AddedMD&A
(2) The net sales and operating results from our travel retail business are included in the Asia/Pacific region.
The 10-K against last year's
149 changes: 20 added, 32 removed, 96 reworded, 1 quiet changes
10-K 0001001250-26-000041 (2026-08-19) vs 10-K 0001001250-25-000099 (2025-08-20)
The redline
The paragraph that changed most in each section
Marked against last year's 10-K:
cut words struck through, new words highlighted and underlined.
Legal Proceedings 247 words changed in this paragraph; it is 34% similar to last year's version.
On December 7, 2023 and January 22, 2024, the Company and its then Chief Executive Officer and Chief Financial Officer were named as defendants in separate purported securities class action complaints were filed in the United States District Court for the Southern District of New York. On February 20, 2024, those two purported securities class York against the Company and its then Chief Executive Officer and Chief Financial Officer. The actions were consolidated into one action. on February 20, 2024. On March 22, 2024, plaintiffs filed their a consolidated amended class action complaint, which alleges that defendants made materially false and misleading statements during the period February 3, 2022 to October 31, 2023 in press releases, the Company’s public filings and during conference calls with analysts that artificially inflated the price of the Company’s stock in violation complaint alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. 1934 based on alleged materially false and misleading statements between February 3, 2022 and October 31, 2023. On March 31, 2025, the Court denied defendants' motion to dismiss. Defendants intend On April 2, 2026, the parties reached an agreement in principle to defend settle the securities class action vigorously. litigation. In light of these discussions, the Company recorded a loss contingency of $ 210 million relating to a potential settlement of the securities class action in Other accrued liabilities in the accompanying consolidated balance sheet during the fiscal 2026 third quarter, as well as recorded a receivable for the estimated probable amounts expected to be paid by insurance carriers. As of June 30, 2026, the total settlement of $ 210 million has been funded, which includes the amounts paid by the insurance carriers, and as such there are no amounts related to this matter reflected in the accompanying consolidated balance sheet. This matter is subject to final approval from the Court.
Source: Item 3, via Note 16 – COMMITMENTS AND CONTINGENCIES, 10-K 0001001250-26-000041 vs Item 3, via Note 17 – COMMITMENTS AND CONTINGENCIES, 10-K 0001001250-25-000099
MD&A 232 words changed in this paragraph; it is 34% similar to last year's version.
The effective tax rate for fiscal 2025 decreased 2026 increased approximately 5,590 7,370 basis points. The decrease extent of the year over year change was broadly impacted by the loss before income taxes in fiscal 2025. The increase was primarily attributable to the higher effective tax rate on income from our foreign operations of approximately 2,630 5,630 basis points, due to our geographical mix of earnings for fiscal 2025, earnings, including the establishment of new valuation allowances on certain foreign deferred tax assets. Further contributing to the increase in the effective tax rate was the unfavorable impact of the One Big Beautiful Bill Act, resulting from an increase in tax deductible interest expense which reduced U.S. taxable income and increased the excess foreign tax credits generated which require a valuation allowance of approximately 1,010 basis points, changes in unrecognized tax benefits related to transfer pricing matters impacting multiple tax jurisdictions of approximately 820 basis points, as well as the unfavorable impact associated with previously issued U.S. stock-based compensation of approximately 590 basis points. The overall increase in the effective tax rate is partially offset by the favorable year-over-year utilization of U.S. general foreign tax credits net of the prior year establishment of a valuation allowance against U.S. general foreign tax credit credits and research and development tax credit carryforwards of approximately 1,651 basis points, the impact of nondeductible goodwill impairment charges associated with the Too Faced reporting unit of approximately 800 basis points and the unfavorable impact associated with previously issued stock-based compensation of approximately 640 550 basis points. The loss before income taxes due to the goodwill and other intangible asset impairment charges, as well as the charges associated with restructuring and other activities and talcum litigation settlement agreements increased the impact of these tax adjustments.
Source: Item 7, 10-K 0001001250-26-000041 vs Item 7, 10-K 0001001250-25-000099
Accounting Policies 68 words changed in this paragraph; it is 37% similar to last year's version.
Effective for the Company - Company: The guidance became becomes effective for the Company’s first quarter of fiscal 2024 2029 and has been is applied on a retrospective basis, except for basis through a cumulative-effect adjustment to the requirement to disclose rollforward information annually which became effective for opening balance of retained earnings (prior reporting periods are not recast). Early adoption is permitted as of the Company’s fiscal year ended June 30, 2025 Form 10-K and has been applied on a prospective basis. beginning of an annual reporting period.
Source: 10-K text, Note 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001001250-26-000041 vs 10-K text, Note 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, 10-K 0001001250-25-000099
Risk Factors 44 words changed in this paragraph; it is 76% similar to last year's version.
We continuously review acquisition and strategic opportunities that would expand our current product offerings, our distribution channels, increase the size and geographic scope of our operations or otherwise offer growth and operating efficiency opportunities. In addition, we periodically review our brand portfolio, and our strategy includes potential divestitures of certain brands as we rationalize product offerings. There can be no assurance we will be able to identify these strategic actions, be the successful bidder, and consummate such transactions on favorable terms, or otherwise realize the full intended benefit of such transactions. In addition, we periodically review our brand portfolio, and our strategy includes potential divestitures of certain brands as we rationalize product offerings.
Source: Item 1A, 10-K 0001001250-26-000041 vs Item 1A, 10-K 0001001250-25-000099
Every change, by type
Sentences and paragraphs added, removed or reworded
Sentences and paragraphs of EL's Risk Factors and MD&A, 10-K 2026-08-19 against 10-K 2025-08-20. Each links to the text at sec.gov.
AddedMD&A
While we have seen improvements within our business, we are mindful of areas of volatility and uncertainty that may impact our results. We continue to face challenges in key markets in the West, including in some markets in Western Europe and the United States. Within our Asia travel retail business, we continue to monitor the impacts of the change in duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses. We are also monitoring the conflict in the Middle East as it relates to our business in the domestic markets and travel retail locations in the region. Net sales from locations impacted by the conflict in the Middle East accounted for approximately 2% of consolidated net sales in fiscal 2025. We continue to monitor and assess the impact that these areas of volatility and uncertainty may have on net sales and profitability, including impacts to our effective tax rate from changes to our geographical mix of earnings.
AddedMD&A
On February 20, 2026, the U.S. Supreme Court ruled that the U.S. tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) on goods imported into the U.S. were unauthorized. The ruling did not address potential refunds, however on March 4, 2026, the U.S. Court of International Trade ordered U.S. Customs and Border Protection to begin refunding all tariffs imposed under IEEPA. During the fiscal 2026 fourth quarter, we submitted claims for a portion of our eligible IEEPA tariffs paid, and have begun to receive refunds. For refunds received during the period, we have recorded these as an offset to cost of sales. As of June 30, 2026, the remaining amount of potential IEEPA tariff refunds not yet submitted or for which refunds have not been received are not considered material to the consolidated financial statements.
AddedMD&A
As of June 30, 2026, approvals under the Restructuring Program concluded, and by the end of fiscal 2027, the cumulative approved initiatives are expected to be substantially completed.
AddedMD&A
On December 7, 2023 and January 22, 2024, purported securities class action complaints were filed in the United States District Court for the Southern District of New York against the Company and its then Chief Executive Officer and Chief Financial Officer. The actions were consolidated on February 20, 2024. On March 22, 2024, plaintiffs filed a consolidated amended complaint alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on alleged materially false and misleading statements between February 3, 2022 and October 31, 2023. On March 31, 2025, the Court denied defendants’ motion to dismiss. On April 2, 2026, the parties reached an agreement in principle to settle the securities class action litigation. In light of these discussions, during the fiscal 2026 third quarter, we recorded a loss contingency of $84 million, net of the estimated probable insurance recoveries, in the consolidated statements of earnings (loss) relating to a potential settlement of the securities class action. As of June 30, 2026, the total settlement amount has been funded, including amounts paid by the insurance carriers. This matter is subject to final approval from the Court.
AddedMD&A
Aligned with our policy on Goodwill and Other Indefinite-lived Intangible Assets, as described in Item 8. Financial Statements and Supplementary Data – Note 2 – Summary of Significant Accounting Policies, we performed our annual impairment assessments as of April 1, 2026. Goodwill and trademark intangible assets were evaluated using either qualitative or quantitative assessments, as appropriate based on the reporting unit or brand. Based on the results of these assessments, no impairment charges were recorded, however, certain trademarks have limited excess fair value over carrying value.
AddedMD&A
Reported makeup net sales increased $71 million, or 2%, in fiscal 2026, including the favorable impact of foreign currency translation of 2%. Including the favorable impact of foreign currency translation, the increase in makeup net sales was primarily driven by M·A·C, reflecting higher net sales in the lip subcategory, driven by Powder Kiss Lipstick, Lip Pencil, MACximal Silky Matte Lipstick and MACximal Sleek Satin Lipstick. Also contributing to the increase in M·A·C net sales was the benefit from targeted expanded consumer reach.
AddedMD&A
The increase in net sales from Le Labo was led by the Classic Collection, including growth from targeted expanded consumer reach and the benefit from new product launches. Net sales from TOM FORD increased, reflecting the benefit from new product launches which created halo benefits on existing products, with overall growth in both the Signature and Private Blend franchises. Net sales from KILIAN PARIS increased, driven by the Angels' Share and Love, don't be shy franchises including growth attributable to new product launches and key campaigns, as well as growth from targeted expanded consumer reach.
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AddedMD&A
The increase in net sales from The Ordinary reflected growth of the Multi-Peptide Serum for Hair Density, as well as the benefit from targeted expanded consumer reach.
AddedMD&A
The decrease in net sales from Aveda reflects the brand’s strategies to improve long-term performance, including (i) planned rebalancing of online promotional activity and (ii) the exit from underperforming doors, including freestanding stores. These declines were partially offset by the impact from its launch in Amazon's U.S. Premium Beauty store during the fiscal 2025 fourth quarter.
AddedMD&A
(1)The net sales from our travel retail business are included in the Asia/Pacific region.
AddedMD&A
The increase in net sales in our travel retail business was driven by Asia travel retail, including (i) the increase in net sales in Korea travel retail and Hong Kong SAR travel retail, benefiting from retailer shifts toward more profitable duty-free business models, which helped reduce discounting, as well as the increase in traveling consumers, (ii) net sales growth in Hainan travel retail, reflecting the improvement in retail sales, benefiting from higher traffic and key campaigns to drive growth, and (iii) the net sales decline in the rest of mainland China travel retail, primarily driven by the transitory pressure from the change of duty-free retailers servicing the Beijing and Shanghai airports, including the related online businesses.