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Coty Inc. (COTY) Drops 21% Amid Another Retailer Inventory Destocking Disclosure -- Hagens Berman

1. Coty's shares fell 21% after weak financial results. 2. Investigation opened into potential misrepresentation of growth prospects. 3. Inventory destocking issues cited as a significant factor in revenue decline. 4. Shareholders urged to report losses as investigation progresses. 5. Coty's digital inventory strategy may have been mismanaged.

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FAQ

Why Very Bearish?

The significant drop in share price followed negative earnings and an investigation, reminiscent of past events where companies faced legal scrutiny after poor financial disclosures. For example, companies like Theranos and Enron experienced severe drops after similar probes.

How important is it?

The ongoing investigation and severe drop in stock price directly impact COTY's market perception and investor confidence, severely influencing trading dynamics and stakeholder actions.

Why Short Term?

Immediate investor sentiment is negatively affected, but long-term recovery may be possible if management addresses concerns effectively, similar to how companies have rebound post-investigation after restructuring communications.

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ELPGAVP
, /PRNewswire/ -- On August 21, 2025, investors in Coty Inc. (NYSE: COTY) saw the price of their shares fall $1.05 (-21%) after the company reported its FY 2025 and Q4 financial results and revealed ongoing inventory destocking issues. The company's earnings disclosures have prompted national shareholders rights firm Hagens Berman to open an investigation into whether Coty may have misled investors about its growth prospects. The firm urges investors in Coty who suffered significant losses to submit your losses now. The firm also encourages persons with knowledge who may be able to assist in the investigation to contact its attorneys. Visit: www.hbsslaw.com/investor-fraud/cotyContact the Firm Now: [email protected]                                        844-916-0895 Coty Inc. (COTY) Investigation: Coty is one of the largest beauty companies, with a portfolio of brands across fragrance, color cosmetics, and skin and body care. The company has two reporting segments – Prestige and Consumer Beauty – which accounted for about 65% and 35% of Coty's revenues during 2025. The investigation is focused on the propriety of Coty's disclosures to investors concerning the company's growth trajectory within its segments and the success of its digital inventory strategy ("SAP S/4HANA) transition, which Coty has repeatedly said since August 2024 "went off without a hitch[]" but has also occasioned "inventory buildup" at the company. On August 21, 2025, Coty's disclosures may have come into question, when Coty reported a very weak Q4 and revealed during its earnings call that it experienced significant year-over-year revenue decreases in both Prestige and Consumer Beauty. The company blamed its financial performance, in part, on its retailers' inventory reduction ("destocking"), a phenomenon the company has downplayed since its SAP S/4HANA transition, which supposedly "went off without a hitch." This news drove the price of Coty shares sharply lower that day. "We're investigating whether Coty may have misled investors about possibly overloading its retailers with excess inventory to reduce its inventory buildup and/or hit its earnings expectations," said Reed Kathrein, the Hagens Berman partner leading the investigation. If you invested in Coty and have substantial losses, or have knowledge that may assist the firm's investigation, submit your losses now » If you'd like more information and answers to frequently asked questions about the Coty investigation, read more » Whistleblowers: Persons with non-public information regarding Coty should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email [email protected]. About Hagens BermanHagens Berman is a global plaintiffs' rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman's team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.  SOURCE Hagens Berman Sobol Shapiro LLP WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In Also from this source

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