Beauty company Coty beat Wall Street expectations for third-quarter revenue on Monday and said it expects to achieve the high end of its annual targets, riding on steady global demand for its luxury and mass-market products.

The CoverGirl parent has been investing heavily in new product launches and collaborations with influencers and e-retail partners to drive demand at a time when higher prices of necessities force customers to rethink luxurious purchases.

Coty’s third-quarter e-commerce revenue growth was nearly 20%, helped by new launches such as Cosmic Kylie Jenner and Marc Jacobs Daisy.

Like-for-like sales in Coty’s prestige segment, which houses brands such as Burberry and Gucci, were up 13% and the consumer beauty segment, home to Rimmel and CoverGirl, saw a 6% jump.

European rival L’Oreal, which reported a rise in first-quarter like-for-like sales on the back of strong demand for mass market and dermatological products, had flagged weakness in the luxury segment.

“(Prestige) category remains very very dynamic … we are overperforming the category dynamic and we are gaining market share across all continents,” Coty CFO Laurent Mercier told Reuters.

Total third-quarter net revenue at Coty rose 7.5% to $1.39 billion, beating LSEG estimates of $1.37 billion.
Its adjusted net income fell to $43.8 million, or 5 cents per share, from $168.1 million, or 19 cents per share, a year earlier as profit expansion was more than offset by a reversal of $133 million in the benefit from the equity swap mark-to-market.

Coty expects fiscal 2024 core sales to be at the high end of the 9% to 11% growth it previously forecast. It also sees annual adjusted per-share profit at the high end of its prior expectation of 44 cents to 47 cents.