Shiseido's woes in China are not over yet.
The Japanese beauty group's first-quarter net sales rose 4% to $1.6 billion, but the company said on Friday that wariness about the brand in the huge Chinese market continued to weigh on growth elsewhere. It was announced on .
While many premium beauty companies are struggling in China due to a decline in travel retail and declining discretionary spending, Shiseido, which owns premium brands such as Nars, Drunk Elephant and Clé de Peau, is a more unique company. I have a problem. The release of radioactive water from the Fukushima nuclear power plant in August 2024 prompted China to boycott many Japanese brands. First quarter net sales in China decreased 3% in constant currency to $356 million.
The company said its Clé de Peau Beauté and Nars brands, which are not sold under the Shiseido name, performed well, but its namesake brand also suffered negative sales growth in the quarter.
Group operating profit decreased by 10% due to weaker travel retail sales and lower intersegment sales. The company is in the midst of a strategic shift aimed at reducing its reliance on promotions and prioritizing brand equity expansion to drive growth.
Other markets outside of China performed well. In the United States, a key growth market for the company, premium skin care lines Drunk Elephant and Dr. Dennis Gross contributed to a 9% increase in sales. In Europe, the popularity of the group's Narciso Rodriguez fragrance line boosted sales.
Travel retail fell 30.5% due to inventory adjustments by retailers and low foot traffic in popular shopping destinations in Hainan and South Korea, but sales at duty-free stores in Japan declined as tourists began to return. the company said.
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