L'Oréal's Q1 Growth Reaches 6.7%, Major Personnel Changes in China Again | Exclusive

Text | He Zhexin

Editor | Qiao Qian

In the past week, L'Oréal delivered a performance report that exceeded market expectations.

In the first quarter of 2026, the company achieved sales of approximately 12.15 billion euros, a year-on-year increase of 3.6%. On a like-for-like basis, sales growth reached 7.6%, and 6.7% after adjustment. This growth rate was not only higher than the market's general expectations. On the day after the release of the financial report, L'Oréal's stock price soared by 9%, marking the largest single-day increase since November 2008.

Looking at different categories, all four business units achieved growth, but the growth engine has shifted. The Professional Products Division replaced the Skin Care Division to lead the growth with a 13.1% increase. The Skin Care Division grew by 10.2%. The Luxury Products Division grew by 5.6%, and during the conference call, the management specifically mentioned that this division "was boosted by high-single-digit growth in the Chinese market." The Consumer Products Division had the lowest growth rate at 4.1%.

Looking at different regions, emerging markets including South Asia - Pacific, Middle East, North Africa, and Sub - Saharan Africa (SAPMENA - SSA) continued to lead with a 15.4% growth rate. North America grew by 7.6%, Europe by 5.5%, and North Asia, including the Chinese market, grew by 4.8%.

Almost simultaneously with the release of the financial report, there was an important organizational structure adjustment in the Chinese region. Ma Lan, the former general manager of the Skin Care Division, has also concurrently served as the general manager of the Consumer Products Division. Li Lin, the former general manager of the Consumer Products Division, has taken on the role of Chief Digital Marketing Officer for North Asia and China at L'Oréal.

Looking at their resume backgrounds, Ma Lan has long been in charge of the Skin Care Division, which has been the most stable growth business for L'Oréal globally and in China in recent years. The Consumer Products Division has always been the largest business segment of L'Oréal, but it has relatively weak growth. Promoting its person - in - charge and integrating the mass business to some extent means that the company hopes to replicate the growth methodology of the Skin Care Division to a larger - scale business.

From a market perspective, this personnel adjustment can also be seen as a response to changes in consumer behavior . In the past, the advantages based on channel segmentation and relatively clear purchasing logic are being rapidly broken. Consumers may be exposed to makeup products at different price points under the L'Oréal Group during the same browsing session. Ingredient - based essences based on skin science and so - called "luxury creams" may also appear on the same product recommendation page. Against this background, merging the Consumer Products Division with the Skin Care Division and strengthening the consumer - centered operation logic is, to some extent, an organizational adaptation to the reconstruction of the consumption path.

From a regional structure perspective, L'Oréal's growth focus is also clearly tilting towards the European and American markets. In 2025, the business in North Asia accounted for 22.9% of L'Oréal Group's total revenue, a significant decline from the peak of 30% in 2021. The first and second - largest markets, Europe and North America, accounted for 34% and 27% respectively, still achieving a 1% - 2% increase compared to 2021. The obvious change in the regional growth structure further confirms the necessity of the company's organizational restructuring and business re - balancing in China.

According to the disclosure by Group CEO Nicolas Hieronimus, the business in mainland China currently accounts for about 17% of the group's total revenue and about 70% of North Asia's revenue. In 2025 and the first quarter of 2026, mainland China achieved growth from "mid - single - digit" to "mid - to - high - single - digit". Although it outperformed the overall growth rate of the domestic beauty market by about 1% - 2%, it also confirms what Vincent Boinay, the CEO of North Asia, said: the Chinese market is facing multiple challenges such as "demographic changes, deflationary pressure, population decline, and weakening consumer confidence".

Against this background, the certainty of the growth path presented in the Q1 financial report will also face some questions.

Take the Professional Products Division as an example. In the first quarter, this division had a growth rate of over 15% and 7% in North Asia, showing outstanding performance. However, its core is a B2B logic, relying on salon channels and professional systems. In the Chinese market, this means there is a ceiling for scale expansion. Its high - growth rate supports the overall structure more in terms of profit quality rather than sales volume, and in the long run, it may become a hidden constraint on growth.

Another area worthy of attention is the perfume business. This segment has long been considered relatively weak within L'Oréal. According to insiders, before the pandemic, the size of the Chinese perfume team was less than ten people. With the completion of the acquisition of Kering Beauté's assets on March 31, L'Oréal obtained a 50 - year license for perfumes and cosmetics of Creed, Bottega Veneta, and Balenciaga. This is the resource prerequisite for L'Oréal to implement localization in the Chinese perfume market. However, a product portfolio does not equal market position. The integration and implementation after this acquisition require a considerable amount of time. It will take at least 18 to 24 months of continuous observation to see how its real effects are reflected in the financial report.