The fog is slowly clearing for Estée Lauder Companies (ELC). The company announced on Friday that organic net sales rose 2% to $3.61 billion in the third quarter of fiscal 2026, ended March 31, 2026. 

“Our third-quarter results extend strong year-to-date performance, driven by Beauty Reimagined [ELC’s transformation plan],” ELC CEO and president Stéphane de La Faverie said during the company’s earnings call. “In the first nine months of fiscal 2026, organic sales for fragrance rose double digits, while three of four regions grew — led by high-single-digit growth in Mainland China, where we outperformed prestige beauty to gain share.”

ELC is following through with its Beauty Reimagined plan, which came into place in February 2025 and whose current pay-off is spurring the conglomerate to raise its full-year outlook to roughly 300 basis points. De La Faverie added that the year ahead is “pivotal”. Following a period of decline, the business aims to restore organic sales growth, while expanding its adjusted operating margin for the first time in four years, off the back of recovery signs.

Fragrance saw the biggest sales growth in the third quarter, up 10% to $628 million across all geographic regions. The category was led by brands Le Labo, Kilian Paris, Balmain Beauty, and Tom Ford. ELC’s other categories including skincare, haircare, and makeup remained flat.

By region, ELC reported retail sales growth of 6% in Mainland China, driven by the timing of recognition of local government subsidies. The EMEA region, which includes Europe, the UK, Ireland and emerging markets, also witnessed a 3% rise, while Asia-Pacific sales decreased 1% in Q3 and the Americas remained flat.

Looking ahead to fiscal 2027, the company said it is confident in improving its trajectory. “Our preliminary view is to accelerate organic sales growth and for adjusted operating margin to approach 13%, albeit in an uncertain geopolitical and macroeconomic environment,” said de La Faverie.

As for ELC’s potential merger with Puig, the company did not comment on the deal. Earlier this week, the Spanish conglomerate said that “no final decision has been made. Unless and until an agreement is reached, there can be no assurances regarding the transaction or the terms.”