Good day everyone, and welcome to The Estée Lauder Companies fiscal 2026 fourth quarter and full-year conference call. Today's webcast is being recorded. For opening remarks and introductions, I would like to turn the call over to the Senior Vice President of Investor Relations, Ms. Rainey Mancini. Hello. On today's webcast are Stéphane de La Faverie, President and Chief Executive Officer, and Akhil Shrivastava, Executive Vice President and Chief Financial Officer. Since many of our remarks today contain forward-looking statements, let me refer you to our press release and our reports filed with the SEC where you'll find factors that could cause actual results to differ materially from these forward-looking statements. To facilitate the discussion of our underlying business, the commentary on our financial results and expectations is before restructuring and other charges and adjustments disclosed in our press release. Unless otherwise stated, references to net sales refer to organic net sales, which excludes the non-comparable impacts of acquisitions, divestitures, brand closures, and the impact of foreign currency translation. You can find reconciliations between GAAP and non-GAAP measures in our press release and on the Investor Section of our website. Retail sales performance discussed is based on information available as of August 14, 2026. As a reminder, references to online sales include sales we make directly to our consumers through our brand.com sites and through third-party platforms. It also includes estimated sales of our products through our retailers' websites. Throughout our discussion, our profit recovery and growth plan will be referred to as our PRGP. During the Q&A session, we ask that you please limit yourself to one question so we can respond to as many participants as possible within the time scheduled for this webcast. Now we have a brand portfolio video before Stéphane begins. Thank you, Rainey, and hello to everyone. I am incredibly proud of our fiscal 2026 results. We reignited growth with organic sales rising 3%, driven by the breadth of growth across brands and expanded operating margins significantly. When we introduced Beauty Reimagined in February 2025, we committed to the biggest organizational, leadership, and cultural transformation in our company's history to become faster and more agile with greater discipline. Our ambition was clear, become the best consumer-centric prestige beauty company with more diversified, balanced, and sustainable growth drivers. Before getting into our fiscal 2026 result, which reflect the early success of this ambition, I want to share why I'm more optimistic for the company's future today, 18 months into my tenure as CEO, and address some of the questions that have arisen in recent months. First, can we accelerate growth? Yes, we just did, and we will again. The PRGP's approvals are done, and now all our energy can be focused on accelerating growth. As we continue to deploy our One ELC operating model, we are enabling the entire organization to do what we do best. This means deepening investment in the desirability of our brands, leveraging superior AI-enabled consumer-driven insights to drive breakthrough innovation and executing with excellence. Second, the elephant in the room, M&A. Our focus has been and will remain growing our core business. We will continue to pursue minority and single-brand deals that enhance our portfolio and can benefit from our ability to create scale and deliver attractive ROIC. We have done this with KILIAN PARIS, Le Labo, and The Ordinary, our three fastest-growing brands in fiscal 2026. We have no doubt we will do it again with Forest Essentials, which we have announced we are adding to our portfolio. To be clear, for the foreseeable future, we are not entertaining transformational deals that will divert us from our winning strategy. Third, I have heard the question about whether the transformation has left us without the right talent in place. Nothing could be further from the truth. I can say definitely we are now stronger having invested in the retained organization and brought in great new talent across the company, including in creative, marketing, research and innovation, and technology. Even more powerful is what is harder for outsiders to see, the ways that the team is working more efficiently, significantly less layers, fewer silos, clarity of roles, and greater accountability. A truly empowered organization. This is why I am confident we will accelerate our growth and continue to rebuild profitability. Now, let's turn to our strong fiscal 2026 results. Reported sales rose 5% and organic sales grew 3%, with positive sales performance every quarter. Looking at profitability, we significantly exceeded our initial outlook from last August. Benefits from the PRGP were more robust and achieved more quickly than anticipated, which is a tribute to the extraordinary contribution of our employees around the world and our strengthening cultures around speed of execution. Gross margin expanded 150 basis points, operating margin expanded 320 basis points, and diluted EPS grew 66%. Impressively, Jo Malone London and TOM FORD joined our billion-dollar club. Our portfolio of billion-dollar brands is unparalleled in prestige beauty, with these two brands joining Clinique, Estée Lauder, La Mer, and M·A·C. With their scale, premier brand desirability, breakthrough innovation, and consumer reach, these brands are positioned to be powerful contributors to growth. In fiscal 2026, five of the six delivered sequentially improved organic sales performance. The Ordinary is quickly ascending towards this milestone, fueled by another year of double-digit organic sales growth in fiscal 2026. Looking at categories, skincare delivered 4% organic sales growth. We drove growth across the price spectrum with The Ordinary vibrant in the entry price tier, Estée Lauder thriving in the art of prestige, and La Mer exceptional in the luxury price tier. For fragrance, our results are amongst the best in the industry, with organic sales growth of 10%. This reflects our continued investment to develop and capture growing demand. Hero scent and newness from Le Labo, TOM FORD, KILIAN PARIS, and Jo Malone London prospered. We also successfully launched Balmain Beauty into the prestige price tier, and we have more to come as we enter fiscal 2027. Looking at makeup, we stabilized performance and improved organic sales trend by 500 basis points, led by M·A·C and TOM FORD. Lip drove M·A·C renaissance, while TOM FORD innovation in face and eyes powered its growth. We have much more to do in makeup, but we are making encouraging progress as we better position our brand in high-growth channels like social commerce and specialty multi and speed up launch cycles. For haircare, while not yet back to organic sales growth, we are seeing evidence of Aveda's turnaround in the U.S., its biggest market, given share expansion in track salon data. The Ordinary's serum for hair density remained a viral sensation, delivering strong growth in both organic and retail sales. Now for the regions. Each improved in fiscal 2026 versus fiscal 2025, from negative to positive organic sales growth across the board. Mainland China led with broad-based 9% organic sales growth as skincare rose high- single- digit, makeup rose mid-single- digit, and fragrance rose double- digits. We outperformed the market every quarter of fiscal 2026 to gain prestige beauty share for the year, led by La Mer, Le Labo, and TOM FORD. Within Asia-Pacific, global travel retail returned to growth, fueled in part by our investment in experiential retail across mainland China and Korea. Travel retail represented approximately 15% of reported sales in fiscal 2026, similar to the channel's global prestige share. Our priority emerging markets excelled, with organic sales growth accelerating from mid-single- digit in fiscal 2025 to high- single- digit in fiscal 2026, despite the disruption in the Middle East. For the U.S., the U.K. and Ireland, and Korea, we improved organic sales trend throughout fiscal 2026. In the U.S., we returned to organic sales growth in the fourth quarter, with retail sales again rising mid-single- digit amid continuous prestige beauty volume share gain. For fiscal 2026, we gained volume share with every category contributing. In the U.K. and Ireland, we delivered three consecutive quarters of organic sales growth, including the fourth quarter when we also gained prestige beauty share in the U.K. This is especially meaningful given prestige beauty's strength in the U.K. and following many years of share loss. Our performance in Korea was similarly encouraging. With three consecutive quarters of organic sales growth through the fourth quarter, retail sales growth accelerated from high- single- digit in the third quarter to double- digits in the fourth quarter, driving a return to prestige beauty share gain to end the year. Looking at channels, online performance was outstanding, with organic sales rising double- digits, driving strong prestige beauty share gain for the channel across many markets, including China and the U.S. Impressively, online reached 34% of reported sales for fiscal 2026, up 3 percentage points from fiscal 2025 to an all-time record. Finally, when we introduced Beauty Reimagined, we committed to creating transformative innovation as we restored sales growth. During fiscal 2026, we accelerated speed to market, launching breakthrough on-trend and commercial innovation across every category with 23% of sales from innovation. With this fiscal 2026 result, we deliver on all aspect of Beauty Reimagined. As promised, accelerating best-in-class consumer coverage, bringing innovation to market faster, increasing consumer-facing investment, streamlining our fixed cost base, and revitalizing our entrepreneurial spirit. Looking ahead to fiscal 2027, we are doubling down on our strengths to further diversify growth across product categories and geographies, including accelerating growth in North America. This means expanding more brands into high-growth channels across more markets, launching a bigger and bolder innovation pipeline, continuing to increase consumer-facing investment, including more into our priority emerging markets, and increasingly benefiting from One ELC, our new operating model. We kicked off fiscal 2027 with a robust slate of newness. For the fiscal year, innovation as a percentage of sales is set to increase 200 basis points to 250 basis points, led by skincare. Already out in skincare, Clinique and The Ordinary tapped into emerging ingredient trends with PDRN innovation, while Estée Lauder introduced a breakthrough in longevity as well newness for night. La Mer and Bobbi Brown created next- generation editions of beloved hero products, and Clinique introduced a new franchise for sensitive skin, spanning skincare and makeup. Building on this in makeup, M·A·C launched exciting innovation in a signature lip franchise, including an all-new lip stain, which was a blockbuster success in its early launch in Korea during fiscal 2026. For fragrance, the category we expect to lead prestige beauty's growth again in fiscal 2027. Our first quarter innovations are extensive from Balmain Beauty, along with the new prestige line from KILIAN PARIS and Estée Lauder, to Jo Malone London and TOM FORD in the luxury price tier. We introduced distinctive scents to drive new consumer acquisition across demographics and regional preference. For One ELC operating ecosystem, we are advancing with speed across our three biggest initiatives. We launched maccosmetics.com on Shopify last week, the first of many deployments online and in-store across brands around the world in fiscal 2027, as we modernize capabilities in our direct-to-consumer business to drive growth. For enterprise business services, we are on track to have transitioned about 80% of the expected roles by September, while also standardizing select processes and standing up key AI-enabled technologies to facilitate service delivery and productivity. For our new unified global media model, most of our markets have transitioned to WPP, already lighting up over 1,500 campaigns and harnessing AI for real-time personalization for many of our performance campaigns. We expanded our collaboration with Meta, leveraging their AI-powered tools built for advertising, conversational commerce, and adjacencies messaging across our brand portfolio to reflect the new consumer behavior of where they are interacting with brands. Now, let me close where I began. I am proud of our fiscal 2026 results. In Beauty Reimagined, we have a winning playbook, and I am confident we will deliver another strong year in fiscal 2027. We have the right brands, the right team, a clear momentum, onward and upward. I will now turn the call over to Akhil. Thank you, Stéphane. Hello, everyone, and thank you for joining us today. We are proud of the progress we made in fiscal 2026 and how our teams executed with excellence against Beauty Reimagined with speed, focus, and discipline. We had promised a focus on growth margin cash to drive sustainable growth and long-term value creation. Our return to organic sales growth of 3%, operating margin improvement of 320 basis points, diluted EPS growth of 66%, and net cash flows from operations of $1.8 billion reflect our strong delivery against that commitment. This was driven by the strategic and disciplined actions we have taken to focus on restoring growth, transforming our operating model, improving our cost structure, and creating operating leverage. Before discussing our fiscal 2027 outlook, I will briefly highlight our fourth quarter and full-year results and progress across key areas of the business. For more information on our full- year and fourth quarter performance, please refer to a press release issued this morning. Starting with organic net sales, we saw broad-based growth in the fourth quarter across all product categories and geographic regions, with the exception of haircare. Our 5% organic sales growth was the strongest quarterly performance of the year, with sequential improvement from the third quarter across every region except EUKEM, where business disruptions from the conflict in the Middle East reduced growth by 2%. We are encouraged by North America's sequential improvement in retail sales growth, along with its return to organic sales growth in the fourth quarter, even without the one-time benefit discussed in our press release. These results reflect the progress we are making through our consumer-facing investments to drive growth. Now looking at margins. Fourth quarter and full-year gross margin reached 75.5%, expanding 360 basis points and 150 basis points respectively compared to last year. This represents nearly 400 basis points of improvement in gross margin compared to fiscal 2024, when we first announced the PRGP. These results reflect the structural improvements we have made and our ability to execute with speed, enhancing operational efficiency, reducing excess, and bringing gross margin back to near historical levels. Turning to operating margin. We delivered nearly 300 basis points or more of expansion in every quarter this year, including 330 basis points in the fourth quarter, contributing to a full-year operating margin of 11.2%, up 320 basis points from last year. Through our PRGP initiatives, we delivered net benefits that funded additional consumer-facing investments throughout the year. Our investments increased 7% for the full- year, or 4% excluding FX. We reduced non-consumer-facing expenses in every quarter this year, except the fourth quarter, which included higher employee incentive costs tied to a better-than-expected full-year performance. This reflects our continuous focus on streamlining our fixed cost base to create greater flexibility and our disciplined allocation of investments toward the highest return areas. In terms of our PRGP restructuring program, we concluded approvals as of June 30th and recorded $823 million of total cumulative charges in fiscal 2026, primarily in employee-related costs. Although the approval phase is behind us, our unrelenting focus on everyday efficiency is not. It is embedded in how we operate, enabling ongoing investments in growth opportunities. Our adjusted effective tax rate for the full- year improved to 35.7%, a decrease from 38.8% last year. Diluted EPS increased to $0.39 in the fourth quarter from $0.09 last year, and increased 66% for the full- year to $2.51. Moving to our next strategic priority, cash flow. Cash generation was very strong this year, with cash flow from operating activities of $1.8 billion, up from $1.3 billion last year, despite higher restructuring payments. This reflects higher earnings and disciplined working capital management, which improved cash productivity across the business. We spent $457 million in CapEx this year compared to $602 million last year, reflecting disciplined capital allocation and prioritizing consumer-facing investments to support growth. These actions supported improved free cash flow, and we ended the year with $3.5 billion in cash on hand. The significant progress we made in fiscal 2026 through our disciplined execution of Beauty Reimagined, including our PRGP, has transformed our operating model, strengthening our company as we enter fiscal 2027. With our momentum, I am excited about our outlook for fiscal 2027, and even more confident in our ability to deliver long-term sustainable value creation. For fiscal 2027, we expect to accelerate organic sales growth and deliver stronger adjusted operating profitability. Turning to top- line. For fiscal 2027, we expect organic net sales growth in the range of 3%-5%, reflecting more diversified growth across product categories and geographic regions. We expect organic net sales growth in the first half of the year to be stronger than in the second half, reflecting a slate of innovation earlier in the year and stronger travel retail shipments giving improving retail trends and a lower base of shipment in the prior year. Looking at EUKEM, we expect stronger sales growth in the second half of the year as we lap the business disruptions related to the conflict in the Middle East that affected the second half of fiscal 2026. While the situation remains dynamic, based on what we know today, we do not expect the impacts from the conflict in the Middle East to be material to our fiscal 2027 results. Turning now to profitability. We are raising our preliminary outlook and now expect operating margin to range between 12.7% and 13.5%. This reflects, in part, our strong fiscal 2026 results, continued operating leverage in non-consumer facing expenses, and a modest expansion in gross margin. We expect an effective tax rate in the range of approximately 33%-34%, building upon the progress we made in fiscal 2026. Diluted EPS is expected to range between $3.10 and $3.35, assuming a weighted average share count of approximately 368 million shares. Moving now to cash generation. In fiscal 2027, we expect to generate net cash flows from operating activities between $1.3 billion and $1.4 billion. This decrease from last year reflects higher restructuring payments, as well as increased working capital needs to support growth, compared to strong working capital improvements in fiscal 2026. After the restructuring payments expected in fiscal 2027, the vast majority of the cash payments associated with the program will be behind us. We expect capital expenditures for the full- year to be approximately 4% of sales as we continue to prioritize consumer-facing investments to fuel growth, including upgrades to our brick-and-mortar and online distribution channels, as well as targeted expanded consumer reach. Before we close, I would like to highlight another example of the more streamlined processes and stronger execution discipline we have built into the organization. Beginning with fiscal 2027, we are accelerating our year-end reporting timeline and plan to report our fiscal 2027 results on August 4th. In closing, we enter fiscal 2027 as a different company, more focused, more agile, and better positioned to execute with speed and excellence. We remain confident in Beauty Reimagined and our ability to deliver sustainable growth and long-term value creation. I want to thank our employees around the world for leading our transformation, and for your unwavering commitment to our company and our success. That concludes our prepared remarks. I will now turn it over to the operator to begin the Q&A session. Thank you. The floor is now open for questions. At this time, if you would like to ask a question, please click on the Raise Hand button, which can be found on the black bar at the bottom of your screen. When it is your turn, you will receive a message on your screen from the host allowing you to talk, and then you will hear your name called. Please accept, unmute your audio and ask your question. If you are dialing in by phone, please press star nine to raise your hand and star six to unmute. As a reminder, we are allowing analysts one question. Time permitting, we will return to you for additional questions. We will wait one moment to allow the queue to form. Our first question comes from Steve Powers with Deutsche Bank. Please unmute your line and ask your question. Great. Very good. Thank you. Good morning. Can you hear me? Morning, Steve. We can hear you. Okay, perfect. Great. I guess, if we could start on profitability, just a little bit more detail, if you could, on what has improved since May that it has allowed you to upgrade the fiscal 2027 margin outlook. And within that, if I could, in the quarter, we are seeing growth appear increasingly diversified, but profitability still seems very concentrated. As we think about the year ahead, the timeline for makeup, fragrances, haircare, and maybe the Americas to contribute more meaningfully to that profitability improvement. Thank you. Thank you, Steve. Essentially, we had a strong 2026 beat. We had a strong 2026 beat, so we wanted to flow that to the next year. In addition, as we have completed our PRGP work, we see further opportunities for SG&A optimization, which we are flowing through, and that has been a consistent message on non-consumer facing investment optimization all through the year. That is included in the improved outlook. What is also included in the improved outlook is continued investments to fuel growth, because that is ultimately the way to continue driving better leverage, better value creation. Then of course, we are also looking at executing the savings we have on PRGP ramp-up through the year. Frankly, this then goes to the full run- rate will even be reflected in 2028. We will exit with a stronger 2027 with most of the savings coming through, but the full run- rate will come through on 2028 as well. Now, related to your point on the diversity or the concentration of a profit, I agree. We have strong profitability on skincare. We have strong profitability in Asia, and we are improving profitability in all our segments. However, you are right that we have opportunity to further improve profitability on categories like makeup, haircare, and fragrances as well, and which is a clear part of our plan to improve profitability as we go towards further from the 13.5%, which is the top- end we have given. So over the next coming years, you should continue to see clear sequential improvement in all segments, both geographic and category. Very good. Thank you very much. Thank you. Your next question comes from Lauren Lieberman at Barclays. Please unmute your line and ask your question. Great. Thanks so much. I thought there was very big news today in the earlier August reporting, so thank you for that. I wanted to acknowledge that. All of the great transparency throughout the presentation was really helpful. My question, at the risk of being a bit nitpicky, is the organic sales guide for 2027 of 3%-5% growth versus the comment that expectation to accelerate organic sales growth, because obviously at the low- end, that would not be an acceleration. I just wanted to understand that low- end. More specifically, it does feel like there is a degree of organic sales growth that is still very tied to timing and dynamics around travel retail shipments. It feels that areas of the business, particularly Hainan retail, has really stabilized. I guess that inventory levels there have as well, given the visibility you seem to have into first half shipments. Just some commentary on, I guess, overall sort of stability and inventory levels on particularly Asia TR and the degree to which that influences the organic sales outlook. Thanks. Yeah, thanks, Lauren, and thank you for your comment. Really appreciate it. Very proud of what the team has achieved throughout fiscal 2026. When it looks at the talk about the outlook, obviously as the Beauty Reimagined strategy lays it out very clearly, we want a much more diversified growth across geography, across categories, across channel going forward. You are going to see us continuing to build on the strengths, obviously, of China and the Asia-Pacific, including travel retail geographies. We also clearly laying out an acceleration on the West, especially with North America, where we are laser focused on pushing retail. You saw, obviously, in the quarter four some very strong result in the mid-single- digit growth. Obviously, this is really balanced in the way we do it. To complement what Akhil was saying, we are obviously going to continue to accelerate skincare and fragrances. Fragrances, like I said in my prepared remark, we expect fragrances to continue to be a stunning performance in fiscal 2027, but obviously with a clear intent to accelerate the performance on makeup. The performance of makeup will be broad-based from a geography standpoint, but with a clear focus also on the West, especially North America again. I think you have to see the outlook for us. We are always looking at it 3% to 5%. As we, in fiscal 2026, deliver the top- end of the guidance, our goal is to just look an acceleration over fiscal 2026. If you look at the midpoint, there will be 100 basis point improvement. If you look at the top- end of the guidance, will be 200 basis point improvements. That mainly will obviously come from the West. That is where I would look at our overall guidance from a sales standpoint for fiscal 2027. Your second part of your question, when you talk about TR shipment, I want to be very clear, and I will reiterate what I have said many, many times. We are shipping to demand, so our inventory is in a very good place in travel retail. I am very happy to report another good news in travel retail. For the first time in three years, for the months of June and the months of July, we are back into positive territory for travel retail global, led by Hainan. That is in double-digit growth in the fourth quarter. That was also there in Q3. We are seeing great momentum in Korea, in Hong Kong, in Southeast Asia, in travel retail. Travel retail West, the America is strong, and it is helping to offset some of the headwind that we are getting from the Middle East. The retail is strong in travel retail, and we are managing inventory to the demand. As I said also many times, travel retail represent about 15% of our business, and we intend to just keep it in line with industry standard. Hope it answers your question, Lauren. Great. Thank you. Thanks, Lauren. Our next question comes from Chris Carey with Wells Fargo Securities. Please go ahead and ask your question. Hi. Good morning, everyone. Can you hear me? Yes. Morning, Chris. Great. I wanted to follow up on this from a bit of a different angle. Just number one, you talked about faster organic sales growth in the front half of the year. Can you just dimensionalize that? Would you be above your guidance range in the front half or more at the higher- end? Secondly, just on this travel retail comment, I think the question's well taken in that travel retail shipment are these two words that we've come accustomed to representing volatility over recent years, and clearly you just said that you're shipping in line with consumption. But can you just give us a sense of how you've evolved the management of the broader Asia ecosystem when you go to market, and how you're thinking about managing the mainland China business versus the travel retail business in Asia, such that you can deliver more consistent growth in both areas over the course of the year. Thanks so much for those two. Thanks, Chris. Let me just take on this question. When it looks at the outlook for fiscal 2027, and we said it in our prepared remark, we have a stronger pipeline on innovation in the first half versus the second half. It was by design, obviously, because when we laid out Beauty Reimagined, we said we were going to just accelerate our innovation and obviously, skincare, alongside every other category, was a key focus for us, for acceleration. So you're seeing a lot more coming in the first half, which led to believe that obviously we will be higher in term of growth in the first half than we would be in the second half. Okay? That will help to guide, somehow, the construction of how we are looking at the year between first half and second half and deliver the 3%-5% guidance. Hopefully, that just gives you a little bit flavor on how to look at it. When it comes to the TR visibility, we have a very clear system in place today. Like you said, on the management, first of all, we had a complete transformation of the leadership team in travel retail with a new leader in travel retail, managing from different places around the world. We have two key region, one for the East and one for the West. The West being managed out of London for us, and the East managed from Singapore, and we have new talent. Like I said in my prepared remark also, we've really accelerated experiential retail in travel retail, so you are going to see us doing a lot more activities in the East and in the West. We've accelerated the deployment of our brand in the West, especially led by the fragrances. You're seeing a lot more visibility on Jo Malone London, on TOM FORD, on KILIAN PARIS, on Le Labo, on many, many airport in the Americas and EUKEM. When it comes to the management of the East, we have some system in place that allows a clear coordination of activities between mainland China and travel retail China. That is done in conjunction between Joy Fan, who is the leader of China, and Matthew Growdon, who is the leader of APAC and travel retail, where they meet regularly to coordinate launches, activities, how do we go at 11.11 versus 618 between the travel retail and in local market. It's a very sophisticated model that allows us to really making sure that we are managing the total China ecosystem, and we are looking at it from mainland to travel retail, alongside also the Chinese travelers around the world in a very coordinated model that allows us to delight the Chinese consumer wherever they are, and as you say, to continue to ship to the demand wherever it is. Okay. Thanks so much. Thanks, Chris. Our next question comes from Filippo Falorni with Citi. Please go ahead with your question. Hi, good morning, everyone. Morning, Filippo. Morning. I wanted to ask about the mainland China business. Clearly, the category has improved, and you call out the significant improvement market share as well, in terms of brand rankings around the 618, 11.11, and you mentioned even a number one share position in prestige beauty. So I just wanted to get your perspective of what has changed in the market, both at the category level and at your execution that has really transformed this business and put in a consistent top-line growth. What allowed you to consistently gain market share in the market, both in terms of innovation changes, marketing, social media presence? What has been the big change that has allowed this very impressive turnaround in China? Thank you. Thank you, Filippo. Fantastic question on China. The first thing I would say is I am really proud of the work that the team in China is doing across all the brands. The most important thing is understanding the fundamental of the market, and the market is very, very strong. It is in high- single-digit growth from a prestige beauty. We are seeing China growing again, and as thank you for pointing it out, we have had some fantastic results. We have been gaining market share in every single quarter and in every single category. Now we are onto six consecutive quarters of market share gain in China. In the last quarter, what is very impressive, we have 11 brands in retail sales growth, of which six are in double-digit growth. That is very important for you to just note, because as we committed a diversified growth around the world, we also committed to a more diversified growth within the region and within the China where we operate. Today, we have obviously continued to have very strong performance on La Mer, but we have a very diversified growth across now six brands in double-digit growth, and we have brands, Le Labo, that are growing in excess of 50% during the year. Which is fantastic. The other thing, to answer your question of why we are winning in the market is remarkable, despite the remarkable execution from the team. We are also accelerating innovation in China for China. Now, 30% of our innovation around the world is coming from China for the China market, thanks to the ramp-up of all the activities we have from our R&D center in Shanghai. This is also allowing us to be even more tailored to the need of the Chinese consumer in skincare or in makeup. The last thing I would say is, in China, we have always been first movers to new channels. Today, obviously, we started years ago with the department stores. That continues to be strong. We accelerated our freestanding stores that allows us to accelerate our experience. But obviously in online, which is now over 50% of the business in China, we are having great success with Douyin. We have now 11 brands in China on the Douyin platform, and we are performing extremely well there. Overall, the market is strong. Our business is even stronger than the market. The last thing that I would say in China, we are now less promotional. We have really pushed the valorization in the market that have really allowed us to just recruit new consumers and allowed us to, thanks to the valorization, to continue to sustain strong investment in the market to just capture the Chinese demand. Great. Thank you very much. Thanks, Filippo. Our next question comes from Peter Grom with UBS. Please go ahead. Hey, Peter. Well, maybe not. Peter, your line is now open. You may ask your question. You guys hear me now? Yes, we can hear you, Peter. Yes. All right. Cool. Thank you. Good morning, guys. Morning. I was hoping to get some perspective on 2026 and just kind of taking a step back, and just looking at where things came in relative to your expectations and just the drivers of the upside. Organic sales came at the high- end, operating margin well ahead of the midpoint if we go back to where guidance was a year ago. I am curious if you have embedded similar levels of flexibility as it pertains to 2027 guidance, particularly as it would seem you are exiting the year with some really nice momentum on the top- line, and the majority of the benefits related to PRGP are still to be realized. Thank you, Peter. I will start, and Stéphane can add here. Essentially, look, it has been what Stéphane just said. It has been outstanding execution against our priorities overall on all of the pillars. Of course, we started the year with a guide of 9.4%-9.9% on margin, and we significantly beat that through the year. That is really the outstanding execution of PRGP, first of all. Secondly, the continued progress we made on reducing, therefore, the non-consumer facing. Thirdly, which allowed us to fuel the business, which is seen as the much more diversified growth in quarter four. We are pleased with the fact that North America has come back to positive results this quarter on net sales, as well as our retail has been building. Those have been positive surprises from a cost and top-line perspective. At the same time, China business, consistent share growth quarter-of-quarter in one of the most competitive market, and that too by a significant distance, as we just said. That has been a positive. Travel retail returning to positive retails as we are exiting the year. These are all positive surprises. Also on gross margin, we delivered 150 basis points. When we entered the year, the environment was quite uncertain with the tariffs, et cetera, being announced, but we really executed very well against that and mitigated a significant part. Our beat on gross margin as well has been very strong. As we look to 2027, of course, the outlook is 3%-5% on sales growth, but it is a much more diversified growth, as Stéphane just said. North America should accelerate. Makeup should accelerate. While East will lead growth, West will accelerate from its prior trends. We will keep building savings through the year, ramping as we execute, which should also give momentum into 2028. Of course, when we give guidance, we consider various things which are controllable. What we are demonstrating is execution against controllables is very strong, and we typically exceed that. Of course, what we are also keeping in mind is the macro environment, which we do not control. We keep enough scenario planning to get to our goals into multiple different paths. That is generally been our posture, and I will pass it over to Stéphane to add. Yeah, no. I think, Peter, I'd just love to add to what Akhil said. I think what you have to take into consideration is the way we enter fiscal 2026 and the way we enter fiscal 2027, we're a very different company. The business is really clearly transformed. We are really operating at a very different speed than we've ever done before, and we are back growing. That's the most important things because the streamlining of the cost has given us a lot greater flexibility to manage sales volatility. So to your question, are we building scenario planning for sales volatility? Absolutely, as we did it in fiscal 2026. We are also realizing a lot more sales leverage. I think when we started the year from 0% to 3%, and we are finishing at the top- end of the guidance, that is giving us a lot of leverage. Next year to 3% to 5%, let's say we just deliver the midpoint or the high- point of the guidance, this is going to give us a lot more sales leverage, and that allows us continue to accelerate. So the model and the discipline that we've built in fiscal 2026 is now pulling in place clearly on a very different company on how we are operating for fiscal 2027, and is going to allow us to replicate, and accelerate, frankly, what we've done in 2026, in 2027. Great. Thank you so much. I'll pass it on. Thanks, Peter. Our next question comes from Cristian Rios with Bernstein. Please go ahead with your question. Hi, good morning and congratulations on a fantastic quarter. Thanks. I was hoping, can you break down the 5% organic sales growth in North America in the quarter into how much of that was sell-through or consumption? I think there was mention of timing of shipments. Can you talk a bit more about what that was, the magnitude of the impact, and how it connects to previous or next quarter growth? Are any other puts and takes that you think we should understand? Then, as we think about next year, what are you most excited about in terms of channels or retailers or maybe even brands in North America? Thank you. Yeah. Thank you, Cristian. I think North America for us is a key focus. It's been a key focus in 2026, and you see there was one slide in our prepared remark that shows the sequential improvement quarter-over-quarter on our performance, finishing on a high note in Q4. Now, obviously from a timing of shipment, this is retail driven. There's a change on activities like Prime Day from Amazon was in July the prior, it's in June in fiscal 2026. There's obviously the market has been growing faster in the last quarter, especially due to the June activity. But the good news is that us, we've been able to accelerate as the market is accelerating at the midpoint. The one thing that I would say is the most important thing for us, and the most important indicator in 2026 was to make sure that we could resume with volume share gain because it is an acquisition game. We needed to just make sure that we reignite the recruitment wheel. It is exactly what we have done. Alongside, we are seeing brand like The Ordinary continuing to having outstanding performance. M·A·C, thanks to our deployment in new channel like Sephora, not only we have been able to regain the number one ranking in Q4, but we have been able to gain market share also in Q4, which is quite outstanding and a very quick turnaround that we will continue to accelerate in fiscal 2027. I could go on. Bobbi Brown is also in market share gain in makeup. We have had exceptional performance on brand like Le Labo that are not in the track data because it is mostly a direct- to- consumer brand, but also TOM FORD, prestige brands that is doing very strong. Let alone online where we know and we have clear data showing that we are gaining market share. That is actually showing the outstanding execution that our team are doing in North America, and I really believe that we are going to be able to just continue to do that. Actually, the early signal of the months of July that we are getting are extremely strong for The Estée Lauder Companies led by Clinique and M·A·C, thanks to great activities that we are doing on social commerce and also obviously the continuous deployment of M·A·C into more growth distribution. I feel very confident and frankly, there is nobody more impatient than me to just drive the growth in North America, and the entire team is really focused in 2027 to take on the great momentum that we have had in Q4. As far as what we are exciting in North America, in China, we are exciting about all the channels. We are exciting where the consumer is, and our objective is to delight the consumer wherever we can create the experience that it is online, that is in specialty multi, that is in our own direct- to- consumer, as well as in department store where we can create the right experience. I think there is great momentum. We have great innovation behind our brands. We are excited, I mentioned it, a new exciting launch behind the Estée Lauder brand franchise called Glimmer that we are shipping as we speak. We have great exciting new launches on Clinique Skincare with the new smart cream serum, tapping into PDRN. We have a slate of innovation that is really going to allow us to just maintain, if not to accelerate our growth in North America in fiscal 2027. Great. Thank you. You're welcome. Our next question comes from Rupesh Parikh with Oppenheimer. Please unmute your line and ask your question. Good morning, and thanks for taking my question. Just going back to your commentary that expectations for a return back to growth in the makeup category, just curious the bigger opportunities you see and then just confidence in being able to get back to growth in makeup. Yeah. We have some of the leading brands in makeup, starting with M·A·C. We are clearly planning to accelerate that business. On makeup, of course, we play with Clinique, which is the number one brand in makeup in the U.S. We have M·A·C. We are also addressing the challenges we have had on some of the other brands in the past. What we are exiting is a stronger performance on makeup, and makeup being our number two category, we continue to believe that it will not only improve on sales trends, it will also improve, as was question was asked earlier, on profitability with all of the work we are doing. That would be a critical part of continuing to build a broader, more diversified sales growth and also profitability in this segment. Yeah, and I think just one addition to what Akhil said, Rupesh, is obviously we are also making sure that we're deploying our makeup brand in the fast-growing channel where the makeup consumers are shopping, mainly specialty- multi, as well as social commerce. One of the reason of the strong acceleration that we're seeing in M·A·C is the entire ecosystem that we've created from social commerce to specialty- multi department store and freestanding stores that are now all working in conjunction just to really activate the recruitment wheel and the retention wheel across the brand. I think what was missing as part of our arsenal was to be everywhere where the consumer is from a recruitment and from the retention. Now that we have the right platform from a distribution standpoint, and then we are adding an acceleration on innovation like this outstanding lip stain that M·A·C launched, this has been like a blockbuster in many market around the world. We believe that now we have the right recipe for us to just accelerate in makeup. At the moment, frankly, where we see in many market, the makeup category also starting to just accelerate, especially in China, we're seeing acceleration in the U.S., which has been, as you know, the category pretty flattish for quite some time, since the exit of COVID. This is also for us the right moment to accelerate. The last thing I would say in makeup, we are continuing to also rationalize the distribution where we don't have the right profitability and the right productivity per door. We've closed a significant amount of freestanding stores in M·A·C around the world as we are pivoting to more growth and profitable channels. Great. Thank you. Thanks, Rupesh. Today's final question comes from Olivia Tong with Raymond James. Please go ahead. Great. Thanks. Good morning. Morning. I want to talk about margins because it is an exciting time as margins continue to move in the right direction. As you think about expanding from about 200 basis points this year, where do you see the biggest opportunity? It seems like there is more opportunity for efficiency gains as well as delayering the organization, and if so, which areas do you see the most opportunity? I also want to ask about cash uses, now that you have taken transformational M&A off the table, PRGP is now closed. How do you think about the deployment of cash from here? Thank you. Thank you, Olivia. We are pleased with the 320 basis points of margin we expanded this year, which was coming from two big drivers, gross margin and the progress on non-consumer facing, which includes, as you pointed out, employee cost reduction and all of the infrastructure rationalization we have done, including real estate and so on and so forth, and the work we have done on procurement. As we look forward on the guide that we have given 150 basis points to 230 basis points margin expansion, as we mentioned, that gross margin would be a modest driver, but a large part of the driver here will come, as you pointed out, from all of the SG&A, which includes employee cost and the announcement we made of the total restructuring that continues through 2027. What we do see a large opportunity even after this year's guide, which is what I said earlier, that as we complete our execution, we will be exiting the year with full benefits starting to hit in the later part of the year, which will then have the full annualized benefit in 2028. That flow-through and margin should continue to come in 2028. Of course, at 13.5% margin, we still believe we have runway to go further, driven by that. Consumer facing, we have continued to invest, and as Stéphane has talked about, all of the work we are doing on media, one from a better placement and better procurement of media. There should be runway there as well, but of course, right now our focus is to build our brands, drive growth, drive share, but that would be another leg to add down the road. It started with gross margin, passes to SG&A, but we will have the full 360 approach to continuing to build margin. That is what we believe, and this should have at least a good flow-through even in 2028. On cash uses, our stated mission has been to deleverage the company beyond any other points on M&A. We are continuing to use cash to drive down our debt. We have debt coming due later in the year, which we will, for all practical purposes, we would continue to pay down. Of course, we are making sure that our CapEx is fully funded to drive consumer CapEx. Secondly, of course, other one is dividend, and then thirdly is deleverage, and at the same time, we will look for any other opportunities to drive a better return on our cash. But first priority right now is to continue to build a stronger balance sheet, and we made solid progress this year with the cash performance. Yeah. The only one thing, Olivia, that I would add to Akhil is obviously look at it as with the streamlining of our cost and the efficiency that we are building across the company, it allows us to realize a lot more sales leverage. As we are accelerating growth, you will see the flow-through in profitability and our ability to continue to accelerate. And this is also why, to reinforce the earlier question that was asked, why we felt comfortable to raise our preliminary view from a margin standpoint and even go beyond on the top- end at 13.5%, which is 50 basis point higher than our preliminary view that we have in the last quarter. Sales leverage now is our disposal to be able to continue to invest in the business to fuel growth, but at the same time to continue to just increase, in a sustainable way, our profitability over time. Great. Thank you. Thanks, Olivia. Thank you. This concludes our allotted time for Q&A today. If you were unable to join for the entire webcast, a playback will be available at 1:00 P.M. Eastern Time today until October 30th. Please visit the Investor Section of the company's website to view a replay of the webcast. I would like to thank you all for joining and wish you a good day.