L’Oreal misses fourth-quarter expectations with 2.5% rise in sales

French cosmetics group L’Oreal reported a 2.5% rise in fourth-quarter sales on Thursday, missing expectations due to persistently weak demand in China and a slowdown in growth in North America.

The owner of brands from Maybelline mascara to Lancome face cream said sales for the three months to end-December were 11.08 billion euros ($11.49 billion), up 2.5% on a like-for-like basis, versus expectations for a 4.4% rise, according to a consensus compiled by LSEG.

The results, slowing from a 3.4% rise in the third quarter, conclude a challenging year when a protracted slowdown in the Chinese economy and inflation in the United States dented demand for skincare and makeup in two of the company’s biggest markets.

Paris-based L’Oreal also lost market share in China’s mass market to domestic rivals such as Proya, analysts say, and its CeraVe and other products recommended by dermatologists face growing competition in developed markets.

Sales grew 1.4% in North America, much less than the 5.2% reported in the third quarter. In North Asia, revenues were down by 3.4%, after a 6.5% decline in the prior period.

The company said in October fourth-quarter sales growth would be comparable to the prior quarter’s.