Shiseido’s net sales decreased 4 percent to $1.7 billion in the second quarter, the Japanese beauty conglomerate announced Wednesday.
Core operating profit for the first half declined 31 percent year-over-year. Shares in the company fell 3 percent following the report.
Bright spots in the first half included the buzzy skincare line Drunk Elephant, whose sales grew 11 percent. Its fragrance division, which manufactures scents for the likes of Narciso Rodriguez and Zadig & Voltaire, grew 15 percent.
But the overall second-quarter net sales in the US declined 20 percent in a sharp reversal of trends following 9 percent growth in the previous quarter. The company chalked the US softness up to lower shipments and slower production.
In China, the company said price competition and a wider pullback in spending was still weighing on the key market, with sales declining 9 percent during the second quarter.
China has been even more of a headache for Shiseido than other international groups. While most have seen softness in the market, Shiseido has also had to contend with a local boycott as Chinese consumers spurned Japanese-owned brands due to concerns over the release of treated radioactive water in Fukushima earlier this year.
The company is making changes in a bid to regain ground. Last week, it announced a new chief executive, Kentaro Fujiwara, who is set to present a new strategy for the group in November. Shiseido said it would be exploring further acquisitions to fuel growth after inking a new fragrance license for Max Mara in July.
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