Coty Sued After CEO Exit, Guidance Withdrawal and 8% Share Drop
Coty is facing a securities class action lawsuit over its February 2026 surprise profit decline, CEO Sue Nabi’s abrupt exit, and withdrawal of its FY2026 guidance, which sent shares down over 8%. Additionally, the company’s 'Supercharge with AI' enterprise upskilling program secured a Newsweek AI Impact Award.
1. Securities Class Action Details
Coty is facing a securities class action for investors who acquired its common stock between November 5, 2025 and February 4, 2026, alleging that the company made false and misleading statements about business trends and failed to disclose underperformance in the Consumer Beauty segment and slowing growth in Prestige fragrances.
2. Financial Impact and Guidance Withdrawal
On February 5, 2026, Coty announced Q2 2026 results showing a more than 70% drop in Consumer Beauty operating income and an 18% decline in Prestige operating income, then withdrew its FY2026 adjusted EBITDA and free cash flow guidance, triggering an over 8% share price decline and the abrupt departure of CEO Sue Nabi.
3. 'Supercharge with AI' Program Award
Coty’s 'Supercharge with AI' enterprise upskilling program won a Newsweek AI Impact Award, highlighting the company’s commitment to workforce digital transformation, although the near-term financial benefit of this recognition remains unclear.