L'Oréal net profit drops 4.4 percent in 2025 due to currency effects and French tax

The French cosmetics giant L'Oréal announced on Thursday a 4.4 percent decrease in its net profit to 6.13 billion euros (7.27 billion dollars). This was penalised by currency effects and the exceptional surcharge imposed on large companies to restore French public finances.

“This increasingly less exceptional tax on large companies (...) costs about 250 million euros. I would have preferred to invest this money in research,” L'Oréal's chief executive officer, Nicolas Hieronimus, told AFP.

“What I regret is that a heavy burden is placed on successful companies that fly the flag for France and Europe. This is happening when savings could be made elsewhere. However, we are happy to have a budget and a stable government, and this is apparently the price to pay,” he added.

The group's turnover increased by 1.3 percent to 44 billion euros, according to a statement. The operating margin was 20.2 percent, compared to 20 percent in 2024.

In the fourth quarter, L'Oréal's sales grew by 1.5 percent to 11.24 billion euros.

This year, 2025, was “a fairly decisive year for L'Oréal,” said Hieronimus, who highlighted “solid results” despite a “volatile and adverse context, to say the least.”

It was also “a year of significant transformation to prepare for future growth” with “major investments in technology, IT, and AI (artificial intelligence)... We spent over one and a half billion euros on tech,” he said. He also mentioned a “historic year” for acquisitions.

725 patents filed

L'Oréal took a minority stake in the fashion brand Jacquemus; increased its stake in the Swiss dermatology laboratory Galderma to 20 percent; and acquired a majority stake in the British skincare brand Medik8. Most importantly, it announced the purchase of the beauty division of the luxury group Kering for 4 billion euros.

“These acquisitions strengthen us in our core business and also open up new prospects,” Hieronimus explained to AFP, “important prospects in luxury, dermatological beauty, and health beauty.”

For 2026, “we must be cautious and humble,” he said. He also believes that, “barring any new surprises,” “the beauty market will continue to accelerate.” “We must redouble our efforts in innovation to energise this market and attract consumers,” he added.

“In 2025, L'Oréal filed its highest ever number of patents. We obtained 725 patents. This guarantees that we will have more exclusive innovations and a larger portion of our turnover protected by patents,” he explained.

Geographically, in 2025, sales in North Asia decreased by 2.2 percent to 10.08 billion euros. However, excluding currency effects, they grew by 0.5 percent. “The improvement is driven by mainland China, where growth is accelerating from low to mid-single-digit growth,” according to the statement.

In Europe, L'Oréal's turnover grew by 4.6 percent to 14.86 billion euros. In North America, sales decreased by 0.7 percent (but grew by 3.4 percent excluding currency effects) to 11.71 billion euros.

By division, sales of consumer products (Garnier, Maybelline) increased by 0.7 percent, exceeding 16 billion euros.

The turnover of L'Oréal Luxe (Lancôme, Yves Saint Laurent, Giorgio Armani) remained stable at 15.6 billion euros. Sales from the dermatological beauty division (La Roche-Posay, CeraVe, Vichy) grew by 2.5 percent to 7.2 billion euros. Professional products (Kerastase, Redken) jumped by 5.5 percent, exceeding 5 billion euros.

This article was translated to English using an AI tool.

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