Slowing down in the United States and struggling in France, the beauty market is feeling the impact of past inflation and ongoing global economic uncertainty. Yet certain categories — particularly fragrances — continue to perform strongly and are expected to drive much of the sector’s growth.
The current environment is particularly favorable for companies with a strong presence in fragrances, such as Interparfums, which posted a 5.8% sales increase in the first half of 2025, fueled by robust growth in the United States. The group, which recently signed a licensing agreement with French leather goods company Longchamp, is further consolidating its position in the sector.
Meanwhile, after the United States announced the introduction of 15% tariffs on products from the European Union, L’Oréal reported a 1.6% increase in revenue for the first half of 2025. The world’s leading cosmetics group remains confident about its full-year outlook.
By contrast, some industry heavyweights like Coty and The Estée Lauder Companies are grappling with headwinds.
The summer was also marked by several notable launches and innovations. Selena Gomez’s Rare Beauty brand debuted its first eau de parfum, complemented by four so-called Fragrance Layering Balms. The bottle was designed for effortless handling, even by those with limited grip.
Following a successful foray into perfumery in 2016, Louis Vuitton has introduced its first ultra-luxury makeup line in collaboration with British makeup artist Pat McGrath.
Also noteworthy is the launch of a new mass-market perfume brand by Coty, keen to take advantage of the category’s growth.
In terms of regulations, Brazil has finally joined the cohort of countries banning the testing of cosmetics on animals, while the UK government announced plans to tighten rules on high-risk cosmetic procedures.
Earlier in July, the European Commission unveiled its European Chemicals Industry Action Plan, including a “6th Omnibus” to streamline rules for cosmetics and chemicals. Industry associations praised the balance between safety and innovation, while consumer groups warned of potential risks.
Negotiations on an international treaty to reduce plastic pollution, held under the auspices of the UN, have once again failed in Geneva. In contrast, U.S. President Donald Trump is pushing ahead with his protectionist agenda, with little concern for consensus. EU products imported into the United States are now subject to a 15% tariff, a rate also applied to South Korean goods. Swiss products face a 30% tax, while British goods are subject to a 10% duty. In addition, as of August 29, the customs duty exemption for small parcels entering the U.S. by mail has been abolished.
According to the Federation of Beauty Companies (FEBEA), the resurgence of protectionism threatens French cosmetics, the world’s leading exporter. L’Oréal CEO Nicolas Hieronimus acknowledged that while the development is “not good news” for the sector, the 15% tariffs remain “manageable” for the company.
