Record-scale losses and structural reform (2025)

The choice to take the losses in full

The heart of this structural reform lies less in the decline of results than in facing head-on the losses left by past overseas-brand acquisitions. Shiseido wrote down, in one stroke, the goodwill that had swollen in the Americas, and took on the pain of two straight years in the red. At the same time it piled up personnel cuts at home and abroad from 2024, pressing ahead with a redesign that narrowed resources onto the fields where it could win. The impairment was a settling of past investment judgments; the early retirements, an adjustment to a cost structure cut to its own size. It was a choice to process the burden left by the past expansion in the form of taking the losses in full.

That said, booking the losses and putting the structure in order does not, in itself, promise a return to growth. Even with the impairment lightening the Americas books and fixed costs brought down, if the overseas brands — Drunk Elephant foremost among them — do not sell again, the 2026 goal of turning the Americas business profitable hangs in the air. The headwinds of a maturing domestic cosmetics market and swings in overseas demand have not vanished either. Shiseido’s rebuilding rests on how it connects a 2025 in which it took the losses in full to the next stage of growth. Whether this venerable house’s turnaround succeeds has yet to show up in the numbers.