Natura sees revenue under pressure in Brazil and Argentina while performing well across other Latin American markets in Q1-26

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• USA - English

• Revenue pressured by macro conditions in Brazil and Argentina, and gradual recovery in the Argentine market following the integration with Avon
• Natura gained market share in Brazil in the quarter, driven by sell-out growth and a sequential increase in the relationship selling channel
• Solid performance in Hispanic markets ex-Argentina, with a channel recovery in Mexico
• EBITDA of R$ 346 million with a 7.3% margin temporarily impacted by extraordinary non-operating costs
• Avon relaunch initiated in March, with new products sales exceeding expectations, though implementation remains in its early stages
• Free cash flow to firm was neutral when excluding R$ 330 million in extraordinary costs amid the implementation of the Company's new operating model

SÃO PAULO, May 11, 2026 /PRNewswire/ -- Natura (B3: NATU3) today reported its first quarter 2026 results, with net revenue of R$ 4.7 billion, EBITDA of R$ 346 million, and EBITDA margin of 7.3%. Performance was pressured by the macroeconomic slowdown and lower consultant activity and headcount in the main market, Brazil. Results further reflect the ongoing recovery of Argentina operations post the Avon integration in the second half of 2025 amid declining consumption and an unfavorable exchange rate in the country.

Despite revenue headwinds, Natura Brazil gained market share in the quarter on the back of sell-out growth (sales to the end consumer), while steadily recovering the relationship selling channel with a sequential increase in the number of beauty consultants. Brazil's digital sales grew +23.6% YoY, underpinned by stronger platform traffic and key initiatives such as live commerce and the ongoing digitization of the consultant network. In retail, revenue increased 14.3% YoY.

Excluding Argentina, the other Hispanic markets delivered solid performance in the first three months of the year, driven by positive contributions from markets where the Avon integration is already more mature and by the ongoing recovery in Mexico, where the brand combination was completed in the first half of 2025.

Across the Hispanic region as a whole, the Natura brand grew 7% in constant currency.

Q1 2026 also marked the beginning of Avon's relaunch in Brazil and Mexico in March, with a new positioning and innovation portfolio to be rolled out in phases. While still in its early stages and accounting for a small share of total volume, the relaunch has already generated above-expectation sales for Avon's new products and delivered improvements in brand health metrics.

Profitability in the quarter was impacted by the revenue slowdown, coupled with non-operating and non-recurring expenses amid the implementation of the Company's new operating model, which has already established a leaner, more agile, and efficient structure effective from the beginning of 2026. Costs related to this transition were concentrated primarily in Q1 2026.

During the period, cash flow (R$ -315 million) was broadly neutral when excluding the Company's extraordinary expenses (R$ 330 million), attesting to the business's resilience even amid revenue pressure.

"Having implemented the new operating model without disruptions, our focus turns entirely to sustainable revenue growth and expanding profitability. We are confident in delivering on our 2026 commitments, which include improving annual margin versus 2025 and robust cash generation, with our optimal capital structure and disciplined capital allocation translating directly into returns for shareholders," stated CEO João Paulo Ferreira.

Regeneration
On the social and environmental front, Natura was recognized as one of the World's Most Ethical Companies by the Ethisphere Institute, appearing for the 15^th time in a ranking that highlights companies leading the definition and advancement of ethical business standards globally.

In Brazil, the Company advanced to 2^nd place in B3's Corporate Sustainability Index (ISE B3), up from 6^th in the previous cycle, reinforcing the consistency of an agenda that integrates social and environmental impact with value creation.

About Natura

Founded in 1969, Natura is a leading Brazilian multinational in beauty and personal care in Latin America, ranked as Brazil's most reputable company and ESG leader by the Merco ranking for 12 consecutive years. A pioneer for over 25 years in the cosmetic use of bioactive ingredients from Brazilian socio-biodiversity through partnerships with Amazonian extractive communities, Natura today benefits thousands of families and helps conserve 2.2 million hectares of forest. In 2014, it became the first publicly-traded company to receive the B Corporation certification from B Lab, recognizing businesses that combine profit with positive socio-environmental impact. Products are available through more than 3 million consultants across the region, e-commerce, the Natura app, and over 1,000 stores. For more information, visit ri.natura.com.br or natura.com.br, and follow Natura on LinkedIn, Facebook, and Instagram.