Most of Estee Lauder's holiday product has already been shipped to retailers, says CEO

KEY POINTS

• Estee Lauder President and CEO Fabrizio Freda expressed confidence Tuesday in the cosmetic company's positioning heading into the holiday shopping season.
• "Most of our holiday shipments have already been shipped to the retailers," he told "Mad Money" host Jim Cramer.

Estee Lauder President and CEO Fabrizio Freda expressed confidence Tuesday in the cosmetic company's positioning heading into the holiday shopping season, despite ongoing logistics challenges such as congested U.S. ports.

Freda's comments — made in an interview with CNBC's Jim Cramer on "Mad Money" — came after Estee Lauder beat Wall Street's expectations on first-quarter revenue and per-share earnings. Freda said it was "probably our best quarter in a long time," suggesting there was "great execution" inside the company as evidenced by its holiday preparedness.

"Imagine that in a period where there is a lot of supply-chain disruption, a lot of supply-chain issues because of Covid in different parts of the world, we were ready with our holiday shipments," Freda said. "Most of our holiday shipments have already been shipped to the retailers, so we're already in the game well before the full holiday season starts, which is rare in this moment of disruption."

Estee Lauder reported $4.39 billion in sales for the three months ended Sept. 30, up 23% year over year while topping analysts' forecasts of $4.25 billion. The company, which owns brands Michael Kors, Clinique and Aveda, among others, earned $1.86 per share, eclipsing estimates by 16 cents.

Shares of New York-based Estee Lauder rose 4.14% Tuesday to close at $338.62 apiece. The stock is up 27.2% year to date, compared with the S&P 500's 23.3% gain over the same span.

Freda, who's been CEO of Estee Lauder since 2009, said the company benefited in the first quarter from more people returning to activities they paused during the Covid pandemic such as working at the office or attending in-person classes. That spurred demand for Estee Lauder's makeup portfolio and other cosmetic products, he said.

Freda also highlighted the positive economic benefits of widespread Covid vaccinations.

"There was a moment, particularly during this quarter, where in North America, in Europe, people were so energized to be able to be back ... with a more normalized life thanks to the growing vaccinations that brick-and-mortar [sales] really picked up and that was good to see how, at the same time, the online sales continued to grow," Freda said.

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