Investing.com — Even Kim and Kylie couldn’t help Coty (NYSE:COTY).
Sales in the fiscal first quarter at Coty — the beauty retailer that is partnering with both Kim Kardashian West and her sister Kyle Jenner — came in less than half of what analysts expected — $560 million versus the estimated $1.27 billion — with the world hunkered down at home and no one but our families to smell us or see us up close.
Coty, which also sells Gucci and Burberry brand perfumes and OPI nail polish, dropped 4.2%, and shares are down 67% in 2020.
The Kylie Beauty partnership, a long-term deal between Coty and Kylie Jenner of Kardashian fame, “was pressured due to the lockdown of its cosmetics third party manufacturer’s fulfillment center during the majority of the quarter,” though Kylie Skin remained operable during the quarter, generating sales growth.
In late June, Coty announced a strategic relationship with Kim Kardashian West, under which Coty will acquire a 20% interest in her beauty business for $200 million and gain a license for new beauty categories. The acquisition is expected to close in the third quarter of the 2021 fiscal year.
Coty reported a loss per share of 51 cents compared to the expected loss of 13 cents.
The outlook for the current quarter may be an improvement.
“Coty is back,” said founder and executive chairman Peter Harf in a statement. In the last two months, “we have seen a significant improvement in the business and we expect the positive momentum to continue, with a return to profit in Q1.”