THE ESTÉE LAUDER COMPANIES REPORTS OUTSTANDING FISCAL 2021 RESULTS

Full Year Net Sales Increased 13% and Diluted EPS Increased to $7.79 from $1.86 In Constant Currency, Net Sales Grew 11% and Adjusted Diluted EPS Increased 54%

Fourth Quarter Net Sales Growth Accelerated to 62%; Up 10% Versus Fiscal 2019 Strong Net Sales Recovery Expected to Continue in Fiscal 2022

The Estée Lauder Companies Inc. (NYSE: EL) today reported net sales of $16.22 billion for its fiscal year ended June 30, 2021, an increase of 13% from $14.29 billion in the prior-year period. Excluding the impact of currency translation, net sales increased 11%. Net sales grew in every region and in most product categories, reflecting the gradual reopening and recovery in brick-and-mortar retail stores in certain markets compared to the prior year when retail locations closed in most markets during the second half of the year as COVID-19 spread globally. Incremental net sales from the Company’s acquisition of Have&Be Co. Ltd. (“Dr. Jart+”) and the increase in its ownership of Deciem Beauty Group (“DECIEM”) contributed 2 percentage points of growth to reported net sales.

The Company reported net earnings of $2.87 billion, compared with net earnings of $0.68 billion last year. Diluted net earnings per common share was $7.79, compared with $1.86 reported in the prior-year period. Excluding restructuring and other charges and adjustments as detailed on page 3, adjusted diluted net earnings per common share increased 57% to $6.45, and rose 54% in constant currency.

Fabrizio Freda, President and CEO, The Estée Lauder Companies

Fabrizio Freda, President and Chief Executive Officer said, “We delivered outstanding results in fiscal 2021, capped by an exceptional fourth quarter and powered by our multiple engines of growth strategy as well as the timeless desirability of prestige beauty. Notably, both sales and profitability meaningfully exceeded fiscal 2019 performance. Amid the challenges of the pandemic, we invested in near- and long-term growth opportunities and managed costs elsewhere with discipline, while making important progress on our social impact commitments and sustainability goals.

Our growth engines of Skin Care, luxury and artisanal Fragrance, Asia/Pacific, travel retail in Asia/ Pacific, and global Online performed exceptionally well. Innovation soared and eight of our brands grew sales double-digits, led by Estée Lauder, La Mer, and Jo Malone London. We amplified the strength of our skin care portfolio as we became majority owners of DECIEM, with its coveted brand The Ordinary. We also invested in an innovation center in Shanghai and a manufacturing facility near Tokyo to enhance our rapid growth in the region.”

Freda emphasized, “We begin fiscal 2022 as a stronger company thanks to our employees, whose compassion, creativity, and resolve have been extraordinary during the pandemic. Our success in the past year gives us confidence for the new year, as volatility and variability from COVID-19 are likely to persist for some time to come. For fiscal 2022, we expect strong net sales and adjusted earnings per share growth with continued margin expansion. Our growth engines are poised to increasingly diversify as Makeup and Hair Care, developed markets in the west, and brick-and-mortar retail gradually recover and complement the strength of our existing growth engines. We anticipate that growth in emerging markets will also resume over time as the impacts of the pandemic abate.”

COVID-19 Business Update

The COVID-19 pandemic continued to disrupt the Company’s operating environment, temporarily impacting retail traffic and certain consumer preferences in the fourth quarter of fiscal 2021. The resurgence of COVID-19 cases and the rapid spread of the Delta variant in most parts of the world, particularly in the United Kingdom and Continental Europe, Latin America and Asia outside of China, led to government restrictions to prevent further spread of the virus. These restrictions included the temporary closure of businesses deemed non- essential, curtailment of travel, social distancing and quarantines.

Retail Impact

While most brick-and-mortar retail stores that sell the Company’s products, whether operated by the Company or its customers, were open during much of the fourth quarter of fiscal 2021, most notably in China and the United States, there were intermittent closures throughout the rest of the world. More specifically, in the United Kingdom, Continental Europe, Canada, much of Latin America, and most of the Asia/Pacific region with the exception of China, many retail stores were temporarily closed for some period during the quarter due to the resurgence of COVID-19 cases. In the United Kingdom, much of Continental Europe and Canada, retail locations gradually reopened during the quarter but with capacity and other safety restrictions in place. Globally, in areas where stores were open, consumer traffic has not recovered to the pre- COVID-19 pandemic levels. International travel has remained largely curtailed globally due to both government restrictions and consumer health concerns that continue to adversely impact consumer traffic in most travel retail locations.

Conversely, domestic travel in China, especially in Hainan, and some other travel corridors in Asia/Pacific and The Americas were open and drove double-digit growth for fiscal 2021. Online continued to be strong globally as well. Online sales1 as a percent of total net sales has nearly doubled since fiscal 2019, with increases in every region, as more consumers have embraced online shopping since the beginning of the pandemic.

Consumer Preferences

The COVID-19 pandemic-related closures of offices, retail stores and other businesses and the significant decline in social gatherings have also influenced consumer preferences and practices. Specifically, the demand for makeup continues to be weak compared to the pre-COVID-19 pandemic period, given fewer makeup usage occasions and ongoing mask wearing, while skin care, fragrance and hair care have been more resilient.

1Online sales discussed throughout includes sales of our products from our websites and third-party platforms, as well as estimated sales of our products sold through our retailers’ websites.

Cost Controls

In response to the ongoing impacts from the COVID-19 pandemic, the Company continues to implement cost control actions in certain areas of the business to effectively manage the changing business environment.

Fiscal 2021 Results

Adjusted diluted earnings per common share excludes restructuring and other charges, changes in contingent consideration, acquisition-related stock option expense (less portion attributable to redeemable non-controlling interest), goodwill, other intangible and long-lived asset impairments, and other income. Please visit www.elcompanies.com for details.

Skin Care

• Skin care net sales grew across every region, led by Estée Lauder, La Mer and Clinique.
• Incremental net sales of Dr. Jart+ and the increase in ownership of DECIEM contributed

  approximately 4 percentage points to skin care net sales growth. Dr. Jart+ contributed strong double-digit organic growth in the second half of the fiscal year driven by consumer demand for high loyalty hero franchises, including Cicapair, Ceramidin and Dermask.

• Estée Lauder delivered double-digit growth, reflecting growth in all regions, with significant strength in mainland China. It delivered double-digit growth in travel retail and online, driven by consumer demand for high-loyalty hero franchises, including Advanced Night Repair, Nutritious, Micro Essence, Revitalizing Supreme+ and Re- Nutriv. Within these franchises, net sales growth benefited from successful new product launches of Advanced Night Repair Synchronized Multi-Recovery Complex and Revitalizing Supreme+ Bright.
• Strong double-digit growth from La Mer was driven by significant strength among Chinese consumers in both mainland China and travel retail. Online also grew double digits globally. Net sales growth was driven by increases in hero products, including The Treatment Lotion, Crème de la Mer, The Concentrate and The Moisturizing Soft Cream.

The launch of Genaissance de la Mer The Concentrated Night Balm and targeted expanded consumer reach also contributed to growth.

• Clinique delivered double-digit growth in every region driven by strong demand for its

  hero products, including the Dramatically Different products and Even Better Clinical Radical Dark Spot Corrector + Interrupter. The launch of Moisture Surge 100H Auto- Replenishing Hydrator also contributed to growth.

• Skin care operating income increased, primarily from higher net sales at Estée Lauder, La Mer and Clinique partially offset by an increase in certain incentive compensation. Incremental cost containment in response to COVID-19 was partially offset by strategic investments that were made during the fiscal year.

Makeup

• Makeup net sales declined among nearly all brands, led by M·A·C and Clinique. These declines were partially offset by growth at Too Faced and La Mer. The effects of COVID-19 disproportionately impacted makeup usage, particularly foundation and lip, in most markets. Makeup sales rose in the second half of the fiscal year in every region, reflecting the more advanced recovery in China and the easier comparisons to the second half of the prior year as COVID-19 spread globally.
• Too Faced net sales growth reflected both targeted expanded consumer reach and strength in lip plumpers, including the successful launch of Lip Injection Maximum Plump Lip Plumper.
• Net sales from La Mer grew due to the continued success of The Luminous Lifting Cushion Foundation in international markets.
• Makeup operating income improved, primarily reflecting the year-over-year reduction of goodwill, other intangible and long-lived asset impairments.

Fragrance

• Net sales grew, largely due to increases from Jo Malone London, Tom Ford Beauty, Le Labo, Kilian Paris, certain designer fragrances and Editions de Parfums Frédéric Malle. Fragrance growth accelerated during the year driven by continued resilience in luxury fragrance during the pandemic as well as easier comparisons in the second half of the fiscal year.
• Jo Malone London’s net sales grew double digits primarily driven by strength in colognes, including the new Blossoms Collection. Bath & Body and Home also delivered strong growth reflecting consumer demand for home fragrance products during the pandemic.
• Tom Ford Beauty grew strong double-digits, reflecting the successful launches of Bitter Peach and Rose Prick Private Blend fragrances as well as hero products, including Oud Wood and Black Orchid among others. The launches of Tubereuse Nue and Costa Azzurra also contributed to growth.
• Net sales from Le Labo rose strong double digits with growth in all regions driven by hero fragrances and home products.
• Kilian Paris’ net sales rose double digits driven by demand for hero products, including Good Girl Gone Bad, and the successful launch of The Liquors franchise.
• Fragrance operating income increased, driven primarily by higher net sales and disciplined expense management partially offset by an increase in certain incentive compensation.

Hair Care

• Hair care net sales rose, primarily reflecting successful innovation at Aveda, including Botanical Repair, and growth from existing product franchises, including Nutriplenish and Invati. Aveda’s online sales grew strong double digits, reflecting the brand’s expanded online services which drove sales to the channel while many salons and freestanding stores were closed.
• Hair care operating results were flat reflecting higher net sales from Aveda, which was offset by the return of incentive compensation to pre-COVID-19 pandemic levels.

The Americas

• Net sales increased slightly in the region reflecting growth in North America compared to the prior year where brick-and-mortar began to shut down in March 2020 due to COVID-19. Net sales in Latin America declined slightly, primarily reflecting lower net sales in Brazil due to the impacts of COVID-19.
• Incremental net sales of Dr. Jart+ and the increase in ownership of DECIEM contributed approximately 1 percentage point to net sales growth.
• Online sales grew double digits in The Americas, comprising 40% of sales, as the Company and many retailers captured consumer demand online utilizing new and existing digital capabilities, which more than offset declines from soft traffic in brick-and- mortar doors.
• In North America, double-digit growth in the fragrance category and strong growth in skin care were mostly offset by the impacts of COVID-19 on the makeup category.
• Operating income in The Americas increased, primarily reflecting the year-over-year reduction of goodwill, other intangible and long-lived asset impairments.

  Europe, the Middle East & Africa

• Net sales grew in the region, led by travel retail and online. During the fourth quarter, rising vaccination rates allowed some markets to reopen while others had additional closures, and brick-and-mortar retail locations started to slowly recover.
• Incremental net sales of Dr. Jart+ and the increase in ownership of DECIEM contributed less than 1 percentage point to net sales growth.

• Net sales from the Company’s global travel retail business increased year-over-year despite the curtailment of international passenger traffic in Europe, the Middle East & Africa and The Americas. This was more than offset by growth in Asia/Pacific driven by China domestic travel, especially in Hainan, and Korea.
• Online sales rose strong double-digits, reflecting the Company’s increased focus on reaching consumers digitally, including the launches of new brand sites in India and several other countries as well as the launches on additional pure play retailers.
• Operating income increased, primarily driven by the growth in travel retail.

Asia/Pacific

• Net sales growth reflected increases in mainland China, Korea, Australia and several smaller markets.
• Incremental net sales of Dr. Jart+ and the increase in ownership of DECIEM contributed approximately 6 percentage points to net sales growth.
• Skin care, fragrance and hair care net sales grew strong double-digits in the region, while makeup net sales declined slightly.
• The Company continued to focus its investments on digital marketing, which drove strong double-digit online sales growth. Sales of the Company’s products online represented 36% of sales for the fiscal year. Department stores, specialty multi and freestanding stores grew double digits as well.
• In mainland China, net sales grew strong double digits led by continued strength in skin care, an acceleration in fragrance growth and the initial recovery in makeup during the year. Net sales growth benefited from successful programs during key shopping events, including the 11.11 Global Shopping Festival and the 6.18 Mid-Year Shopping Festival. Nearly every brand grew, led by luxury brands, and sales increased double digits in every channel.
• Operating income increased, driven by higher net sales partially offset by strategic investments that were made during the fiscal year.

Please visit www.elcompanies.com for details.