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What changed in COTY INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of COTY INC.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+435 added−419 removedSource: 10-K (2025-08-21) vs 10-K (2024-08-20)

Top changes in COTY INC.'s 2025 10-K

435 paragraphs added · 419 removed · 309 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

48 edited+22 added−25 removed24 unchanged
Biggest changeThis research and development is done both internally and through affiliations with various universities, technical centers, supply partners, industry associations and technical associations. A number of our products incorporate patented, patent-pending or proprietary technology. In addition, several of our products and/or packaging for our products are covered by design rights protections.
Biggest changeA number of our products incorporate patented, patent-pending or proprietary technology. In addition, several of our products and/or packaging for our products are covered by design rights protections. Our principal research and development centers are located in the U.S. and Europe, with global centers of excellence for fragrance (Switzerland), skincare (Monaco), body care (Brazil) and cosmetics (U.S.). See “Item 2.
For more information, see “Risk Factors— Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition and results of operations. ” Seasonality The Company’s sales generally increase during the second fiscal quarter as a result of increased demand associated with the winter holiday season.
For more information, see “Risk Factors— 6 Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition and results of operations. ” Seasonality The Company’s sales generally increase during the second fiscal quarter as a result of increased demand associated with the winter holiday season.
Each of our brands is promoted with logos, packaging and advertising designed to enhance its image and the uniqueness of each brand. We manage our creative marketing work through a combination of our in-house teams and external agencies that design and produce the sales materials, social media strategies, advertisements and packaging for products in each brand.
Each of our brands is promoted with logos, packaging and advertising designed to enhance the image and the uniqueness of each brand. We manage our creative marketing work through a combination of our in-house teams and external agencies that design and produce the sales materials, social media strategies, advertisements and packaging for products in each brand.
Such regulations principally relate to the ingredients, labeling, manufacturing, packaging, advertising and marketing and sales and distribution of our products. Because we have commercial operations overseas, we are also subject to the U.S. Foreign Corrupt Practices Act (the “FCPA”) as well as other countries’ anti-corruption and anti-bribery regimes, such as the U.K. Bribery Act.
Such regulations principally relate to the ingredients, labeling, manufacturing, packaging, advertising and marketing and sales and distribution of our products. Because we have commercial operations overseas, we are also subject to the U.S. Foreign Corrupt Practices Act as well as other countries’ anti-corruption and anti-bribery regimes, such as the U.K. Bribery Act.
We have experienced disruptions in our supply chain from time to time, including in connection with our past restructuring efforts and, more recently due to global supply disruptions, and we work to anticipate and respond to actual and potential disruptions.
We have experienced disruptions in our supply chain from time to time, including in connection with our past restructuring efforts and, more recently due to global supply disruptions, and we work to anticipate and respond to actual and potential 3 disruptions.
We are subject to numerous foreign, federal, provincial, state, municipal and local environmental, health and safety laws and regulations relating to, among other matters, safe working conditions, product stewardship, and environmental protection, including those relating to emissions to the air, discharges to land and surface waters, deforestation and land use, generation, handling, storage, transportation, treatment and disposal of hazardous substances and waste materials, and the registration and evaluation of chemicals.
We are subject to numerous foreign, federal, provincial, state, municipal and local environmental, health and safety laws and regulations relating to, among other matters, safe working conditions, product stewardship, and environmental protection, including those relating to GHG emissions, discharges to land and surface waters, deforestation and land use, generation, handling, storage, transportation, treatment and disposal of hazardous substances and waste materials, and the registration and evaluation of chemicals.
Certain brand licenses provide for automatic extensions, so long as minimum annual royalty payments are made, while renewal of others is contingent upon attaining specified sales levels or upon agreement of the licensor. None of our top seven licenses are up for non-automatic renewal before 2028, with an average remaining duration of 14 years.
Certain brand licenses provide for automatic extensions, so long as minimum annual royalty payments are made, while renewal of others is contingent upon attaining specified sales levels or upon agreement of the licensor. None of our top seven licenses are up for non-automatic renewal before 2028, with an average remaining duration of 13 years.
Marketing We have a diverse portfolio of brands, some owned and some licensed, and we employ different models to create a distinct image and personality suited to each brand’s equity, distribution, product focus and consumer. For our licensed brands, we work with licensors to promote brand image.
Marketing We have a diverse portfolio of brands, some owned and some licensed, and we employ different engagement models to create a distinct image and personality suited to each brand’s equity, distribution, product focus and consumer base. For our licensed brands, we work with licensors to promote brand image.
We maintain policies and procedures to monitor and control environmental, health and safety risks, 6 and to monitor compliance with applicable environmental, health and safety requirements.
We maintain policies and procedures to monitor and control environmental, health and safety risks, and to monitor compliance with applicable environmental, health and safety requirements.
We leverage our relationships with celebrities, on-line influencers and brand ambassadors to endorse certain of our products, and we seek to attract and engage existing and new consumers through buzz-worthy activations, unexpected creativity and unique collaborations.
We leverage our relationships with celebrities, influencers and brand ambassadors to endorse certain of our products, and we seek to attract and engage existing and new consumers through buzz-worthy activations, unexpected creativity and unique collaborations.
For additional risks associated with our licensing arrangements, see “Risk Factors— Our brand licenses may be terminated if specified conditions are not met, and we may not be able to renew expiring licenses on favorable terms or at all ” and “Risk Factors— Our failure to protect our reputation, or the failure of our brand partners or licensors to protect their reputations, could have a material adverse effect on our brand images ”.
For additional risks associated with our licensing arrangements, see “Risk Factors— Our brand licenses may be terminated if specified conditions are not met, and we may not be able to renew expiring licenses on favorable terms or at all ” and “Risk Factors— Our failure to protect our reputation, or the failure of our brand partners or licensors to protect their reputations, could have a material adverse effect on our brand images ”. 4 Human Capital Workforce .
For segment financial information and information about our long-lived assets, see Note 4— Segment Reporting in the notes to our Consolidated Financial Statements. 1 Brands The following chart reflects our iconic brand portfolio: Consumer Beauty Prestige Adidas Burberry Beckham Calvin Klein Bozzano* Chloe Bourjois* Davidoff Bruno Banani Escada* CoverGirl* Gucci Jovan* Hugo Boss LeGer by Lena Gercke Infiniment Coty Paris* Max Factor* Jil Sander Mexx Joop!* Monange* Kylie Cosmetics by Kylie Jenner Nautica Lancaster* Paixao* Marc Jacobs Rimmel* Miu Miu Risque* Orveda Sally Hansen* philosophy* Vera Wang SKKN BY KIM Tiffany & Co. * Indicates an owned beauty brand.
For segment financial information and information about our long-lived assets, see Note 3— Segment Reporting in the notes to our Consolidated Financial Statements. 1 Brands The following chart reflects our iconic brand portfolio: Consumer Beauty Prestige Adidas Burberry David Beckham Calvin Klein Bozzano* Chloe Bourjois* Davidoff Bruno Banani Escada* CoverGirl* Etro Jovan* Gucci LeGer by Lena Gercke Hugo Boss Max Factor* Infiniment Coty Paris* Mexx Jil Sander Monange* Joop!* Nautica Kylie Cosmetics by Kylie Jenner Paixao* Lancaster* Rimmel* Marc Jacobs Risque* Orveda Sally Hansen* philosophy* Vera Wang Tiffany & Co. * Indicates an owned beauty brand.
While we consider our patents and copyrights, and the protection thereof, to be important, no single patent or copyright, or group of related patents or copyrights, is material to the conduct of our business. Products representing 50% of our fiscal 2024 net revenues are manufactured and marketed under brands owned by us or under licenses which are effectively perpetual.
While we consider our patents and copyrights, and the protection thereof, to be important, no single patent or copyright, or group of related patents or copyrights, is material to the conduct of our business. Products representing 48% of our fiscal 2025 net revenues are manufactured and marketed under brands owned by us or under licenses which are effectively perpetual.
We believe that we are currently in material compliance with the terms of our material brand license agreements. Our license agreements have an average duration of over 25 years. Most brand licenses have renewal options for one or more terms, which can range from two to ten years.
We believe that we are currently in material compliance with the terms of our material brand license agreements. Our license agreements have an average duration of approximately 24 years. Most brand licenses have renewal options for one or more terms, which can range from two to ten years.
We have also posted on our website our: (i) Principles of Corporate Governance; (ii) Code of Conduct (and any amendments or waivers); (iii) Code of Conduct for Business Partners; (iv) Charters for the Audit and Finance Committee and Remuneration and Nomination Committee; and (vi) sustainability information, including information on our sustainability strategy, Beauty that Lasts , and our diversity, equity and inclusion strategy.
We have also posted on our website our: (i) Principles of Corporate Governance; (ii) Code of Conduct (and any amendments or waivers); (iii) Code of Conduct for Business Partners; (iv) Charters for the Audit and Finance Committee and Remuneration and Nomination Committee; and (v) sustainability information, including information on our sustainability strategy, Beauty that Lasts .
Human Capital Workforce . As of June 30, 2024, we had approximately 11,791 full-time employees in over 36 countries. In addition, we typically employ a large number of seasonal contractors during our peak manufacturing and promotional season. Our employees in the U.S. are not covered by collective bargaining agreements.
As of June 30, 2025, we had approximately 11,636 full-time employees in over 36 countries. In addition, we typically employ a large number of seasonal contractors during our peak manufacturing and promotional season. Our employees in the U.S. are not covered by collective bargaining agreements.
In addition, the E.U.’s Corporate Sustainability Due Diligence Directive (“CSDDD”), adopted in July 2024, may subject certain of our E.U. and non-E.U. entities to additional due diligence obligations and governance requirements with respect to their own operations and “chain(s) of activities,” as promulgated, and activities of their external suppliers in their upstream value chain.
In addition, the E.U.’s Corporate Sustainability Due Diligence Directive (“CSDDD”), expected to apply from 2027, may subject certain of our E.U. and non-E.U. entities to engage in additional due diligence obligations and governance requirements with respect to their own operations and “chain(s) of activities,” as promulgated, and activities of their external suppliers in their upstream value chain.
In the U.S., certain states, such as California, and the U.S. Congress have proposed legislation relating to chemical disclosure and other requirements related to the content of our products.
In the U.S., certain states, such as California, have proposed and adopted legislation relating to corporate climate disclosures, chemical disclosure and other requirements related to the content of our products.
Our marketing efforts also benefit from cooperative advertising programs with retailers, often in connection with in-store marketing activities designed to engage consumers so that they try, or purchase, our products, including sampling and “gift-with-purchase” programs designed to stimulate product trials. We have dedicated marketing and sales forces in most of our significant markets.
Our marketing efforts also benefit from cooperative advertising programs with retailers, often in connection with in-store marketing activities that aim to engage consumers through sampling and “gift-with-purchase” programs designed to stimulate product trials. We have dedicated marketing and sales forces in most of our significant markets.
Our employees are a key source of competitive advantage and their actions, guided by our Code of Conduct and our global compliance program, Behave Beautifully , are critical to the long-term success of our business.
Our employees are a key source of competitive advantage and their actions, guided by our Code of Conduct and our global compliance program, Behave Beautifully , are critical to the long-term success of our business. We recognize the importance of our employees to our business and believe our relationship with our employees is satisfactory.
In addition, approximately 56% of our fiscal 2024 net revenues were attributable to prestige fragrance, of which approximately 91% was from our top seven prestige fragrance brands. Approximately 82% of the revenues from our top seven fragrance brands were from licenses with remaining durations spanning from approximately 8 to 21 years, or perpetual.
In addition, approximately 60% of our fiscal 2025 net revenues were attributable to prestige fragrance, of which approximately 91% was from our top seven prestige fragrance brands. Approximately 81% of the revenues from our top seven fragrance brands were from licenses with remaining durations spanning from approximately 7 to 20 years, or perpetual.
In fiscal 2024, Walmart, our top retailer, accounted for approximately 5% of total Coty Inc. net revenues. Innovation Innovation is a pillar of our business. We innovate through brand-building and new product lines, as well as through new technology.
Watson, our top retailers, each accounted for approximately 4% of total Coty Inc. net revenues. Innovation Innovation is a pillar of our business. We innovate through brand-building and new product lines, as well as through new technology.
Of the remaining portfolio, 34% of our fiscal 2024 sales are under exclusive license agreements granted to us for use on a worldwide and/or regional basis with a remaining duration spanning from 6 to 30 years. As of June 30, 2024, we maintained 24 brand licenses.
Products representing 37% of our fiscal 2025 sales are under exclusive license agreements granted to us for use on a worldwide and/or regional basis with a remaining duration spanning from 7 to 25 years. As of June 30, 2025, we maintained 22 brand licenses.
The content of our sustainability reports and information on our website are not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC. On March 6, 2024, the SEC adopted a rule on climate-related disclosures by U.S. public companies.
The content of our sustainability reports and information on our website are not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC.
We have a balanced multi-channel distribution strategy which complements our product categories. Our mass beauty brands are primarily sold through hypermarkets, supermarkets, drug stores and pharmacies, mid-tier department stores, traditional food and drug retailers, and dedicated e-commerce retailers. The prestige products are primarily sold through prestige retailers, including perfumeries, department stores, e-retailers, direct-to-consumer websites and duty-free shops.
Our mass beauty brands are primarily sold through hypermarkets, supermarkets, drug stores and pharmacies, mid-tier department stores, traditional food and drug retailers, and dedicated e-commerce retailers. The prestige products are primarily sold through prestige retailers, including perfumeries, department stores, e-retailers, direct-to-consumer websites and duty-free shops. We continue to focus on expanding our e-commerce and direct-to-consumer channels.
We continue to focus on expanding our e-commerce and direct-to-consumer channels. We also sell our products through third-party distributors. In fiscal 2024, no retailer accounted for more than 10% of our global net revenues; however, certain retailers accounted for more than 10% of net revenues within certain geographic markets and segments.
We also sell our products through third-party distributors. In fiscal 2025, no retailer accounted for more than 10% of our global net revenues; however, certain retailers accounted for more than 10% of net revenues within certain geographic markets and segments. In fiscal 2025, Walmart and A.S.
We have also focused our efforts on meeting evolving consumer shopping preferences and behaviors, both on-line and in-store. We have introduced new ways to customize the consumer experience, including using artificial intelligence-powered tools to provide personalized advice on selecting and using products, and augmented reality tools that invite customers to virtually try products with curated looks, tutorials and product recommendations.
We have introduced new ways to customize the consumer experience, including using AI-powered tools to provide personalized advice on selecting and using products, and augmented reality tools that invite customers to virtually try products with curated looks, tutorials and product recommendations. In addition, we continuously seek to improve our products through research and development.
Over the past few years we have implemented a comprehensive transformation agenda (the “Transformation Plan”), focusing on our core go-to-market competencies, simplifying our capital structure and deleveraging our balance sheet.
Over the past few years, we have implemented a comprehensive transformation agenda (the “Transformation Plan”), focusing on our core go-to-market competencies, simplifying our capital structure and deleveraging our balance sheet. Following this transformation, we continue to make progress on our strategic priorities, including leveraging our leadership position and capabilities in global fragrances to fuel expansion.
With a focus on product, planet and people, we aim to contribute towards delivering a more sustainable and inclusive world. We report annually on our progress towards our sustainability targets through a separate sustainability report. Our sustainability reports and other information on our sustainability initiatives and achievements are available on our website.
We report annually on our progress towards our sustainability targets through a separate sustainability report. Our sustainability reports and other information on our sustainability initiatives and achievements are available on our website.
We believe that we compete primarily on the basis of perceived value, including pricing and innovation, product efficacy, service to the consumer, promotional activities, advertising, special events, new product introductions, e-commerce initiatives, direct sales and other activities (including influencers).
We believe that we compete primarily on the basis of perceived value, including pricing and innovation, product efficacy, service to the consumer, promotional activities, advertising, special events, new product introductions, e-commerce initiatives, direct sales and other activities (including influencers) and the ability to effectively leverage existing and emerging digital technologies, such as AI and data analytics, to gain more commercial insights and develop relevant marketing concepts and advertising to reach consumers.
We collaborate with our suppliers to meet our stringent design and creative criteria. We believe that we currently have adequate sources of supply for all our products. We review our supplier base periodically with the specific objectives of improving quality, increasing innovation and speed-to-market, ensuring supply sufficiency and reducing costs.
We review our supplier base periodically with the specific objectives of improving quality, increasing innovation and speed-to-market, ensuring supply sufficiency and reducing costs.
The essential oils in our fragrance products are generally sourced from fragrance houses. As a result, we realize material cost savings and benefits from the technology, innovation and resources provided by these fragrance houses. We purchase the raw materials for all our products from various third parties. We also purchase packaging components that are manufactured to our design specifications.
The principal raw materials used in the manufacture of our products are primarily essential oils, alcohols and specialty chemicals. The essential oils in our fragrance products are generally sourced from fragrance houses. As a result, we realize material cost savings and benefits from the technology, innovation and resources provided by these fragrance houses.
In addition, we continuously seek to improve our products through research and development. Our basic and applied research groups, which conduct longer-term and “blue sky” research, seek to develop proprietary new technologies for first-to-market products and for improving existing products.
Our basic and applied research groups, which conduct longer-term and “blue sky” research, seek to develop proprietary new technologies for first-to-market products and for improving existing products. This research and development is done both internally and through affiliations with various universities, technical centers, supply partners, industry associations and technical associations.
The targets cover our greenhouse gas emissions for scopes 1 and 2, renewable electricity commitment and our greenhouse gas reduction for scope 3. In November 2023, we committed to the SBTi to set emissions reduction targets in line with science-based net-zero 1 . We continue to focus on the implementation of these targets with the development of operational plans.
In November 2023, we committed to the SBTi to set emissions reduction targets in line with science-based net-zero 1 . We continue to focus on the implementation of these targets with the development of operational plans. We are currently implementing our climate strategy focusing on areas: packaging, formula, sourcing, transportation, media, merchandising and the impact of our own operations.
These teams leverage local insights to strategically promote our brands and product offerings and tailor our creative marketing to fit local tastes and resonate with consumers most effectively.
These teams leverage local insights to strategically promote our brands and product offerings and tailor our creative marketing to fit local tastes and resonate with consumers most effectively. We utilize in-depth brand and market data analytics to develop branding, merchandising and marketing execution strategies to maximize the consumer experience and build a better business.
We recognize the importance of our employees to our business and believe our relationship with our employees is satisfactory. 4 Environmental, Social and Governance Our sustainability framework, Beauty That Lasts, is a multi-pillared strategy which aims to contribute to a more sustainable and inclusive future.
Environmental, Social and Governance Our sustainability framework, Beauty That Lasts, is a multi-pillared strategy which aims to contribute to a more sustainable and inclusive future. We focus on three pillars: Beauty of our Planet, Beauty of our People and Governed Beautifully, while the Beauty of our Products sits at heart of everything we do.
We continue to explore options to further optimize our supply chain operations, including the implementation of advanced digital solutions to streamline and enhance our supply chain operations. 3 Competition There is significant competition within each market where our products are sold. We compete against manufacturers and marketers of beauty products, salon professional nail products and personal care products.
Competition There is significant and increasing competition within each market where our products are sold. We compete against manufacturers and marketers of beauty products, salon professional nail products and personal care products. In addition to the established multinational brands against which we compete, small targeted niche brands continue to enter the beauty market.
Our principal research and development centers are located in the U.S. and Europe. See “Item 2. Properties.” We do not perform, nor do we commission any third parties on our behalf to perform, testing of our products or ingredients on animals except where required by law.
Properties.” We do not perform, nor do we commission any third parties on our behalf, to perform testing of our products or ingredients on animals except where required by law. In the few jurisdictions requiring animal testing, we actively apply for exemptions and work with local authorities and organizations to authorize alternative methods of product testing.
We are changing the way we design, formulate and manufacture in order to minimize our environmental impact and create innovative products. Since 2020, we have an operational Beauty That Lasts Index in place, which is a qualitative tool for evaluating the sustainability profile of new product developments.
Our products have an important role to play in building a sustainable future for the beauty sector.We are changing the way we design, formulate and manufacture in order to minimize our environmental impact and create innovative products.
Our research and development teams work with our marketing and operations teams to identify recent trends and consumer needs and to bring products quickly to market. We are continuously innovating to increase our sales by elevating our digital presence, including e-commerce and digital, social media and influencer marketing designed to build brand equity and consumer engagement.
We are continuously innovating to increase our sales by elevating our digital presence, including e-commerce and digital, social media and influencer marketing designed to build brand equity and consumer engagement. We have also focused our efforts on meeting evolving consumer shopping preferences and behaviors, both on-line and in-store.
The Beauty of Our Planet Conserving and protecting the natural environment is a vital part of our responsibility as a business. We are committed to minimizing the environmental impact of our operations and preserving resources for generations to come. Our short-term greenhouse gas emissions targets are approved by the Science Based Target initiative (“SBTi”).
We are committed to minimizing the environmental impact of our operations. Our short-term greenhouse gas (“GHG”) emissions targets are approved by the Science Based Target initiative (“SBTi”). The targets cover our GHG emissions for scopes 1 and 2, renewable electricity commitment and our GHG reduction for scope 3.
We recognize the importance of our employees at our manufacturing facilities and have in place programs designed to ensure operating safety. In addition, we implement programs designed to ensure that our manufacturing and distribution facilities comply with applicable environmental rules and regulations, as well as initiatives to support our sustainability goals.
In addition, we implement programs designed to ensure that our manufacturing and distribution facilities comply with applicable environmental rules and regulations, as well as initiatives to support our sustainability goals. To capitalize on innovation and other supply chain benefits, we continue to utilize a network of third-party manufacturers on a global basis who produce approximately 19% of our finished products.
In fiscal year 2025, we are assessing our compliance obligations and the impact the European Union Deforestation Regulation (“EUDR”) will have on our business as it will require companies trading in certain commodities, including, but not limited to, palm oil, wood, as well as products derived from these commodities, to ensure these commodities and related products do not result from deforestation or forest degradation in order to sell such products in the European Union.
We continuously assess our compliance obligations and the impact the European Union Deforestation Regulation (“EUDR”) will have on our business as it will require due diligence on our value chain to ensure covered commodities and related products do not contribute to global deforestation and forest degradation.
We utilize in-depth brand and market data analytics to develop branding, merchandising and marketing execution strategies to maximize the consumer experience and build a better business. 2 Distribution Channels and Retail Sales We market, sell and distribute our products in approximately 121 countries and territories, with dedicated local sales forces in most of our significant markets.
Distribution Channels and Retail Sales We market, sell and distribute our products in approximately 123 countries and territories, with dedicated local sales forces in most of our significant markets. We have a balanced multi-channel distribution strategy which complements our product categories.
In the few jurisdictions requiring animal testing, we actively apply for exemptions and work with local authorities and organizations to authorize alternative methods of product testing. Supply Chain During fiscal year 2024, we continued to manufacture and package approximately 79% of our products, primarily in facilities located in the United States, Brazil, China and various countries in Europe.
Supply Chain During fiscal year 2025, we continued to manufacture and package approximately 81% of our products, primarily in facilities located in the United States, Brazil and various countries in Europe. We recognize the importance of our employees at our manufacturing facilities and have in place programs designed to ensure operating safely.
Our training programs at the Coty Academy are designed to align with business priorities and to enhance essential skills such as personal effectiveness, people management, and leadership. Annual Learning Festivals have been hosted at most of our largest sites and are supported by our Leadership Team. The Learning Festivals feature a strategic and experiential agenda, that have been extremely well-received.
Our training programs at the Coty Academy are designed to align with business priorities and to enhance essential skills such as personal effectiveness, people management, and leadership. Our global Health and Safety Policy governs the management of work-related health and safety risks across all our manufacturing and distribution sites, including corporate offices. Consumer safety is a top priority.
In addition to the established multinational brands against which we compete, small targeted niche brands continue to enter the beauty market. We also have competition from private label products sold by retailers.
We also have competition from private label products sold by retailers.
We are also active members of the Sustainable Packaging Initiative for Cosmetics — SPICE — where we partner with other companies in the cosmetics industry to collectively shape the future of sustainable packaging. We continue to evaluate and modify our processes and activities to further limit our impact on the environment as we implement our sustainability strategy.
In 2024, we rejoined the Ellen MacArthur Foundation Network as a Member to support us to implement and scale circular design. We continue to evaluate and modify our processes and activities to further limit our impact on the environment as we implement our sustainability strategy.
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Following this transformation, we continue to make progress on our strategic priorities, including stabilizing and growing our consumer beauty brands through leading innovation and improved execution, accelerating our prestige fragrance brands and ongoing expansion into prestige cosmetics, building a comprehensive skincare portfolio over the mid-to-long term leveraging existing brands, enhancing our organizational growth capabilities including digital and research and development, expanding our presence in the travel retail channel, China and other growth markets, and establishing Coty as an industry leader in sustainability.
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We will continue expanding our presence in a limited number of structurally profitable and growing beauty categories, in growth channels such as e-commerce and the Travel Retail channel, all while establishing Coty as an industry leader in sustainability. We have sharpened our priorities to capitalize on structural tailwinds in the fragrance market.
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To capitalize on innovation and other supply chain benefits, we continue to utilize a network of third-party manufacturers on a global basis who produce approximately 21% of our finished products. The principal raw materials used in the manufacture of our products are primarily essential oils, alcohols and specialty chemicals.
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We are leveraging our leadership in fragrance innovation, licensing, and manufacturing to expand across price points, from mass to ultra-premium. With slower growth in China’s beauty market, we have shifted focus to a broader set of emerging markets and the U.S.
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On April 4, 2024, the SEC stayed the rule pending the completion of judicial review of the consolidated Eighth Circuit petitions.
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In Prestige, we are accelerating our fragrance business with exceptional new launches and franchise-building extensions, expanding our premium and ultra-premium category portfolio, extending into the rapidly growing fragrance mist adjacency with multiple brands, while also enhancing assortment of our Prestige cosmetic products.
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We are unable to predict if or when the stay will be lifted, and the extent to which the outcome of the petitions may result in changes to the final rules and the timing of the effectiveness of such rules.
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In Consumer Beauty, we aim to improve performance and profitability through agile innovation, social media advocacy, and expansion into body mists and masstige fragrances. Skincare remains a strategic focus, but achieving scale takes time, and we will pursue this while remaining very mindful of the investment demands. We also continue to advance key sustainability priorities.
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The Beauty of Our Product Our products have an important role to play in building a sustainable future for the beauty sector. To respond to evolving social and environmental challenges, we are putting sustainability at the heart of our product creation, from design and development through to sourcing of materials. We see sustainability as the ultimate driver of innovation.
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We have implemented artificial intelligence (“AI”) tools to 2 power our media allocation models and support content creation and optimization, including search engine optimization copy generation and translation, to improve efficiency and reach of our marketing campaigns.
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We have an ambition to reduce the amount of packaging we use across our portfolio, while sourcing from more sustainable sources. In fiscal 2024, we are continuing to steadily expand refillable formats, including Burberry Goddess , Cosmic Kylie Jenner and Infiniment Coty Paris .
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Our research and development teams, which include scientists, engineers, analysts, and other specialists involved in product and packaging innovation, work with our marketing and operations teams to identify recent trends and consumer needs and to bring products quickly to market.
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We are implementing screw neck caps for new prestige fragrance bottle designs to further enable refill potential. In addition, we work to reduce the environmental impact of our product formulas and our new products. In fiscal 2024, Infiniment Coty Paris is the first globally distributed full fragrance collection manufactured using 100% carbon-captured ethanol.
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We purchase the raw materials for all our products from various third parties. We also purchase packaging components that are manufactured to our design specifications. We collaborate with our suppliers to meet our stringent design and creative criteria. We believe that we currently have adequate sources of supply for all our products.
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We recognize that sustainability efforts require collaboration which goes beyond our own organization. To that end we are members of several industry initiatives, including the Responsible Beauty Initiative and Responsible Mica Initiative, focused on responsible sourcing.
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We have begun to implement advanced digital solutions to streamline and enhance our supply chain operation, including AI and machine learning tools for demand planning, and continue to explore options to further optimize our supply chain operations.
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We are also part of the EcoBeautyScore Consortium – a breakthrough initiative which aims to develop an industry-wide environmental scoring system for cosmetics products, with the aim of empowering consumers to make sustainable beauty choices.
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In fiscal 2025, we established a global supply chain hub in Barcelona to centralize supply chain operations and drive efficiencies to improve service levels, inventory management and carbon impact, and we will continue to evaluate our full manufacturing and sourcing ecosystem to enable the delivery of consistent improvement in costs of goods sold.
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We are currently implementing our climate strategy focusing on three focus areas: our product impact, our transportation and the impact of our own operations. In fiscal 2024, we have expanded our solar panel use across four sites and we now have eight carbon neutral sites, labs and offices 2 .
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Governed Beautifully At Coty, we believe that sustainability needs to be integrated into the business, with each area of impact led by the relevant business functions. The Executive Committee (“EC”) and Senior Leadership Team (“SLT”) are responsible for the development of strategy, targets and driving progress for their respective material topics.
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Air freight emissions have decreased by more than 50% since 2019 due to the efforts of our transport and supply chain teams to improve planning and educating internal stakeholders about the importance of shifting to less carbon intense modes of transport.
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The global Sustainability Office develops the transversal sustainability strategy and is responsible for ESG reporting and governance, under the oversight of the Chief Scientific & Sustainability Officer. The Sustainability Office provides formal updates to both the EC and the Board at least once a year. Our Board provides oversight, including through its committees and our Board member for ESG.
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In our efforts to reduce our impacts on the environment, none of the waste from our factories and distribution centers 3 was sent to landfi 1 Per SBTi target setting process, targets will be set within 24 months of November 2023. 2 Scope 1 and 2 emissions . 3 The scope for our waste reporting is our factories and distribution centers managed by Coty.
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The Sustainability Office and our business leaders work to drive change and lead our reporting and due diligence efforts. Our Sustainability Office also works closely with Coty’s brands and external partners to implement, evolve, and communicate Beauty that Lasts.
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For our reporting on our emissions, energy usage and water consumption our scope covers our factories and distribution centers managed by Coty and our corporate offices (14 factories and distribution centers, and 40+ offices and R&D centers) and excludes third-party operated factories and distribution centers. 5 ll, while most was reused, recycled, or composted.
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To enable our sustainability strategy to reflect our impact, the views of our stakeholders, and the risks and opportunities sustainability issues have for our business, in fiscal 2025, we completed a double materiality assessment in line with European Sustainability Reporting Standards (“ESRS”) guidance. Our identified material topics will guide our program and inform our future reporting.
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We have implemented several measures to reduce water consumption across our plants and distribution centers. While certain projects are already in execution phase, other projects are in the early stages as we validate their feasibility and explore new ones to achieve our proposed targets.
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Governed Beautifully also means conducting business ethically and responsibly. Our global compliance program, ‘Behave Beautifully,’ is designed to detect and prevent unlawful behavior and promote a culture of ethical business practice.
Removed
We continue to evaluate and modify our processes and activities to further limit our impact on the environment and to enable the deployment of our climate-related initiatives to meet our proposed targets. The Beauty of Our People We are committed to playing our part in creating a more inclusive business and society.
Added
We also expect our suppliers to implement responsible practices and aim to manage any negative environmental, social, or economic impacts through our Code of Conduct for Business Partners, supplier assessments and ethical sourcing practices. The Beauty of Our Planet Conserving and protecting the natural environment is a vital part of our responsibility as a business.
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We celebrate diversity in all its forms and continue to work towards building a more inclusive business. We recognize the importance of diversity at a leadership level and throughout our whole organization. In fiscal 2024, we made strides in advancing our Diversity, Equity, and Inclusion (DE&I) initiatives.
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For the first time, we conducted a climate risks assessment in line with Task Force on Climate-related Financial Disclosures (“TCFD”) framework to improve our risks and opportunities assessment.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSome of the factors that could materially and adversely affect our business, financial condition, results of operations or prospects include: • 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. • 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. • Changes in industry trends and consumer preferences could adversely affect our business, prospects, financial condition and results of operations. • Our success depends, in part, on the quality, efficacy and safety of our products. • Our failure to protect our reputation, or the failure of our brand partners or licensors to protect their reputations, could have a material adverse effect on our brand images. • Our brand licenses may be terminated if specified conditions are not met, and we may not be able to renew expiring licenses on favorable terms or at all. • 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. • Our success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property of third parties. • Our business is subject to seasonal variability. • Our success depends on our ability to achieve our global business strategies. • 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. • We face risks associated with our joint ventures and strategic partnership investments. • 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. • 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 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. • 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. • Failure to protect sensitive information of our consumers and information technology systems against security breaches could damage our reputation and substantially harm our business, financial condition and results of operations. • 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. • Our success depends, in part, on our employees, including our key personnel. 8 • 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 subject to risks related to our international operations. • Changes in tax laws or regulations, or challenges to our tax positions, could significantly increase our tax liabilities. • We have taken on significant debt, and the agreements that govern such debt contain various covenants that impose restrictions on us, which may adversely affect our business. • Our ability to service and repay our indebtedness will be dependent on the cash flow generated by our subsidiaries and events beyond our control. • Our variable rate indebtedness subjects us to interest rate risk, which could cause certain debt service obligations to increase. • 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. • 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. • 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. • Fluctuations in currency exchange rates may negatively impact our financial condition and results of operations. • Public health crises could have a negative impact on our business, financial condition, results of operations and cash flows. • We are subject to legal proceedings and legal compliance risks, including talc-related litigation alleging bodily injury. • Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition, results of operations, cash flows, as well as the trading price of our securities. • Our operations and acquisitions in certain foreign areas expose us to political, regulatory, economic and reputational risks. • Our employees or others may engage in misconduct or other improper activities including noncompliance with regulatory standards and regulatory requirements. • Violations of our prohibition on harassment, sexual or otherwise, could result in liabilities and/or litigation. • If the Distribution (as defined below) or the acquisition of the P&G Beauty Business does not qualify for its intended tax treatment, in certain circumstances we are required to indemnify P&G for resulting tax-related losses under the tax matters agreement entered into in connection with the acquisition of the P&G Beauty Business dated October 1, 2016. • We are subject to risks related to our common stock and our stock repurchase program. • JAB Beauty B.V.
Biggest changeSome of the factors that could materially and adversely affect our business, financial condition, results of operations or prospects include: • 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. • 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. • Changes in industry trends and consumer preferences could adversely affect our business, prospects, financial condition and results of operations. • Our success depends, in part, on the quality, efficacy and safety of our products. • Our failure to protect our reputation, or the failure of our brand partners or licensors to protect their reputations, could have a material adverse effect on our brand images. • Our brand licenses may be terminated if specified conditions are not met, and we may not be able to renew expiring licenses on favorable terms or at all. 7 • 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. • Our success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property of third parties. • Our business is subject to seasonal variability. • Our success depends on our ability to achieve our global business strategies. • 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. • We face risks associated with our joint ventures and strategic partnership investments. • 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. • 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 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. • 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. • Failure to protect sensitive information of our consumers and information technology systems against security breaches could damage our reputation and substantially harm our business, financial condition and results of operations. • 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. • Our success depends, in part, on our employees, including our key personnel. • 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 subject to risks related to our international operations. • 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. • Changes in tax laws or regulations, or challenges to our tax positions, could significantly increase our tax liabilities. • We have taken on significant debt, and the agreements that govern such debt contain various covenants that impose restrictions on us, which may adversely affect our business. • Our ability to service and repay our indebtedness will be dependent on the cash flow generated by our subsidiaries and events beyond our control. • Our variable rate indebtedness subjects us to interest rate risk, which could cause certain debt service obligations to increase. • 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. • 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. 8 • 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. • Fluctuations in currency exchange rates may negatively impact our financial condition and results of operations. • We are subject to legal proceedings and legal compliance risks, including talc-related litigation alleging bodily injury. • Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition, results of operations, cash flows, as well as the trading price of our securities. • Our operations and acquisitions in certain foreign areas expose us to political, regulatory, economic and reputational risks. • Our employees or others may engage in misconduct or other improper activities including noncompliance with regulatory standards and regulatory requirements. • Violations of our prohibition on harassment, sexual or otherwise, could result in liabilities and/or litigation. • If the Distribution (as defined below) or the acquisition of the P&G Beauty Business does not qualify for its intended tax treatment, in certain circumstances we are required to indemnify P&G for resulting tax-related losses under the tax matters agreement entered into in connection with the acquisition of the P&G Beauty Business dated October 1, 2016. • We are subject to risks related to our common stock and our stock repurchase program. • JAB Beauty B.V.
The multi-year implementation of our global business strategies has resulted 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.
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.
Our presence in such geographies has expanded as a result of our acquisitions, as well as organic growth, and we are pursuing selective international expansion in countries where we do not yet have significant presence.
Our presence in such geographies has expanded as a result of our acquisitions, as well as organic growth, and we are pursuing selective international expansion in countries where we do not yet have a significant presence.
The war in Ukraine and/or the armed conflict 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. 23 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.
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. 23 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.
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 10 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 do not generate sufficient cash flow to satisfy our covenants and debt service obligations, including payments on our senior secured notes, senior unsecured notes and under the 2018 Coty Credit Agreement, we may have to undertake additional cost reduction measures or alternative financing plans, such as refinancing or restructuring our debt; selling assets; reducing or delaying capital investments; modifying terms of agreements, including timing of payments, with vendors, customers, and other third parties; or seeking to raise additional capital.
If we do not generate sufficient cash flow to satisfy our covenants and debt service obligations, including payments on our senior secured notes and under the 2018 Coty Credit Agreement, we may have to undertake additional cost reduction measures or alternative financing plans, such as refinancing or restructuring our debt; selling assets; reducing or delaying capital investments; modifying terms of agreements, including timing of payments, with vendors, customers, and other third parties; or seeking to raise additional capital.
In particular, due to the seasonal nature of the beauty industry, with the highest levels of consumer demand generally occurring during the holiday buying season in our second fiscal quarter, our subsidiaries’ cash flow in the second half of the fiscal year may be less than in the first half of the fiscal year, which may affect our ability to satisfy our debt service obligations, including to service our senior secured notes, senior unsecured notes and the 2018 Coty Credit Agreement, and to meet our deleveraging objectives.
In particular, due to the seasonal nature of the beauty industry, with the highest levels of consumer demand generally occurring during the holiday buying season in our second fiscal quarter, our subsidiaries’ cash flow in the second half of the fiscal year may be less than in the first half of the fiscal year, which may affect our ability to satisfy our debt service obligations, including to service our senior secured notes and the 2018 Coty Credit Agreement, and to meet our deleveraging objectives.
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, senior unsecured 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, senior unsecured notes and the 2018 Coty Credit Agreement.
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.
We are engaged in efforts to rationalize our wholesale distribution channel and continue efforts to reduce the amount of product diversion to the value and mass channels; however, 12 stopping or significantly reducing such commerce could result in a potential adverse impact to our sales and net revenues, including to those customers who are selling our products to unauthorized retailers, or an increase in returns over historical levels.
We are engaged in efforts to rationalize our wholesale distribution channel and continue efforts to reduce the amount of product diversion to the value and mass channels; however, stopping or significantly reducing such commerce could result in a potential adverse impact to our sales and net revenues, including to those customers who are selling our products to unauthorized retailers, or an increase in returns over historical levels.
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, 13 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.
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.
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.
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 27 development of an active trading market for Class A Common Stock on Euronext Paris.
The U.S. 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.
The U.S. 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 20 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.
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.
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 17 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 are under the jurisdiction of regulators and other governmental authorities which may, in certain circumstances, lead to enforcement actions, changes in business practices, fines and penalties, the assertion of private litigation claims and damages. Some of these actions 24 may also adversely impact our customer relationships, particularly to the extent customers were implicated by such proceedings.
We are under the jurisdiction of regulators and other governmental authorities which may, in certain circumstances, lead to enforcement actions, changes in business practices, fines and penalties, the assertion of private litigation claims and damages. Some of these actions may also adversely impact our customer relationships, particularly to the extent customers were implicated by such proceedings.
These restrictions may limit or prohibit our ability and the ability of our restricted subsidiaries to, among other things: • incur indebtedness or grant liens on our property; • dispose of assets or equity; • make acquisitions or investments; • make dividends, distributions or other restricted payments; • effect affiliate transactions; • enter into sale and leaseback transactions; and 21 • enter into mergers, consolidations or sales of substantially all of our assets and the assets of our subsidiaries.
These restrictions may limit or prohibit our ability and the ability of our restricted subsidiaries to, among other things: • incur indebtedness or grant liens on our property; • dispose of assets or equity; • make acquisitions or investments; • make dividends, distributions or other restricted payments; • effect affiliate transactions; • enter into sale and leaseback transactions; and • enter into mergers, consolidations or sales of substantially all of our assets and the assets of our subsidiaries.
Our operations and acquisitions in certain foreign areas expose us to political, regulatory, economic and reputational risks. 25 We operate on a global basis. Our employees, contractors and agents, business partners, joint ventures and joint venture partners and companies to which we outsource certain of our business operations, may take actions in violation of our compliance policies or applicable law.
Our operations and acquisitions in certain foreign areas expose us to political, regulatory, economic and reputational risks. We operate on a global basis. Our employees, contractors and agents, business partners, joint ventures and joint venture partners and companies to which we outsource certain of our business operations, may take actions in violation of our compliance policies or applicable law.
As a controlled company, we are exempt under the NYSE standards from the obligation to comply with certain NYSE corporate governance requirements, including the requirements: • that a majority of our board of directors consists of independent directors; • that we have a nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and 27 • that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
As a controlled company, we are exempt under the NYSE standards from the obligation to comply with certain NYSE corporate governance requirements, including the requirements: • that a majority of our board of directors consists of independent directors; • that we have a nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and • that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
Such attacks have become increasingly difficult to detect, defend against or prevent and may originate from outside parties, hackers, criminal organizations or other threat actors, including nation states. As AI capabilities 17 improve and gain widespread use, we may experience cyber attacks created using AI, which may be difficult to detect and mitigate against.
Such attacks have become increasingly difficult to detect, defend against or prevent and may originate from outside parties, hackers, criminal organizations or other threat actors, including nation states. As AI capabilities improve and gain widespread use, we may experience cyber attacks created using AI, which may be difficult to detect and mitigate against.
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.
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 18 vulnerable to website or application downtime and other technical failures, as well as disruptions beyond our control.
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 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.
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.
In connection with the closing of the acquisition of the P&G Beauty Business on October 1, 2016, we and P&G received written opinions from special tax counsel regarding the intended tax treatment of the merger, and The Procter & Gamble Company (“P&G”) received an additional written opinion from special tax counsel regarding the intended tax treatment of the 26 distribution by P&G of its shares of Galleria Co.
In connection with the closing of the acquisition of the P&G Beauty Business on October 1, 2016, we and P&G received written opinions from special tax counsel regarding the intended tax treatment of the merger, and The Procter & Gamble Company (“P&G”) received an additional written opinion from special tax counsel regarding the intended tax treatment of the distribution by P&G of its shares of Galleria Co.
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.
The trend toward consolidation, particularly in developed markets such as the U.S. and Western Europe, has resulted in our becoming increasingly dependent on 9 our relationships with, and the overall business health of, fewer key retailers that control an increasing percentage of retail locations, which trend may continue.
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 inability to introduce successful products in our traditional categories and channels or in these 14 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.
See “—Fluctuations in currency exchange rates may negatively impact our financial condition and results of operations” and “—We are subject to risks related to our international operations.” 15 We face risks associated with our joint ventures and strategic partnership investments. We are party to several joint ventures and strategic partnership investments in both the U.S. and abroad.
See “—Fluctuations in currency exchange rates may negatively impact our financial condition and results of operations” and “—We are subject to risks related to our international operations.” We face risks associated with our joint ventures and strategic partnership investments. We are party to several joint ventures and strategic partnership investments in both the U.S. and abroad.
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.
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 11 may in the future breach, certain terms of our brand licenses.
The loss of, or damage or disruption to, any of our manufacturing facilities or distribution centers could 16 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. We manufacture and package a majority of our products.
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. We manufacture and package a majority of our products.
(“JAB”) and its affiliates, through their ownership of approximately 55% of the outstanding shares of our Class A Common Stock, have the ability to effect and/or significantly influence certain decisions requiring stockholder approval, which may be inconsistent with the interests of our other stockholders. • We are a “controlled company” within the meaning of the NYSE rules and, as a result, are entitled to rely on exemptions from certain corporate governance requirements that are designed to provide protection to stockholders of companies that are not “controlled companies”. • The dual-listing of our Class A Common Stock on the New York Stock Exchange (“NYSE”) and on Euronext Paris’s Professional Segment may adversely affect the liquidity and value of our Class A Common Stock.
(“JAB”) and its affiliates, through their ownership of approximately 54% of the outstanding shares of our Class A Common Stock, have the ability to effect and/or significantly influence certain decisions requiring stockholder approval, which may be inconsistent with the interests of our other stockholders. • We are a “controlled company” within the meaning of the NYSE rules and, as a result, are entitled to rely on exemptions from certain corporate governance requirements that are designed to provide protection to stockholders of companies that are not “controlled companies”. • The dual-listing of our Class A Common Stock on the New York Stock Exchange (“NYSE”) and on Euronext Paris’s Professional Segment may adversely affect the liquidity and value of our Class A Common Stock.
Further, a 18 failure to adequately protect personal data, including that of customers or employees, or other data security failure, such as a cyber attack from a third party, could lead to penalties, significant remediation costs and reputational damage, including loss of future business.
Further, a failure to adequately protect personal data, including that of customers or employees, or other data security failure, such as a cyber attack from a third party, could lead to penalties, significant remediation costs and reputational damage, including loss of future business.
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 19 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.
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), immigration, 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.
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.
Further, other 19 companies may attempt to recruit our key personnel and we may attempt to recruit their key personnel, even if bound by non-competes, which could result in diversion of management attention and our resources to litigation related to such recruitment.
Further, other companies may attempt to recruit our key personnel and we may attempt to recruit their key personnel, even if bound by non-competes, which could result in diversion of management attention and our resources to litigation related to such recruitment.
Agreements that govern our indebtedness, including our credit agreement (as amended, the “2018 Coty Credit Agreement”), and the indentures governing our senior secured notes and our senior unsecured notes, impose significant operating and financial restrictions on our activities.
Agreements that govern our indebtedness, including our credit agreement (as amended, the “2018 Coty Credit Agreement”), and the indentures governing our senior secured notes, impose significant operating and financial restrictions on our activities.
Non-U.S. operations are subject to many risks and uncertainties, including ongoing instability or changes in a country’s or region’s economic, regulatory or political conditions, including inflation, recession, interest rate fluctuations, sovereign default risk and actual or anticipated military or political conflicts, labor market disruptions, sanctions, boycotts, new or increased tariffs, quotas, exchange or price controls, trade barriers or other restrictions on foreign businesses, our failure to effectively and 20 timely implement processes and policies across our diverse operations and employee base and difficulties and costs associated with complying with a wide variety of complex and potentially conflicting regulations across multiple jurisdictions.
Non-U.S. operations are subject to many risks and uncertainties, including ongoing instability or changes in a country’s or region’s economic, regulatory or political conditions, including inflation, recession, interest rate fluctuations, sovereign default risk and actual or anticipated military or political conflicts, labor market disruptions, sanctions, boycotts, new or increased tariffs, quotas, exchange or price controls, trade barriers or other restrictions on foreign businesses, our ability to effectively and timely implement processes and policies across our diverse operations and employee base, and difficulties and costs associated with complying with a wide variety of complex and potentially conflicting regulations across multiple jurisdictions.
See Note 24— Legal and Other Contingencies for more information regarding our potential tax obligations in Brazil. Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition, results of operations, cash flows, as well as the trading price of our securities. Our business is subject to numerous laws, regulations and policies.
See Note 22— Legal and Other Contingencies for more information regarding our potential tax obligations in Brazil. Changes in laws, regulations and policies that affect our business or products could adversely affect our business, financial condition, results of operations, cash flows, as well as the trading price of our securities. Our business is subject to numerous laws, regulations and policies.
In the past year, inflation and other factors have resulted in an increase in interest rates generally, which has impacted our borrowing costs.
In the past, inflation and other factors have resulted in an increase in interest rates generally, which has impacted our borrowing costs.
(“JAB”) and its affiliates beneficially own approximately 55% of the fully diluted shares of our Class A Common Stock and, as such, have the ability to effect certain decisions requiring stockholder approval, which may be inconsistent with the interests of our other stockholders. JAB Holdings B.V.
(“JAB”) and its affiliates beneficially own approximately 54% of the fully diluted shares of our Class A Common Stock and, as such, have the ability to effect certain decisions requiring stockholder approval, which may be inconsistent with the interests of our other stockholders. JAB Holdings B.V.
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 innovative in-store activations.
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.
We have outsourced and may continue to outsource certain functions, including outsourcing of distribution functions, outsourcing of business processes (including certain financing 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.
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.
The currencies to which we are exposed include the euro, the British pound, the Chinese yuan, the Polish zloty, the Brazilian real, the Australian dollar and the Canadian dollar. The exchange rates between these currencies and the U.S. dollar in recent years have fluctuated significantly and may continue to do so in the future.
The currencies to which we are exposed include the euro, the British pound, the Chinese yuan, the Argentine peso, the Polish zloty, the Brazilian real, the Australian dollar and the Canadian dollar. The exchange rates between these currencies and the U.S. dollar in recent years have fluctuated significantly and may continue to do so in the future.
Although we are seeking a favorable administrative and judicial decisions on the related tax enforcement actions, we may not be successful.
Although we are seeking favorable administrative and judicial decisions on the related tax enforcement actions, we may not be successful.
For a further discussion of our impairment testing, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Financial Condition-Liquidity and Capital Resources-Goodwill, Other Intangible Assets and Long-Lived Assets”. Risks related to our Business Operations A disruption in operations could adversely affect our business.
For a further discussion of our impairment testing, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Financial Condition-Liquidity and Capital Resources-Goodwill, Other Intangible Assets and Long-Lived Assets.” Risks related to our Business Operations A disruption in operations could adversely affect our business.
Such matters may result in our incurring unanticipated costs that may negatively impact the financial contributions of such acquisitions at least in the periods in which such liability is incurred or require operational adjustments that affect our results of operations with respect to such investments.
Such matters may result in our incurring unanticipated costs that may negatively impact the financial contributions of such acquisitions at least in the periods in which such liability is incurred or requires operational adjustments that affect our results of operations with respect to such investments.
The terms of the indentures governing our senior secured notes and senior unsecured 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.
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.
(the “Hypermarcas Brands”) and our joint venture with Kylie Jenner and our investment in the Kim Kardashian beauty business, entail certain particular risks, including potential difficulties in geographies and channels in which we lack a significant presence, difficulty in seizing business opportunities compared to local or other global competitors, difficulty in complying with new regulatory frameworks, the acquisition of new or unexpected liabilities, the adverse impact of fluctuating exchange rates and entering lines of business where we have limited or no direct experience.
(the “Hypermarcas Brands”) and our joint venture with Kylie Jenner, entail certain particular risks, including potential difficulties in geographies and channels in which we lack a significant presence, difficulty in seizing business opportunities compared to local or other global competitors, difficulty in complying with new regulatory frameworks, the acquisition of new or unexpected liabilities, the adverse impact of fluctuating exchange rates and entering lines of business where we have limited or no direct experience.
Failure of or disruption to one or more of our information technology platforms could affect our ability to execute our operating strategy. We rely on multiple information technology platforms to execute operations related to OTC (order to cash), manufacturing, financial transactions and reporting, procurement to pay and payroll. In addition, we have become more reliant on DTC and content management.
Failure of or disruption to one or more of our information technology platforms could affect our ability to execute our operating strategy. We rely on multiple information technology platforms to execute operations related to OTC (order to cash), manufacturing, financial transactions and reporting, procurement to pay and payroll. In addition, we have become more reliant on direct-to-consumer and content management.
We also are involved in numerous lawsuits involving product liability issues, most involving allegations related to alleged asbestos in our talc-based cosmetic products, allegedly leading to mesothelioma.
We also are involved in numerous lawsuits involving product liability issues, mostly involving allegations related to alleged asbestos in our talc-based cosmetic products, allegedly leading to mesothelioma.
In addition, sudden disruptions in business conditions as a consequence of events such as terrorist attacks, war or other military action or the threat of further attacks, pandemics or other crises or vulnerabilities or as a result of adverse weather conditions or climate changes, may have an impact on consumer spending, which 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.
In addition, sudden disruptions in business conditions as a consequence of events such as terrorist attacks, war or other military action or the threat of further attacks, pandemics or other crises or vulnerabilities or as a result of natural disasters, adverse weather conditions or climate changes, may have an impact on consumer spending in one or more regions, which 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 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. During the past several years, we have explored and undertaken opportunities to acquire other companies and assets as part of our growth strategy.
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.
We also devote time and resources to citizenship efforts that are consistent with our corporate values and are designed to strengthen our business and protect and preserve our reputation, including programs driving diversity, equity and inclusion, responsible sourcing, packaging and environmental sustainability.
We also devote time and resources to corporate citizenship efforts that are consistent with our corporate values and are designed to strengthen our business and protect and preserve our reputation, including programs driving responsible sourcing, packaging and environmental sustainability.
We may not have adequate or any insurance coverage for some of these legacy matters, including matters assumed in the acquisition of the P&G Beauty Business, the Hypermarcas Brands and the Burberry fragrance business, the joint venture with Kylie Jenner and the strategic partnership with Kim Kardashian.
We may not have adequate or any insurance coverage for some of these legacy matters, including matters assumed in the acquisition of the P&G Beauty Business, the Hypermarcas Brands and the Burberry fragrance business, and the joint venture with Kylie Jenner.
Abrupt political change, terrorist activity, and armed conflict, such as the ongoing war in Ukraine and/or the armed conflict in the Middle East (including the Red Sea conflict) and any escalation or expansion thereof, pose a risk of further general economic disruption in affected regions.
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.
For example, in connection with a Goiás State tax ICMS assessment received in August 2020, we have 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.
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, 24 which we have appealed to the Superior Court of Justice for review and are awaiting a decision.
We are also subject to legal proceedings and legal compliance risks in connection with legacy matters involving the P&G Beauty Business, the Burberry fragrance business, Hypermarcas Brands, the Kylie Jenner business and the Kim Kardashian business that were previously outside our control and that we are now independently addressing, as well as retained liabilities relating to divested businesses, which may result in unanticipated or new liabilities.
We are also subject to legal proceedings and legal compliance risks in connection with legacy matters involving the P&G Beauty Business and the Hypermarcas Brands that were previously outside our control and that we are now independently addressing, as well as retained liabilities relating to divested businesses, which may result in unanticipated or new liabilities.
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 COVID-19, the war in Ukraine and related geopolitical conditions.
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.
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 potential increases in tariffs).
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).
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, recessionary conditions and geopolitical conditions including the war in Ukraine and/or the armed conflict in the Middle East (including the Red Sea conflict) .
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 .
We are subject to risks related to our international operations. We operate on a global basis, and approximately 71% of our net revenues in fiscal 2024, were generated outside North America. We have employees in more than 36 countries, and we market, sell and distribute our products in over 121 countries and territories.
We are subject to risks related to our international operations. We operate on a global basis, and approximately 73% of our net revenues in fiscal 2025 were generated outside North America. We have employees in more than 36 countries, and we market, sell and distribute our products in over 123 countries and territories.
Deterioration in global financial markets, including as a result of global and regional economic conditions, the war in Ukraine and/or the armed conflict in the Middle East (including the Red Sea conflict) and related geopolitical conditions, could make future financing 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 armed conflicts in the Middle East and related geopolitical conditions, could make future financing or refinancing difficult or more expensive.
We do not control the protection of the trademarks and other intellectual property rights of our brand and joint venture partners and licensors and cannot ensure that our brand and joint venture partners and licensors will be able to secure or protect their trademarks and other intellectual property rights, which could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows, as well as the trading price of our securities.
We do not control the protection of the trademarks and other intellectual property rights of our brand and joint venture partners and licensors and cannot ensure that our brand and joint venture partners and licensors will be able to secure or protect their trademarks and other intellectual property rights, which could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows, as well as the trading price of our securities. 12 Our success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property of third parties.
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 COVID-19 and the war in Ukraine, such events can evolve rapidly and cause significant and pervasive disruptions to global economic and business conditions.
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.
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 currently engage in a program seeking to improve control over our product demand and inventories.
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.
For example, we entered into strategic partnerships with Kylie Jenner and Kim Kardashian, both digital-native beauty businesses, we are continuing our expansion into prestige cosmetics, and we are building a comprehensive skincare portfolio leveraging existing and new brands.
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 ability to restructure or refinance our debt 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 April 2026, will depend on the capital markets and other macroeconomic conditions and our financial condition at such time.
In addition, we have entered into forward repurchase transactions to begin hedging for a potential $196 million repurchase under our stock repurchase program currently planned for 2025 and an additional potential $294 million repurchase planned for 2026.
In addition, in 2022 and 2023 we entered into 26 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, 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.
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.
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). We entered into a joint venture with Kylie Jenner in fiscal 2020 and a strategic partnership with Kim Kardashian in fiscal 2021.
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.
In addition, in the U.S. and internationally, there has been increased legislative and regulatory activity related to AI and the risks and challenges AI poses, including the European Union’s Artificial Intelligence Act and the current U.S. presidential administration’s executive order to, among other things, establish AI safety and security.
In addition, in the U.S. and internationally, there has been increased legislative and regulatory activity related to AI and the risks and challenges AI poses, including the European Union’s Artificial Intelligence Act.
These assets represent a significant portion of our net assets, particularly the P&G Beauty Business. As we consider growth opportunities, we may continue to 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.
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.
These forward repurchase transactions expose us to additional risks related to the price of our common stock, including a potential true-up in cash upon specified changes in the price of our common stock. JAB Beauty B.V.
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. JAB Beauty B.V.
When used in this discussion, the term “includes” and “including” means, unless the context otherwise indicates, including without limitation and the terms “Coty,” the “Company,” “we,” “our,” or “us” mean, unless the context otherwise indicates, Coty Inc. and its majority and wholly-owned subsidiaries. 7 Risk Factor Summary We are providing the following summary of the risk factors to enhance the readability and accessibility of our risk factor disclosures.
When used in this discussion, the term “includes” and “including” means, unless the context otherwise indicates, including without limitation and the terms “Coty,” the “Company,” “we,” “our,” or “us” mean, unless the context otherwise indicates, Coty Inc. and its majority and wholly-owned subsidiaries.
These joint ventures and investments involve risks that our joint venture or strategic investment partners may: • have economic or business interests or goals that are inconsistent with or adverse to ours; • take actions contrary to our requests or contrary to our policies or objectives, including actions that may violate applicable law; • be unable or unwilling to fulfill their obligations under the relevant joint venture agreements; • have financial or business difficulties; • take actions that may harm our reputation; or • have disputes with us as to the scope of their rights, responsibilities and obligations.
These joint ventures and investments involve risks that our joint venture or strategic investment partners may: • have economic or business interests or goals that are inconsistent with or adverse to ours; • take actions contrary to our requests or contrary to our policies or objectives, including actions that may violate applicable law; • be unable or unwilling to fulfill their obligations under the relevant joint venture agreements; • have financial or business difficulties; • take actions that may harm our reputation; or • have disputes with us as to the scope of their rights, responsibilities and obligations. 15 In certain cases, joint ventures and strategic partnership investments may present us with a lack of ability to fully control all aspects of their operations, including due to veto rights, and we may not have full visibility with respect to all operations, customer relations and compliance practices, among others.
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.
We are subject to the interpretation and enforcement by governmental agencies of other foreign laws, rules, regulations or policies, including any changes thereto, such as restrictions on trade, import and export license requirements, and tariffs and taxes (including assessments and disputes related thereto), which may require us to adjust our operations in certain areas where we do business.
For example, in April 2022, following the imposition of additional sanctions against Russia and Russian interests in connection with the war in Ukraine, we announced our Board’s decision to wind down the operations of our Russian subsidiary as a result of the war and the related sanctions. 25 We are subject to the interpretation and enforcement by governmental agencies of other foreign laws, rules, regulations or policies, including any changes thereto, such as restrictions on trade, import and export license requirements, and tariffs and taxes (including assessments and disputes related thereto), which may require us to adjust our operations in certain areas where we do business.
Third parties have in the past, and could in the future, bring infringement, invalidity, co-inventorship, re-examination, opposition or similar claims with respect to our current or future intellectual property.
Furthermore, we may not apply for, or be unable to obtain, intellectual property protection for certain aspects of our business. Third parties have in the past, and could in the future, bring infringement, invalidity, co-inventorship, re-examination, opposition or similar claims with respect to our current or future intellectual property.
Any future impairment of our goodwill or other intangible assets could have an adverse effect on our financial condition and results of operations, as well as the trading price of our securities.
It is possible that material changes in our business, market conditions, or market assumptions could occur over time. Any future impairment of our goodwill or other intangible assets could have an adverse effect on our financial condition and results of operations, as well as the trading price of our securities.
Our success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property of third parties. Our commercial success depends in part on our ability to operate without infringing, misappropriating or otherwise violating the trademarks, patents, copyrights and other proprietary rights of third parties.
Our commercial success depends in part on our ability to operate without infringing, misappropriating or otherwise violating the trademarks, patents, copyrights and other proprietary rights of third parties. However, we cannot be certain that the conduct of our business does not and will not infringe, misappropriate or otherwise violate such rights.
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 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. 13 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.
For so long as JABH and its affiliates own more than 50% of the total voting power of our common shares, we are a “controlled company” within the meaning of the NYSE corporate governance standards.
We are a “controlled company” within the meaning of the NYSE rules and, as a result, are entitled to rely on exemptions from certain corporate governance requirements that are designed to provide protection to stockholders of companies that are not “controlled companies.” For so long as JABH and its affiliates own more than 50% of the total voting power of our common shares, we are a “controlled company” within the meaning of the NYSE corporate governance standards.
Furthermore, we cannot predict how consumers will react to any new products that we launch or to repositioning of our brands. 10 Our successful product launches may not continue. The amount of positive or negative sales contribution of any of our products may change significantly within a period or from period to period.
Our successful product launches may not continue. The amount of positive or negative sales contribution of any of our products may change significantly within a period or from period to period.
We encourage you to carefully review the full risk factors discussed below in their entirety for additional information.
Risk Factor Summary We are providing the following summary of the risk factors to enhance the readability and accessibility of our risk factor disclosures. We encourage you to carefully review the full risk factors discussed below in their entirety for additional information.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Cybersecurity Special Committee, led by our Chief Information and Business Services Officer and two Board members (including the Chair of the AFC), consists of executive members from various corporate functions, including information technology, digital operations, corporate affairs, legal, compliance, human resources and finance.
Biggest changeThe Cybersecurity Special Committee, led by our Chief Information, Digital Innovation and Business Services Officer and two Board members (including the Chair of the AFC), consists of executive members from various corporate functions, including information technology, digital operations, corporate affairs, legal, compliance, human resources and finance.
Outside cybersecurity experts periodically present to the Board on topics related to information security, data privacy and cyber risks and mitigation strategies. At the management level, our Global Information Security Team monitors alerts and informs relevant global senior management of all incidents and related mitigation and remediation, and escalates to the Cybersecurity Special Committee as needed.
Outside cybersecurity experts periodically present to the Board on topics related to information security, data privacy and cyber risks and mitigation strategies. 28 At the management level, our Global Information Security Team monitors alerts and informs relevant global senior management of all incidents and related mitigation and remediation, and escalates to the Cybersecurity Special Committee as needed.
Governance 28 Management is responsible for understanding and managing the risks that we face in our business, including relating to cybersecurity, and the Board of Directors is responsible for overseeing management’s overall approach to risk management.
Governance Management is responsible for understanding and managing the risks that we face in our business, including relating to cybersecurity, and the Board of Directors is responsible for overseeing management’s overall approach to risk management.

Item 2. Properties

Properties — owned and leased real estate

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Biggest change(leased) Corporate/Commercial Corporate / Consumer Beauty Paris, France (2 locations) (leased) Corporate/Commercial Corporate / Prestige Singapore, Singapore (leased) Corporate/Commercial Corporate Ashford, England (land leased, building owned) Manufacturing Consumer Beauty Chartres, France (owned) Manufacturing Prestige Granollers, Spain (owned) Manufacturing Prestige Hunt Valley, U.S. (owned) Manufacturing Consumer Beauty Monaco, Monaco (leased) Manufacturing /R&D Prestige Sanford, North Carolina, U.S.
Biggest change(leased) Corporate/Commercial Corporate / Consumer Beauty Paris, France (2 locations) (leased) Corporate/Commercial Corporate / Prestige Singapore, Singapore (leased) Corporate/Commercial Corporate Barcelona, Spain (leased) Corporate/Supply Chain Corporate Ashford, England (land leased, building owned) Manufacturing Consumer Beauty Chartres, France (owned) Manufacturing Prestige Granollers, Spain (owned) Manufacturing Prestige Hunt Valley, U.S.
We consider our properties to be generally in good condition and believe that our facilities are adequate for our operations and provide sufficient capacity to meet anticipated requirements. The following table sets forth our principal owned and leased corporate, manufacturing and research and development facilities as of June 30, 2024.
We consider our properties to be generally in good condition and believe that our facilities are adequate for our operations and provide sufficient capacity to meet anticipated requirements. The following table sets forth our principal owned and leased corporate, manufacturing and research and development facilities as of June 30, 2025.
(owned) Manufacturing Prestige Senador Canedo, Brazil (owned) Manufacturing Consumer Beauty Wujiang, China (owned) Manufacturing Consumer Beauty Morris Plains, New Jersey, U.S. (leased) R&D All segments Item 3. Legal Proceedings. For information on our legal matters, see Note 24—Legal and Other Contingencies in the notes to our Consolidated Financial Statements. PART II
(owned) Manufacturing Consumer Beauty Monaco, Monaco (leased) Manufacturing /R&D Prestige Sanford, North Carolina, U.S. (owned) Manufacturing Prestige Senador Canedo, Brazil (owned) Manufacturing Consumer Beauty Morris Plains, New Jersey, U.S. (leased) R&D All segments Item 3. Legal Proceedings. For information on our legal matters, see Note 22—Legal and Other Contingencies in the notes to our Consolidated Financial Statements. PART II

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings 29 Part II: Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 29 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 33 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 62
Biggest changeItem 3. Legal Proceedings 29 Part II: Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 29 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 32 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 61

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAs we focus on preserving cash, we have continued to suspend the payment of Common Stock dividends. Any determination to pay dividends on our common stock in the future will be at the discretion of our Board of Directors and is subject to the restrictions under the terms of the Convertible Series B Preferred Stock described below.
Biggest changeAny determination to pay dividends on our common stock in the future will be at the discretion of our Board of Directors and is subject to the restrictions under the terms of the Convertible Series B Preferred Stock described below. 29 Dividends on the Convertible Series B Preferred Stock are payable in cash, or by increasing the amount of accrued dividends on Convertible Series B Preferred Stock, or any combination thereof, at the sole discretion of the Company.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock 29 Our common stock is listed on the New York Stock Exchange under the symbol “COTY.” It is also listed on the Euronext Paris Professional Segment.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Common Stock Our common stock is listed on the New York Stock Exchange under the symbol “COTY.” It is also listed on the Euronext Paris Professional Segment.
Furthermore, we are required to comply with certain covenants contained within the agreements that govern our indebtedness, including our credit agreements and the indentures relating to our senior secured notes and our senior unsecured notes.
Furthermore, we are required to comply with certain covenants contained within the agreements that govern our indebtedness, including our credit agreements and the indentures relating to our senior secured notes.
(b) The Peer Group includes L'Oréal S.A., Inc., Estée Lauder Companies, Inc., Beiersdorf AG, Shiseido Company, Limited and Inter Parfums Inc. The Market Performance Graph above assumes a $100.00 investment on June 30, 2019, in Coty Inc.’s common stock, the S&P 500 Index and the Peer Group.
(b) The Peer Group includes L'Oréal S.A., Inc., Estée Lauder Companies, Inc., Beiersdorf AG, Shiseido Company, Limited and Inter Parfums Inc. The Market Performance Graph above assumes a $100.00 investment on June 30, 2020, in Coty Inc.’s common stock, the S&P 500 Index and the Peer Group.
For additional information on our Share Repurchase Program and our forward repurchase contracts, see Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements. No shares of Class A Common Stock were repurchased during the fiscal year ended June 30, 2023. 32
For additional information on our Share Repurchase Program and our forward repurchase contracts, see Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements. No shares of Class A Common Stock were repurchased during the fiscal year ended June 30, 2025. 31
Stockholders of Record As of June 30, 2024 there were 588 stockholders of record of our Class A Common Stock. The actual number of stockholders is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees.
Stockholders of Record As of June 30, 2025, there were 565 stockholders of record of our Class A Common Stock. The actual number of stockholders is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees.
The returns of each company in the Peer Group have been weighted according to their respective stock market capitalization at the beginning of the measurement period for purposes of arriving at a Peer Group average. 31 Equity Compensation Plan Information Plan Category (1) Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (d ) (excluding securities reflected in column (1) ) Equity compensation plans approved by security holders Options (a) 3,581,669 $ 13.82 Restricted Stock Units (a) 22,054,245 N/A Performance Restricted Stock Units (e) 13,422,500 N/A Subtotal 39,058,414 — 46,537,839 Equity compensation plans not approved by security holders Series A Preferred Stock (b) 1,000,000 $ 22.39 Phantom Units (c) 349,432 N/A Subtotal 1,349,432 — — Total 40,407,846 46,188,407 N/A is not applicable (a) For information about Options and Restricted Stock Units, see Note 22 — Share-Based Compensation Plans in the notes to our Consolidated Financial Statements.
The returns of each company in the Peer Group have been weighted according to their respective stock market capitalization at the beginning of the measurement period for purposes of arriving at a Peer Group average. 30 Equity Compensation Plan Information Plan Category (1) Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (d ) (excluding securities reflected in column (1) ) Equity compensation plans approved by security holders Options (a) 3,387,901 $ 13.89 Restricted Stock Units (a) 18,899,123 N/A Performance Restricted Stock Units (e) 15,213,772 N/A Subtotal 37,500,796 — 43,643,012 Equity compensation plans not approved by security holders Series A Preferred Stock (b) 1,000,000 N/A Phantom Units (c) 349,432 N/A Subtotal 1,349,432 — — Total 38,850,228 43,293,580 N/A is not applicable.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition—Liquidity and Capital Resources—Debt” and Note 14—Debt in the notes to our Consolidated Financial Statements. 30 Market Performance Graph Comparison of 5 Year Cumulative Total Return (a) Coty Inc., The S&P 500 Index, and Fiscal 2024 Peer Group (b) (a) Total return assumes reinvestment of dividends at the closing price at the end of each quarter, since June 30, 2019.
Market Performance Graph Comparison of 5 Year Cumulative Total Return (a) Coty Inc., The S&P 500 Index, and Fiscal 2025 Peer Group (b) (a) Total return assumes reinvestment of dividends at the closing price at the end of each quarter, since June 30, 2020.
(b) On March 27, 2017 a Series A Preferred Stock subscription agreement was entered into with Lambertus J.H. Becht (“Mr. Becht”), the Company’s former Chairman of the Board.
(a) For information about Options and Restricted Stock Units, see Note 20 — Share-Based Compensation Plans in the notes to our Consolidated Financial Statements. (b) On March 27, 2017, a Series A Preferred Stock subscription agreement was entered into with Lambertus J.H. Becht (“Mr. Becht”), the Company’s former Chairman of the Board.
Removed
Dividends on the Convertible Series B Preferred Stock are payable in cash, or by increasing the amount of accrued dividends on Convertible Series B Preferred Stock, or any combination thereof, at the sole discretion of the Company.
Added
We have continued to suspend the payment of Common Stock dividends.
Added
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition—Liquidity and Capital Resources—Debt” and Note 12—Debt in the notes to our Consolidated Financial Statements.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

155 edited+93 added−72 removed111 unchanged
Biggest changeHowever, we currently anticipate the overall impact of inflation to remain muted. 34 Selected Financial Data (in millions, except per share data) Year Ended June 30, 2024 2023 2022 Net revenues $ 6,118.0 $ 5,554.1 $ 5,304.4 Gross profit 3,939.2 3,547.3 3,369.2 Restructuring costs 36.7 (6.5) (6.5) Acquisition- and divestiture-related costs — — 14.7 Asset impairment charges — — 31.4 Operating income 546.7 543.7 240.9 Interest expense, net 252.0 257.9 224.0 Other expense (income), net 90.2 (419.0) (409.9) Income from continuing operations before income taxes 204.5 704.8 426.8 Provision for income taxes on continuing operations 95.1 181.6 164.8 Net income from continuing operations 109.4 523.2 262.0 Net income from discontinued operations — — 5.7 Net income 109.4 523.2 267.7 Net income attributable to Coty Inc. $ 89.4 $ 508.2 $ 259.5 Amounts attributable to Coty Inc.: Net income from continuing operations attributable to common stockholders $ 76.2 $ 495.0 $ 55.5 Net income from continuing operations attributable to common stockholders $ 76.2 $ 495.0 $ 61.2 Per Share Data: Net income attributable to Coty Inc. per common share: Basic income from continuing operations $ 0.09 $ 0.58 $ 0.07 Basic income from discontinued operations $ 0.00 $ 0.00 $ 0.01 Basic income for Coty Inc. $ 0.09 $ 0.58 $ 0.08 Diluted income from continuing operations $ 0.09 $ 0.57 $ 0.07 Diluted income from discontinued operations $ 0.00 $ 0.00 $ 0.01 Diluted income for Coty Inc. $ 0.09 $ 0.57 $ 0.08 Weighted-average common shares Basic 874.4 849.0 820.6 Diluted 883.4 886.5 834.1 (in millions) Year Ended June 30, 2024 2023 2022 Consolidated Statements of Cash Flows Data: Net cash provided by operating activities $ 614.6 $ 625.7 $ 726.6 Net cash (used in) provided by investing activities (226.2) (118.2) 269.7 Net cash used in financing activities (336.7) (469.3) (1,034.0) (in millions) As of June 30, 2024 2023 2022 Consolidated Balance Sheets Data: Cash and cash equivalents $ 300.8 $ 246.9 $ 233.3 Total assets 12,082.5 12,661.6 12,116.1 Total debt 3,913.7 4,281.6 4,473.9 Total Coty Inc. stockholders’ equity 3,827.1 3,811.1 3,154.5 35 Non-GAAP Financial Measures To supplement the financial measures prepared in accordance with GAAP, we use non-GAAP financial measures for continuing operations and Coty Inc. including Adjusted operating income (loss), Adjusted EBITDA, Adjusted net income (loss), and Adjusted net income (loss) attributable to Coty Inc. to common stockholders (collectively, the “Adjusted Performance Measures”).
Biggest changeWe expect that our reported net revenue for the second half fiscal 2026 will return to growth versus the prior year, supported by major launches across both our Prestige and Consumer Beauty segments and more favorable comparisons. 34 Selected Financial Data (in millions, except per share data) Year Ended June 30, 2025 2024 2023 Net revenues $ 5,892.9 $ 6,118.0 $ 5,554.1 Gross profit 3,820.9 3,939.2 3,547.3 Restructuring costs 76.7 36.7 (6.5) Asset impairment charges 212.8 — — Operating income 241.1 546.7 543.7 Interest expense, net 214.2 252.0 257.9 Other expense (income), net 371.7 90.2 (419.0) (Loss) income before income taxes (344.8) 204.5 704.8 Provision for income taxes 5.4 95.1 181.6 Net (loss) income (350.2) 109.4 523.2 Net (loss) income attributable to Coty Inc. $ (367.9) $ 89.4 $ 508.2 Amounts attributable to Coty Inc.: Net (loss) income attributable to common stockholders $ (381.1) $ 76.2 $ 495.0 Per Share Data: Net income attributable to Coty Inc. per common share: Basic income for Coty Inc. $ (0.44) $ 0.09 $ 0.58 Diluted income for Coty Inc. $ (0.44) $ 0.09 $ 0.57 Weighted-average common shares Basic 870.9 874.4 849.0 Diluted 870.9 883.4 886.5 (in millions) Year Ended June 30, 2025 2024 2023 Consolidated Statements of Cash Flows Data: Net cash provided by operating activities $ 492.6 $ 614.6 $ 625.7 Net cash used in investing activities (128.4) (226.2) (118.2) Net cash used in financing activities (426.8) (336.7) (469.3) (in millions) As of June 30, 2025 2024 2023 Consolidated Balance Sheets Data: Cash and cash equivalents $ 257.1 $ 300.8 $ 246.9 Total assets 11,907.7 12,082.5 12,661.6 Total debt 4,008.4 3,913.7 4,281.6 Total Coty Inc. stockholders’ equity 3,542.7 3,827.1 3,811.1 35 Non-GAAP Financial Measures To supplement the financial measures prepared in accordance with GAAP, we use non-GAAP financial measures for Coty Inc. including Adjusted operating income (loss), Adjusted EBITDA, Adjusted net income (loss), and Adjusted net income (loss) attributable to Coty Inc. to common stockholders (collectively, the “Adjusted Performance Measures”).
Also, the size, complexity and/or volume of past transactions, which often drives the magnitude of such expenses, may not be indicative of the size, complexity and/or volume of any future acquisitions or divestitures. 36 • Restructuring and other business realignment costs: We have excluded costs associated with restructuring and business structure realignment programs to allow for comparable financial results to historical operations and forward-looking guidance.
Also, the size, complexity and/or volume of past transactions, which often drives the magnitude of such expenses, may not be indicative of the size, complexity and/or volume of any future acquisitions or divestitures. • Restructuring and other business realignment costs: We have excluded costs associated with restructuring and business structure realignment programs to allow for comparable financial results to historical operations and forward-looking 36 guidance.
Excluding net revenue from the first half of the prior period from Russia and the second half of the prior period from Lacoste, net revenues increased 15% or $508.5 to $3,857.3 from $3,348.8, reflecting a positive price and mix impact of 8% (primarily due to positive pricing impact as a result of price increases and in line with overall premiumization strategy), an increase in unit volume of 6% (primarily due to successful innovations and positive trends in the prestige fragrance category in many markets), and positive foreign currency exchange translation impact of 1%.
Excluding net revenue from the first half of the prior period from Russia and the second half of the prior period from Lacoste, net revenues increased 15% or $508.5 to $3,857.3 from $3,348.8, reflecting a positive price and mix impact of 8% (primarily due to the positive pricing impact as a result of price increases and in line with overall premiumization strategy), an increase in unit volume of 6% (primarily due to successful innovations and positive trends in the prestige fragrance category in many markets), and positive foreign currency exchange translation impact of 1%.
Consumer Beauty In fiscal 2024, net revenues in the Consumer Beauty segment increased 6%, or $127.1, to $2,260.7 from $2,133.6 in fiscal 2023.
In fiscal 2024, net revenues in the Consumer Beauty segment increased 6%, or $127.1, to $2,260.7 from $2,133.6 in fiscal 2023.
Excluding net revenue from the second half of the prior period from Russia, net revenues increased 7% or $145.8 to $2,260.7 from $2,114.9, reflecting a positive price and mix impact of 5% (primarily due to positive pricing impact as a result of price increases), an increase in unit volume of 1% (primarily due to increases from Brazilian brands offsetting decreases in volumes in most other markets), and a positive foreign currency exchange translation impact of 1%.
Excluding net revenue from the second half of the prior period from Russia, net revenues increased 7% or $145.8 to $2,260.7 from $2,114.9, reflecting a positive price and mix impact of 5% (primarily due to the positive pricing impact as a result of price increases), an increase in unit volume of 1% (primarily due to increases from Brazilian brands offsetting decreases in volumes in most other markets), and a positive foreign currency exchange translation impact of 1%.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES In fiscal 2024, selling, general and administrative expenses increased 12%, or $344.1, to $3,162.4 from $2,818.3 in fiscal 2023. Selling, general and administrative expenses as a percentage of net revenues increased to 51.7% in fiscal 2024 from 50.7% in fiscal 2023, or approximately 100 basis points.
In fiscal 2024, selling, general and administrative expenses increased 12%, or $344.1, to $3,162.4 from $2,818.3 in fiscal 2023. Selling, general and administrative expenses as a percentage of net revenues increased to 51.7% in fiscal 2024 from 50.7% in fiscal 2023, or approximately 100 basis points.
These increases were partially offset by the following decreases: (i) 100 basis points due to a decrease in stock-based compensation cost primarily related to a reduction in expense recognized in connection with awards granted to the CEO; (ii) 30 basis points due to a decrease in logistics costs as a percentage of net revenues; and (iii) 30 basis points due to favorable transactional impact from our exposure to foreign currency as a percentage of net revenues.
These increases were partially offset by the following decreases: 41 (i) 100 basis points due to a decrease in stock-based compensation cost primarily related to a reduction in expense recognized in connection with awards granted to the CEO; (ii) 30 basis points due to a decrease in logistics costs as a percentage of net revenues; and (iii) 30 basis points due to favorable transactional impact from our exposure to foreign currency as a percentage of net revenues.
The overall increase in net revenues reflects growth in our prestige fragrance category due to the continued success of fragrance brands, specifically Burberry, Hugo Boss, Calvin Klein, 38 Gucci, Chloe, Davidoff, Joop, and Marc Jacobs, as well as innovation from the launches including Marc Jacobs Daisy Wild and Cosmic Kylie Jenner, and positive performance in the prestige cosmetics category.
The overall increase in net revenues reflects growth in our prestige fragrance category due to the continued success of fragrance brands, specifically Burberry, Hugo Boss, Calvin Klein, Gucci, Chloe, Davidoff, Joop, and Marc Jacobs , as well as innovation from the launches including Marc Jacobs Daisy Wild and Cosmic Kylie Jenner , and positive performance in the prestige cosmetics category.
All adjustments are reflected in Corporate, except for amortization and asset impairment charges on goodwill, indefinite-lived intangible assets, and finite-lived intangible assets, which are reflected in the Prestige and Consumer Beauty segments. 44 Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc. Adjusted operating income and adjusted EBITDA provide investors with supplementary information relating to our performance.
All adjustments are reflected in Corporate, except for amortization and asset impairment charges on goodwill, indefinite-lived intangible assets, and finite-lived intangible assets, which are reflected in the Prestige and Consumer Beauty segments. Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc. Adjusted operating income and adjusted EBITDA provide investors with supplementary information relating to our performance.
These decreases were partially offset by higher year over year impacts from all other net working capital accounts which include a positive impact from inventory levels returning closer to normal compared to the prior year when inventory levels reflected increased safety stock to mitigate supply chain 54 constraints.
These decreases were partially offset by higher year over year impacts from all other net working capital accounts which include a positive impact from inventory levels returning closer to normal compared to the prior year when inventory levels reflected increased safety stock to mitigate supply chain constraints.
In fiscal 2024, we incurred restructuring and other business structure realignment costs of $36.6, as follows: • We incurred restructuring costs of $36.7, primarily related to the Current Restructuring Actions, included in the Consolidated Statements of Operations and • We incurred a credit in business structure realignment costs of $(0.1) which is reported in selling, general and administrative expenses.
In fiscal 2024, we incurred a credit in restructuring and other business structure realignment costs of $36.6, as follows: • We incurred restructuring costs of $36.7 primarily related to the Restructuring Actions, included in the Consolidated Statements of Operations and • We incurred a credit in business structure realignment costs of $(0.1) which is reported in selling, general and administrative expenses.
To the extent there remains a basis difference between the financial reporting and tax basis of an investment in a foreign subsidiary after the repatriation of the previously taxed income, the Company is permanently reinvested. A determination of the unrecognized deferred taxes related to these components is not practicable. 61
To the extent there remains a basis difference between the financial reporting and tax basis of an investment in a foreign subsidiary after the repatriation of the previously taxed income, the Company is permanently reinvested. A determination of the unrecognized deferred taxes related to these components is not practicable.
These factors include actual or anticipated fluctuations in the quarterly 57 and annual results of our Company or of other peer companies in the industry, market perceptions concerning the macroeconomic, social or political developments, industry conditions, changes in government regulation and the securities market trends.
These factors include actual or anticipated fluctuations in the quarterly and annual results of our Company or of other peer companies in the industry, market perceptions concerning the macroeconomic, social or political developments, industry conditions, changes in government regulation and the securities market trends.
In addition, and as necessary, the Company may establish specific reserves for future known or anticipated events. Income Taxes We are subject to income taxes in the U.S. and various foreign jurisdictions. We account for income taxes under the asset and liability method.
In addition, and as necessary, the Company may establish specific reserves for future known or anticipated events. 60 Income Taxes We are subject to income taxes in the U.S. and various foreign jurisdictions. We account for income taxes under the asset and liability method.
OTHER EXPENSE (INCOME), NET In fiscal 2024, net other expense was $90.2, was principally comprised of net losses on forward repurchase contracts of $124.2, partially offset by a favorable adjustment for the unrealized gain in the Wella investment of $25.0.
In fiscal 2024, net other expense was $90.2, was principally comprised of net losses on forward repurchase contracts of $124.2, partially offset by a favorable adjustment for the unrealized gain in the Wella investment of $25.0.
We do not enter into derivative financial instruments for trading or speculative purposes. 56 Foreign Currency Exchange Risk Management We operate in multiple functional currencies and are exposed to the impact of foreign currency fluctuations.
We do not enter into derivative financial instruments for trading or speculative purposes. Foreign Currency Exchange Risk Management We operate in multiple functional currencies and are exposed to the impact of foreign currency fluctuations.
If the historical data we use to calculate these estimates does not approximate future returns, additional allowances may be required. Equity Investments 58 We elected the fair value option to account for its investment in Wella to align with our strategy for this investment. The fair value is updated on a quarterly basis.
If the historical data we use to calculate these estimates does not approximate future returns, additional allowances may be required. Equity Investments The Company elected the fair value option to account for its investment in the Wella Company to align with our strategy for this investment. The fair value is updated on a quarterly basis.
The Company may be required to perform additional impairment testing based on changes in the economic environment, disruptions to the Company’s business, significant declines in operating results of the Company’s reporting units and/or tradenames, further sustained deterioration of the Company’s market capitalization, and other factors, which could result in impairment charges in the future.
The Company may be required to perform additional impairment testing based on changes in the economic environment, disruptions to the Company’s business, significant declines in operating results of the Company’s reporting units and/or trademarks, further sustained deterioration of the Company’s market capitalization, and other factors, which could result in impairment charges in the future.
Given the provisions of the associated Put and Call rights, RNCI is redeemable outside of our control and is recorded in temporary equity. See Note 20—Redeemable Noncontrolling Interests in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the redemption value of this noncontrolling interest.
Given the provisions of the associated Put and Call rights, RNCI is redeemable outside of our control and is recorded in temporary equity. See Note 18—Redeemable Noncontrolling Interests in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the redemption value of this noncontrolling interest.
Our principal uses of cash are to fund planned operating expenditures, capital expenditures, interest payments, dividends, share repurchases, any principal payments on debt, and from time to time, acquisitions, and business structure realignment expenditures. Working capital movements are influenced by the sourcing of materials related to the production of products.
Our principal uses of cash are to fund planned operating expenditures, capital expenditures, interest payments, dividends, share repurchases, any principal payments on debt, and from time to time, acquisitions, and business structure realignment expenditures. Working capital movements are influenced by the sourcing of materials related to the manufacturing of products.
For additional information on our dividends and dividend policy, respectively, see Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements and Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Dividend Policy”.
For additional information on our dividends and dividend policy, respectively, see Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements and Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Dividend Policy”.
These investments are subject to a wide variety of market-related risks that could have a material impact on the carrying value of our holdings. We continually evaluate our equity investments in privately-held companies. See Note 12—Equity Investments for additional information.
These investments are subject to a wide variety of market-related risks that could have a material impact on the carrying value of our holdings. We continually evaluate our equity investments in privately-held companies. See Note 10—Equity Investments for additional information.
In addition to the above equity investments, we entered into forward repurchase contracts in December 2022 and November 2023 with three large financial institutions to hedge for potential $196.0 and $294.0 share buyback programs of share repurchases in 2025 and 2026, respectively.
In addition to the above equity investments, we entered into forward repurchase contracts in December 2022 and November 2023 with three large financial institutions to hedge for potential $200.0 and $294.0 share buyback programs of share repurchases in 2025 and 2026, respectively.
Any future acquisitions may result in the amortization of additional intangible assets. • Gain on sale and termination of brand assets and early license termination: We have excluded the impact of gain on sale and termination of brand assets and early license termination as such amounts are inconsistent in amount and frequency and are significantly impacted by the size of the sale of brand assets and early license termination. • Costs related to market exit: We have excluded the impact of direct incremental costs related to our decision to wind down our business operations in Russia.
Any future acquisitions may result in the amortization of additional intangible assets. • Gain or loss on sale and early license termination: We have excluded the impact of gain or loss on sale and early license termination as such amounts are inconsistent in amount and frequency and are significantly impacted by the size of the sale and early license termination. • Costs related to market exit: We have excluded the impact of direct incremental costs related to our decision to wind down our business operations in Russia.
Any realized gains or losses resulting from such fair value changes would occur if we elect to terminate the forward repurchase contracts prior to or on maturity. Refer to Note 21—Equity and Convertible Preferred Stock.
Any realized gains or losses resulting from such fair value changes would occur if we elect to terminate the forward repurchase contracts prior to or on maturity. Refer to Note 19—Equity and Convertible Preferred Stock.
See Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the Convertible Series B Preferred Stock. The table excludes amounts related to our remaining forward repurchase contracts. See Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion.
See Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the Convertible Series B Preferred Stock. The table excludes amounts related to our remaining forward repurchase contracts. See Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion.
Such charge could have a material effect on the Consolidated Statements of Operations and Balance Sheets. There were no impairments of goodwill at our reporting units in fiscal 2024, 2023 or fiscal 2022.
Such charge could have a material effect on the Consolidated Statements of Operations and Balance Sheets. There were no impairments of goodwill at our reporting units in fiscal 2025, 2024 or fiscal 2023.
In connection with our decision to wind down our operations in Russia, we recognized tax charges related to certain direct incremental impacts of our decision, which are reflected in this amount, in fiscal 2024, fiscal 2023 and fiscal 2022.
In connection with our decision to wind down our operations in Russia, we recognized tax charges related to certain direct incremental impacts of our decision, which are reflected in this amount, in fiscal 2025, fiscal 2024 and fiscal 2023.
We have taken action to reduce variability in our interest payments including completely paying down variable interest rate debt outstanding under our 2018 Coty Term B Facility and issuing fixed rate bonds.
We have taken action to reduce variability in our interest payments including paying down variable interest rate debt outstanding under our 2018 Coty Term A and 2018 Coty Term B Facility and issuing fixed rate bonds.
During the twelve months ended June 30, 2024, the Board of Directors declared dividends on the Series B Preferred Stock of $13.2, of which $9.9 was paid during fiscal 2024 and $3.3 was paid in July 2024.
During the twelve months ended June 30, 2025, the Board of Directors declared dividends on the Series B Preferred Stock of $13.2, of which $9.9 was paid during fiscal 2025 and $3.3 was paid in July 2025.
Returns represented 1%, 2% and 2% of gross revenue after customer discounts and allowances in fiscal 2024, 2023 and 2022, respectively. Trade spending activities recorded as a reduction to gross revenue after customer discounts and allowances represent 9%, 10%, and 10% in fiscal 2024, 2023 and 2022, respectively.
Returns represented 2%, 1% and 2% of gross revenue after customer discounts and allowances in fiscal 2025, 2024 and 2023, respectively. Trade spending activities recorded as a reduction to gross revenue after customer discounts and allowances represent 10%, 9%, and 10% in fiscal 2025, 2024 and 2023, respectively.
This growth was partially offset by lower net revenues for the Lacoste brand in the first six months of the current period, which was primarily due to the early license termination resulting in a wind down of 39 sales through the end of the second quarter; and no net revenues for the Bottega Veneta brand in the current period due to the ending of our licensing arrangement where sales of the brand ended in fiscal 2023; and • Prestige cosmetic sales growth of $24.5, primarily due to brand innovation from Kylie Cosmetics .
This growth was partially offset by lower net revenues for the Lacoste brand in the first six months of fiscal 2024, which was primarily due to the early license termination resulting in a wind down of sales through the end of the second quarter; and no net revenues for the Bottega Veneta brand in fiscal 2024 due to the ending of our licensing arrangement where sales of the brand ended in fiscal 2023; and • Prestige cosmetic sales growth of $24.5, primarily due to brand innovation from Kylie Cosmetics.
Adjusted operating income/Adjusted EBITDA from continuing operations excludes restructuring costs and business structure realignment programs, amortization, acquisition- and divestiture-related costs and acquisition accounting impacts, stock-based compensation, and asset impairment charges and other adjustments as described below. For adjusted EBITDA, in addition to the preceding, we exclude adjusted depreciation as defined below.
Adjusted operating income/Adjusted EBITDA excludes restructuring costs and business structure realignment programs, amortization, acquisition- and divestiture-related costs and acquisition accounting impacts, stock-based compensation, and asset impairment charges and other adjustments as described below. For adjusted EBITDA, in addition to the preceding, we exclude adjusted depreciation as defined below.
(f) As of June 30, 2024, 2023 and 2022, 23.7 million dilutive shares of Convertible Series B Preferred Stock were excluded in the computation of adjusted weighted-average diluted shares because their effect would be anti-dilutive. 51 Quarterly Results of Operations Data The following tables set forth our unaudited quarterly consolidated statements of operations data for each of the eight quarters in the periods ended June 30, 2024.
(f) As of June 30, 2025, 2024 and 2023, 23.7 million dilutive shares of Convertible Series B Preferred Stock were excluded in the computation of adjusted weighted-average diluted shares because their effect would be anti-dilutive. 50 Quarterly Results of Operations Data The following tables set forth our unaudited quarterly consolidated statements of operations data for each of the eight quarters in the periods ended June 30, 2025.
The table excludes $142.4 of preferred stock, which is reflected in Convertible Series B Preferred Stock in the Consolidated Balance Sheet as of June 30, 2024. Given the provisions of the associated Put rights, Convertible Series B Preferred Stock is redeemable outside of our control upon certain change of control events and is recorded in temporary equity.
The table excludes $142.4 of preferred stock, which is reflected in Convertible Series B Preferred Stock in the Consolidated Balance Sheet as of June 30, 2025. Given the provisions of the associated Put rights, Convertible Series B 55 Preferred Stock is redeemable outside of our control upon certain change of control events and is recorded in temporary equity.
A 25 basis-point increase in our variable interest rate debt would have increased our interest costs by $35.6 over the term of our long-term debt. (b) Obligations under license agreements relate to royalty payments and required advertising and promotional spending levels for our products bearing the licensed trademark. Royalty payments are typically made based on contractually defined net sales.
A 25 basis-point increase in our variable interest rate debt would have increased our interest costs by $37.1 over the term of our long-term debt. (b) Obligations under license agreements relate to royalty payments and required advertising and promotional spending levels for our products bearing the licensed trademark. Royalty payments are typically made based on contractually defined net sales.
The overall increase in net revenues for the Consumer Beauty segment was due to positive performance in the color cosmetics category specifically from Rimmel Manhattan and Risque , mass fragrance category specifically from David Beckham and Bruno Banani , and the skin and body care categories in Brazil, specifically from Monange , Paixao and Bozzano .
The overall increase in net revenues for the Consumer Beauty segment was due to positive performance in the color cosmetics category specifically from Rimmel Manhatta n and Risque , mass fragrance category specifically from David Beckham and Bruno Banani , and the skin and body care categories in Brazil, specifically from Monange, Paixao and Bozzano .
We physically settled the June 2022 forward repurchase contracts by delivering approximately $200.0 cash in exchange for 27.0 million shares of our Class A Common Stock during the third quarter of fiscal 2024. The forward repurchase contracts permit a net cash settlement alternative in addition to the physical settlement.
We physically settled the June 2022 forward repurchase contracts by delivering approximately $200.0 cash in exchange for 27.0 million shares of our Class A Common Stock during fiscal 2024. Our remaining forward repurchase contracts permit a net cash settlement alternative in addition to the physical settlement.
Other Intangible Assets We assess indefinite-lived other intangible assets (trademarks) at least annually as of May 1 for impairment, or more frequently if certain events occur or circumstances change that would more likely than not reduce the fair value of an indefinite-lived intangible asset below its carrying value. Trademarks are tested for impairment on a brand level basis.
Other Intangible Assets We assess indefinite-lived other intangible assets (“trademarks”) at least annually as of May 1 for impairment, or more frequently if certain events occur or circumstances change that would more likely than not reduce the fair value of a trademark below its carrying value. Trademarks are tested for impairment on a brand level basis.
Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our most critical accounting policies relate to revenue recognition, the fair value of equity investments, the assessment of goodwill, other intangible and long-lived assets for impairment, inventory and income taxes.
We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our most critical accounting policies relate to revenue recognition, the fair value of equity investments, the assessment of goodwill, other intangible and long-lived assets for impairment, inventory and income taxes.
Additionally, Adjusted net income attributable to Coty Inc. and Adjusted net income attributable to Coty Inc. per common share are adjusted for certain interest and other (income) expense items and preferred stock deemed dividends, as described below, and the related tax effects of each of the items used to derive Adjusted net income as such charges are not used by our management in assessing our operating performance period-to-period.
Additionally, Adjusted net income attributable to Coty Inc. and Adjusted net income attributable to Coty Inc. per common share are adjusted for certain interest and other (income) expense items, as described below, and the related tax effects of each of the items used to derive Adjusted net income as such charges are not used by our management in assessing our operating performance period-to-period.
Stock-based compensation In fiscal 2024, stock-based compensation was $88.8 as compared with $135.9 in fiscal 2023. The decrease in stock-based compensation is primarily related to a reduction in expense recognized in connection with awards granted to the CEO. In fiscal 2023, stock-based compensation was $135.9 as compared with $195.5 in fiscal 2022.
The decrease in stock-based compensation is primarily related to a reduction in expense recognized in connection with awards granted to the CEO. In fiscal 2024, stock-based compensation was $88.8 as compared with $135.9 in fiscal 2023. The decrease in stock-based compensation is primarily related to a reduction in expense recognized in connection with awards granted to the CEO.
Consequently, there were no goodwill impairment charges recorded as a result of the annual impairment test performed on May 1, 2024. To determine the fair value of our reporting units, we have used annual revenue growth rates ranging from 3.0%-10.0% and 2.0%-7.8% for the Prestige and Consumer Beauty reporting units, respectively, and a discount rate of 9.5%.
Consequently, there were no goodwill impairment charges recorded as a result of the annual impairment test performed on May 1, 2025. To determine the fair value of our reporting units, we have used annual revenue growth rates ranging from (6.3)%-6.0% and (1.7)%-8.3% for the Prestige and Consumer Beauty reporting units, respectively, and a discount rate of 10.5%.
The increase in net revenues primarily reflects: • Color cosmetics sales growth of $51.4, primarily due to the continued success of Rimmel Manhattan which saw continued brand innovation, such as Lasting Finish foundation and Thrill Seeker mascara, and Risque due to strong category momentum in Brazil and positive pricing impact, despite a category slowdown in the US; • Mass fragrance sales growth of $46.3, due to the continued success from the re-launch of David Beckham Instinct in the current period and success of Bruno Banani ; and • Skin and body care sales growth of $44.6, due to the continued success of Brazilian brands Monange , Bozzano , and Paixao benefiting from strong category momentum and positive pricing impact.
The increase in net revenues primarily reflects: • Color cosmetics sales growth of $51.4, primarily due to the continued success of Rimmel Manhattan which saw continued brand innovation, such as Lasting Finish foundation and Thrill Seeker mascara, and Risque due to strong category momentum in Brazil and positive pricing impact, despite a category slowdown in the U.S.; • Mass fragrance sales growth of $46.3, due to the continued success from the re-launch of David Beckham Instinct in fiscal 2024 and success of Bruno Banani ; and • Skin and body care sales growth of $44.6, due to the continued success of Brazilian brands Monange , Bozzano , and Paixao benefiting from strong category momentum and positive pricing impact.
In fiscal 2023, net other income was $419.0, primarily related to a favorable adjustment for the unrealized gain in the Wella investment of $230.0 and unrealized gain on forward repurchase contracts of $196.9 partially offset by associated fees of $28.2. 48 In fiscal 2022, net other income was $409.9, primarily related to a favorable adjustment for the unrealized gain in the Wella investment of $403.9.
In fiscal 2023, net other income was $419.0, primarily related to a favorable adjustment for the unrealized gain in the Wella investment of $230.0 and unrealized gain on forward repurchase contracts of $196.9 partially offset by associated fees of $28.2.
Third quarter fiscal 2024 Termination: Lacoste Third and fourth quarters fiscal 2023 net revenue excluded. n/a When used herein, the term “Acquisitions,” “Divestitures,” “Terminations,” and “Market Exit,” refer to the financial contributions of the related acquisitions or divestitures, early license terminations, and market exits shown above, during the period that is not comparable as a result of such acquisitions or divestitures, early license terminations, and market exits.
Third and fourth quarters fiscal 2023 net revenue excluded. When used herein, the term “Acquisitions,” “Divestitures,” “Terminations,” and “Market Exit,” refer to the financial contributions of the related acquisitions or divestitures, early license terminations, and market exits shown above, during the period that is not comparable as a result of such acquisitions or divestitures, early license terminations, and market exits.
During fiscal years 2024, 2023 and 2022, we recorded asset impairment charges of $1.7, $4.3 and $2.4, respectively, to Property and equipment, net and nil, $1.1 and $1.0, respectively to Operating lease right-of-use assets, primarily relating to the abandonment of equipment or leases no longer in use.
During fiscal years 2025, 2024 and 2023, we recorded asset impairment charges of nil, $1.7 and $4.3, respectively, to Property and equipment, net and nil, nil and $1.1, respectively to Operating lease right-of-use assets, primarily relating to the abandonment of equipment or leases no longer in use.
We recorded net foreign currency (losses) gains of $(18.1), $(32.3) and $3.3 in fiscal 2024, 2023 and 2022, respectively, resulting from non-financing foreign currency exchange transactions which are included in their associated expense type and are included in the Consolidated Statements of Operations.
We recorded net foreign currency (losses) gains of $(21.7), $(18.1) and $(32.3) in fiscal 2025, 2024 and 2023, respectively, resulting from non-financing foreign currency exchange transactions which are included in their associated expense type and are included in the Consolidated Statements of Operations.
An impairment loss is recognized when the estimated fair value of the intangible asset is less than the carrying value. Fair value calculation requires significant judgments in determining both the assets’ estimated cash flows as well as the appropriate discount and royalty rates applied to those cash flows to determine fair value.
An impairment loss is recognized when the estimated fair value of a trademark is less than the carrying value. Fair value calculation requires significant judgments in determining both the assets’ estimated cash flows as well as the appropriate discount and royalty rates applied to those cash flows to determine fair value.
Subsequent funding requirements cannot be reasonably estimated as the return on plan assets in future periods, as well as future assumptions are not known. The table above excludes obligations for uncertain tax benefits, including interest and penalties, of $200.2 as of June 30, 2024, as we are unable to predict when, or if, any payments would be made.
Subsequent funding requirements cannot be reasonably estimated as the return on plan assets in future periods, as well as future assumptions are not known. The table above excludes obligations for uncertain tax benefits, including interest and penalties, of $194.3 as of June 30, 2025, as we are unable to predict when, or if, any payments would be made.
Gains on Sale of Real Estate In fiscal 2024, we recognized gains of $1.6 related to sale of real estate, which was reported in Corporate. In fiscal 2023, we recognized gains of $4.9 related to sale of real estate, which was reported in Corporate.
Gains on Sale of Real Estate In fiscal 2025, we recognized no gains related to sale of real estate. In fiscal 2024, we recognized gains of $1.6 related to sale of real estate, which was reported in Corporate. In fiscal 2023, we recognized gains of $4.9 related to the sale of real estate, which was reported in Corporate.
Treasury Stock - Share Repurchase Program For additional information on our Share Repurchase Program, see Note 21—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements. 55 Contractual Obligations and Commitments Our principal contractual obligations and commitments are presented below as of June 30, 2024.
Treasury Stock - Share Repurchase Program For additional information on our Share Repurchase Program, see Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements. Contractual Obligations and Commitments Our principal contractual obligations and commitments are presented below as of June 30, 2025.
The total tax impact on adjustments also includes a tax benefit of $1.1, $0.4 and tax expense of $24.1 for fiscal 2024, fiscal 2023 and fiscal 2022, respectively, recorded as the result of the Company’s exit from Russia. (d) The amount represents the realized and unrealized (gain) loss recognized for the change in fair value of the investment in Wella.
The total tax impact on adjustments also includes a tax benefit of $10.0, $1.1, and $0.4 for fiscal 2025, fiscal 2024, and fiscal 2023, respectively, recorded as the result of the Company’s exit from Russia. (d) The amount represents the unrealized (gain) loss recognized for the change in fair value of the investment in Wella.
(b) See a description of adjustments under “Adjusted Operating Income (Loss) from Continuing Operations for Coty Inc.” (c) In fiscal 2024, 2023, and 2022, the amount represents the unrealized (gain) loss recognized for the change in fair value of the investment in Wella.
(b) See a description of adjustments under “Adjusted Operating Income (Loss) for Coty Inc.” (c) In fiscal 2025, 2024, and 2023, the amount represents the unrealized (gain) loss recognized for the change in fair value of the investment in Wella.
The net income increase was primarily driven by losses from forward repurchase contracts of $124.2 compared to gains of $168.7 in the prior year and a lower favorable adjustment of $205.0 related to the unrealized gain in the Wella investment in the current year.
The net income increase was primarily driven by losses from forward repurchase contracts of $124.2 compared to gains of $168.7 in the prior year and a lower favorable adjustment of $205.0 related to the unrealized gain in the Wella investment in the current year. 49 ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO COTY INC.
OVERVIEW We are one of the world’s largest beauty companies, with an iconic portfolio of brands across fragrance, color cosmetics, and skin and body care. Our brands empower people to express themselves freely, creating their own visions of beauty; and we are committed to making a positive impact on the planet.
OVERVIEW We are one of the world’s largest beauty companies, with an iconic portfolio of brands across fragrance, color cosmetics, and skin and body care. Our brands empower people to express themselves freely, creating their own visions of beauty; and we are committed to protecting the planet.
The investments are classified within Level 3 in the fair value hierarchy because we estimate the fair value of the investments using a combination of the income approach, the market approach and private transactions, when applicable.
The investment is classified within Level 3 in the fair value hierarchy because we estimate the fair value of the investment using a combination of the income approach, the market approach and private transactions, when applicable.
As of June 30, 2024, in the event of a 10% unfavorable change in the prevailing market rates of hedged foreign currencies versus the U.S. dollar, the change in fair value of all foreign exchange forward contracts would result in a $89.5 decrease in the fair value of these forward contracts, which would be offset by an increase in the underlying foreign currency exposures.
As of June 30, 2025, in the event of a 10% increase in the prevailing market rates of hedged foreign currencies versus the U.S. dollar, the change in fair value of all foreign exchange forward contracts would result in a $29.8 decrease in the fair value of these forward contracts, which would be offset by an increase in the underlying foreign currency exposures.
Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the fair value of contracts in net asset positions, which totaled $1.5 as of June 30, 2024. Management believes risk of material loss under these hedging contracts is remote.
Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the fair value of contracts in net asset positions, which totaled $2.4 as of June 30, 2025. Management believes the risk of material loss under these hedging contracts is remote.
Changes in the fair value of equity investments under the fair value option are recorded in Other expense (income), net within the Consolidated Statements of Operations (see Note 12—Equity Investments).
Changes in the fair value of an equity investment under the fair value option are recorded in Other expense (income), net within the Consolidated Statements of Operations (see Note 10—Equity Investments).
Adjusted operating margin increased to 14.1% of net revenues in fiscal 2024 as compared to 13.3% in fiscal 2023. In fiscal 2024, adjusted EBITDA was $1,091.1 compared to $972.8 in fiscal 2023. Adjusted EBITDA margin increased to 17.8% of net revenues in 2024 as compared to 17.5% in fiscal 2023.
In fiscal 2024, adjusted EBITDA was $1,091.1 compared to $972.8 in fiscal 2023. Adjusted EBITDA margin increased to 17.8% of net revenues in 2024 as compared to 17.5% in fiscal 2023.
See Note 16—Income Taxes in the notes to our Consolidated Financial Statements for additional information on our uncertain tax benefits. The table excludes $93.6 of RNCI which is reflected in Redeemable noncontrolling interest in the Consolidated Balance Sheet as of June 30, 2024 related to the 25.0% RNCI in our subsidiary in the Middle East (“Middle East Subsidiary”).
See Note 14—Income Taxes in the notes to our Consolidated Financial Statements for additional information on our uncertain tax benefits. The table excludes $94.2 of RNCI which is reflected in Redeemable noncontrolling interest in the Consolidated Balance Sheet as of June 30, 2025 related to the 25.0% RNCI in our subsidiary in the Middle East (“Middle East Subsidiary”).
As for the indefinite-lived intangible assets, the most significant assumptions used are the revenue growth rate and the discount rate, a decrease in the revenue growth rate or an increase in the discount rate could result in a future impairment. The Company will continue to monitor its indefinite-lived tradenames for any triggering events or other signs of impairment.
As for our trademarks, the most significant assumptions used are the revenue growth rate and the discount rate, a decrease in the revenue growth rate or an increase in the discount rate could result in a future impairment. The Company will continue to monitor its trademarks for any triggering events or other signs of impairment.
Net (losses) gains of $(16.5), $(12.2) and $10.0 in fiscal 2024, 2023 and 2022, respectively, resulting from financing foreign exchange currency transactions are included in Interest expense, net in the Consolidated Statements of Operations.
Net (losses) gains of $(3.8), $(16.5) and $(12.2) in fiscal 2025, 2024 and 2023, respectively, resulting from financing foreign exchange currency transactions are included in Interest expense, net in the Consolidated Statements of Operations.
Period of acquisition, divestiture, termination, or market exit Acquisition, divestiture, termination, or market exit Impact on basis of 2024/2023 presentation Impact on basis of 2023/2022 presentation Third quarter fiscal 2023 Market Exit from Russia First and second quarters fiscal 2023 net revenue excluded. Third and fourth quarters fiscal 2022 net revenue excluded.
Period of acquisition, divestiture, termination, or market exit Acquisition, divestiture, termination, or market exit Impact on basis of 2025/2024 presentation Impact on basis of 2024/2023 presentation Third quarter fiscal 2023 Market Exit from Russia N/A First and second quarters fiscal 2023 net revenue excluded. Third quarter fiscal 2024 Termination: Lacoste First and second quarters fiscal 2024 net revenue excluded.
Federal statutory rate of 21%. These increases were partially offset by the following decreases: • an 18.5% decrease as a result of the issuance of non-refundable income tax credits received from the Swiss Tax Authorities of $97.1.
Federal statutory rate of 21%. These unfavorable rate drivers were partially offset by the following favorable rate drivers: • an 18.5% favorable impact as a result of the issuance of non-refundable income tax credits received from the Swiss Tax Authorities of $97.1.
Contingencies From time to time, our Brazilian subsidiaries receive tax assessments from local, state, and federal tax authorities in Brazil. In relation to the appeal of our Brazilian tax assessments, we have entered into surety bonds of R$449.0 million (approximately $81.6) as of June 30, 2024. See Note 24—Legal and Other Contingencies for more details on these tax assessments.
Contingencies From time to time, our Brazilian subsidiaries receive tax assessments from local, state, and federal tax authorities in Brazil. In relation to the appeal of our Brazilian tax assessments, we have entered into surety bonds of approximately $172.0 as of June 30, 2025. See Note 22—Legal and Other Contingencies for more details on these tax assessments.
Our effective tax rate could fluctuate significantly and could be adversely affected to the extent earnings are lower than anticipated in countries that have lower statutory rates and higher than anticipated in countries that have higher statutory rates. 49 Reconciliation of Reported Income (Loss) Before Income Taxes to Adjusted Income (Loss) Before Income Taxes and Effective Tax Rates from Continuing Operations: Year Ended June 30, 2024 Year Ended June 30, 2023 Year Ended June 30, 2022 (in millions) (Loss)/ income before income taxes (Benefit) provision for income taxes Effective tax rate (Loss)/ income before income taxes (Benefit) provision for income taxes Effective tax rate (Loss)/income before income taxes (Benefit)provision for income taxes Effective tax rate Reported income before income taxes $ 204.5 $ 95.1 46.5 % $ 704.8 $ 181.6 25.8 % $ 426.8 $ 164.8 38.6 % Adjustments to reported operating income (loss) (a) 316.7 195.1 374.6 Change in fair value of investment in Wella Business (d) (25.0) (230.0) (403.9) Other adjustments (e) (2.4) 0.2 (2.4) Total Adjustments (b)(c) 289.3 $ 35.6 (34.7) (4.5) (31.7) (55.3) Adjusted income before income taxes $ 493.8 $ 130.7 26.5 % $ 670.1 $ 177.1 26.4 % $ 395.1 $ 109.5 27.7 % (a) See a description of adjustments under “Adjusted Operating Income (Loss) for Coty Inc.” (b) The tax effects of each of the items included in adjusted income are calculated in a manner that results in a corresponding income tax benefit/provision for adjusted income.
Our effective tax rate could fluctuate significantly and could be adversely affected to the extent earnings are lower than anticipated in countries that have lower statutory rates and higher than anticipated in countries that have higher statutory rates. 48 Reconciliation of Reported Income (Loss) Before Income Taxes to Adjusted Income (Loss) Before Income Taxes and Effective Tax Rates: Year Ended June 30, 2025 Year Ended June 30, 2024 Year Ended June 30, 2023 (in millions) (Loss)/ income before income taxes Provision for income taxes Effective tax rate (Loss)/ income before income taxes Provision for income taxes Effective tax rate (Loss)/ income before income taxes Provision for income taxes Effective tax rate Reported (loss) income before income taxes $ (344.8) $ 5.4 (1.6) % $ 204.5 $ 95.1 46.5 % $ 704.8 $ 181.6 25.8 % Adjustments to reported operating income (loss) (a) 611.8 316.7 195.1 Change in fair value of investment in Wella Business (d) 83.0 (25.0) (230.0) Other adjustments (e) (0.6) (2.4) 0.2 Total Adjustments (b)(c) 694.2 $ 117.4 289.3 35.6 (34.7) (4.5) Adjusted income before income taxes $ 349.4 $ 122.8 35.1 % $ 493.8 $ 130.7 26.5 % $ 670.1 $ 177.1 26.4 % (a) See a description of adjustments under “Adjusted Operating Income (Loss) for Coty Inc.” (b) The tax effects of each of the items included in adjusted income are calculated in a manner that results in a corresponding income tax benefit/provision for adjusted income.
We may elect net cash settlement of all, or some of the remaining forward repurchase contracts based on factors such as timing, the market value of the underlying shares at the settlement date and other internal cash management considerations. We will continue to incur costs associated with the remaining forward repurchase contracts before settlement.
We may elect net cash settlement of all, or some of the remaining forward repurchase contracts based on factors such as timing, the market value of the underlying shares at the settlement date and other internal cash management considerations.
Based on the annual impairment test performed on May 1, 2024, we determined that the fair value of each of the reporting units exceeded their respective carrying values at that date by approximately 143.6% and 69.9% relating to the Prestige and 59 Consumer Beauty reporting units, respectively.
Based on the annual impairment test performed on May 1, 2025, we determined that the fair value of each of the reporting units exceeded their respective carrying values at that date by approximately 55.4% and 28.9% relating to the Prestige and Consumer Beauty reporting units, respectively.
Cash paid during the years ended June 30, 2024, 2023 and 2022, for income taxes was $172.6, $58.6 and $97.2, respectively. NET INCOME (LOSS) ATTRIBUTABLE TO COTY INC. In fiscal 2024, net income attributable to Coty Inc. was $89.4 compared to income of $508.2 in fiscal 2023.
Cash paid during the years ended June 30, 2025, 2024 and 2023, for income taxes was $95.4, $172.6 and $58.6, respectively. NET INCOME (LOSS) ATTRIBUTABLE TO COTY INC. In fiscal 2025, net loss attributable to Coty Inc. was $367.9 compared to income of $89.4 in fiscal 2024.
We calculate constant currency information by translating current and prior-period results for entities reporting in currencies other than U.S. dollars into U.S. dollars using prior year foreign currency exchange rates.
Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We calculate constant currency information by translating current and prior-period results for entities reporting in currencies other than U.S. dollars into U.S. dollars using prior year foreign currency exchange rates.
Year Ended June 30, Change % (in millions) 2024 2023 2022 2024/2023 2023/2022 NET REVENUES Prestige $ 3,857.3 $ 3,420.5 $ 3,267.9 13 % 5 % Consumer Beauty 2,260.7 2,133.6 2,036.5 6 % 5 % Total $ 6,118.0 $ 5,554.1 $ 5,304.4 10 % 5 % Prestige In fiscal 2024, net revenues in the Prestige segment increased 13%, or $436.8 to $3,857.3 from $3,420.5 in fiscal 2023.
Year Ended June 30, Change % (in millions) 2025 2024 2023 2025/2024 2024/2023 NET REVENUES Prestige $ 3,820.2 $ 3,857.3 $ 3,420.5 (1 %) 13 % Consumer Beauty 2,072.7 2,260.7 2,133.6 (8 %) 6 % Total $ 5,892.9 $ 6,118.0 $ 5,554.1 (4 %) 10 % Prestige In fiscal 2025, net revenues in the Prestige segment decreased 1%, or $37.1 to $3,820.2 from $3,857.3 in fiscal 2024.
The net amount utilized under the factoring facilities was $195.3 and $202.9 as of June 30, 2024 and 2023, respectively. The aggregate amount of trade receivable invoices factored on a worldwide basis amounted to $1,534.3 and $1,579.2 in fiscal 2024 and 2023, respectively.
The net amount factored under the factoring facilities was $211.8 and $195.3 as of June 30, 2025 and 2024, respectively. The aggregate (gross) amount of trade receivable invoices factored on a worldwide basis amounted to $1,568.9 and $1,534.3 in fiscal 2025 and 2024, respectively.
Equity Investment Risk Our equity investments are investments in equity securities of privately-held companies without readily determinable fair values, including an investment of approximately $1,085.0 that is valued using the fair value option and approximately $5.6 that is accounted for using the equity method as of June 30, 2024.
Equity Investment Risk Our equity investments are investments in equity securities of privately-held companies without readily determinable fair values, including an investment of approximately $1,002.0 that is valued using the fair value option as of June 30, 2025.
See “Overview—Non-GAAP Financial Measures.” A reconciliation of reported operating income (loss) to Adjusted operating income is presented below, by segment: Year Ended June 30, 2024 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) from continuing operations Prestige $ 580.7 $ 153.7 $ 734.4 Consumer Beauty 89.3 39.7 129.0 Corporate (123.3) 123.3 — Total $ 546.7 $ 316.7 $ 863.4 Year Ended June 30, 2023 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) from continuing operations Prestige $ 483.7 $ 151.4 $ 635.1 Consumer Beauty 63.3 40.4 103.7 Corporate (3.3) 3.3 — Total $ 543.7 $ 195.1 $ 738.8 Year Ended June 30, 2022 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) from continuing operations Prestige $ 367.2 $ 162.9 $ 530.1 Consumer Beauty 9.5 75.9 85.4 Corporate (135.8) 135.8 — Total $ 240.9 $ 374.6 $ 615.5 (a) See a reconciliation of reported net income to operating income (loss) to adjusted operating income (loss) and adjusted EBITDA for Coty Inc. and reconciliations of segment operating income (loss) to segment adjusted operating income (loss) and segment adjusted EBITDA for the Prestige, Consumer Beauty and Corporate segments with a description of the adjustments under “Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc.” and “Segment Operating Income (Loss), Segment Adjusted Operating Income (Loss) and Segment Adjusted EBITDA”, below.
See “Overview—Non-GAAP Financial Measures.” A reconciliation of reported operating income (loss) to Adjusted operating income is presented below, by segment: Year Ended June 30, 2025 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) Prestige $ 580.6 $ 192.6 $ 773.2 Consumer Beauty (127.4) 207.1 79.7 Corporate (212.1) 212.1 — Total $ 241.1 $ 611.8 $ 852.9 Year Ended June 30, 2024 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) Prestige $ 580.7 $ 153.7 $ 734.4 Consumer Beauty 89.3 39.7 129.0 Corporate (123.3) 123.3 — Total $ 546.7 $ 316.7 $ 863.4 43 Year Ended June 30, 2023 (in millions) Reported (GAAP) Adjustments (a) Adjusted (Non-GAAP) Adjusted operating income (loss) Prestige $ 483.7 $ 151.4 $ 635.1 Consumer Beauty 63.3 40.4 103.7 Corporate (3.3) 3.3 — Total $ 543.7 $ 195.1 $ 738.8 (a) See a reconciliation of reported net income to operating income (loss) to adjusted operating income (loss) and adjusted EBITDA for Coty Inc. and reconciliations of segment operating income (loss) to segment adjusted operating income (loss) and segment adjusted EBITDA for the Prestige, Consumer Beauty and Corporate segments with a description of the adjustments under “Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc.” and “Segment Operating Income (Loss), Segment Adjusted Operating Income (Loss) and Segment Adjusted EBITDA”, below.
In particular, economic conditions in China have had, and are expected to continue to have, an impact on our strategic initiatives, including our growth agenda in the region for Prestige products and our skincare growth priorities.
In particular, challenging economic conditions in China have had, and are expected to continue to have, an impact on our strategic initiatives including our growth agenda in the region for Prestige products and our skincare growth priorities. We remain attentive to economic and geopolitical conditions that may materially impact our business.
While our revolving credit facility, which we draw on from time to time, is subject to variable interest rates, all of our long-term debt outstanding as of June 30, 2024 is fixed rate debt, and all floating-to-fixed interest rate swaps have been terminated.
While our revolving credit facility, which we draw on from time to time, is subject to variable interest rates, all of our other long-term debt outstanding as of June 30, 2025 is fixed rate debt.
We continue to take steps to permanently reduce our debt, in order to reduce interest costs and improve our long term profitability and cash flows. In addition, our 25.84% investment in Wella gives us the opportunity for further permanent debt reductions, when our equity position is fully or partially divested.
We continue to take steps to permanently reduce our debt, in order to reduce interest costs and improve our long term profitability and cash flows. Our 25.84% investment in Wella gives us the opportunity for further permanent debt reductions when our equity position is divested. We have substantially completed the exit of our commercial activities in Russia.
In addition, the greater proportion of Consumer Beauty net revenues, including a greater proportion of revenues from our Brazilian business were from lower margin Brazil brands, compared to the prior year, negatively impacted our consolidated operating income margin. In fiscal 2023, operating income from continuing operations was $543.7 compared to income of $240.9 in fiscal 2022.
In addition, the greater proportion of Consumer Beauty net revenues, including a greater proportion of revenues from our Brazilian business were from lower margin Brazil brands, compared to the prior year, negatively impacted our consolidated operating income margin.

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