THE WHAT? AmorePacific has reported its results for the first quarter of fiscal 2023. The K-beauty behemoth saw profit plummet 59.3 percent to KRW64.4 billion while revenue dropped 21.6 percent to KRW913.7 billion.
THE DETAILS The Domestic business suffered as the much-awaited return of Chinese tourists failed to materialise. Travel retail revenue was down by double digits, hitting Domestic revenue and operating profit hard despite department store and multi-brand shop channels reporting sales growth.
It was a similar story in the Overseas unit – where China accounts for some 50 percent of Asia sales. Despite an impressive 80 percent growth in North America sales and 94 percent uptick in EMEA revenue, Overseas revenue was down 17 percent and operating profit declined 37 percent.
THE WHY? AmorePacific attributed its decline to weak demand and restructuring of the offline channel in China. Despite its efforts to diversify into new markets, the owner of Sulwhasoo continues to be heavily reliant on the subdued Chinese market.
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