Kering closes out its beauty licensing overhaul as Coty steps aside from Gucci Beauty eighteen months before the original contract’s end date
Key Takeaways
- The new Gucci Beauty license with L’Oréal begins July 1, 2027, one year earlier than the original June 30, 2028 expiration of Coty’s agreement.
- Coty will receive approximately $400 million for the early redemption, paid in two installments: $250 million in 2026 and up to $150 million by September 30, 2027.
- L’Oréal is covering roughly 70 percent of the early redemption costs and inventory transfer.
- The agreement is a 50-year exclusive license and completes the Kering-L’Oréal alliance formed in October 2025, which already moved Creed, Bottega Veneta, and Balenciaga fragrances to L’Oréal.
Kering has finalized the last piece of its beauty realignment, moving the Gucci Beauty license to L’Oréal a year earlier than originally scheduled. The house confirmed that the new fifty-year license with L’Oréal takes effect July 1, 2027, ending Coty’s stewardship of the brand ahead of its planned 2028 expiration.
Coty will receive approximately $400 million in exchange for the early redemption, with the payments split across two phases: $250 million disbursed in 2026 and up to $150 million due by September 30, 2027, a portion of which is tied to performance conditions. L’Oréal is absorbing about 70 percent of the associated redemption and inventory transition costs, easing the financial burden on Kering as it winds down its remaining beauty license obligations. Coty has said the proceeds will go toward debt reduction and reinvestment in its core prestige portfolio, including BOSS and Marc Jacobs.
The move completes a realignment that began in October 2025, when Kering and L’Oréal announced a sweeping beauty alliance that shifted Creed, Bottega Veneta, and Balenciaga fragrances into L’Oréal’s portfolio. Gucci was always the centerpiece of that arrangement, given its scale within Coty’s business since the license was first signed in 2016 and the more than 60 percent revenue growth the brand has posted since 2019. With Gucci now folded in, Kering has fully exited direct beauty operations and consolidated its entire fragrance and beauty licensing structure under a single partner.
For Kering, the deal removes the operational complexity of managing multiple beauty licensees and concentrates leverage, resourcing, and long-term strategic alignment in one relationship. For L’Oréal, absorbing Gucci a year early accelerates its ability to integrate the brand’s fragrance architecture into its luxury division well before the original handover date, giving the group a longer runway to shape Gucci Beauty’s next chapter before the license’s true start was set to arrive.