From Observer, July 30:
As L'Oréal posts strong first-half earnings and strikes a sweeping partnership with OpenAI, the reclusive dynasty behind the world's largest beauty company—already worth $95.6 billion—cements its next generation of control.
More than a century after chemist Eugène Schueller turned a hair-dye formula into the business that became L’Oréal, the beauty giant is still finding new ways to grow, with A.I. as its latest bet.
L’Oréal’s Revenue rose 6.3 percent on a like-for-like basis, a key retail metric, to €11.6 billion ($13.2 billion) in the April-June quarter. For the first half of 2026, revenue increased 5.8 percent to €23.78 billion ($27.1 billion), while net profit climbed 4.7 percent to €3.96 billion ($4.5 billion) and the operating margin reached 21.3 percent. Growth extended across every region and division, from Maybelline’s mass-market makeup to La Roche-Posay’s dermatological skincare and Kérastase’s salon-grade haircare.
CEO Nicolas Hieronimus credited that performance to e-commerce and L’Oréal’s innovation strategy, which now includes a partnership with OpenAI announced in June. “Our innovation engine is firing on all cylinders—and A.I. will help it maintain its pace,” he said in a statement accompanying the results.
Few investors have more riding on that momentum than Schueller’s descendants. His granddaughter, Françoise Bettencourt Meyers, and her family own 34.79 percent of L’Oréal, making them the company’s largest shareholder. L’Oréal shares rose 3.6 percent to €397.15 in Thursday trading, adding roughly €2.5 billion ($2.9 billion) to the market value of the family’s stake. Forbes currently estimates the family’s collective fortune at $95.6 billion.
L’Oréal is turning ChatGPT into a beauty counter
L’Oréal’s e-commerce sales jumped 18 percent to €7.4 billion ($8.5 billion) during the first half of the year, almost twice the growth rate of the online beauty market, according to the company. L’Oréal now sees chatbots as a potential next storefront.
On the earnings call, Hieronimus said younger consumers are “shifting massively” toward large language models for product questions and described beauty as one of the most conversational categories. L’Oréal’s brand recognition, scientific data and professional endorsements could help its products surface in A.I.-generated recommendations, he argued, although the channel remains a “moving target.”
The shift could be lucrative well beyond L’Oréal. McKinsey estimated last year that generative A.I. could create $9 billion to $10 billion in annual value across the beauty industry, with marketing and sales among the largest opportunities.
At VivaTech in Paris in June, L’Oréal outlined a two-pronged collaboration with OpenAI: turning ChatGPT into an interactive beauty assistant while putting its models to work behind the scenes....
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