L'Oréal, the global cosmetics giant, has seen its shares fall sharply, reaching their lowest point in almost two years. This decline follows weaker-than-expected sales in China, adding to concerns about the company’s ability to maintain growth in key markets. The stock closed as the worst performer on the CAC 40 index on Wednesday and is one of the weakest in the Stoxx Europe 600.
In the third quarter of 2024, L'Oréal reported an overall sales increase of 3.4% on a comparable basis, with total revenue hitting €10.3 billion. However, its North Asia market, which includes China and Japan, saw a significant 6.5% decline in sales.
CEO Nicolas Hieronimus addressed the situation, stating, "The Chinese market is becoming increasingly challenging, but we remain optimistic about its long-term potential." He also noted that economic and geopolitical uncertainties are continuing to impact consumer confidence.
A Continued Struggle in China
The weakness in Chinese demand has been a persistent issue for L'Oréal, echoing concerns raised by other luxury brands like LVMH.
With L'Oréal's shares already down by more than 21% this year, the company is facing mounting pressure to regain investor confidence. However, with continued challenges in key markets like China, the path to recovery remains uncertain.
