Unilever sales are rising because beauty shopping is back

Shoppers are purchasing name-brand beauty products again, and that’s lifting sales at consumer goods company Unilever. The London-based Unilever this week reported a 4.4% increase in sales during the first quarter of 2024, surpassing analysts’ expectations of a 3.5% rise.

The Dove soap maker reported better-than-expected earnings on Thursday led primarily by sales in its beauty and well being category. Even with stubborn inflation and higher prices pushing consumers to purchase cheaper items, Unilever appears to be winning back those that once left.

“The continuing double-digit growth of Beauty and Health & Wellbeing combined is successfully re-shaping our portfolio and increasing our exposure to the critical US market and in particular, to selective premium and online channels,” Unilever CEO Hein Schumacher said during the company’s earnings call on Thursday.

Unilever’s beauty and wellbeing section, which includes premium skincare brands such as Tresemme, Living Proof, and Nutrafol, saw a 7.4% increase in sales, led primarily by higher volumes, Schumacher said.

Unilever said it expects multi-year sales growth to be between 3% and 5%. It’s looking to make up for a sales drop in its North America segment, which Schumacher said “did hurt our shares.”

The 94-year old company said it has devised a growth action plan, dubbed “GAP,” to drive growth, performance, and better profits. That plan to boost profit margins is already underway. In March, Unilever said it would spin off its ice cream business, which includes Ben & Jerry’s, into its own company, and cut 7,500 jobs globally.

“The separation makes good strategic sense, both for Unilever and for the Ice Cream business,” Schumacher said during the earnings call. “Work to separate that business is underway and we expect the process to be complete by the end of 2025.”