(Bloomberg) -- Estée Lauder Cos. has picked longtime executive Stéphane de La Faverie to take over as chief executive officer, the Wall Street Journal reported, citing people familiar with the matter.
The announcement could come as soon as this week, the Journal said. Jane Lauder, the granddaughter of Estée Lauder’s founder and among the list of potential CEO candidates, plans to step aside from her executive role at the end of the year, the newspaper reported. Current CEO Fabrizio Freda announced his retirement plans earlier this year.
An Estée Lauder spokeswoman declined to comment.
The new CEO will inherit numerous challenges from Freda. Demand in China has been slow to come back since the pandemic, especially at duty-free stores, a key sales driver for Estée Lauder brands. Company executives have repeatedly had to postpone their timelines for a recovery.
More recently, other cosmetic companies and high-end brands have been warning about a pullback in spending by Chinese consumers in the most recent quarter, which doesn’t bode well for Estée Lauder’s earnings results on Thursday.
When Estée Lauder announced in August that Freda was stepping down, some analysts said that a leader from outside the company might be better positioned to make the sweeping changes needed to turn the business around.
Shares of Estée Lauder pared their gains to 1.8% as of 1:38 p.m. New York time after earlier trading up as much as 6%. The stock has fallen almost 40% this year, compared with a 22% gain in the S&P 500 Index.
Bloomberg News reported in August 2023 that de la Faverie and Lauder were among the internal candidates being considered at the time to replace Freda.
De la Faverie is one of two executive group presidents at the company and oversees its namesake brand and others including Le Labo, Kilian Paris and The Ordinary. He joined Estée Lauder in 2011 from competitor L’Oréal SA, according to his LinkedIn profile.
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