COTY INC. (COTY)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of the financial condition and results of operations of Coty Inc. and its consolidated subsidiaries, should be read in conjunction with the information contained in the Condensed Consolidated Financial Statements and related notes included elsewhere in this document, and in our other public filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (“Fiscal 2025 Form 10-K”). When used in this discussion, the terms “Coty,” the “Company,” “we,” “our,” or “us” mean, unless the context otherwise indicates, Coty Inc. and its majority and wholly-owned subsidiaries. Also, when used in this Quarterly Report on Form 10-Q, the term “includes” and “including” means, unless the context otherwise indicates, including without limitation. The following report includes certain non-GAAP financial measures. See “Overview—Non-GAAP Financial Measures” for a discussion of non-GAAP financial measures and how they are calculated.

All dollar amounts in the following discussion are in millions of United States (“U.S.”) dollars, unless otherwise indicated.

More information about potential risks and uncertainties that could affect our business and financial results is included under the heading “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q and other periodic reports we have filed and may file with the SEC from time to time.

Forward-looking Statements

Certain statements in this Form 10-Q are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, strategic planning, targets and outlook for future reporting periods (including the extent and timing of revenue, expense and profit trends and changes in operating cash flows and cash flows from operating activities and investing activities), the Company’s future operations and strategy (including the expected implementation and related impact of its strategic priorities), ongoing and future cost efficiency, optimization and restructuring initiatives and programs, expectations of the impact of inflationary pressures and the timing, magnitude and impact of pricing actions to offset inflationary costs, strategic transactions (including their expected timing and impact), the strategic review of the Company’s consumer beauty business, including its mass color cosmetics business and associated brands and the Company’s distinct Brazil business comprised of local Brazilian brands, and any transactions related thereto, use of proceeds from any transaction and the timing and outcome of the strategic review, expectations and/or plans with respect to joint ventures, the timing and size of any future distribution related to the Wella Distribution Rights (as defined below), the Company’s capital allocation strategy and payment of dividends (including suspension of dividend payments and the duration thereof and any plans to resume cash dividends on common stock or to continue to pay dividends in cash on preferred stock) and expectations for stock repurchases, investments, plans and expectations with respect to licenses and/or portfolio changes, product launches, relaunches or rebranding (including the expected timing or impact thereof), plans for growth in certain categories, markets, channels and other white spaces, synergies, savings, performance, cost, timing and integration of acquisitions, future cash flows, liquidity and borrowing capacity (including any refinancing or deleveraging activities), timing and size of cash outflows and debt deleveraging, the timing and magnitude of any “true-up” payments in connection with our forward repurchase contracts and plans for settlement of such contracts, the timing and extent of any future impairments, and synergies, savings, impact, cost, timing and implementation of the Company’s ongoing strategic transformation agenda (including operational and organizational structure changes, operational execution and simplification initiatives, fixed cost reduction plans, continued process improvements and supply chain changes), the impact, cost, timing and implementation of e-commerce and digital initiatives, the expected impact, cost, timing and implementation of sustainability initiatives (including progress, plans, goals and our ability to achieve sustainability targets), the expected impact of geopolitical risks including the ongoing war in Ukraine and/or the ongoing war in the Middle East on our business operations, sales outlook and strategy, expectations regarding the impact of tariffs (including magnitude, scope and timing) and plans to manage such impact, expectations regarding economic recovery in Asia, consumer purchasing trends and the related impact on our plans for growth in China, the expected impact of global supply chain challenges and/or inflationary pressures (including as a result of the war in Ukraine and/or the ongoing war in the Middle East, or due to a change in tariffs or trade policy impacting raw materials) and expectations regarding future service levels, inventory levels and excess and obsolescence trends, expectations regarding the expanded use of artificial intelligence (“AI”) and advanced analytics in our operations and the timing and impact thereof, and the priorities of senior management. These forward-looking statements are generally identified by words or phrases, such as “anticipate”, “are going to”, “estimate”, “plan”, “project”, “expect”, “believe”, “intend”, “foresee”, “forecast”, “will”, “may”, “should”, “outlook”, “continue”, “temporary”, “target”, “aim”, “potential”, “goal” and similar words or phrases. These statements are based on certain assumptions and estimates that we consider reasonable, but are subject to a number of risks and uncertainties, many of which are beyond our control, which could cause actual events or results (including our financial condition, results of operations, cash flows and prospects) to differ materially from such statements, including risks and uncertainties relating to:

•our ability to successfully implement our strategic priorities (including leveraging our leadership position and

37

Table of Contents

capabilities in global fragrances to fuel strong expansion and continue to grow our footprint and diversification in a limited number of structurally profitable and growing beauty categories and geographic markets at scale), achieve the benefits contemplated by our strategic initiatives (including revenue growth, cost control, gross margin growth and debt deleveraging), and compete effectively in the beauty industry, in each case within the expected time frame or at all;

•our ability to anticipate, gauge and respond to market trends and consumer preferences, which may change rapidly, and the market acceptance of new products, including new products in our skincare and prestige cosmetics portfolios, any relaunched or rebranded products and the anticipated costs and discounting associated with such relaunches and rebrands, and consumer receptiveness to our current and future marketing philosophy and consumer engagement activities (including digital marketing and media), and our ability to effectively manage our production and inventory levels in response to demand;

•use of estimates and assumptions in preparing our financial statements, including with regard to revenue recognition, income taxes (including the expected timing and amount of the release of any tax valuation allowance), the assessment of goodwill, other intangible and long-lived assets for impairments, and the market value of inventory;

•the impact of any future impairments;

•managerial, transformational, operational, regulatory, legal and financial risks, including diversion of management attention to and management of cash flows, expenses and costs associated with our transformation agenda, our global business strategies, the management of our strategic partnerships, the strategic review of our consumer beauty business, and future strategic initiatives, and, in particular, our ability to manage and execute many initiatives simultaneously including any resulting complexity, employee attrition or diversion of resources;

•the timing, costs and impacts of divestitures and the amount and use of proceeds from any such transactions;

•future divestitures and the impact thereof on, and future acquisitions, new licenses and joint ventures and the integration thereof with, our business, operations, systems, financial data and culture and the ability to realize synergies, manage supply chain challenges and other business disruptions, reduce costs (including through our cash efficiency initiatives), avoid liabilities and realize potential efficiencies and benefits (including through our restructuring initiatives) at the levels and at the costs and within the time frames contemplated or at all;

•increased competition, consolidation among retailers, shifts in consumers’ preferred distribution and marketing channels (including to digital and prestige channels), distribution and shelf-space resets or reductions, compression of go-to-market cycles, changes in product and marketing requirements by retailers, reductions in retailer inventory levels and order lead-times or changes in purchasing patterns, impact from public health events on retail revenues, and other changes in the retail, e-commerce and wholesale environment in which we do business and sell our products and our ability to respond to such changes (including our ability to expand our digital, direct-to-consumer and e-commerce capabilities within contemplated timeframes or at all);

•our and our joint ventures’, business partners’ and licensors’ abilities to obtain, maintain and protect the intellectual property used in our and their respective businesses, protect our and their respective reputations (including those of our and their executives or influencers) and public goodwill, and defend claims by third parties for infringement of intellectual property rights;

•any change to our capital allocation and/or cash management priorities, including any change in our dividend policy and any change in our stock repurchase plans;

•any unanticipated problems, liabilities or integration or other challenges associated with a past or future acquired business, joint ventures or strategic partnerships, which could result in increased risk or new, unanticipated or unknown liabilities, including with respect to environmental, competition and other regulatory, compliance or legal matters, and specifically in connection with our strategic partnerships, risks related to the entry into a new distribution channel, the potential for channel conflict, risks of retaining customers and key employees, difficulties of integration (or the risks associated with limiting integration) and management of the partnerships, our relationships with our strategic partners, our ability to protect trademarks and brand names, litigation, investigations by governmental authorities, and changes in law, regulations and policies that affect the business or products of our strategic partnerships, including the risk that direct selling laws and regulations may be modified, interpreted or enforced in a manner that results in a negative impact to the business model, revenue, sales force or business of any of our strategic partnerships;

38

Table of Contents

•our international operations and joint ventures, including enforceability and effectiveness of our joint venture agreements and reputational, compliance, regulatory, economic and foreign political risks, including difficulties and costs associated with maintaining compliance wi

[Excerpt truncated for page length; source filing is linked above.]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of the financial condition and results of operations of Coty Inc. and its consolidated subsidiaries should be read in conjunction with the information contained in the Consolidated Financial Statements and related notes included elsewhere in this document. When used in this discussion, the terms “Coty,” the “Company,” “we,” “our,” or “us” mean, unless the context otherwise indicates, Coty Inc. and its majority and wholly-owned subsidiaries. The following discussion contains forward-looking statements. See “Forward-Looking Statements” and “Risk Factors” for a discussion on the uncertainties, risks and assumptions associated with these statements as well as any updates to such discussion as may be included in subsequent reports we file with the SEC. Actual results may differ materially and adversely from those contained in any forward-looking statements. The following discussion includes certain non-GAAP financial measures. See “Overview—Non-GAAP Financial Measures” for a discussion of non-GAAP financial measures and how they are calculated.

All dollar amounts in the following discussion are in millions of United States (“U.S.”) dollars, unless otherwise indicated.

OVERVIEW

We are one of the world’s largest beauty companies, with an iconic portfolio of brands across fragrance, color cosmetics, and skin and body care. Our brands empower people to express themselves freely, creating their own visions of beauty; and we are committed to protecting the planet. We have sharpened our priorities to capitalize on structural tailwinds in the fragrance market. We are leveraging our leadership in fragrance innovation, licensing, and manufacturing to expand across price points, from mass to ultra-premium and across scenting formats. With slower growth in China’s beauty market, we have shifted focus to a broader set of emerging markets and the U.S. In Consumer Beauty, we aim to improve performance and profitability through agile innovation, social media advocacy, and expansion into body mists and masstige fragrances. Skincare remains a strategic focus, but achieving scale takes time, and we will pursue this while remaining very mindful of the investment demand. We also continue to advance key sustainability priorities.

Strategic Progress

We have been making progress on our strategic priorities. In Consumer Beauty, we have implemented the relaunch of our top brands. We are now focusing on diversifying our business by overdriving mass fragrances and adjacencies, while accelerating our color cosmetics business through digital advocacy, channel diversification and on-trend innovation, all of which is intended to step change our Consumer Beauty profitability. In Prestige, we are accelerating our fragrance business with exceptional new launches and franchise-building extensions, expanding our premium and ultra-premium category portfolio, extending into the rapidly growing fragrance mist adjacency with multiple brands, while also enhancing the assortment of our Prestige cosmetic products. We are continuing to thoughtfully expand our skincare portfolio (which contributed a mid-single digit percentage of our fiscal 2025 net revenue). We continue to expand our e-commerce capabilities across our portfolio, through online launches, our digital advocacy strategy and active participation in key online shopping events. We are adjusting our strategy in step with the beauty market evolution. Our aim is to continue expanding our footprint and diversifying into a limited number of structurally profitable and growing beauty categories and geographic markets at scale. We are leveraging and overdriving our leadership position and best-in-class capabilities in global fragrances to fuel strong expansion— with fragrances already constituting more than 65% of our fiscal 2025 net revenues and an even larger portion of our profits.

During the third quarter of fiscal 2025, we formulated a new plan, which was announced on April 24, 2025, to strengthen our operating model and simplify our fixed cost structure (the “Fixed Cost Reduction Plan”). Cash costs associated with the program include restructuring and business structure realignment costs and are expected to be approximately $80.0, roughly evenly split between fiscal 2026 and fiscal 2027.

Global Economic Landscape and Business Impact

Our products are marketed, sold and distributed in approximately 123 countries and territories. As a geographically diverse company we are susceptible to global economic trends, geopolitical conflicts, domestic and foreign governmental policies, and changes in foreign exchange rates. In particular, challenging economic conditions in China have had, and are expected to continue to have, an impact on our strategic initiatives including our growth agenda in the region for Prestige products and our skincare growth priorities. We remain attentive to economic and geopolitical conditions that may materially impact our business. We also continue to monitor and take actions to address the impact to our Consumer Beauty brands in China.

Recent changes in U.S. and international trade policies—particularly tariff increases—and the ongoing uncertainty surrounding such policies may present challenges to our business operations and financial condition. These challenges may include supply chain disruptions and commodity price volatility, resulting in increases in our cost of goods sold. Under the current tariff framework, the biggest areas of potential challenges for us are prestige fragrances shipped to the U.S. from our Barcelona plant, and the sourcing of various components and marketing materials from China. In response, we have evaluated more diversified sourcing strategies, strategic pricing adjustments and cost-reduction initiatives to help offset these pressures and protect our profitability. We are optimizing our supply chain to enhance resilience and agility in response to changing tariff

32

environments. We have successfully transitioned mass fragrance production—including key brands such as Adidas, Origen, and Nautica—as well as fragrance mists to our U.S. manufacturing site. Additional transfers of entry-level prestige fragrance products are planned for early in the third quarter of fiscal 2026, further optimizing U.S. capacity.

In the short term, we are accelerating dual sourcing for all entry-level prestige products by leveraging regional input materials, and future launches will be developed with dual production capabilities. We expect that any increases in our cost of goods sold will be balanced with minimal price adjustments to ensure competitiveness. On a longer-term basis, we are evaluating expanded regionalization strategies, including potential additional U.S. investments. We will also continue to collaborate with external partners to strengthen our domestic manufacturing capabilities, supporting our goal of a robust, U.S.-based supply chain.

We estimate additional costs related to tariff increases to be around approximately $70.0 before any mitigating actions taken by the Company. We expect that certain non-price related mitigating actions will offset $15.0-$20.0 of the impact from tariffs. The vast majority of these costs are expected to be incurred in fiscal 2026, based on analyses of announcements made by the U.S. administration including those on April 2, 2025 and on August 1, 2025, as well as announcements by U.S. trade partners. Despite our efforts, reductions in consumer confidence and discretionary spending could impact demand for our products and negatively affect our sales. We are closely monitoring developments, evaluating potential impacts, and proactively taking steps to mitigate adverse effects on our business.

Market Trends and Sales Performance

Changing market trends continue to impact sales of our products across and within product categories and geographic regions.

•Fragrances: We believe fragrances will remain a structurally advantageous category, supported by beauty category-leading brand loyalty, strong consumer demand, increasing usage, broader price points and formats, and expanding global penetration. In fiscal 2025, our fragrance category experienced low-single digit percentage net revenue growth compared to the previous fiscal year, driven by high-single digit percentage, but decelerating, growth in the overall fragrance market. Net revenues from prestige fragrances increased by a low-single digit percentage in fiscal 2025, reflecting a deceleration in growth compared to the prior year, as the contribution from our fragrance innovation this fiscal year was more moderate than the contribution from major innovations in the previous fiscal year. With a slate of new launches scheduled for fiscal 2026 and beyond, we believe that our prestige fragrances are strategically positioned to achieve sustained growth and strong momentum across key markets. Within our Consumer Beauty segment, we are planning exciting new fragrance launches and strategic retail partnerships, expanding our mass fragrance presence into value segments. By innovating with leading brands and leveraging high-performing digital channels, we believe we are well positioned to build awareness and fuel demand.

•Color Cosmetics: Our net revenues from mass color cosmetics declined by low-double digits percentage during the same period due to a weakening in market demand, particularly in the United States and in several European markets. Our net revenues from prestige color cosmetics declined by a double-digits percentage, impacted by economic conditions in Asia affecting a key brand in the region.

•Skin and Body Care: Our skincare portfolio contributed a mid-single digit percentage of our fiscal 2025 net revenue. Competitive pricing actions in Brazil negatively impacted demand for certain of our deodorant brands leading to a high-double digit percentage decline in our body care net revenues during fiscal 2025, despite positive trends in the overall mass body care market. Positive, but decelerating, market trends in Brazil have supported volumes in the overall Consumer Beauty business, despite having a negative impact on the segment’s gross and operating margins.

•Geographic Regions: Net revenue in the Americas declined by a high-single digit percentage during fiscal 2025, driven by softness within the color cosmetics market in the United States. Net revenue from EMEA increased by a low-single digit percentage due to decelerating growth across most European markets. Net revenue in the Asia Pacific region declined by a high-single digit percentage in fiscal 2025, impacted by continued economic challenges in China affecting certain of our brands, and a decline in sales in the Asia Travel Retail channel. Asia Travel Retail channel sales were negatively affected by regulatory restrictions in Asia aimed at formalizing cross-border shopping, which reduced daigou (surrogate shopping) purchases.

We expect that some of the market trends may continue into fiscal 2026.

Financial Outlook

33

We expect that our reported net revenue for the first half of fiscal 2026 will decline in the low-single digit percentage versus the prior year, which includes an estimated low-single digit percentage benefit from foreign exchange. We anticipate that our first half fiscal 2026 gross margin will be pressured as a result of lower sales as well as the net impact from tariffs, with some easing in the second half fiscal 2026 as a result of mitigation efforts. We are re-accelerating our cost reduction efforts across to deliver savings of approximately $80.0 in fiscal 2026. We expect that our reported net revenue for the second half fiscal 2026 will return to growth versus the prior year, supported by major launches across both our Prestige and Consumer Beauty segments and more favorable comparisons.

34

Selected Financial Data

35

Non-GAAP Financial Measures

To supplement the financial measures prepared in accordance with GAAP, we use non-GAAP financial measures for Coty Inc. including Adjusted operating income (loss), Adjusted EBITDA, Adjusted net income (loss), and Adjusted net income (loss) attributable to Coty Inc. to common stockholders (collectively, the “Adjusted Performance Measures”). The reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are shown in tables below. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of the business as determined in accordance with GAAP. Other companies, including companies in the beauty industry, may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.

Despite the limitations of these non-GAAP financial measures, our management uses the Adjusted Performance Measures as key metrics in the evaluation of our performance and annual budgets and to benchmark performance of our business against our competitors. The following are examples of how these Adjusted Performance Measures are utilized by our management:

•strategic plans and annual budgets are prepared using the Adjusted Performance Measures;

•senior management receives a monthly analysis comparing budget to actual operating results that is prepared using the Adjusted Performance Measures; and

•senior management’s annual compensation is calculated, in part, by using some of the Adjusted Performance Measures.

In addition, our financial covenant compliance calculations under our debt agreements are substantially derived from these Adjusted Performance Measures.

Our management believes that Adjusted Performance Measures are useful to investors in their assessment of our operating performance and the valuation of the Company. In addition, these non-GAAP financial measures address questions we routinely receive from analysts and investors and, in order to ensure that all investors have access to the same data, our management has determined that it is appropriate to make this data available to all investors. The Adjusted Performance Measures exclude the impact of certain items (as further described below) and provide supplemental information regarding our operating performance. By disclosing these non-GAAP financial measures, our management intends to provide investors with a supplemental comparison of our operating results and trends for the periods presented. Our management believes these measures are also useful to investors as such measures allow investors to evaluate our performance using the same metrics that our management uses to evaluate past performance and prospects for future performance. We provide disclosure of the effects of these non-GAAP financial measures by presenting the corresponding measure prepared in conformity with GAAP in our financial statements, and by providing a reconciliation to the corresponding GAAP measure so that investors may understand the adjustments made in arriving at the non-GAAP financial measures and use the information to perform their own analyses.

Adjusted operating income/Adjusted EBITDA excludes restructuring costs and business structure realignment programs, amortization, acquisition- and divestiture-related costs and acquisition accounting impacts, stock-based compensation, and asset impairment charges and other adjustments as described below. For adjusted EBITDA, in addition to the preceding, we exclude adjusted depreciation as defined below. We do not consider these items to be reflective of our core operating performance due to the variability of such items from period-to-period in terms of size, nature and significance. They are primarily incurred to realign our operating structure and integrate new acquisitions, and implement divestitures of components of our business, and fluctuate based on specific facts and circumstances. Additionally, Adjusted net income attributable to Coty Inc. and Adjusted net income attributable to Coty Inc. per common share are adjusted for certain interest and other (income) expense items, as described below, and the related tax effects of each of the items used to derive Adjusted net income as such charges are not used by our management in assessing our operating performance period-to-period.

Adjusted Performance Measures reflect adjustments based on the following items:

•Costs related to acquisition and divestiture activities: We have excluded acquisition- and divestiture-related costs and the accounting impacts such as those related to transaction costs and costs associated with the revaluation of acquired inventory in connection with business combinations because these costs are unique to each transaction. Additionally, for divestitures, we exclude write-offs of assets that are no longer recoverable and contract related costs due to the divestiture. The nature and amount of such costs vary significantly based on the size and timing of the acquisitions and divestitures, and the maturities of the businesses being acquired or divested. Also, the size, complexity and/or volume of past transactions, which often drives the magnitude of such expenses, may not be indicative of the size, complexity and/or volume of any future acquisitions or divestitures.

•Restructuring and other business realignment costs: We have excluded costs associated with restructuring and business structure realignment programs to allow for comparable financial results to historical operations and forward-looking

36

guidance. In addition, the nature and amount of such charges vary significantly based on the size and timing of the programs. By excluding the referenced expenses from our non-GAAP financial measures, our management is able to further evaluate our ability to utilize existing assets and estimate their long-term value. Furthermore, our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Asset impairment charges: We have excluded the impact of asset impairments as such non-cash amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Amortization expense: We have excluded the impact of amortization of finite-lived intangible assets, as such non-cash amounts are inconsistent in amount and frequency and are significantly impacted by the timing and/or size of acquisitions. Our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance. Although we exclude amortization of intangible assets from our non-GAAP expenses, our management believes that it is important for investors to understand that such intangible assets contribute to revenue generation. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such intangible assets have been fully amortized. Any future acquisitions may result in the amortization of additional intangible assets.

•Gain or loss on sale and early license termination: We have excluded the impact of gain or loss on sale and early license termination as such amounts are inconsistent in amount and frequency and are significantly impacted by the size of the sale and early license termination.

•Costs related to market exit: We have excluded the impact of direct incremental costs related to our decision to wind down our business operations in Russia. We believe that these direct and incremental costs are inconsistent and infrequent in nature. Consequently, our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Gains on sale of real estate: We have excluded the impact of gains on sale of real estate as such amounts are inconsistent in amount and frequency and are significantly impacted by the size of the sale. Our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Stock-based compensation: Although stock-based compensation is a key incentive offered to our employees, we have excluded the effect of these expenses from the calculation of adjusted operating income and adjusted EBITDA. This is due to their primarily non-cash nature; in addition, the amount and timing of these expenses may be highly variable and unpredictable, which may negatively affect comparability between periods.

•Depreciation and Adjusted depreciation: Our adjusted operating income excludes the impact of accelerated depreciation for certain restructuring projects that affect the expected useful lives of Property, Plant and Equipment, as such charges vary significantly based on the size and timing of the programs. Further, we have excluded adjusted depreciation, which represents depreciation expense net of accelerated depreciation charges, from our adjusted EBITDA. Our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Other (income) expense: We have excluded the impact of pension curtailment (gains) and losses and pension settlements as such events are triggered by our restructuring and other business realignment activities and the amount of such charges vary significantly based on the size and timing of the programs. Further, we have excluded the change in fair value of the investment in Wella, as well as expenses related to potential or actual sales transactions reducing equity investments, as our management believes these unrealized (gains) and losses do not reflect our underlying ongoing business, and the adjustment of such impact helps investors and others compare and analyze performance from period to period. Such transactions do not reflect our operating results and we have excluded the impact as our management believes that the adjustment of these items supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.

•Noncontrolling interest: This adjustment represents the after-tax impact of the non-GAAP adjustments included in Net income attributable to noncontrolling interests based on the relevant noncontrolling interest percentage.

•Tax: This adjustment represents the impact of the tax effect of the pretax items excluded from Adjusted net income. The tax impact of the non-GAAP adjustments is based on the tax rates related to the jurisdiction in which the adjusted items are received or incurred. Additionally, adjustments are made for the tax impact of any intra-entity transfer of assets and liabilities. Also, in connection with our market exit in Russia, we have adjusted for the release of tax charges previously taken related to certain direct incremental impacts of the decision.

37

Constant Currency

We operate on a global basis, with the majority of our net revenues generated outside of the U.S. Accordingly, fluctuations in foreign currency exchange rates can affect our results of operations. Therefore, to supplement financial results presented in accordance with GAAP, certain financial information is presented in “constant currency,” excluding the impact of foreign currency exchange translations to provide a framework for assessing how our underlying businesses performed excluding the impact of foreign currency exchange translations. Constant currency information compares results between periods as if exchange rates had remained constant period-over-period. We calculate constant currency information by translating current and prior-period results for entities reporting in currencies other than U.S. dollars into U.S. dollars using prior year foreign currency exchange rates. The constant currency calculations do not adjust for the impact of revaluing specific transactions denominated in a currency that is different to the functional currency of that entity when exchange rates fluctuate, or for the impacts of hyperinflation. The constant currency information we present may not be comparable to similarly titled measures reported by other companies.

Basis of Presentation of Acquisitions, Divestitures, Terminations and Market Exit from Russia

During the period when we complete an acquisition, divestiture, early license termination, or market exit, the financial results of the current year period are not comparable to the financial results presented in the prior year period. When explaining such changes from period to period and to maintain a consistent basis between periods, we exclude the financial contribution of: (i) the acquired brands or businesses in the current year period until we have twelve months of comparable financial results, and (ii) the divested brands or businesses or early terminated brands or markets exited in the prior year period, to maintain comparable financial results with the current fiscal year period. Acquisitions, divestitures, early license terminations, and market exits that would impact the comparability of financial results between periods presented in the Management’s Discussion and Analysis of Financial Condition and Results of Operations are shown in the table below.

When used herein, the term “Acquisitions,” “Divestitures,” “Terminations,” and “Market Exit,” refer to the financial contributions of the related acquisitions or divestitures, early license terminations, and market exits shown above, during the period that is not comparable as a result of such acquisitions or divestitures, early license terminations, and market exits.

NET REVENUES

Consolidated Fiscal 2025 as Compared with Fiscal 2024

In fiscal 2025, net revenues decreased 4%, or $225.1, to $5,892.9 from $6,118.0 in fiscal 2024. Excluding net revenue from the first half of the prior period from Lacoste, net revenues decreased 3% or $196.5 to $5,892.9 from $6,089.4, reflecting a decrease in unit volume of 2%, and a negative foreign currency exchange translation impact of 1%. The overall decrease in net revenues reflects declines within color cosmetics across both our Prestige and Consumer Beauty segments— primarily due to negative market trends in the United States, China, and across several European markets— and as a result of a decline in the Travel Retail Asia channel due to regulations impacting surrogate shopping purchases. The decline can also be attributed to mass body care in Brazil— primarily due to competitive pricing action in the Brazilian deodorant market— and from prestige skincare due to negative performance from certain brands. These declines were partially offset by growth in our prestige and mass fragrance categories due to the positive, but decelerating, market trends in most major markets and geographical expansion of certain brands. Net revenues declined in the Americas and Asia Pacific but grew within Europe, the Middle East and Africa (EMEA) region.

Digital and e-commerce channel sales declines also contributed to the decrease in net revenues.

38

Consolidated Fiscal 2024 as Compared with Fiscal 2023

In fiscal 2024, net revenues increased 10%, or $563.9, to $6,118.0 from $5,554.1 in fiscal 2023. Excluding net revenue from the first half of the prior period from Russia and the second half of the prior period from Lacoste, net revenues increased 12% or $654.3 to $6,118.0 from $5,463.7, reflecting a positive price and mix impact of 9%, an increase in unit volume of 2%, and a positive foreign currency exchange translation impact of 1%. The overall increase in net revenues reflects growth in our prestige fragrance category due to the continued success of fragrance brands, specifically Burberry, Hugo Boss, Calvin Klein, Gucci, Chloe, Davidoff, Joop, and Marc Jacobs, as well as innovation from the launches including Marc Jacobs Daisy Wild and Cosmic Kylie Jenner, and positive performance in the prestige cosmetics category. The overall increase in net revenues for the Consumer Beauty segment was due to positive performance in the color cosmetics category specifically from Rimmel Manhattan and Risque, mass fragrance category specifically from David Beckham and Bruno Banani, and the skin and body care categories in Brazil, specifically from Monange, Paixao and Bozzano.

The overall increase in net revenues reflects the continued success of our pricing and revenue management strategies, including the implementation of price increases across our product portfolio earlier in the fiscal year. Volume growth across our fragrance portfolio, as well as in skin and body care products in Brazil helped drive the increase in revenues, partially offset by volume declines from certain color cosmetic and other body care brands in China due to macroeconomic conditions which resulted in higher trade inventory levels.

Geographically, except for China, net revenues in all major markets grew, led by Brazil, the United States, and Germany. Additionally, there was an increase in travel retail channel sales in all regions.

Digital and e-commerce channel sales growth also contributed to the increase in net revenues.

Prestige

In fiscal 2025, net revenues in the Prestige segment decreased 1%, or $37.1 to $3,820.2 from $3,857.3 in fiscal 2024. Excluding net revenue from the first half of the prior period from Lacoste, net revenues remained relatively flat or decreased $8.5 to $3,820.2 from $3,828.7, reflecting a positive price and mix impact of 3% (primarily due to positive pricing impact as a result of prior year period price increases and in line with overall premiumization strategy), partially offset by a decrease in unit volume of 3% (primarily due to negative performance for prestige cosmetics brands) The decrease in net revenues primarily reflects:

•Prestige cosmetic sales declines of $55.3, primarily due to declines in sales volumes in the Asia Travel Retail channel from Gucci makeup and as a result of regulations impacting the surrogate shopping purchases, and declines in sales from Kylie makeup as a result of less innovations and negative market trends in the category; and

•Prestige skincare sales declines of $18.1, primarily due to negative performance from philosophy.

These decreases were partially offset by:

•Prestige fragrance sales growth of $64.9, due to successful performance from the existing fragrance lines of Burberry, Gucci, Chloe, and Hugo Boss. In addition, continued brand innovation such as Gucci Flora Gorgeous Orchid, Burberry Goddess Intense, Boss Bottled Absolu, Chloe Signature Intense, Kylie Cosmic 2.0, and Burberry Hero EDP Intense contributed to the category sales growth. The category sales growth was partially offset by declines in Calvin Klein due to a reduction in certain channel sales and tight inventory management from certain retailers, declines in Tiffany & Co. as a result of negative performance and no innovation in the current period, declines in philosophy resulting from negative performance, as well as due to the expiration of the Roberto Cavalli license in the prior year. The overall category sales growth from existing brands can also be attributed to positive, but decelerating, market trends in most major markets.

39

In fiscal 2024, net revenues in the Prestige segment increased 13%, or $436.8, to $3,857.3 from $3,420.5 in fiscal 2023. Excluding net revenue from the first half of the prior period from Russia and the second half of the prior period from Lacoste, net revenues increased 15% or $508.5 to $3,857.3 from $3,348.8, reflecting a positive price and mix impact of 8% (primarily due to the positive pricing impact as a result of price increases and in line with overall premiumization strategy), an increase in unit volume of 6% (primarily due to successful innovations and positive trends in the prestige fragrance category in many markets), and positive foreign currency exchange translation impact of 1%. The increase in net revenues primarily reflects:

•Prestige fragrance sales growth of $476.9, primarily due to the continued success of Burberry Goddess, Classic, Her and Hero, Hugo Boss, Boss Bottled and Boss the Scent, Calvin Klein One, Euphoria, and Eternity, Gucci Guilty and Flora, Chloe Nomade and Signature, Marc Jacobs Daisy Wild, Davidoff Cool Water, and Joop Homme, as well as continued brand innovation within the Gucci Flora franchise and Cosmic Kylie Jenner. Prestige fragrance sales grew in major markets such as the United States, Germany, Australia, and Spain as well as through travel retail channel sales across all regions. This growth was partially offset by lower net revenues for the Lacoste brand in the first six months of fiscal 2024, which was primarily due to the early license termination resulting in a wind down of sales through the end of the second quarter; and no net revenues for the Bottega Veneta brand in fiscal 2024 due to the ending of our licensing arrangement where sales of the brand ended in fiscal 2023; and

•Prestige cosmetic sales growth of $24.5, primarily due to brand innovation from Kylie Cosmetics.

Consumer Beauty

In fiscal 2025, net revenues in the Consumer Beauty segment decreased 8%, or $188.0, to $2,072.7 from $2,260.7 in fiscal 2024, reflecting a negative price and mix impact of 3% (primarily due to higher returns and discounts and promotions in the current period), a negative foreign currency exchange translation impact of 3% (primarily driven by the weakening of the Brazilian Real versus the U.S. dollar), and a decrease in unit volume of 2% (primarily due to negative performance for color cosmetics and body care brands, despite volume increases from most product categories in Brazil). The decrease in net revenues primarily reflects:

•Color cosmetics sales declines of $161.7, primarily due to negative market trends in the color cosmetics market in the United States which impacted net revenues from Covergirl, Sally Hansen, and Rimmel. Negative market trends for color cosmetics in several European markets also impacted net revenues from Max Factor, Bourjois, and Rimmel. Category net sales declines were also impacted by increased discounts and promotions compared to the prior period; and

•Mass body care sales declines of $61.4, primarily due to declines in sales volumes from Monange in Brazil due to competitive pricing action in the deodorant market and adidas due to declines in sales volumes in Mexico and Brazil.

These decreases were partially offset by:

•Mass fragrance sales growth of $27.9, due to geographical expansion of existing products from Nautica into growth-engine markets and brand innovation such as adidas Vibes; and

•Mass skincare sales growth of $7.2.

In fiscal 2024, net revenues in the Consumer Beauty segment increased 6%, or $127.1, to $2,260.7 from $2,133.6 in fiscal 2023. Excluding net revenue from the second half of the prior period from Russia, net revenues increased 7% or $145.8 to $2,260.7 from $2,114.9, reflecting a positive price and mix impact of 5% (primarily due to the positive pricing impact as a result of price increases), an increase in unit volume of 1% (primarily due to increases from Brazilian brands offsetting decreases in volumes in most other markets), and a positive foreign currency exchange translation impact of 1%. The increase in net revenues primarily reflects:

•Color cosmetics sales growth of $51.4, primarily due to the continued success of Rimmel Manhattan which saw continued brand innovation, such as Lasting Finish foundation and Thrill Seeker mascara, and Risque due to strong category momentum in Brazil and positive pricing impact, despite a category slowdown in the U.S.;

•Mass fragrance sales growth of $46.3, due to the continued success from the re-launch of David Beckham Instinct in fiscal 2024 and success of Bruno Banani; and

•Skin and body care sales growth of $44.6, due to the continued success of Brazilian brands Monange, Bozzano, and Paixao benefiting from strong category momentum and positive pricing impact. This growth was partially offset by lower sales volume for adidas primarily as a result of category slowdown in China which resulted in higher trade inventory levels.

40

COST OF SALES

In fiscal 2025, cost of sales decreased 5%, or $106.8, to $2,072.0 from $2,178.8 in fiscal 2024. Cost of sales as a percentage of net revenues decreased to 35.2% in fiscal 2025 from 35.6% in fiscal 2024 resulting in a gross margin percentage increase of approximately 40 basis points, primarily reflecting:

(i)approximately 40 basis points related to a decrease in excess and obsolescence costs; and

(ii)approximately 20 basis points related to a decrease in manufacturing and material costs as a percentage of net revenues, driven by increased manufacturing efficiencies, improvements in productivity, as well as procurement and material cost optimization.

The above reflects a positive impact from pricing net of inflation of approximately 70 basis points. Despite an overall improvement, our gross margin percentage was negatively impacted by an increase in discounts and promotions— which rose by approximately 100 basis points. This increase negatively impacted cost of sales absorption, including excess and obsolescence costs as well as manufacturing and material costs previously discussed.

In fiscal 2024, cost of sales increased 9%, or $172.0, to $2,178.8 from $2,006.8 in fiscal 2023. Cost of sales as a percentage of net revenues decreased to 35.6% in fiscal 2024 from 36.1% in fiscal 2023 resulting in a gross margin percentage increase of approximately 50 basis points primarily reflecting:

(i)approximately 80 basis points related to a decrease in manufacturing and material costs as a percentage of net revenues, driven by increased manufacturing efficiencies, improvements in productivity, as well as procurement and material cost optimization; and

(ii)approximately 50 basis points related to decreased freight costs.

These increases were partially offset by:

(i)approximately 50 basis points related to an increase in excess and obsolescence costs across various subcategories within the Prestige and Consumer Beauty product portfolios; and

(ii)approximately 30 basis points related to an increase in designer license fees due to licensed Prestige brands comprising a larger portion of overall net revenues in the current period as well as favorable royalty activity in the prior period, which did not reoccur in the current period.

The above reflects a positive impact from pricing net of inflation of approximately 160 basis points.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

In fiscal 2025, selling, general and administrative expenses decreased 2%, or $59.0, to $3,103.4 from $3,162.4 in fiscal 2024. Selling, general and administrative expenses as a percentage of net revenues increased to 52.7% in fiscal 2025 from 51.7% in fiscal 2024, or approximately 100 basis points. This increase was primarily due to:

(i)120 basis points primarily due to the loss on the termination of the KKW Collaboration Agreement in the current period;

(ii)120 basis points primarily due to an increase in administrative costs as a percentage of net revenues;

(iii)30 basis points due to an increase in other general expenses; and

(iv)20 basis points due to unfavorable transactional impact from our exposure to foreign currency as a percentage of net revenues.

These increases were partially offset by the following decreases:

(i)150 basis points due to a decrease in discretionary compensation expense for employees; and

(ii)60 basis points due to a decrease in stock-based compensation cost primarily related to a reduction in expense recognized in connection with awards granted to the CEO.

In fiscal 2024, selling, general and administrative expenses increased 12%, or $344.1, to $3,162.4 from $2,818.3 in fiscal 2023. Selling, general and administrative expenses as a percentage of net revenues increased to 51.7% in fiscal 2024 from 50.7% in fiscal 2023, or approximately 100 basis points. This increase was primarily due to:

(i)220 basis points due to a decrease in net gains in the current period compared to the prior year related to the early termination of the Lacoste license;

(ii)40 basis points due to an increase in bad debt expense as a percentage of net revenues.

These increases were partially offset by the following decreases:

41

(i)100 basis points due to a decrease in stock-based compensation cost primarily related to a reduction in expense recognized in connection with awards granted to the CEO;

(ii)30 basis points due to a decrease in logistics costs as a percentage of net revenues; and

(iii)30 basis points due to favorable transactional impact from our exposure to foreign currency as a percentage of net revenues.

OPERATING INCOME (LOSS)

In fiscal 2025, operating income was $241.1 compared to income of $546.7 in fiscal 2024. Operating income as a percentage of net revenues decreased to 4.1% in fiscal 2025 as compared to Operating income as a percentage of net revenues of 8.9% in fiscal 2024. The decreased operating margin is largely driven by the asset impairment charges (approximately 360 basis points), a loss on the termination of the KKW Collaboration Agreement (approximately 120 basis points), higher restructuring costs in the current period (approximately 70 basis points), an increase in unfavorable transactional impact from our exposure to foreign currency (approximately 20 basis points), and an increase in other general expenses (approximately 20 basis points), partially offset by a decrease in stock-based compensation expense (approximately 60 basis points) primarily related to a reduction in expense with a prior year’s grant made to the CEO, lower cost of goods sold as a percentage of net revenues (approximately 40 basis points) and a decrease in fixed costs as a percentage of net revenues (approximately 20 basis points) primarily related to decreased discretionary compensation for employees offsetting increased administrative costs. In addition, a greater proportion of total sales came from higher margin Prestige brands in the current year which positively benefited our operating margin.

In fiscal 2024, operating income was $546.7 compared to income of $543.7 in fiscal 2023. Operating income as a percentage of net revenues decreased to 8.9% in fiscal 2024 as compared to Operating income as a percentage of net revenues of 9.8% in fiscal 2023. The worsened operating margin is largely driven by gains from the early termination of the Lacoste license in the prior year (approximately 200 basis points), higher restructuring costs as a percentage of net revenues (approximately 70 basis points), partially offset by lower stock-based compensation expense (approximately 100 basis points) primarily related to a reduction in expense recognize in connection with grants made to the CEO, lower cost of sales as a percentage of net revenues (approximately 50 basis points), lower amortization expense as a percentage of net revenues (approximately 30 basis points), and lower fixed costs as a percentage of net revenues (approximately 30 basis points) primarily related to non-people costs. In addition, the greater proportion of Consumer Beauty net revenues, including a greater proportion of revenues from our Brazilian business were from lower margin Brazil brands, compared to the prior year, negatively impacted our consolidated operating income margin.

Operating Income (Loss) by Segment

Prestige

In fiscal 2025, operating income for Prestige was $580.6 compared to income of $580.7 in fiscal 2024. Operating margin improved to 15.2% of net revenues in fiscal 2025 as compared to 15.1% in fiscal 2024, driven primarily by lower costs of goods sold as a percentage of net revenues (approximately 100 basis points), lower fixed costs as a percentage of net revenues (approximately 30 basis points) primarily related to decreased discretionary compensation for employees offsetting increased administrative costs, partially offset by asset impairment charges (approximately 110 basis points) and an increase in other general expenses (approximately 20 basis points). Our prestige operating income margin was positively impacted by a higher proportion of net revenues generated by the higher margin fragrance brands.

In fiscal 2024, operating income for Prestige was $580.7 compared to income of $483.7 in fiscal 2023. Operating margin improved to 15.1% of net revenues in fiscal 2024 as compared to 14.1% in fiscal 2023, driven primarily by lower amortization expense as a percentage of net revenues (approximately 40 basis points), lower cost of sales as a percentage of net revenues (approximately 40 basis points), lower fixed costs as a percentage of net revenues (approximately 30 basis points) primarily related to non-people costs.

42

Consumer Beauty

In fiscal 2025, operating loss for Consumer Beauty was $127.4 compared to income of $89.3 in fiscal 2024. Operating margin worsened to (6.1)% of net revenues in fiscal 2025 as compared to 4.0% in fiscal 2024, primarily driven by asset impairment charges (approximately 820 basis points), higher costs of goods sold as a percentage of net revenues (approximately 100 basis points), an increase in other general expenses (approximately 80 basis points), and higher advertising and consumer promotion expense as a percentage of net revenues (approximately 40 basis points), partially offset by lower fixed costs as a percentage of net revenues (approximately 40 basis points) primarily related to decreased discretionary compensation for employees offsetting increased administrative costs. Our Consumer Beauty operating margin was negatively impacted by a greater proportion of net revenues generated by the lower margin brands in Brazil compared to the prior year.

In fiscal 2024, operating income for Consumer Beauty was $89.3 compared to income of $63.3 in fiscal 2023. Operating margin improved to 4.0% of net revenues in fiscal 2024 as compared to 3.0% in fiscal 2023, primarily driven by lower advertising and consumer promotion expense as a percentage of net revenues (approximately 30 basis points) primarily due to lower spend in offline consumer engagement and lower transactional foreign exchange losses as a percentage of net revenues (approximately 30 basis points).

Corporate

Corporate primarily includes expenses not directly relating to our operating activities. These items are included in Corporate since we consider them to be corporate responsibilities, and these items are not used by our management to measure the underlying performance of the segments.

Operating loss for Corporate was $212.1, $123.3 and $3.3 in fiscal 2025, 2024 and 2023, respectively, as described under “Adjusted Operating Income (Loss) by Segment” below. The operating loss of $212.1 in fiscal 2025 increased in comparison to the prior year primarily driven by the loss on the termination of the KKW Collaboration Agreement of $71.0, $55.2 related to an increase in restructuring and business realignment costs in the current period, partially offset by a decrease of $38.8 in stock compensation expense in the current period.

The operating loss of $123.3 in fiscal 2024 primarily includes stock based compensation of $88.8 and restructuring and business realignment costs of $36.6.

The operating loss of $3.3 in fiscal 2023 includes stock-based compensation of $135.9, partially offset by gains related to the early termination of the Lacoste fragrance license of $104.4, gains related to the market exit in Russia of approximately $17.0, and gains on sale of real estate of $4.9.

Adjusted Operating Income (Loss) by Segment

We believe that adjusted operating income (loss) by segment further enhances an investor’s understanding of our performance. See “Overview—Non-GAAP Financial Measures.” A reconciliation of reported operating income (loss) to Adjusted operating income is presented below, by segment:

43

(a)See a reconciliation of reported net income to operating income (loss) to adjusted operating income (loss) and adjusted EBITDA for Coty Inc. and reconciliations of segment operating income (loss) to segment adjusted operating income (loss) and segment adjusted EBITDA for the Prestige, Consumer Beauty and Corporate segments with a description of the adjustments under “Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc.” and “Segment Operating Income (Loss), Segment Adjusted Operating Income (Loss) and Segment Adjusted EBITDA”, below. All adjustments are reflected in Corporate, except for amortization and asset impairment charges on goodwill, indefinite-lived intangible assets, and finite-lived intangible assets, which are reflected in the Prestige and Consumer Beauty segments.

Net Income, Adjusted Operating Income and Adjusted EBITDA for Coty Inc.

Adjusted operating income and adjusted EBITDA provide investors with supplementary information relating to our performance. See “Overview—Non-GAAP Financial Measures.” Reconciliation of reported operating loss to adjusted operating income (loss) is presented below:

In fiscal 2025, adjusted operating income was $852.9 compared to income of $863.4 in fiscal 2024. Adjusted operating margin increased to 14.5% of net revenues in fiscal 2025 as compared to 14.1% in fiscal 2024. In fiscal 2025, adjusted EBITDA was $1,081.7 compared to $1,091.1 in fiscal 2024. Adjusted EBITDA margin increased to 18.4% of net revenues in 2025 as compared to 17.8% in fiscal 2024.

44

In fiscal 2024, adjusted operating income was $863.4 compared to an income of $738.8 in fiscal 2023. Adjusted operating margin increased to 14.1% of net revenues in fiscal 2024 as compared to 13.3% in fiscal 2023. In fiscal 2024, adjusted EBITDA was $1,091.1 compared to $972.8 in fiscal 2023. Adjusted EBITDA margin increased to 17.8% of net revenues in 2024 as compared to 17.5% in fiscal 2023.

Segment Operating Income (Loss), Segment Adjusted Operating Income (Loss) and Segment Adjusted EBITDA

Operating Income, Adjusted Operating Income and Adjusted EBITDA - Prestige Segment

Operating Income, Adjusted Operating Income and Adjusted EBITDA - Consumer Beauty Segment

45

Operating Loss, Adjusted Operating Loss and Adjusted EBITDA - Corporate Segment

Amortization Expense

In fiscal 2025, amortization expense decreased to $186.9 from $193.4 in fiscal 2024.

In fiscal 2024, amortization expense increased to $193.4 from $191.8 in fiscal 2023.

Restructuring and Other Business Realignment Costs

During the third quarter of fiscal 2025, we formulated a new plan, which was announced on April 24, 2025, to strengthen our operating model and simplify our fixed cost structure (the “Fixed Cost Reduction Plan”). Cash costs associated with the program include restructuring and business structure realignment costs and are expected to be approximately $80.0, roughly evenly split between fiscal 2026 and fiscal 2027. We incurred approximately $5.0 of cash costs life-to-date as of June 30, 2025, which have been recorded in Corporate.

In fiscal 2025, we incurred restructuring and other business structure realignment costs of $91.8, as follows:

•We incurred restructuring costs of $76.7, of which $75.0 related to the Fixed Cost Reduction Plan, included in the Consolidated Statement of Operations; and

•We incurred business structure realignment costs of $15.1 which are reported in selling, general and administrative expenses and cost of sales, primarily related to the Fixed Cost Reduction Plan.

In fiscal 2024, we incurred a credit in restructuring and other business structure realignment costs of $36.6, as follows:

•We incurred restructuring costs of $36.7 primarily related to the Restructuring Actions, included in the Consolidated Statements of Operations and

•We incurred a credit in business structure realignment costs of $(0.1) which is reported in selling, general and administrative expenses.

In fiscal 2023, we incurred a credit in restructuring and other business structure realignment costs of $(6.3), as follows:

•We incurred a credit in restructuring costs of $(6.5) primarily related to the Transformation Plan, included in the Consolidated Statements of Operations and

•We incurred business structure realignment costs of $0.2 primarily related to our Transformation Plan. This amount includes $0.9 reported in cost of sales in the Consolidated Statement of Operations, and a credit of $(0.7) reported in selling, general and administrative expenses.

46

In all reported periods, all restructuring and other business realignment costs were reported in Corporate.

Stock-based compensation

In fiscal 2025, stock-based compensation was $50.0 as compared with $88.8 in fiscal 2024. The decrease in stock-based compensation is primarily related to a reduction in expense recognized in connection with awards granted to the CEO.

In fiscal 2024, stock-based compensation was $88.8 as compared with $135.9 in fiscal 2023. The decrease in stock-based compensation is primarily related to a reduction in expense recognized in connection with awards granted to the CEO.

In all reported periods, all costs related to stock-based compensation were reported in Corporate.

Asset Impairment Charges

In fiscal 2025, we incurred $212.8 of asset impairment charges of which $84.0, $61.0, and $24.9 related to the Max Factor, CoverGirl and Bourjois trademarks, respectively, totaling $169.9 within the Consumer Beauty segment and $42.9 related to the Philosophy trademark within the Prestige Segment.

In fiscal 2024 and 2023, we did not incur any asset impairment charges.

For further detail as to the factors resulting in the asset impairment charges, see Note 9 —Goodwill and Other Intangible Assets, net to the Consolidated Financial Statements.

Early License Termination and Market Exit Costs

In fiscal 2025, we incurred a net loss of $71.0 related to the loss on the termination of the KKW Collaboration Agreement and recognized a gain of $(0.7) related to our decision to wind down our business in Russia.

In fiscal 2024, we recognized a gain of $(0.5) related to the early termination of a license and our decision to wind down our business in Russia.

In fiscal 2023, we recognized gains of $(121.4) related to the early termination of a license and our decision to wind down our business operations in Russia.

Gains on Sale of Real Estate

In fiscal 2025, we recognized no gains related to sale of real estate.

In fiscal 2024, we recognized gains of $1.6 related to sale of real estate, which was reported in Corporate.

In fiscal 2023, we recognized gains of $4.9 related to the sale of real estate, which was reported in Corporate.

INTEREST EXPENSE, NET

Net interest expense was $214.2, $252.0, and $257.9 in fiscal 2025, fiscal 2024 and fiscal 2023, respectively. In fiscal year 2025, the decrease in interest expense is primarily due to lower average debt balances in the current period, lower average interest rates primarily reflecting positive impact from cross-currency swaps in reducing interest expense, as well as due to lower losses on foreign exchange forward contracts on the Euro as compared to the prior year. In fiscal year 2024, the decrease in interest expense is primarily due to lower debt balances compared to fiscal 2023 despite higher interest rates.

OTHER EXPENSE (INCOME), NET

In fiscal 2025, net other expense was $371.7, was principally comprised of net losses on forward repurchase contracts of $291.7, and unfavorable fair market value adjustment related to our equity investment in Wella of $83.0.

In fiscal 2024, net other expense was $90.2, was principally comprised of net losses on forward repurchase contracts of $124.2, partially offset by a favorable adjustment for the unrealized gain in the Wella investment of $25.0.

In fiscal 2023, net other income was $419.0, primarily related to a favorable adjustment for the unrealized gain in the Wella investment of $230.0 and unrealized gain on forward repurchase contracts of $196.9 partially offset by associated fees of $28.2.

INCOME TAXES

The following table presents our (benefit) provision for income taxes, and effective tax rates for the periods presented:

47

The (1.6)% effective tax rate in fiscal 2025 results from reporting losses before income taxes and a provision for income taxes. The unfavorable impacts to the rate were primarily driven by the following items:

•a 28.4% unfavorable impact to the effective tax rate due to an increase in valuation allowances recorded on interest expense carryforwards and the capital loss realized as a result of the sale of its investment in KKW Holdings during the period, compared with a 19.0% unfavorable impact in the prior period;

•a 9.9% unfavorable impact to the effective tax rate due to changes in unrecognized tax benefits primarily related to new reserves for benefits realized as a result of a tax recovery benefit in Brazil, compared to a favorable impact of 7.6% in the prior period;

•a 12.7% unfavorable impact to the effective tax rate as a result of various permanent differences including US foreign income inclusions.

These unfavorable rate drivers were partially offset by the following favorable rate drivers:

•a 22.8% favorable impact to the effective tax rate due to benefits realized as a result of a tax recovery benefit in Brazil (a majority of which are offset by the unrecognized tax benefit impact described above);

•a 9.0% favorable impact due to a tax deductible impairment in Switzerland on its investment in subsidiaries.

The 46.5% effective tax rate in fiscal 2024 results from reporting income before taxes and a provision for income taxes. The unfavorable impacts to the rate were primarily driven by the following items:

•a 19.0% unfavorable impact from an increase in valuation allowances recorded primarily on interest expense carryforwards;

•a 13.5% unfavorable impact due to changes to the net deferred taxes recognized on the assignment of strategic service functions from Amsterdam to Geneva, as an indirect result of the required revaluation of the original transfer of the main principal location from Geneva to Amsterdam in fiscal 2021;

•an 11.8% unfavorable impact from the revaluation of our deferred tax liabilities due to a tax rate increase enacted in Switzerland; and

•a 10.2% unfavorable impact in the foreign tax rate differential impact primarily due to fair value gains related to the investment in the Wella business taxed at a lower rate as compared to our U.S. Federal statutory rate of 21%.

These unfavorable rate drivers were partially offset by the following favorable rate drivers:

•an 18.5% favorable impact as a result of the issuance of non-refundable income tax credits received from the Swiss Tax Authorities of $97.1. The Company recorded a benefit for the tax credit of $37.8, net of a valuation allowance; and

•a 7.6% favorable impact from a reduction of foreign tax audits due to the settlement of foreign tax audits.

The Company has significant income in jurisdictions such as Germany, Netherlands, France, and Spain which have statutory tax rates higher than the U.S. Federal statutory rate of 21%. The impact of the foreign earnings in higher taxed jurisdictions coupled with U.S. losses at the statutory tax rate of 21% increases the Company’s effective tax rate. This jurisdictional mix is expected to have a continuing impact on the effective tax rate.

The effective rates vary from the U.S. Federal statutory rate of 21% due to the effect of (i) jurisdictions with different statutory rates, (ii) adjustments to our unrecognized tax benefits and accrued interest, (iii) non-deductible expenses, (iv) audit settlements and (v) valuation allowance changes. Our effective tax rate could fluctuate significantly and could be adversely affected to the extent earnings are lower than anticipated in countries that have lower statutory rates and higher than anticipated in countries that have higher statutory rates.

48

Reconciliation of Reported Income (Loss) Before Income Taxes to Adjusted Income (Loss) Before Income Taxes and Effective Tax Rates:

(a)See a description of adjustments under “Adjusted Operating Income (Loss) for Coty Inc.”

(b)The tax effects of each of the items included in adjusted income are calculated in a manner that results in a corresponding income tax benefit/provision for adjusted income. In preparing the calculation, each adjustment to reported income is first analyzed to determine if the adjustment has an income tax consequence. The provision for taxes is then calculated based on the jurisdiction in which the adjusted items are incurred, multiplied by the respective statutory rates and offset by the increase or reversal of any valuation allowances commensurate with the non-GAAP measure of profitability. In connection with our decision to wind down our operations in Russia, we recognized tax charges related to certain direct incremental impacts of our decision, which are reflected in this amount, in fiscal 2025, fiscal 2024 and fiscal 2023.

(c) In fiscal 2024, the total tax impact on adjustments includes a tax expense of $27.6 due to changes to the net deferred taxes recognized on the assignment of strategic service functions from Amsterdam to Geneva, as an indirect result of the required revaluation of the original transfer of the main principal location from Geneva to Amsterdam in fiscal 2021. The total tax impact on adjustments also includes a tax benefit of $10.0, $1.1, and $0.4 for fiscal 2025, fiscal 2024, and fiscal 2023, respectively, recorded as the result of the Company’s exit from Russia.

(d)The amount represents the unrealized (gain) loss recognized for the change in fair value of the investment in Wella.

(e)See “Reconciliation of Reported Net Income (Loss) Attributable to Coty Inc. to Adjusted Net Income (Loss) Attributable to Coty Inc.”

The adjusted effective tax rate was 35.1% compared to 26.5% in the prior-year period. The differences were primarily due to an increase in valuation allowances recorded on interest expense carryforwards in the current period. Cash paid during the years ended June 30, 2025, 2024 and 2023, for income taxes was $95.4, $172.6 and $58.6, respectively.

NET INCOME (LOSS) ATTRIBUTABLE TO COTY INC.

In fiscal 2025, net loss attributable to Coty Inc. was $367.9 compared to income of $89.4 in fiscal 2024. The increase in net loss was primarily driven by asset impairment charges of $212.8, higher net losses on forward repurchase contracts of $167.5, lower gross profit of $118.3, higher losses from equity investments of $108.0 as a result of unfavorable fair value market adjustment in the current period compared to favorable adjustments in the prior year period, and higher restructuring costs of $40.0, partially offset by a lower provision for income taxes of $89.7 in the current period, lower selling, general and administrative expenses of $59.0, and lower interest expense of $37.8.

In fiscal 2024, net income attributable to Coty Inc. was $89.4 compared to income of $508.2 in fiscal 2023. The net income increase was primarily driven by losses from forward repurchase contracts of $124.2 compared to gains of $168.7 in the prior year and a lower favorable adjustment of $205.0 related to the unrealized gain in the Wella investment in the current year.

49

ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO COTY INC.

We believe that adjusted net income (loss) attributable to Coty Inc. provides an enhanced understanding of our performance. See “Overview—Non-GAAP Financial Measures.”

(a)Diluted EPS is adjusted by the effect of dilutive securities, including awards under the Company's equity compensation plans, the convertible Series B Preferred Stock and the Forward Repurchase Contracts, if applicable. When calculating any potential dilutive effect of stock options, Series A Preferred Stock, restricted stock, PRSUs and RSUs, the Company uses the treasury method and the if-converted method for the Convertible Series B Preferred Stock and the Forward Repurchase Contracts. The treasury method typically does not adjust the net income attributable to Coty Inc., while the if-converted method requires an adjustment to reverse the impact of the preferred stock dividends and the impact of fair market value (gains)/losses for contracts with the option to settle in shares or cash, if dilutive, on net income applicable to common stockholders during the period.

(b)See a description of adjustments under “Adjusted Operating Income (Loss) for Coty Inc.”

(c)In fiscal 2025, 2024, and 2023, the amount represents the unrealized (gain) loss recognized for the change in fair value of the investment in Wella.

(d)In fiscal 2025, the amount includes recovery of previously written-off non-income tax credits, the amortization of basis differences in certain equity method investments, and net loss on the sale of an equity investment. In fiscal 2024, the amount includes recovery of previously written-off non-income tax credits and the amortization of basis differences in certain equity method investments. In fiscal 2023, the amount includes the amortization of basis differences in certain equity method investments and pension curtailment gains.

(e)The amounts represent the after-tax impact of the non-GAAP adjustments included in Net (loss) income attributable to noncontrolling interests based on the relevant noncontrolling interest percentage in the Consolidated Statements of Operations.

(f)As of June 30, 2025, 2024 and 2023, 23.7 million dilutive shares of Convertible Series B Preferred Stock were excluded in the computation of adjusted weighted-average diluted shares because their effect would be anti-dilutive.

50

Quarterly Results of Operations Data

The following tables set forth our unaudited quarterly consolidated statements of operations data for each of the eight quarters in the periods ended June 30, 2025. We have prepared the quarterly consolidated statements of operations data on a basis consistent with the consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. In the opinion of management, the financial information reflects all adjustments, consisting only of normal recurring adjustments, which we consider necessary for a fair presentation of this data. This information should be read in conjunction with the consolidated financial statements and related notes included in Part II, Item 8, “Financial Statements and Supplementary Data” in this Annual Report. The results of historical periods are not necessarily indicative of the results of operations for any future period.

(a)The outstanding stock options and Series A Preferred Stock with purchase or conversion rights to purchase shares of Common Stock, RSUs, Convertible Series B Preferred Stock, and Forward Repurchase Contracts were excluded in the computation of diluted shares when their effect would be antidilutive.

51

FINANCIAL CONDITION

LIQUIDITY AND CAPITAL RESOURCES

Overview

Our primary sources of funds include cash expected to be generated from operations, borrowings from issuance of debt and lines of credit provided by banks and lenders in the U.S. and abroad.

Our cash flows are subject to seasonal variation throughout the year, including demands on cash made during our first fiscal quarter in anticipation of higher global sales during the second fiscal quarter and strong cash generation in the second fiscal quarter as a result of increased demand by retailers associated with the holiday season.

Our principal uses of cash are to fund planned operating expenditures, capital expenditures, interest payments, dividends, share repurchases, any principal payments on debt, and from time to time, acquisitions, and business structure realignment expenditures. Working capital movements are influenced by the sourcing of materials related to the manufacturing of products. Cash and working capital management initiatives, including the phasing of vendor and tax payments and factoring of trade receivables from time-to-time, may also impact the timing and amount of our operating cash flows.

We remain focused on deleveraging our balance sheet using cash flows generated from our operations. We continue to take steps to permanently reduce our debt, in order to reduce interest costs and improve our long term profitability and cash flows. Our 25.84% investment in Wella gives us the opportunity for further permanent debt reductions when our equity position is divested.

We have substantially completed the exit of our commercial activities in Russia. However, we anticipate that the process related to the liquidation of the Russian legal entity will take an extended period of time. We anticipate that we will incur an immaterial amount of additional costs through the completion of the wind down, and future net cash costs of $1.0 to $1.5, which will be funded by our Russian subsidiary. The amount of future costs, including cash costs, will be subject to various factors, such as additional government regulation and the resolution of legal contingencies.

Recent changes in U.S. and international trade policies—particularly tariff increases—and the ongoing uncertainty surrounding such policies may present challenges to our business operations and financial condition. These challenges may include supply chain disruptions and commodity price volatility, resulting in increases in our cost of goods sold. Under the current tariff framework, the biggest areas of potential challenges for us are prestige fragrances shipped to the U.S. from our Barcelona plant, and the sourcing of various components and marketing materials from China. We estimate additional costs related to tariff increases to be around approximately $70.0 before any mitigating actions taken by the Company. We expect that certain non-price related mitigating actions will offset $15.0-$20.0 of the impact from tariffs. The vast majority of these costs are expected to be incurred in fiscal 2026, based on analyses of announcements made by the U.S. administration including those on April 2, 2025 and on August 1, 2025, as well as announcements by U.S. trade partners. In response, we may consider more diversified sourcing and production strategies, strategic pricing adjustments and cost-reduction initiatives to help offset these pressures and protect our profitability. In addition, reductions in consumer confidence and discretionary spending could impact demand for our products and negatively affect our sales. We are closely monitoring developments, evaluating potential impacts, and proactively taking steps to mitigate adverse effects on our business.

During the third quarter of fiscal 2025, we formulated a new plan, which was announced on April 24, 2025, to strengthen our operating model and simplify our fixed cost structure (the “Fixed Cost Reduction Plan”). Cash costs associated with the program include restructuring and business structure realignment costs and are expected to be approximately $80.0, roughly evenly split between fiscal 2026 and fiscal 2027. We incurred approximately $5.0 of cash costs life-to-date as of June 30, 2025, which have been recorded in Corporate.

52

Debt Financing

We are in the process of deleveraging our company and improving the maturity mix of our debt, including through refinancing or repayment of a portion of our debt. We expect to continue to take actions to improve the maturity mix of our debt, including through refinancings or new issuances of notes, as well as redemptions and/or tender offers for near-dated maturities, from time to time as market conditions permit.

We have taken action to reduce variability in our interest payments including paying down variable interest rate debt outstanding under our 2018 Coty Term A and 2018 Coty Term B Facility and issuing fixed rate bonds. While our revolving credit facility, which we draw on from time to time, is subject to variable interest rates, all of our other long-term debt outstanding as of June 30, 2025 is fixed rate debt.

Our 2026 Dollar Senior Secured Notes due April 2026 and the 2026 Euro Senior Secured Notes due April 2026 had amounts outstanding of $350.0 and €700.0 million, respectively, as of June 30, 2025. These notes are scheduled to mature in fiscal 2026. We intend to refinance on a long-term basis from borrowings under our existing revolving credit facility or through the issuance of new notes subject to financial market conditions.

See Note 12—Debt in the notes to our Consolidated Financial Statements for additional information on our debt arrangements and prior period credit agreements, as well as definitions of capitalized terms.

Share Repurchases

In connection with our Share Repurchase Program, we entered into forward repurchase contracts in June 2022, December 2022, and November 2023 with three large financial institutions to hedge for $200.0, and a potential $196.0 and $294.0 of share repurchases in 2024, 2025 and 2026, respectively. We physically settled the June 2022 forward repurchase contracts by delivering approximately $200.0 cash in exchange for 27.0 million shares of our Class A Common Stock during fiscal 2024.

Our remaining forward repurchase contracts permit a net cash settlement alternative in addition to the physical settlement. We may elect net cash settlement of all, or some of the remaining forward repurchase contracts based on factors such as timing, the market value of the underlying shares at the settlement date and other internal cash management considerations. In addition, based on these factors, we continue to evaluate the potential timing and options for settlement of these forward repurchase contracts, including whether to extend, terminate early or settle at maturity. We will continue to incur costs associated with the remaining forward repurchase contracts before settlement. Cash costs incurred in the current fiscal year to date for all forward repurchase contracts amounted to $35.5.

Our forward repurchase contracts include a provision for a potential true-up in cash upon specified changes in the price of Coty’s Class A Common Stock relative to the counterparties’ initial purchase price (the “Hedge Valuation Adjustment”). In October 2024, the price of Coty’s Class A Common Stock declined, resulting in a potential Hedge Valuation Adjustment event under the November 2023 forward repurchase contracts, with a corresponding potential cash true-up obligation. During the second quarter of fiscal 2025, we paid $61.8 to the counterparties, which was refunded to us during the same period after entering into agreements with the applicable counterparties in November 2024 for a temporary contractual amendment to the November 2023 forward repurchase contracts' Hedge Valuation Adjustment mechanism.

The amendments were effective from October 2024 to February 2025 and did not apply to the forward repurchase contracts executed in December 2022. The share price further declined during the amendment period, triggering cash settlements under our December 2022 and November 2023 forward repurchase contracts of $191.1, in February 2025.

A reduction in the price of Coty’s Class A Common Stock in August 2025 triggered additional payments under our remaining forward repurchase contracts. We estimate making future cash payments to the counterparties of $54.0. Future reductions in the price of Coty’s Class A Common Stock may trigger additional payments under our remaining forward repurchase contracts. See Footnote 17— Derivative Instruments and Footnote 19—Equity and Convertible Preferred Stock for additional information on the Company's forward repurchase contracts.

Factoring of Receivables

From time to time, we supplement the timing of our cash flows through the factoring of trade receivables. In this regard, we have entered into factoring arrangements with financial institutions.

The net amount factored under the factoring facilities was $211.8 and $195.3 as of June 30, 2025 and 2024, respectively. The aggregate (gross) amount of trade receivable invoices factored on a worldwide basis amounted to $1,568.9 and $1,534.3 in fiscal 2025 and 2024, respectively. Remaining balances due from factors amounted to $3.8 and $10.0 as of June 30, 2025 and 2024, respectively.

53

Cash Flows

Net cash provided by operating activities

Net cash provided by operating activities was $492.6, $614.6 and $625.7 for fiscal 2025, 2024 and 2023, respectively.

The decrease in cash provided by operating activities of $122.0 in fiscal 2025 as compared with fiscal 2024 was mainly driven by the impact of higher cash outflows from working capital, primarily reflecting changes in accounts payable and accrued expenses and inventories. The higher cash outflows from accounts payable and accrued expenses were driven by a change in the mix of suppliers with shorter payment cycles, while lower cash inflows from inventory year-over-year reflect the prior year decreases in safety stock. Working capital cash flows also reflect the impact of the prior-year Wella reimbursement for working capital which did not recur in the current year. The decrease in cash provided by operating activities was partially offset by lower cash outflows related to the timing of payments for income taxes.

The decrease in cash provided by operating activities of $11.1 in fiscal 2024 as compared with fiscal 2023 is primarily the result of a negative impact from changes in accounts payable due to the timing of payments and mix of vendor terms, higher cash outflows from the timing of income tax related payments and changes in trade receivables reflecting higher net revenues with an unfavorable customer mix and decreases from lower factoring. These decreases were partially offset by higher year over year impacts from all other net working capital accounts which include a positive impact from inventory levels returning closer to normal compared to the prior year when inventory levels reflected increased safety stock to mitigate supply chain constraints. Net working capital accounts in the current year were also positively impacted by a net inflow of $35.0 as a reimbursement from Wella for working capital financed by Coty since the separation from the Wella business.

Net cash used in investing activities

Net cash used in investing activities was $128.4, $226.2 and $118.2 for fiscal 2025, 2024 and 2023, respectively.

The decrease in cash used in investing activities of $97.8 in fiscal 2025 as compared with fiscal 2024 primarily reflects current year cash proceeds from the termination of the KKW Collaboration Agreement and sale of the 20% KKW Holdings equity investment combined with lower capital expenditures year-over-year. These impacts were partially offset by the non-recurring proceeds during the prior year from early license termination.

The increase in cash used in investing activities of $108.0 in fiscal 2024 as compared with fiscal 2023 was primarily due to lower current year proceeds related to the early termination of the Lacoste license agreement and proceeds from sale of other long-term assets combined with the impact of an increase in capital expenditures. The year over year increases in cash used in investing activities were partially offset by the current year collection of contingent consideration.

Net cash used in financing activities

Net cash used in financing activities was $426.8, $336.7 and $469.3 for fiscal 2025, 2024 and 2023, respectively.

The increase in cash used in financing activities of $90.1 in fiscal 2025 as compared to fiscal 2024 was primarily driven by the cash proceeds from issuance of Class A Common Stock in connection with the global offering in the prior year which did not recur, and higher net repayments relating to other long-term debt. This was partially offset by higher net proceeds from the Company's revolving credit facility and lower cash payments for deferred financing fees in the current year. Net cash used in financing activities as it relates to the forward repurchase contracts was relatively flat year-over-year, reflecting the cash payment for the settlement of the June 2022 forward repurchase contract in the prior year, and cash payments and refund for the hedge valuation adjustments in the current year.

The decrease in cash used in financing activities of $132.6 in fiscal 2024 as compared to fiscal 2023 was primarily driven by the current year net proceeds from the issuance of Class A Common Stock in connection with the global offering and lower cash payments related to the Company’s financing related foreign currency contracts in the current year compared to the prior year. The decrease in cash used in financing activities was partially offset by higher outflows in the current year related to the Company’s forward repurchase contracts, higher current year net repayments as a result of current year debt related activity, as well as higher payments year over year for the associated deferred financing fees.

Dividends

On April 29, 2020, the Board of Directors suspended the payment of dividends on Common Stock. As previously disclosed, we expect to suspend the payment of dividends until we approach a Net debt to Adjusted earnings before interest,

54

taxes, depreciation and amortization (“Adjusted EBITDA”) target of 2x. We expect to consider any future resumption of dividends in line with that target while continuing to pursue our deleveraging agenda and implementing our strategic initiatives. Any determination to pay dividends in the future will be at the discretion of our Board of Directors.

Dividends on the Convertible Series B Preferred Stock are payable in cash, or by increasing the amount of accrued dividends on Convertible Series B Preferred Stock, or any combination thereof, at the sole discretion of the Company. We expect to pay such dividends in cash on a quarterly basis, subject to the declaration thereof by our Board of Directors. The terms of the Convertible Series B Preferred Stock restrict our ability to declare cash dividends on our common stock until all accrued dividends on the Convertible Series B Preferred Stock have been declared and paid in cash. During the twelve months ended June 30, 2025, the Board of Directors declared dividends on the Series B Preferred Stock of $13.2, of which $9.9 was paid during fiscal 2025 and $3.3 was paid in July 2025.

For additional information on our dividends and dividend policy, respectively, see Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements and Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Dividend Policy”.

Treasury Stock - Share Repurchase Program

For additional information on our Share Repurchase Program, see Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements.

Contractual Obligations and Commitments

Our principal contractual obligations and commitments are presented below as of June 30, 2025.

(a) Interest costs on our debt after consideration of our interest rate swap arrangements are determined based on interest rate forecast and assumptions of the amount of debt outstanding. A 25 basis-point increase in our variable interest rate debt would have increased our interest costs by $37.1 over the term of our long-term debt.

(b) Obligations under license agreements relate to royalty payments and required advertising and promotional spending levels for our products bearing the licensed trademark. Royalty payments are typically made based on contractually defined net sales. However, certain licenses require minimum guaranteed royalty payments regardless of sales levels. Actual royalty payments are expected to be higher. Furthermore, early termination of any of these license agreements could result in potential cash outflows that have not been reflected above.

(c) Other contractual obligations primarily represent advertising/marketing, manufacturing, logistics and capital improvements commitments. We also maintain several distribution agreements for which early termination could result in potential future cash outflows that have not been reflected above.

(d) Represents future contributions to our pension and other postretirement benefit plans over the next five years mandated by local regulations or statutes. Subsequent funding requirements cannot be reasonably estimated as the return on plan assets in future periods, as well as future assumptions are not known.

The table above excludes obligations for uncertain tax benefits, including interest and penalties, of $194.3 as of June 30, 2025, as we are unable to predict when, or if, any payments would be made. See Note 14—Income Taxes in the notes to our Consolidated Financial Statements for additional information on our uncertain tax benefits.

The table excludes $94.2 of RNCI which is reflected in Redeemable noncontrolling interest in the Consolidated Balance Sheet as of June 30, 2025 related to the 25.0% RNCI in our subsidiary in the Middle East (“Middle East Subsidiary”). Given the provisions of the associated Put and Call rights, RNCI is redeemable outside of our control and is recorded in temporary equity. See Note 18—Redeemable Noncontrolling Interests in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the redemption value of this noncontrolling interest.

The table excludes $142.4 of preferred stock, which is reflected in Convertible Series B Preferred Stock in the Consolidated Balance Sheet as of June 30, 2025. Given the provisions of the associated Put rights, Convertible Series B

55

Preferred Stock is redeemable outside of our control upon certain change of control events and is recorded in temporary equity. See Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion related to the calculation of the Convertible Series B Preferred Stock.

The table excludes amounts related to our remaining forward repurchase contracts. See Note 19—Equity and Convertible Preferred Stock in the notes to our Consolidated Financial Statements for further discussion.

Contingencies

From time to time, our Brazilian subsidiaries receive tax assessments from local, state, and federal tax authorities in Brazil. In relation to the appeal of our Brazilian tax assessments, we have entered into surety bonds of approximately $172.0 as of June 30, 2025. See Note 22—Legal and Other Contingencies for more details on these tax assessments.

Derivative Financial Instruments and Hedging Activities

We are exposed to foreign currency exchange fluctuations and interest rate volatility through our global operations. We utilize natural offsets to the fullest extent possible in order to identify net exposures. In the normal course of business, established policies and procedures are employed to manage these net exposures using a variety of financial instruments. We do not enter into derivative financial instruments for trading or speculative purposes.

Foreign Currency Exchange Risk Management

We operate in multiple functional currencies and are exposed to the impact of foreign currency fluctuations. For foreign currency exposures, which primarily relate to receivables, inventory purchases and sales, payables and intercompany loans, derivatives are used to better manage the earnings and cash flow volatility arising from foreign currency exchange rate fluctuations. We recorded net foreign currency (losses) gains of $(21.7), $(18.1) and $(32.3) in fiscal 2025, 2024 and 2023, respectively, resulting from non-financing foreign currency exchange transactions which are included in their associated expense type and are included in the Consolidated Statements of Operations. In July 2021, the Company entered into foreign exchange forward contracts to hedge up to 80% of our euro denominated external debt as part of management's strategy to minimize the impact of currency movements on those debt instruments. The outstanding foreign exchange forward contracts mature by the end of the first quarter of fiscal year 2026, and the Company does not anticipate extending these contracts beyond that maturity date. Net (losses) gains of $(3.8), $(16.5) and $(12.2) in fiscal 2025, 2024 and 2023, respectively, resulting from financing foreign exchange currency transactions are included in Interest expense, net in the Consolidated Statements of Operations.

Exchange gains or losses are also partially offset through the use of qualified derivatives under hedge accounting, for which we record accumulated gains or losses in Accumulated other comprehensive income until the underlying transaction occurs at which time the gain or loss is reclassified into the respective account in the Consolidated Statements of Operations.

We have experienced and will continue to experience fluctuations in our net income as a result of balance sheet transactional exposures. We use a combination of foreign currency forward contracts and cross currency contracts when necessary to offset these exposures. As of June 30, 2025, in the event of a 10% increase in the prevailing market rates of hedged foreign currencies versus the U.S. dollar, the change in fair value of all foreign exchange forward contracts would result in a $29.8 decrease in the fair value of these forward contracts, which would be offset by an increase in the underlying foreign currency exposures.

Interest Rate Risk Management

We are exposed to interest rate risk that relates primarily to our indebtedness, which is affected by changes in the general level of the interest rates primarily in the U.S. and Europe. All of our long-term debt outstanding as of June 30, 2025 is fixed rate debt, other than debt outstanding under our revolving credit facility, which is subject to variable interest rates. Because of variable rate debt under our revolving credit facility, we are exposed to changes in interest rates as discussed in Note 12—Debt. If interest rates had been 10% higher and all other variables were held constant, (Loss) income before income taxes in fiscal 2025 would increase by $2.3.

We may reduce our exposure to fluctuations in the cash flows associated with changes in the variable interest rates by entering into offsetting positions through the use of derivative instruments, such as interest rate swap contracts. The interest rate swap contracts result in recognizing a fixed interest rate for the portion of our variable rate debt that was hedged. This will reduce the negative and positive impact of increases in the variable rates over the term of the contracts. Hedge effectiveness of interest rate swap contracts is based on a long-haul hypothetical derivative methodology and includes all changes in value. We had no outstanding interest rate swap contracts as of June 30, 2025.

Since our senior notes (the “Notes”) bear interest at fixed rates and are carried at amortized cost, fluctuations in interest rates do not have any impact on our consolidated financial statements. However, the fair value of the Notes will fluctuate with

56

movements in market interest rates, increasing in periods of declining interest rates and declining in periods of increasing interest rates.

In addition, the Company from time to time uses cross currency swaps to economically lower the interest rate on our loan portfolio.

Equity Investment Risk

Our equity investments are investments in equity securities of privately-held companies without readily determinable fair values, including an investment of approximately $1,002.0 that is valued using the fair value option as of June 30, 2025. These investments are subject to a wide variety of market-related risks that could have a material impact on the carrying value of our holdings. We continually evaluate our equity investments in privately-held companies. See Note 10—Equity Investments for additional information.

In addition to the above equity investments, we entered into forward repurchase contracts in December 2022 and November 2023 with three large financial institutions to hedge for potential $200.0 and $294.0 share buyback programs of share repurchases in 2025 and 2026, respectively. In December 2024, the Company entered into an agreement to extend the maturity date of the December 2022 forward repurchase contracts by one year to fiscal 2026. These forward repurchase contracts are accounted for at fair value, with changes in the fair value recorded in Other expense (income), net within the Consolidated Statements of Operations. Our primary exposure is the movements of our stock price during the contract period, which may be volatile and is likely to fluctuate due to a number of factors beyond our control. These factors include actual or anticipated fluctuations in the quarterly and annual results of our Company or of other peer companies in the industry, market perceptions concerning the macroeconomic, social or political developments, industry conditions, changes in government regulation and the securities market trends. We estimate that an immediate, hypothetical 10% decline in our stock price would result in a $22.1 decrease in the fair value of these forward repurchase contracts and reduce our Income (loss) before income taxes. In addition, such a decline would trigger a Hedge Valuation Adjustment as discussed in Liquidity and Capital Resources. Any realized gains or losses resulting from such fair value changes would occur if we elect to terminate the forward repurchase contracts prior to or on maturity. Refer to Note 19—Equity and Convertible Preferred Stock.

Credit Risk Management

We attempt to minimize credit exposure to counterparties by generally entering into derivative contracts with counterparties that have an “A” (or equivalent) credit rating. The counterparties to these contracts are major financial institutions. Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the fair value of contracts in net asset positions, which totaled $2.4 as of June 30, 2025. Management believes the risk of material loss under these hedging contracts is remote.

Off-Balance Sheet Arrangements

We had undrawn letters of credit of $3.1 and $4.1 and bank guarantees of $16.0 and $18.4 as of June 30, 2025 and 2024, respectively.

Critical Accounting Policies

We prepare our Consolidated Financial Statements in conformity with U.S. generally accepted accounting principles. The preparation of these Consolidated Financial Statements requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. These estimates and assumptions can be subjective and complex and, consequently, actual results may differ from those estimates that would result in material changes to our operating results and financial condition. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our most critical accounting policies relate to revenue recognition, the fair value of equity investments, the assessment of goodwill, other intangible and long-lived assets for impairment, inventory and income taxes.

Our management has discussed the selection of significant accounting policies and the effect of estimates with the Audit and Finance Committee of our Board of Directors.

57

Revenue Recognition

Net revenues comprise gross revenues less customer discounts and allowances, actual and expected returns (estimated based on an analysis of historical experience and position in product life cycle) and various trade spending activities. Trade spending activities represent variable consideration promised to the customer and primarily relate to advertising, product promotions and demonstrations, some of which involve cooperative relationships with customers. The costs of trade spend activities are estimated considering all reasonably available information, including contract terms with the customer, the Company’s historical experience and its current expectations of the scope of the activities, and is reflected in the transaction price when sales are recorded. For additional information on our revenue accounting policies, see Note 2—Summary of Significant Accounting Policies. Returns represented 2%, 1% and 2% of gross revenue after customer discounts and allowances in fiscal 2025, 2024 and 2023, respectively. Trade spending activities recorded as a reduction to gross revenue after customer discounts and allowances represent 10%, 9%, and 10% in fiscal 2025, 2024 and 2023, respectively.

Our sales return accrual reflects seasonal fluctuations, including those related to the holiday season in the first half of our fiscal year. This accrual is a subjective critical estimate that has a direct impact on reported net revenues, and is calculated based on history of actual returns, estimated future returns and information provided by retailers regarding their inventory levels. In addition, as necessary, specific accruals may be established for significant future known or anticipated events. The types of known or anticipated events that we have considered, and will continue to consider, include the financial condition of our customers, store closings by retailers, changes in the retail environment, and our decision to continue to support new and existing brands. If the historical data we use to calculate these estimates does not approximate future returns, additional allowances may be required.

Equity Investments

The Company elected the fair value option to account for its investment in the Wella Company to align with our strategy for this investment. The fair value is updated on a quarterly basis. The investment is classified within Level 3 in the fair value hierarchy because we estimate the fair value of the investment using a combination of the income approach, the market approach and private transactions, when applicable. Changes in the fair value of an equity investment under the fair value option are recorded in Other expense (income), net within the Consolidated Statements of Operations (see Note 10—Equity Investments).

Some of the inherent estimates and assumptions used in determining fair value of the Wella Company are outside the control of management, including interest rates, cost of capital, tax rates, credit ratings and industry growth. While we believe we have made reasonable estimates and assumptions to calculate the fair value of the Wella Company, it is possible changes could occur. As for the Wella Company, if in future years, the actual results are not consistent with our estimates and assumptions used to calculate fair value, we may be required to recognize additional adjustments.

Goodwill, Other Intangible Assets and Long-Lived Assets

Goodwill

Goodwill is calculated as the excess of the cost of purchased businesses over the fair value of their underlying net assets. Other intangible assets consist of indefinite-lived trademarks. Goodwill and other indefinite-lived intangible assets are not amortized.

We assess goodwill at least annually as of May 1 for impairment, or more frequently, if certain events or circumstances warrant. We test goodwill for impairment at the reporting unit level, which is the same level as our reportable segments. We identify our reporting units by assessing whether the components of our reporting segments constitute businesses for which discrete financial information is available and management of each reporting unit regularly reviews the operating results of those components.

When testing goodwill for impairment, we have the option of first performing a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as the basis to determine if it is necessary to perform a quantitative goodwill impairment test. In performing our qualitative assessment, we consider the extent to which unfavorable events or circumstances identified, such as changes in economic conditions, industry and market conditions or company specific events, could affect the comparison of the reporting unit’s fair value with its carrying amount. If we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we are required to perform a quantitative impairment test.

Quantitative impairment testing for goodwill is based upon the fair value of a reporting unit as compared to its carrying value. We make certain judgments and assumptions in allocating assets and liabilities to determine carrying values for our reporting units. The impairment loss recognized would be the difference between a reporting unit’s carrying value and fair value in an amount not to exceed the carrying value of the reporting unit’s goodwill.

58

Testing goodwill for impairment requires us to estimate fair values of reporting units using significant estimates and assumptions. The assumptions made will impact the outcome and ultimate results of the testing. We use industry accepted valuation models and set criteria that are reviewed and approved by various levels of management and, in certain instances, we engage independent third-party valuation specialists. To determine fair value of the reporting unit, we used a combination of the income and market approaches, when applicable. We believe the blended use of both models, when applicable, compensates for the inherent risk associated with either model if used on a stand-alone basis, and this combination is indicative of the factors a market participant would consider when performing a similar valuation.

Under the income approach, we determine fair value using a discounted cash flow method, projecting future cash flows of each reporting unit, as well as a terminal value, and discounting such cash flows at a rate of return that reflects the relative risk of the cash flows. Under the market approach, when applicable, we utilize information from comparable publicly traded companies with similar operating and investment characteristics as the reporting units, which creates valuation multiples that are applied to the operating performance of the reporting units being tested, to value the reporting unit.

The key estimates and factors used in these approaches include revenue growth rates and profit margins based on our internal forecasts, our specific weighted-average cost of capital used to discount future cash flows, and comparable market multiples for the industry segment, when applicable, as well as our historical operating trends. Certain future events and circumstances, including deterioration of market conditions, higher cost of capital, a decline in actual and expected consumer consumption and demands, could result in changes to these assumptions and judgments. A revision of these assumptions could cause the fair values of the reporting units to fall below their respective carrying values, resulting in a non-cash impairment charge. Such charge could have a material effect on the Consolidated Statements of Operations and Balance Sheets.

There were no impairments of goodwill at our reporting units in fiscal 2025, 2024 or fiscal 2023.

Based on the annual impairment test performed on May 1, 2025, we determined that the fair value of each of the reporting units exceeded their respective carrying values at that date by approximately 55.4% and 28.9% relating to the Prestige and Consumer Beauty reporting units, respectively. Consequently, there were no goodwill impairment charges recorded as a result of the annual impairment test performed on May 1, 2025. To determine the fair value of our reporting units, we have used annual revenue growth rates ranging from (6.3)%-6.0% and (1.7)%-8.3% for the Prestige and Consumer Beauty reporting units, respectively, and a discount rate of 10.5%.

Some of the inherent estimates and assumptions used in determining fair value of the reporting units are outside the control of management, including interest rates, cost of capital, tax rates, credit ratings and industry growth. While the Company believes it has made reasonable estimates and assumptions to calculate the fair values of the reporting units, it is possible changes could occur. As for all the Company’s reporting units, if in future years, the reporting unit’s actual results are not consistent with the Company’s estimates and assumptions used to calculate fair value, the Company may be required to recognize material impairments to goodwill. The Company will continue to monitor its reporting units for any triggering events or other signs of impairment. The Company may be required to perform additional impairment testing based on changes in the economic environment, disruptions to the Company’s business, significant declines in operating results of the Company’s reporting units, further sustained deterioration of the Company’s market capitalization, and other factors, which could result in impairment charges in the future. Although management cannot predict when improvements in macroeconomic conditions will occur, if consumer confidence and consumer spending decline significantly in the future or if commercial and industrial economic activity or the market capitalization deteriorates significantly from current levels, it is reasonably likely the Company will be required to record impairment charges in the future.

Other Intangible Assets

We assess indefinite-lived other intangible assets (“trademarks”) at least annually as of May 1 for impairment, or more frequently if certain events occur or circumstances change that would more likely than not reduce the fair value of a trademark below its carrying value. Trademarks are tested for impairment on a brand level basis.

The trademarks’ fair values are based upon the income approach, primarily utilizing the relief from royalty methodology. This methodology assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to obtain the rights to use the trademark. An impairment loss is recognized when the estimated fair value of a trademark is less than the carrying value. Fair value calculation requires significant judgments in determining both the assets’ estimated cash flows as well as the appropriate discount and royalty rates applied to those cash flows to determine fair value. Variations in economic conditions or a change in general consumer demand, operating results estimates or the application of alternative assumptions could produce significantly different results.

The carrying value of our trademarks was $761.0 as of June 30, 2025, and is comprised of trademarks for the following brands: CoverGirl of $266.4, Max Factor of $64.4, Sally Hansen of $163.7, Philosophy of $87.1, and other trademarks totaling $179.4.

59

On May 1, 2024 and 2023, we performed our annual impairment testing of our trademarks and determined that no adjustments to carrying values were required.

During fiscal 2025, we recorded total impairments on our trademarks of $212.8. In the third quarter, the Company concluded that weakening demand in the color cosmetics market, particular in the United States and Europe, combined with broader macroeconomic disruptions, signaled a deterioration in business climate. Management concluded these adverse factors represented an indicator of impairment that warranted an interim test for certain trademarks. Based on the evaluation of future cash flows of these trademarks, impairment charges of $212.8 were recorded related to our Max Factor ($84.0), CoverGirl ($61.0), and Bourjois ($24.9) trademarks within the Consumer Beauty Segment and for our Philosophy ($42.9) trademark within the Prestige Segment.

As part of the May 1, 2025 annual impairment test, we determined that the fair value of our CoverGirl, Max Factor, Sally Hansen, and Philosophy trademarks exceeded their carrying values by approximately 0.2%, 7.2%, 2.5%, and 3.6%, using annual revenue growth rates ranging from (7.7)%-5.4%, (6.1)%-2.0%, (11.1)%-9.0%, and (4.9)%-2.0%, and a discount rate of 11.95%, 14.0%, 11.25%, and 11.25%, respectively. The fair value of CoverGirl, Max Factor, Sally Hansen, and Philosophy would fall below their carrying values if the annual revenue growth rate decreased by approximately 25 basis points, 320 basis points, 260 basis points, and 350 basis points, respectively or the discount rate increased by 5 basis points, 100 basis points, 25 basis points, and 35 basis points, respectively.

The fair values of the remaining trademarks exceeded their carrying values by amounts ranging from 26% to 868%, except for Bourjois with 0% excess due to recent impairment recorded during the third quarter of fiscal 2025.

Some of the inherent estimates and assumptions used in determining fair value of our trademarks are outside the control of management, including interest rates, cost of capital, tax rates, credit ratings and industry growth. While the Company believes it has made reasonable estimates and assumptions to calculate the fair values of our trademarks, it is possible changes could occur. As for our trademarks, the most significant assumptions used are the revenue growth rate and the discount rate, a decrease in the revenue growth rate or an increase in the discount rate could result in a future impairment. The Company will continue to monitor its trademarks for any triggering events or other signs of impairment. The Company may be required to perform additional impairment testing based on changes in the economic environment, disruptions to the Company’s business, significant declines in operating results of the Company’s reporting units and/or trademarks, further sustained deterioration of the Company’s market capitalization, and other factors, which could result in impairment charges in the future. Although management cannot predict when improvements in macroeconomic conditions will occur, if consumer confidence and consumer spending decline significantly in the future or if commercial and industrial economic activity or the market capitalization deteriorates significantly from current levels, it is reasonably likely the Company will be required to record impairment charges in the future.

Long-Lived Assets

Long-lived assets, including tangible and intangible assets with finite lives, are amortized over their respective lives to their estimated residual values and are also reviewed for impairment whenever certain triggering events may indicate impairment. When such events or changes in circumstances occur, a recoverability test is performed comparing projected undiscounted cash flows from the use and eventual disposition of an asset or asset group to its carrying value. If the projected undiscounted cash flows are less than the carrying value, an impairment would be recorded for the excess of the carrying value over the fair value, which is determined by discounting future cash flows.

During fiscal years 2025, 2024 and 2023, we recorded asset impairment charges of nil, $1.7 and $4.3, respectively, to Property and equipment, net and nil, nil and $1.1, respectively to Operating lease right-of-use assets, primarily relating to the abandonment of equipment or leases no longer in use. These impairment charges are primarily recorded in Selling, general and administrative expenses in the Consolidated Statements of Operations.

Inventory

Inventories include items which are considered salable or usable in future periods and are stated at the lower of cost or net realizable value, with cost being based on standard cost which approximates actual cost on a first-in, first-out basis. Costs include direct materials, direct labor and overhead (e.g., indirect labor, rent and utilities, depreciation, purchasing, receiving, inspection and quality control) and in-bound freight costs. The Company classifies inventories into various categories based upon their stage in the product life cycle, future marketing sales plans and the disposition process.

The Company also records an inventory obsolescence reserve, which represents the excess of the cost of the inventory over its net realizable value, based on product sales projections. This reserve is calculated using an estimated obsolescence percentage applied to the inventory based on age, historical trends, and requirements to support forecasted sales. In addition, and as necessary, the Company may establish specific reserves for future known or anticipated events.

60

Income Taxes

We are subject to income taxes in the U.S. and various foreign jurisdictions. We account for income taxes under the asset and liability method. Therefore, income tax expense is based on reported income before income taxes, and deferred income taxes reflect the effect of temporary differences between the amounts of assets and liabilities that are recognized for financial reporting purposes and the amounts that are recognized for income tax purposes. Deferred taxes are recorded at currently enacted statutory tax rates and are adjusted as enacted tax rates change.

A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount that is more likely than not to be realized based on currently available evidence. We consider how to recognize, measure, present and disclose in financial statements uncertain tax positions taken or expected to be taken on a tax return.

We are subject to tax audits in various jurisdictions. We regularly assess the likely outcomes of such audits in order to determine the appropriateness of liabilities for unrecognized tax benefits. We classify interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes.

For unrecognized tax benefits, we first determine whether it is more-likely-than-not (defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all relevant information. A tax position that meets this more-likely-than-not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority. As the determination of liabilities related to unrecognized tax benefits, including associated interest and penalties, requires significant estimates to be made by us, there can be no assurance that we will accurately predict the outcomes of these audits, and thus the eventual outcomes could have a material impact on our operating results or financial condition and cash flows.

Unrecognized tax benefits are reviewed on an ongoing basis and are adjusted in light of changing facts and circumstances, including progress of examinations by tax authorities, developments in case law and closing of statute of limitations. Such adjustments are reflected in the provision for income taxes as appropriate. In addition, we are present in approximately 40 tax jurisdictions and we are subject to the continuous examination of our income tax returns by the Internal Revenue Service (IRS) and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes.

As a result of the 2017 Tax Act changing the U.S. to a modified territorial tax system, the Company no longer asserts that any of its undistributed foreign earnings are permanently reinvested. We do not expect to incur significant withholding or state taxes on future distributions. To the extent there remains a basis difference between the financial reporting and tax basis of an investment in a foreign subsidiary after the repatriation of the previously taxed income, the Company is permanently reinvested. A determination of the unrecognized deferred taxes related to these components is not practicable.