1、Barclays Capital Inc.and/or one of its affiliates does and seeks to do business with companiescovered in its research reports.As a result,investors should be aware that the firm may have aconflict of interest that could affect the objectivity of this report.Investors should consider thisreport as on

2、ly a single factor in making their investment decision.Please see analyst certifications and important disclosures beginning on page 7.U.S.CHPC&BeveragesEuropean Beauty Sector Report&Implications for US BeautyWe review key themes and charts as well as discuss our viewsacross our US Beauty names,EL(E

3、W),COTY(UW),OLPX(EW)and ODD(EW).Our European Consumer Staples colleague Patrick Folan published an in-depth report and slidedeck on the European Beauty sector earlier this month(see Beauty is in the eye of the beholder15 July 2025;Beauty is in the eye of the beholder-slide deck 16 July 2025)and made

4、 four ratingchanges:hedowngraded LOreal andEssity to Underweight andPuig to Equal Weight,andupgradedHenkel to Overweight while maintainingBeiersdorf at Equal Weight.Below,wehighlight key themesand charts from his work and,importantly,how these relate to our ownbeauty coverage.From a category perspec

5、tive,we view the global beauty sector asone where the growth profileremains robust,but certain challenges cloud the industrys once-clear formula for success forglobal manufacturers.As we look at beauty companies we are seeing a transformational shift intwo of their most commercial functions of opera

6、tion marketing and retail(point of purchase).We think that brand marketing can still capture consumers minds and wallets,but companiesneed an original story to tell while offering a differentiated product with the right valueproposition.Five key themes that are bringing the beauty industry to an int