject to Netting Net Amounts of Assets / (Liabilities)

17 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025:

The following table presents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2026:

(In millions) Level 1 Level 2 Level 3 Total

19 unchanged sentences

The estimated fair values of the Company’s financial instruments not measured at fair value on a recurring basis are as follows:

December 31, 2025 June 30, 2025

March 31, 2026 June 30, 2025

(In millions) Carrying

2 unchanged sentences

$ 7,312 $ 6,734 $ 7,317 $ 6,794

Deferred consideration payable

Notes payable and deferred consideration

$ 88 $ 87 $ 322 $ 323

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following methods and assumptions were used to estimate the fair value of the Company’s financial instruments for which it is practicable to estimate that value:

1 unchanged sentence

Cash deposits in interest bearing accounts and time deposits are carried at cost, which approximates fair value, due to the short maturity of these cash equivalent instruments.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Foreign currency forward contracts – The fair values of the Company’s foreign currency forward contracts were determined using an industry-standard valuation model, which is based on an income approach.

The significant observable inputs to the model, such as swap yield curves and currency spot and forward rates, were obtained from an independent pricing service.

To determine the fair value of contracts under the model, the difference between the contract price and the current forward rate was discounted using SOFR forward curves.

The significant observable inputs to the model, such as swap yield curves, SOFR forward curves and currency spot and forward rates, were obtained from an independent pricing service.

Cross-currency swap contracts – The fair values of the Company’s cross-currency swap contracts were determined using an industry-standard valuation model, which is based on the income approach.

5 unchanged sentences

The Company’s debt is classified within Level 2 of the valuation hierarchy.

Deferred consideration payable – The deferred consideration payable consists primarily of deferred payments associated with the fiscal 2023 fourth quarter acquisition of TOM FORD.

The fair value of the payments treated as deferred consideration payable are calculated based on the net present value of cash payments using an estimated borrowing rate based on quoted prices for a similar liability.

The Company’s deferred consideration payable is classified within Level 2 of the valuation hierarchy.

Notes payable and deferred consideration – Notes payable and deferred consideration as of March 31, 2026 consist primarily of obligations to a vendor related to deferred service payments, and as of June 30, 2025 consist primarily of deferred payments associated with the fiscal 2023 fourth quarter acquisition of TOM FORD, which was paid during the fiscal 2026 first and third quarters.

The fair value of notes payable and deferred consideration are calculated based on the net present value of cash payments using an estimated borrowing rate based on quoted prices for a similar liability.

The Company’s notes payable and deferred consideration are classified within Level 2 of the valuation hierarchy.

NOTE 6 – REVENUE RECOGNITION

1 unchanged sentence

Three Months Ended

December 31, Six Months Ended December 31,

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

9 unchanged sentences

Net sales $ 3,712 $ 3,550 $ 11,422 $ 10,915

(1) The Company has reorganized its geographic regions, effective July 1, 2025 and has presented the information for the three and six months ended December 31, 2025 and 2024 under this new basis.

(1) The Company has reorganized its geographic regions, effective July 1, 2025 and has presented the information for the three and nine months ended March 31, 2026 and 2025 under this new basis.

(2) The net sales from the Company’s travel retail business are included in the Asia/Pacific region.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Accounts Receivable

Accounts receivable, net is stated net of the allowance for doubtful accounts, including credit losses, and customer deductions totaling $ 53 million and $ 38 million as of December 31, 2025 and June 30, 2025, respectively.

Accounts receivable, net is stated net of the allowance for doubtful accounts, including credit losses, and customer deductions totaling $ 43 million and $ 38 million as of March 31, 2026 and June 30, 2025, respectively.

Payment terms are short-term in nature and are generally less than one year.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Changes in the allowance for credit losses are as follows:

(In millions) December 31, 2025

(In millions) March 31, 2026

Balance at June 30, 2025 $ 26

1 unchanged sentence

Write-offs, net & other ( 12 )

Balance at December 31, 2025 $ 40

The remaining balance of the allowance for doubtful accounts and customer deductions of $ 13 million and $ 12 million as of December 31, 2025 and June 30, 2025, respectively, relates to non-credit losses, which are primarily due to customer deductions.

Balance at March 31, 2026 $ 29

The remaining balance of the allowance for doubtful accounts and customer deductions of $ 14 million and $ 12 million as of March 31, 2026 and June 30, 2025, respectively, relates to non-credit losses, which are primarily due to customer deductions.

Deferred Revenue

1 unchanged sentence

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

1 unchanged sentence

Revenue recognized that was included in the deferred revenue balance at the beginning of the period ( 29 ) ( 38 ) ( 259 ) ( 293 )

Revenue deferred during the period

Revenue (released) deferred during the period

( 7 ) ( 29 ) 227 229

2 unchanged sentences

Transaction Price Allocated to the Remaining Performance Obligations

At December 31, 2025, the combined estimated revenue expected to be recognized in the next twelve months related to performance obligations for customer loyalty programs, gift with purchase promotions, purchase with purchase promotions, gift card liabilities and the Marcolin license arrangement related to TOM FORD that are unsatisfied (or partially unsatisfied) is $ 327 million.

The remaining balance of deferred revenue at December 31, 2025 will be recognized beyond the next twelve months, of which $ 204 million relates to the non-refundable upfront payment received as part of the Marcolin licensing arrangement that is being recognized on a straight-line basis over the estimated economic life of the license, which is 20 years ending in fiscal 2043.

At March 31, 2026, the combined estimated revenue expected to be recognized in the next twelve months related to performance obligations for customer loyalty programs, gift with purchase promotions, purchase with purchase promotions, gift card liabilities and the Marcolin license arrangement related to TOM FORD that are unsatisfied (or partially unsatisfied) is $ 294 million.

The remaining balance of deferred revenue at March 31, 2026 will be recognized beyond the next twelve months, of which $ 201 million relates to the non-refundable upfront payment received as part of the Marcolin licensing arrangement that is being recognized on a straight-line basis over the estimated economic life of the license, which is 20 years ending in fiscal 2043.

Royalty Revenue – License Arrangements

7 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The components of net periodic benefit cost for the three months ended December 31, 2025 and 2024 consisted of the following:

The components of net periodic benefit cost for the three months ended March 31, 2026 and 2025 consisted of the following:

Pension Plans Other than

11 unchanged sentences

Net periodic benefit cost $ 14 $ 13 $ 4 $ 7 $ — $ 1

The components of net periodic benefit cost for the six months ended December 31, 2025 and 2024 consisted of the following:

The components of net periodic benefit cost for the nine months ended March 31, 2026 and 2025 consisted of the following:

Pension Plans Other than

12 unchanged sentences

The amounts recognized in the consolidated balance sheets related to the Company’s pension and post-retirement benefit plans consist of the following:

(In millions) December 31, 2025 June 30, 2025

(In millions) March 31, 2026 June 30, 2025

Other assets $ 127 $ 128

10 unchanged sentences

This contract is intended to drive productivity and savings.

As of December 31, 2025, this contract is expected to increase our unconditional purchase obligations through fiscal 2033 by approximately $ 1,600 million.

As of March 31, 2026, unconditional purchase obligations related to this contract are estimated to be approximately $ 1,600 million and are expected to be payable through fiscal 2033.

The amounts expected to be paid under the contract may vary from this amount based on future variability in the pricing model and performance by the vendor under the contract.

Legal Proceedings

The Company is involved, from time to time, in litigation and other legal proceedings incidental to its business, including product liability matters (including asbestos-related claims), advertising, regulatory, employment, intellectual property, real estate, environmental, trade relations, securities, tax, and privacy.

The Company establishes accruals for loss contingencies when it has determined that a loss is probable and that the amount of loss, or range of loss, can be reasonably estimated.

Amounts accrued for legal contingencies often result from a complex series of judgments about future events and uncertainties that rely on estimates and assumptions including timing of related payments.

Any such accruals are adjusted thereafter as appropriate to reflect changes in circumstances.

The Company also determines estimates of reasonably possible losses or ranges of reasonably possible losses in excess of related accrued liabilities, if any, when it has determined that a loss is reasonably possible, and it is able to determine such estimates.

Legal defense costs are recognized as incurred when the legal services are provided.

Refer below for the assessment of loss contingencies associated with the Company's Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters.

Management believes that the outcome of all remaining current litigation and other legal proceedings will not have a material adverse effect upon the Company’s business, results of operations, financial condition or cash flows.

Reasonably possible losses in addition to the amounts accrued for the Company's remaining litigation and legal proceedings are not expected to be material to the Company’s consolidated financial statements.

However, management's assessment of the Company's current litigation and other legal proceedings, including the Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters, could change in light of the discovery of facts with respect to legal actions or other proceedings pending against the Company not presently known to the Company or determinations by judges, juries or other finders of fact which are not in accord with management's evaluation of the possible liability or outcome of such litigation or proceedings.

The Company is involved, from time to time, in litigation and other legal proceedings incidental to its business, including product liability (including asbestos-related claims), advertising, regulatory, employment, intellectual property, real estate, environmental, trade relations, securities, tax and privacy matters.

The Company records accruals for loss contingencies when a loss is probable and reasonably estimable, and estimates reasonably possible losses or ranges of losses in excess of accrued amounts, when such estimates can be made.

Such estimates involve significant judgment regarding future events and uncertainties, including timing of related payments, and are adjusted as appropriate.

Legal defense costs are expensed as incurred.

See below for the assessment of loss contingencies related to the Company’s Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters.

Management believes that the outcome of all other pending litigation and legal proceedings will not have a material adverse effect on the Company’s operations or consolidated financial statements.

Reasonably possible losses in excess of accrued amounts are not expected to be material.

Management’s assessments of the Company’s pending litigation and other legal proceedings, including the Securities Class Action and Derivative Matters and Cosmetic Talcum Powder Matters, are subject to inherent uncertainties and may change based on future developments.

Securities Class Action and Derivative Matters

On December 7, 2023 and January 22, 2024, the Company and its then Chief Executive Officer and Chief Financial Officer were named as defendants in separate purported securities class action complaints filed in the United States District Court for the Southern District of New York.

On February 20, 2024, those two purported securities class actions were consolidated into one action.

On March 22, 2024, plaintiffs filed their consolidated amended class action complaint, which alleges that defendants made materially false and misleading statements during the period February 3, 2022 to October 31, 2023 in press releases, the Company’s public filings and during conference calls with analysts that artificially inflated the price of the Company’s stock in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.

On December 7, 2023 and January 22, 2024, purported securities class action complaints were filed in the United States District Court for the Southern District of New York against the Company and its then Chief Executive Officer and Chief Financial Officer.

The actions were consolidated on February 20, 2024.

On March 22, 2024, plaintiffs filed a consolidated amended complaint alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on alleged materially false and misleading statements between February 3, 2022 and October 31, 2023.

On March 31, 2025, the Court denied defendants’ motion to dismiss.

Defendants intend to defend the action vigorously.

On February 1, 2024 and March 15, 2024, stockholder derivative action complaints were filed against certain of the Company’s officers as of those dates, all the Company’s directors as of those dates and certain of the Company’s former directors as of those dates in the United States District Court for the Southern District of New York.

In April 2024, both complaints were voluntarily dismissed without prejudice.

Subsequently, the Company's Board of Directors ("the Board") received stockholder litigation demands, requesting, among other things, that the Board investigate potential claims on behalf of the Company based on the same alleged course of conduct identified in the securities case complaint (which were also the subject of the voluntarily dismissed stockholder derivative actions complaints) described above.

A committee of the Board has been formed to review the stockholder demands and make recommendations, as appropriate in its discretion, to the Board.

On April 2, 2026, the parties reached an agreement in principle to settle the securities class action litigation.

In light of these discussions, the Company has recorded a loss contingency of $ 210 million relating to a potential settlement of the securities class action in Other accrued liabilities in the accompanying consolidated balance sheet.

The Company maintains insurance coverage that will offset a portion of defense and settlement costs for this action.

Stockholder derivative complaints were filed on February 1, 2024 and March 15, 2024 in the same court against certain current and former officers and directors of the Company and were voluntarily dismissed without prejudice in April 2024.

The Company subsequently received stockholder litigation demands requesting that the Board investigate similar allegations.

A committee of the Board has been formed to review these demands and make recommendations, as appropriate.

Two additional stockholder derivative complaints were filed on May 8, 2025 in the United States District Court for the Southern District of New York;

one stockholder derivative complaint was filed on June 23, 2025 in the Supreme Court of the State of New York in Kings County;

and four additional stockholder derivative complaints were filed on September 15, 2025, September 26, 2025, November 11, 2025 and November 12, 2025 in Delaware Chancery Court against certain current and former officers and directors, asserting claims including breach of fiduciary duty, unjust enrichment, as well as claims of waste, gross mismanagement and insider trading.

One of the Delaware complaints originally filed in September was voluntarily dismissed and refiled on November 11, 2025 by shareholders.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In fiscal 2025, on May 8, 2025, two additional stockholder derivative action complaints were filed in the United States District Court for the Southern District of New York against certain of the Company’s current and former officers and directors alleging breach of fiduciary duty and unjust enrichment from the sale of stock by certain individual defendants during the time period surrounding the allegations of false and misleading statements in the purported securities class action described above.

Then, on June 23, 2025, another stockholder derivative action complaint was filed in the Supreme Court of the State of New York in Kings County against certain of the Company’s current and former officers and directors, also alleging breach of fiduciary duty and unjust enrichment as well as claims of waste, gross mismanagement and insider trading.

In fiscal 2026, on September 15, 2025 and September 26, 2025, two additional stockholder derivative action complaints were filed in Delaware Chancery Court against certain of the Company’s current and former officers and directors, also alleging breach of fiduciary duty and unjust enrichment as well as claims of waste, gross mismanagement and insider trading.

One of those complaints was voluntarily dismissed and refiled on November 11, 2025, by the proper shareholder.

On November 11, 2025 and November 12, 2025, two additional stockholder derivative action complaints were filed in Delaware Chancery Court against certain of the Company's current and former officers and directors, also alleging breach of fiduciary duty and unjust enrichment as well as claims of waste, gross mismanagement and insider trading.

The Company believes that it is not possible at this time to reasonably assess the outcome of these matters or to estimate the loss or range of losses, if any.

The Company believes that it is not possible at this time to reasonably assess the outcome of these derivative matters or to estimate the loss or range of losses, if any.

Cosmetic Talcum Powder Matters

The Company has been named as a defendant in civil actions alleging that certain cosmetic talcum powder products sold by the Company were contaminated with asbestos.

Most of these actions involve a number of co-defendants from a variety of different industries.

As of December 31, 2025, there were 105 individual cases pending against the Company in state and federal courts throughout the United States, as compared to 84 cases as of June 30, 2025.

During the six months ended December 31, 2025, 41 new cases were filed and 20 cases were resolved by settlement or voluntary dismissal.

In view of the number of cases pending against the Company at June 30, 2024, as well as the evolution of the litigation landscape and expectations regarding future claims at that time, the Company took action from the end of August 2024 through October 2024 to mitigate its future exposure.

During that period, the Company reached agreements with certain plaintiff law firms (collectively, the “talcum litigation settlement agreements”) for:

(i) the resolution of over 200 pending cosmetic talcum powder matters handled by those firms as well as (ii) a process for resolving potential future cosmetic talcum powder claims expected to be brought on behalf of plaintiffs by those firms from January 1, 2025 through December 31, 2029, with annual capped amounts per year for each participating law firm.

To account for the talcum litigation settlement agreements, the Company recorded a charge of $ 159 million during the fiscal 2025 first quarter for the amount agreed to settle the current and potential future claims (amounts recorded for potential future claims were based on the best estimate of the probable loss at that time, and actual additional charges and any further reasonably possible losses beyond the amounts recorded during the three months ended September 30, 2024 has not been and is not expected to be material).

As of December 31, 2025, $ 24 million is recorded in Other accrued liabilities and $ 73 million is recorded in Other noncurrent liabilities in the accompanying consolidated balance sheet related to the talcum litigation settlement agreements.

There are and could be other plaintiff law firms outside of those included in the talcum litigation settlement agreements that bring claims against the Company.

The value of other settlements outside of the talcum litigation settlement agreements, either individually or in the aggregate, for the three and six months ended December 31, 2025 and 2024 was not material.

Given the inherent uncertainties of litigation, it is not possible to predict the outcome of all individual cases pending against the Company or potential unasserted claims, and therefore a specific estimate and associated provision is made, as needed, for a small number of individual cases that have advanced to the later stages of legal proceedings.

For the remaining filed cases, the Company records an estimate of exposure loss on an aggregated and ongoing basis, which takes into account the historical outcomes of cases the Company has resolved to date.

Any adverse outcomes, either in an individual case or in the aggregate, could be material.

While the Company and its legal counsel intend to continue to defend these cases vigorously, there can be no assurances regarding the ultimate resolution of these matters.

The amounts recorded during the three and six months ended December 31, 2025 and 2024 for such litigation, outside of the talcum litigation settlement agreements, are not material to the Company's consolidated financial statements.

The range of reasonably possible losses in excess of accrued liabilities currently cannot be reasonably estimated for cosmetic talcum matters, outside of the talcum litigation settlement agreements.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company believes that a portion of its costs incurred in defending and resolving these claims may be covered by insurance policies issued by several insurance carriers, subject to deductibles, exclusions, retentions and policy limits.

Amounts received to date have not been material.

The Company has been named as a defendant in civil actions alleging that certain cosmetic talcum powder products were contaminated with asbestos.

These matters generally involve multiple co-defendants.

In fiscal 2025, in view of the number of cases pending against the Company as well as the evolution of the litigation landscape and expectations regarding future claims at that time, the Company took action from the end of August 2024 through October 2024 to mitigate its future exposure.

During that period, the Company entered into agreements with certain plaintiff law firms to resolve over 200 pending matters and establish a framework for resolving potential future claims from January 1, 2025 through December 31, 2029, subject to annual caps (the “talcum litigation settlement agreements”).

In connection with these agreements, the Company recorded a charge of $ 159 million in the fiscal 2025 first quarter, representing its best estimate of probable losses for current and potential future claims.

As of March 31, 2026, $ 25 million and $ 66 million are recorded in Other accrued liabilities and Other noncurrent liabilities, respectively, in the accompanying consolidated balance sheet.

Additional charges and reasonably possible losses in excess of the initial charge have not been and are not expected to be material.

Other claims may be brought by plaintiff firms not party to the talcum litigation settlement agreements.

For certain matters that have advanced to later stages, the Company records specific accruals as appropriate.

For remaining matters, the Company estimates losses on an aggregate basis based on historical experience.

While amounts recorded for the three and nine months ended March 31, 2026 and 2025, respectively, for these matters (outside the talcum litigation settlement agreements) are not material, adverse outcomes could be material.

The Company cannot reasonably estimate the range of possible losses in excess of accrued amounts for these matters.

As of March 31, 2026, there were 130 cases pending against the Company in U.S.

state and federal courts, as compared to 84 cases as of June 30, 2025.

During the nine months ended March 31, 2026, 74 cases were filed and 28 cases were resolved.

The Company maintains insurance coverage that may offset a portion of defense and settlement costs, subject to policy terms.

Recoveries to date have not been material.

NOTE 9 – STOCK PROGRAMS

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Total net stock-based compensation expense is attributable to the granting of, and the remaining requisite service periods of stock options, restricted stock units (“RSUs”) and performance share units (“PSUs”).

Compensation expense attributable to net stock-based compensation was $ 94 million and $ 106 million for the three months ended December 31, 2025 and 2024, respectively, and was $ 182 million and $ 180 million for the six months ended December 31, 2025 and 2024, respectively.

Compensation expense attributable to net stock-based compensation was $ 72 million and $ 75 million for the three months ended March 31, 2026 and 2025, respectively, and was $ 254 million and $ 255 million for the nine months ended March 31, 2026 and 2025, respectively.

Stock Options

During the six months ended December 31, 2025, the Company granted stock options in respect of approximately 1.2 million shares of Class A Common Stock with a weighted average exercise price per share of $ 91.71 and a weighted average grant date fair value per share of $ 34.84 .

During the nine months ended March 31, 2026, the Company granted stock options in respect of approximately 1.2 million shares of Class A Common Stock with a weighted average exercise price per share of $ 92.18 and a weighted average grant date fair value per share of $ 35.07 .

The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model.

Restricted Stock Units

During the six months ended December 31, 2025, the Company granted RSUs in respect of approximately 3.5 million shares of Class A Common Stock with a weighted average grant date fair value per share of $ 91.66 that, at the time of grant, are scheduled to vest at 1.2 million, 1.5 million and 0.8 million shares per year, in fiscal 2027, fiscal 2028 and fiscal 2029, respectively.

During the nine months ended March 31, 2026, the Company granted RSUs in respect of approximately 3.5 million shares of Class A Common Stock with a weighted average grant date fair value per share of $ 91.89 that, at the time of grant, are scheduled to vest at 1.2 million, 1.5 million and 0.8 million shares per year, in fiscal 2027, fiscal 2028 and fiscal 2029, respectively.

Vesting of RSUs is generally subject to the continued employment or the retirement of the grantees.

The RSUs are generally accompanied by dividend equivalent rights, payable upon settlement of the RSUs either in cash or shares (based on the terms of the particular award) and, as such, were generally valued at the closing market price of the Company’s Class A Common Stock on the date of grant.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Included in the above are one-time awards granted in the first quarter of fiscal 2026, in respect of approximately 0.5 million shares of Class A Common Stock scheduled to cliff vest in fiscal 2028 with a weighted average grant-date fair value per share of $ 91.77 made under the PRGP Incentive Program which was implemented in an effort to incentivize and retain leaders who are critical to the success of the PRGP.

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The total fair value of PVUs at the time of issuance was $ 8 million.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 – NET EARNINGS (LOSS) PER COMMON SHARE

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Net earnings (loss) per common share assuming dilution (“diluted EPS”) is computed by reflecting potential dilution from stock-based awards using the treasury stock method.

For the three and six months ended December 31, 2024, the effects of potentially dilutive stock options, PSUs and RSUs were excluded from the computation of diluted EPS as they were anti-dilutive due to the net loss incurred during the period.

For the nine months ended March 31, 2025, the effects of potentially dilutive stock options, PSUs and RSUs were excluded from the computation of diluted EPS as they were anti-dilutive due to the net loss incurred during the period.

A reconciliation between the numerator and denominator of the basic and diluted EPS computations is as follows:

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions, except per share data) 2026 2025 2026 2025

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Effect of RSUs

2.5 0.9 2.4 —

Weighted average common shares outstanding – Diluted

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$ .24 $ .44 $ .82 $ ( 1.63 )

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The shares of Class A Common Stock underlying stock options, RSUs and PSUs that were excluded in the computation of diluted EPS because their inclusion would be anti-dilutive were as follows:

Three Months Ended December 31, Six Months Ended December 31,

Three Months Ended March 31, Nine Months Ended March 31,

(In millions) 2026 2025 2026 2025

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— 0.2 0.2 1.8

As of December 31, 2025 and 2024, 0.5 million and 0.6 million shares, respectively, of Class A Common Stock underlying PSUs have been excluded from the computation of diluted EPS as the number of shares ultimately issued is contingent on the achievement of applicable performance targets of the Company, as discussed in Note 19 – Stock Programs in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2025.

THE ESTÉE LAUDER COMPANIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of March 31, 2026 and 2025, 0.5 million and 0.6 million shares, respectively, of Class A Common Stock underlying PSUs have been excluded from the computation of diluted EPS as the number of shares ultimately issued is contingent on the achievement of applicable performance targets of the Company, as discussed in Note 19 – Stock Programs in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2025.

NOTE 11 – EQUITY

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Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions, except per share data)

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Accumulated other comprehensive loss, beginning of the period ( 1,080 ) ( 1,341 ) ( 1,127 ) ( 1,140 )

Other comprehensive earnings (loss)

Other comprehensive (loss) income

( 76 ) 68 ( 29 ) ( 133 )

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following is a summary of quarterly cash dividends declared per share on the Company’s Class A and Class B Common Stock during the six months ended December 31, 2025:

The following is a summary of quarterly cash dividends declared per share on the Company’s Class A and Class B Common Stock during the nine months ended March 31, 2026:

Date Declared Record Date Payable Date Amount per Share

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October 29, 2025 November 28, 2025 December 15, 2025 $ .35

On February 4, 2026, a dividend was declared in the amount of $ .35 per share on the Company’s Class A and Class B Common Stock.

The dividend is payable in cash on March 16, 2026 to stockholders of record at the close of business on February 27, 2026.

February 4, 2026 February 27, 2026 March 16, 2026 $ .35

On April 30, 2026, a dividend was declared in the amount of $ .35 per share on the Company’s Class A and Class B Common Stock.

The dividend is payable in cash on June 15, 2026 to stockholders of record at the close of business on May 29, 2026.

Beginning in December 2022, the Company suspended the repurchase of shares of its Class A Common Stock under its publicly announced program.

The Company may resume repurchases in the future.

During the six months ended December 31, 2025, 11.0 million shares of the Company’s Class B Common Stock were converted into the same amount of shares of the Company’s Class A Common Stock.

During the nine months ended March 31, 2026, 11.0 million shares of the Company’s Class B Common Stock were converted into the same amount of shares of the Company’s Class A Common Stock.

Accumulated Other Comprehensive Loss

The following table represents changes in accumulated other comprehensive loss, net of tax, by component for the three and six months ended December 31, 2025:

The following table represents changes in accumulated other comprehensive loss, net of tax, by component for the three and nine months ended March 31, 2026:

(In millions) Net Cash

Gain (Loss) Cross-Currency Swap Contracts - Fair Value Hedge Gain (1)

Included in Net Periodic Benefit Cost Translation

Cross-Currency Swap Contracts

- Fair Value Hedge (1)

Amounts Included in

Net Periodic Benefit Cost

Adjustments Total

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OCI before reclassifications (2)

13 6 — ( 32 )

Amounts reclassified to Net earnings 6 ( 7 ) 6 — 5

Net current-period OCI 18 4 7 18 47

Balance at September 30, 2025 2 8 ( 201 ) ( 950 ) ( 1,141 )

Balance at December 31, 2025

7 10 ( 197 ) ( 900 ) ( 1,080 )

OCI before reclassifications (2)

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Net current-period OCI 12 ( 3 ) 3 ( 88 ) ( 76 )

Balance at December 31, 2025 $ 7 $ 10 $ ( 197 ) $ ( 900 ) $ ( 1,080 )

Balance at March 31, 2026 $ 19 $ 7 $ ( 194 ) $ ( 988 ) $ ( 1,156 )

(1) The gain recognized in AOCI, net of tax from cross-currency swap contracts represents the amount excluded from effectiveness testing.

(2) The tax provision included in Net Cash Flow Hedge Gain (Loss), Cross-Currency Swap Contracts - Fair Value Hedge Gain and Translation Adjustments for the three months ended September 30, 2025 was $ 3 million, $ 2 million and $ 5 million, respectively.

For the three months ended December 31, 2025, the tax provision included in Net Cash Flow Hedge Gain (Loss), Cross-Currency Swap Contracts - Fair Value Hedge Gain, Amounts Included in Net Periodic Benefit Cost and Translation Adjustments was $ 1 million, $ 1 million, $ 1 million and $ 4 million, respectively.

(2) The tax provision included in Net Cash Flow Hedge, Cross-Currency Swap Contracts - Fair Value Hedge, Amounts Included in Net Period Benefit Cost and Translation Adjustments for the six months ended December 31, 2025 was $ 4 million, $ 3 million, $ 1 million and $ 9 million, respectively.

For the three months ended March 31, 2026, the tax provision (benefit) included in Net Cash Flow Hedge, Cross-Currency Swap Contracts - Fair Value Hedge, Amounts Included in Net Periodic Benefit Cost and Translation Adjustments was $ 1 million, $ 1 million, $( 1 ) million and $ 1 million, respectively.

(3) See Note 4 – Derivative Financial Instruments for gains (losses) relating to net investment hedges.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table represents the effects of reclassification adjustments from AOCI into net earnings (loss) for the three and six months ended December 31, 2025 and 2024:

The following table represents the effects of reclassification adjustments from AOCI into net earnings (loss) for the three and nine months ended March 31, 2026 and 2025:

Amount Reclassified from AOCI Affected Line Item in

Statements of Earnings (Loss)

Consolidated Statements of

Earnings (Loss)

Three Months Ended

December 31, Six Months Ended

March 31, Nine Months Ended

(In millions) 2026 2025 2026 2025

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NOTE 12 – STATEMENT OF CASH FLOWS

Supplemental cash flow information for the six months ended December 31, 2025 and 2024 is as follows:

(In millions) 2025 2024

Supplemental cash flow information for the nine months ended March 31, 2026 and 2025 is as follows:

Nine Months Ended

(In millions) March 31, 2026 March 31, 2025

Cash paid during the period for interest $ 229 $ 243

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Information about the Company's four operating segments for the three and six months ended December 31, 2025 and 2024 is as follows:

Information about the Company's four operating segments for the three and nine months ended March 31, 2026 and 2025 is as follows:

(In millions)

Three Months Ended December 31, 2025

Three Months Ended March 31, 2026

Skin Care Makeup Fragrance Hair Care Total

Other category net sales

Returns associated with restructuring and other activities

Segment net sales

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Selling, general and administrative expenses 958 776 456 90 2,280

Segment operating income

Other segment items (1)

27 35 13 9 84

Segment operating income (loss)

$ 444 $ ( 3 ) $ 21 $ ( 5 ) $ 457

Other category operating income 16

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Depreciation and amortization $ 201

(1) Other segment items reflect the securities class action litigation settlement.

THE ESTÉE LAUDER COMPANIES INC.

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(In millions)

Three Months Ended December 31, 2024

Three Months Ended March 31, 2025

Skin Care Makeup Fragrance Hair Care Total

Other category net sales

Returns associated with restructuring and other activities

Segment net sales

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Selling, general and administrative expenses 1,008 734 405 104 2,251

Impairment of goodwill and other intangible assets — 258 549 — 807

Segment operating income (loss)

$ 361 $ 14 $ 32 $ ( 13 ) $ 394

Other category operating loss ( 45 )

Other category operating income

Charges associated with restructuring and other activities

Operating loss ( 580 )

Reconciliation to loss before income taxes:

Operating income

Reconciliation to earnings before income taxes:

Interest expense ( 87 )

1 unchanged sentence

Other components of net periodic benefit cost ( 5 )

Loss before income taxes $ ( 650 )

Earnings before income taxes

Segment depreciation and amortization

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(In millions)

Six Months Ended December 31, 2025

Nine Months Ended March 31, 2026

Skin Care Makeup Fragrance Hair Care Total

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Selling, general and administrative expenses 3,056 2,391 1,445 306 7,198

Other segment items (1)

27 35 13 9 84

Segment operating income $ 1,085 $ — $ 212 $ 1 $ 1,298

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Depreciation and amortization $ 598

(1) Other segment items reflect the securities class action litigation settlement.

THE ESTÉE LAUDER COMPANIES INC.

1 unchanged sentence

(In millions)

Six Months Ended December 31, 2024

Nine Months Ended March 31, 2025

Skin Care Makeup Fragrance Hair Care Total

Other category net sales

Returns associated with restructuring and other activities

Segment net sales

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Depreciation and amortization $ 619

(1) Other segment items include Talcum litigation settlement agreements

(1) Other segment items reflect Talcum litigation settlement agreements.

THE ESTÉE LAUDER COMPANIES INC.

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-Q

Item 1. Financial Statements