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Coty dropped by as much as 19% on Tuesday after quarterly revenue fell shy of Wall Street's targets as the ongoing COVID-19 pandemic hurt sales of makeup.
The beauty products maker, whose portfolio includes brands such as Cover Girl, Rimmel and Kylie Skin, posted fiscal second-quarter net revenue of $1.42 billion, down 16% from $1.68 billion a year ago. Analysts had expected revenue of $1.43 billion.
Coty's stock hit an intraday low of $6.47, marking an 19% decline from Monday's closing price. So far in 2021, the stock has lost more than 7% and has slid by 45% over the past 12 months.
The company said its cosmetics and fragrance categories within its mass-beauty business "remained pressured" during the second quarter as the number of coronavirus cases ramped up in parts of the US, "impacting both store traffic and make-up usage occasions."
But Coty noted that it saw further strength from its prestige fragrances in the US, with the Marc Jacobs, Gucci, and Burberry brands "delivering robust growth" in the quarter ended December 31.
Adjusted earnings were $0.17 per share, higher than Wall Street's consensus estimate of $0.07 per share but lower than $0.27 per share in the same period in 2019.
Coty said it will begin raising its commercial investments to bolster improvements ahead of fiscal year 2022 despite "continued disruptions" to its sales channels and short-term orders related to the pandemic.
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