The Estée Lauder Companies Inc. stock research
FY2026 Q2
The Estée Lauder Companies (EL) Gross Margin — Quarter Ended Dec 31, 2025
Revenue and gross profit both increased compared to the preceding quarter and the same quarter one year earlier. Cost of revenue also increased, but gross margin improved, reflecting a favorable relationship between revenue growth and cost changes.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2026 Q2
Revenue and gross profit both increased compared to the preceding quarter and the same quarter one year earlier. Cost of revenue also increased, but gross margin improved, reflecting a favorable relationship between revenue growth and cost changes.
- The strongest observable driver is the improvement in gross margin, which resulted from revenue increasing at a faster pace than cost of revenue relative to the prior quarter and year-ago period.
- Gross margin improved sequentially from the preceding quarter and was slightly higher than the same quarter one year earlier. Revenue and gross profit were higher in both comparisons, while cost of revenue was also higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
76.5%
Gross profit
$3.2B
Revenue
$4.2B
Cost of revenue
$994.0M
Quarter-over-quarter change
+3.1 pts
Year-over-year change
+0.4 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2025 | $3.5B | $2.7B | $889.0M | 75.0% |
| Jun 30, 2025 | $3.4B | $2.5B | $955.0M | 72.0% |
| Sep 30, 2025 | $3.5B | $2.6B | $927.0M | 73.4% |
| Dec 31, 2025 | $4.2B | $3.2B | $994.0M | 76.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+3.1 pts
Year-over-year change
Dec 31, 2024
+0.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the improvement in gross margin, which resulted from revenue increasing at a faster pace than cost of revenue relative to the prior quarter and year-ago period.
Gross margin improved sequentially from the preceding quarter and was slightly higher than the same quarter one year earlier. Revenue and gross profit were higher in both comparisons, while cost of revenue was also higher.
Monitor the trend in cost of revenue relative to revenue to assess whether the current margin improvement can be sustained.