Beauty budgets are getting squeezed — and tariffs could only push prices even higher. Here’s how shoppers and L’Oréal alike are bracing for impact

The tariff effect is more than just skin deep

L’Oréal is facing a tough call as tariffs loom over imported goods. Despite its sizable North American manufacturing footprint, many of the company’s bestsellers — like high-end skincare items and fancy fragrances — are still made in Europe. That puts the company squarely in the crosshairs of the 20% tariff on EU imports.

Nicolas Hieronimus, CEO of the French cosmetics brand, recently acknowledged that the U.S. market has proven to be tougher than L'Oréal expected heading into the year. Still, he told The Wall Street Journal that he expects the global beauty market to grow modestly around the lower end of the 4% to 4.5% range.

In 2024, L’Oréal reported solid, broad-based growth across its portfolio despite economic turbulence and shifting consumer habits. The company has a "multipolar model," which means L’Oréal isn’t overly reliant on any one market to keep business booming. Its stable of powerhouse brands — from budget favorites like CeraVe to luxury staples like Lancôme — allows the company to weather storms in one region while picking up momentum elsewhere.

Whether it’s your personal portfolio or a multinational brand, diversification is one of the ways to weather economic uncertainty. By spreading your assets — or your product offerings — across different sectors and regions, you’re not relying on a single stream of income to carry the load. That way, if one market takes a hit, the others can help balance the impact.

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American beauty on a budget

L’Oréal’s luxury fragrances — including YSL’s MYSLF and Valentino’s Born in Roma — helped the beauty company beat expectations in Europe during the first quarter of 2025. But across the Atlantic it’s a different story, as North American sales dropped 3.8% in Q1.

It’s not that Americans have stopped buying beauty products altogether — they’re just getting a lot more strategic about it. On the BeautyGuruChatter subreddit, shoppers echoed the same sentiment. In a thread reacting to a YouTube video about rising beauty prices, users shared how they’re coping: skipping salon visits to trim their own bangs, swapping professional manicures for DIY nail kits and dyeing their hair at home.

But not everyone in the U.S. is panicking. Thanks to an overflowing market — with brands at nearly every price point — beauty lovers can still find affordable options without sacrificing quality. The key is to shop smarter, not harder. Stick to a budget before heading to the drugstore or your local Ulta and look for multi-use products that stretch your dollar further.

To stay ahead of the price hikes, check the label before you buy, as U.S. made products might hold their value better in the months ahead. Buying in bundles or subscribing to auto-ship deals can also help lock in today’s prices before any tariff-driven spikes hit the shelves.