Estée Lauder Cuts Up To 10,000 Jobs as Beauty Giant Shifts from Department Stores

✴︎

5.2.2026

Quick Facts

Estée Lauder increased planned job cuts to 9,000-10,000 positions, up from a previous target of 7,000
More than 70% of additional cuts target department store point-of-sale positions
Company expects $1.5-1.7 billion in restructuring charges and up to $1.2 billion in cost savings

Estée Lauder raised its job reduction target to as many as 10,000 positions as the beauty giant accelerates its shift away from department stores toward digital channels.

The company increased its estimated job cuts from a previous target of 7,000 positions, according to a Friday press release. At the upper end, the cuts represent 17.5% of its 57,000-person global workforce.

More than 70% of the additional reductions will eliminate point-of-sale positions at department stores and freestanding stores. The cuts reflect Estée Lauder’s strategic pivot to faster-growing digital and specialty retail channels including Ulta, Sephora, Amazon and TikTok Shop.

“We are significantly transforming our operating model to be leaner, faster, and more agile,” said CEO Stéphane de La Faverie in a statement. He called fiscal 2026 “the pivotal year” to restore organic sales growth.

The expanded cuts come as Estée Lauder posted stronger-than-expected quarterly results. Net sales grew 5% year-over-year to $3.71 billion in the third quarter, beating estimates of $3.69 billion. Adjusted profit of 88 cents per share topped estimates of 65 cents.

Shares jumped 11% in premarket trading Friday following the earnings report and raised profit outlook.

The restructuring carries a hefty price tag. Estée Lauder expects total restructuring and other charges between $1.5 billion and $1.7 billion, up from $1.1 billion recognized through March. The company targets up to $1.2 billion in cost savings from the cuts.

The job reductions may also reflect Estée Lauder’s merger discussions with Jean Paul Gaultier owner Puig. “The increase in planned job cuts could be an indication that in light of merger plans, Estee Lauder will be able to shed more positions on its side while retaining Puig employees,” said eMarketer analyst Sky Canaves.

Estée Lauder faces additional challenges from geopolitical conflicts in the Middle East, which the company expects to impact fourth-quarter sales by about 2%. The company also anticipates a $100 million hit to fiscal 2026 profitability from tariffs.

The cuts underscore a broader industry shift as beauty brands chase growth in digital channels where younger consumers discover and purchase products. Traditional department stores have lost ground as specialty retailers and social commerce platforms gain market share.