Coty considering two-part sale, according to industry sources

US-based group Coty Inc., listed in New York and Paris, may be approaching a decisive turning point. According to several industry sources cited by WWD, the cosmetics specialist is considering a partial sale of its businesses, potentially paving the way for a profound restructuring of the company.

Two-stage sale

According to information gathered by WWD, discussions are still at a preliminary stage. The scenario under consideration would involve a two-stage sale: firstly, the Luxury division, which includes the Gucci, Burberry, Jil Sander and Hugo Boss licences; and secondly, the Consumer Beauty division, with mass-market brands such as CoverGirl, Max Factor and Rimmel London.

When questioned by the media outlet, a Coty spokesperson declined to comment, stating that the company does not comment on "rumours or speculation".

Coveted brands but complex transaction

According to WWD’s information, Coty is currently in discussion with Interparfums for some of its Luxury assets, including the Burberry and Hugo Boss fragrances. "We are always inclined to study opportunities that arise," said a spokesperson for Interparfums SA on Monday. According to sources close to the matter, the group has already submitted an offer to recover the Burberry licence, which it held until 2013.

The Burberry Goddess brand, launched in 2023, is considered Coty’s greatest commercial success to date, and Hugo Boss rose to become the second largest men’s fragrance franchise in Europe in the second half of 2024.

However, the future of the Gucci licence seems more uncertain. As WWD points out, the parent company Kering has for several years been aiming to develop its beauty activities internally and could recover the management of Gucci perfumes when the licence expires, expected by several observers to be in 2028. This is a deadline that Coty’s chief executive officer, Sue Nabi, mentioned in July 2023, stating that no discussions on licence renewals would take place for five years.

Consumer beauty division: a stumbling block

While the Luxury division is attracting interest, the sale of the Consumer Beauty business is proving more difficult. According to WWD, Coty initially hoped to find a buyer in Asia, but the regional economic slowdown, combined with persistent trade tensions with the US, makes this prospect increasingly unlikely. In addition, mass-market brands such as CoverGirl and Rimmel are facing growing competition from direct-to-consumer (D2C) players, and their attractiveness is considered lower than that of premium brands in terms of valuation.

However, some sources cited by WWD believe that the division could be of interest to private equity funds. But a global takeover of Coty by a single player seems unlikely, particularly for competition reasons.

"If Coty manages to sell the Consumer Beauty division, the fragrance part will find a buyer immediately," another source told WWD.

Shaky financial indicators

In the third quarter of its 2025 fiscal year, ending 31 March, revenue in the Consumer Beauty division fell by 9 percent, reflecting the segment’s difficulties. Overall, Coty posted a 6 percent decline in revenue to 1.29 billion dollars, below analysts’ forecasts of 1.3 billion dollars, reports Investing.com.

Coty’s share price, which has fallen sharply since the beginning of the year (-30.7 percent), jumped 11 to 13 percent after the publication of the sale rumours by WWD, according to Investing.com and Bloomberg. In comparison, L'Oréal posted growth of nearly ten percent over the same period and Estée Lauder’s decline was limited to 2.4 percent.

Coty’s recent underperformance is also explained by the loss-making sale of Skkn by Kim, Kim Kardashian’s brand, which resulted in a loss of 71.1 million dollars in the last quarter. Coty acquired a 20 percent stake in the company for 200 million dollars in 2022, but Kim Kardashian regained full control in March 2025. Coty had already had to manage similar difficulties with Kylie Cosmetics, whose growth disappointed despite a promising start in perfumery.

At the same time, the group is still seeking to fully divest itself of Wella, the hair care specialist, in which it still holds a 3.6 percent stake. An attempted sale to IGF Wealth Management failed in October 2023.

Governance in suspense

Speculation is also rife about Sue Nabi’s future at the helm of Coty. According to WWD, some observers envisage her departure as early as this summer. Formerly of L'Oréal and founder of Orveda, Nabi took over as chief executive officer of Coty in 2020, succeeding Peter Harf, now chairman of the board. Harf announced his retirement from JAB, Coty’s main shareholder, in April 2025 after 40 years with the group.

Turning the page

With a market capitalisation estimated at 4.13 billion dollars and revenue of 6.1 billion dollars in 2024 according to the WWD Beauty Inc ranking, Coty remains a major player in global beauty. But the group’s future seems more open than ever. Between the possible loss of the Gucci licence, the difficulties of the Consumer Beauty division and market pressure, Coty could well be at a decisive turning point.