(Reuters) - Cosmetics company Estee Lauder Cos Inc (N:EL) cut its full-year profit and sales growth forecast due to weak demand for its skin care products in the United States and China.
The company's shares fell as much as 4.7 percent.
Sales in the skin care business, the company's biggest, fell 6.8 percent in the first quarter ended Sept. 30, from a year earlier.
Skin care sales growth in the United States has slowed in the recent quarters, Chief Executive Fabrizio Freda said on a post-earnings conference call.
"We need to increase the amount of innovation in the U.S., to compete in a market where skin care is becoming much more competitive," Freda said.
The company's net sales fell 1.6 percent to $2.63 billion (1.64 billion pounds) in the first quarter as some retailers advanced orders in the fourth quarter ahead of a planned technology upgrade.
The advanced orders likely led to a shift of $125-$150 million in sales, S&P Capital analyst Joseph Agnese wrote in a note.
In the last one year, Estee Lauder has grown sales faster than those of rivals such as Coty Inc (N:COTY) and Elizabeth Arden Inc (O:RDEN) as it has a wider portfolio of skin care and makeup, and caters to higher-income customers.
The maker of M.A.C., Bobbi Brown and Estee Lauder cosmetics said sales in the Americas fell 7.3 percent, while those in Europe, the Middle East and Africa rose 5.7 percent.
The two regions made up for nearly 80 percent of Estee Lauder's total sales in the first quarter. The Americas alone accounted for 42 percent of the sales.
Freda said sales in China, its biggest emerging market, were being hurt by increased promotions, competition from Korean brands and lower luxury spending.
China accounts for about 6 percent of the company's total sales, according to Stifel Nicolaus analyst Mark Astrachan.
The company expects a strong U.S. dollar to hurt full-year sales growth by about 3 percentage points, compared with the 2 percentage points it had forecast.
The company cut its full-year adjusted earnings outlook to $3.03-$3.11 per share from $3.10-$3.20.
It trimmed its forecast for net sales growth to 2-3 percent in constant currency, from 3-4 percent.
Net income attributable to Estee Lauder fell 24 percent to $228.1 million, or 59 cents per share in the first quarter. Analysts an average had expected a profit of 55 cents per share, according to Thomson Reuters I/B/E/S.
The company's shares were down 4.2 percent at $72.78 in early afternoon trading.
(Reporting by Shailaja Sharma in Bangalore; Editing by Maju Samuel)