Coty eyes Consumer Beauty overhaul to recoup losses, CoverGirl in spotlight

Coty has launched a strategic review of its Consumer Beauty division. Notable brands in the category include CoverGirl, Rimmel, Sally Hansen, Max Factor, and its Brazil business. The review will consider partnerships, divestitures, spin-offs, or other options to strengthen the company’s balance sheets.

As part of the move, Coty will integrate its prestige and mass fragrance businesses, which together account for 69% of its sales.

“This next phase of our transformation is about clarity and focus. By more closely integrating all our fragrance and scenting brands, we unlock the full power of our scale,” says Sue Nabi, CEO of Coty.

“The fragrance category continues to outperform the global beauty market and already drives the majority of our revenues and profits. Coty has a proven right to win at all price points of scenting, from US$5 to US$500, and is already making strong headway in the exciting new US$7 billion mist market.”

The restructuring follows a disappointing financial year for the company, which it attributed to “innovation fatigue” in makeup and slower fragrance sales than 2024 saw. Last month, Coty reported a net loss of US$381 million for fiscal 2025, compared to a net profit of US$76 million the year before.

“We realize our results are not satisfying,” Nabi said during an investor call.

Following its financial results, Coty’s shares fell almost 22%, and since the start of the year, the stock has lost nearly half its value.

Rumors are circulating that CoverGirl is a possible brand at risk. Personal Care Insights contacted Coty, but the company declined to comment. 

Consumer Beauty review

The review will focus on Coty’s US$1.2 billion mass color cosmetics business and its US$400 million Brazil business. The company aims to maximize its long-term value and increase its revenue.

The move follows a weak year for Coty, marked by a US$381 million loss.“This new structure will also drive renewed momentum and sharper focus for Consumer Beauty, positioning it to compete more effectively in the evolving beauty landscape,” says Nabi.

As part of the review, Coty has pushed out Stefano Curti, chief brands officer, and Alexis Vaganay, chief commercial officer, from the struggling Consumer Beauty unit.

In their place, the company has asked Gordon von Bretten, a Coty board member and the company’s former chief transformation officer, to lead the segment and its turnaround as president. 

“Our agenda is clear: realize the full potential of our market-leading brands by focusing the portfolio, elevating product excellence, and driving productivity with discipline so that performance is visible in growth, margin expansion, and cash generation,” von Bretten says.

The company details that its Prestige division will continue to grow its cosmetics and skin care businesses with an extensive IP portfolio and advanced formulations. It hopes this will increase its presence in these categories, which show “strong margin potential” and “significant runway” for global growth.

“Coty remains fully committed to growing its prestige portfolio through blockbuster launches and brand elevation,” the company says.

Updates will follow once the board approves decisions.