Business
Coty Wrote Down $362.8M on Brands Its CEO Named Improving
On November 6, 2025, Coty CEO Sue Nabi named five Consumer Beauty brands and called fiscal 2026 trends 'steadily improving.' The Q3 10-Q, filed six months later, recorded $362.8 million in impairments against four of them; Rimmel, already under a strategic divestiture review Nabi had announced six weeks earlier, does not appear in the write-down.
Coty's Q3 fiscal 2026 10-Q, filed May 5, recorded $362.8 million in impairment charges against its Consumer Beauty brands.
November 6, 2025, Q1 FY2026 earnings call: CEO Sue Nabi named the portfolio by brand: "scale brands such as Covergirl, Rimmel, and Sally Hansen, alongside medium-sized brands such as Max Factor and Bourjois." She described fiscal 2026 trends as "steadily improving in line with our expectations" and reaffirmed an adjusted EBITDA target of approximately $1 billion. Six weeks earlier, on September 30, she had announced a strategic review of CoverGirl, Rimmel, Sally Hansen, and Max Factor for potential partnerships, divestitures, or spin-offs.
May 5, 2026, Q3 FY2026 10-Q: Coty recorded $237.1 million in goodwill impairments and $125.7 million in trademark impairments against CoverGirl, Sally Hansen, Max Factor, and Bourjois. Rimmel does not appear in the trademark impairment list. Coty had recorded $212.8 million in Consumer Beauty impairments in fiscal 2025; the Q3 filing does not explain the exclusion.
Consumer Beauty revenue fell 10% like-for-like in Q3. The 10-Q cites two triggering events: lower forecasted revenues and a higher weighted average cost of capital.
The second reflects a share price that set a new 52-week low on March 9. By early May, COTY traded at $2.41, down 53% from its peak of $5.17 a year earlier.
Nabi left the company 37 days after the November call. Coty named Markus Strobel interim CEO on December 12, 2025, and disclosed no reason.
The Q2 press release, filed February 5, had already registered the shift: adjusted EBITDA down 15% year over year, Consumer Beauty operating margin compressed from 13.3% to 5%. Strobel's first public statement acknowledged the trajectory: "Both things are true: Coty has outstanding assets and capabilities, yet we have not been delivering at the level we should."
The write-down exposes the November 6 earnings call as a forecast already contingent on conditions the Q3 filing shows did not materialize. Nabi's "steadily improving" language arrived six weeks after she announced a strategic review. That review had already placed four of the five named brands on a potential divestiture path.
Full-year adjusted EBITDA guidance is now $838 million to $848 million, roughly $155 million below the commitment Nabi made on November 6. Strobel has guided Q4 adjusted EBITDA at $85 million to $95 million. Coty's fiscal year closes June 30; Q4 results are expected in August.