L'Oreal, one of the world's largest cosmetics companies, missed estimates for its second-quarter sales growth citing weakness in U.S. demand.
Chairman and Chief Executive Jean-Paul Agon told CNBC Wednesday that the trading environment was "never steady" in the U.S. and that the makeup industry was vulnerable to the country's economic cycles.
"We started from scratch in the U.S. 50 years ago, we are now number one and it has never been a walk in the park. So some years are better than others. This year is a bit tough, we acknowledge that," he told CNBC's Julianna Tatelbaum.
Consumer analysts have highlighted a boom in the U.S. makeup market in the last five years, with many celebrities launching their own successful brands, such as singer Rihanna's Fenty Beauty collection or Kylie Jenner's Kylie Cosmetics.
A raft of Instagram celebrities and bloggers promoting cosmetics and makeup tutorials has also led to a generation of millennials who are more confident with makeup products, styles and application than their parents' generation.
But Agon said Wednesday that "the makeup market has really slowed down in the U.S.," which suggests that recent boom may have peaked.
"We are by far the number one player in makeup, in consumer, but also we are pretty strong in luxury. So when the cycle is not good for makeup it's a headwind for us," he said.
Analysts also say there may be "fatigue" in the U.S. makeup market in the last 12 to 18 months, with some consumers looking at more niche or luxury makeup products, rather than mass-market offerings .
North American like-for-like revenues for L'Oreal — which strip out currency swings and acquisitions — fell 1.1% in the April to June period and were flat in the first half of 2019. The French cosmetics company is the latest European brand to point to wavering demand and shifting beauty trends in North America with Kering's Gucci also highlighting faltering U.S sales last week.
Asked how long this dynamic could last, Agon didn't believe it would be long, noting that "maybe the cupboards are a bit full with makeup and after a while people will go again and buy some makeup products."
Shares of L'Oreal were trading 4.5% lower Wednesday following the results.