Export growth extends into October
October marked the eighth straight month of double-digit export growth, KED Global reported on November 3. Demand from the United States and Europe remained firm even as manufacturers faced pressure on profits.
The increase followed a January-September export total of $11.14 billion, or about 15 trillion won, according to Chosun Biz. That was 30.8% higher than a year earlier and already represented 98% of the previous full-year total. South Korea had ranked second worldwide in cosmetics exports in 2025, with $11.4 billion, ahead of the United States at $10.8 billion but behind France at roughly $24 billion, Personal Care Insights reported.
The United States was South Korea's largest cosmetics export market in the first half of 2026. Ministry of Food and Drug Safety figures reported by Personal Care Insights put shipments there at $1.45 billion, up 41.5% and accounting for 20.7% of the total. Overall first-half exports grew 27.3% to $7 billion. China ranked second at $1.01 billion, a decline of 6.6%, while Japan ranked third at $580 million, up 5.9%.
By September, exports to China were growing again: shipments rose 9% from a year earlier, their fifth consecutive monthly increase. Hana Securities figures reported by Businesskorea put total September exports at a record $1.21 billion, up 30%. Shipments to the United States increased 21% to $247 million, while the combined total for nine European countries rose 103%.
APR's record quarter falls short of profit expectations
With 94% of its third-quarter revenue coming from overseas, APR reported both rapid growth and a substantial currency hit. Revenue reached a quarterly high of 773.1 billion won, twice the year-earlier level. Operating profit increased 68.9% to 160.6 billion won, yet missed the market forecast cited by Hana Securities, 181.4 billion won, by 11.5%. Its operating margin narrowed from 24.8% in the second quarter to 20.8%.
APR attributed an estimated 27.8 billion won reduction in operating profit to the stronger won. Between early July and the end of September, the currency gained 12.6% against the dollar and 13.2% against the euro. Those moves lowered the value of outstanding receivables as well as the amount of won received when overseas sales were translated into the home currency.
Although APR described the impact as temporary, exchange rates remained a concern after the quarter ended. The average rate moved from 1,501.93 won per dollar in the second quarter to 1,423.28 in the third; an intraday reading in October reached 1,321.20. Korea Investment & Securities forecasts a fourth-quarter average of about 1,350 won per dollar.
A stable exchange rate would reduce valuation losses, but a persistently lower won-per-dollar rate would continue to affect translated sales. Brokerages nevertheless forecast a fourth-quarter operating margin of 23% to 24%, supported by sales growth during the year-end peak season.
Domestic business supports Amorepacific
Amorepacific met market expectations, reporting third-quarter operating profit of 115.2 billion won, up 25.4%, on revenue of 1.1295 trillion won, up 11.1%. Most of the profit improvement came at home: domestic operating profit increased by 25.2 billion won from a year earlier, compared with a 5.8 billion won increase overseas.
The domestic business earned an operating margin of 13.6%, versus 9.8% abroad. Amorepacific said a greater contribution from high-margin sales channels improved domestic profitability. In Western markets, additional digital marketing investment caused operating profit to edge lower.
The gains at the operating level did not carry through to net income. Amorepacific recorded 44.2 billion won in non-operating losses, while net profit declined 14.3% to 58.5 billion won. Yuanta Securities Korea attributed the decline to foreign exchange translation losses.
LG H&H reshapes its business and exits Avon North America
LG Household & Health Care, or LG H&H, is shifting away from China and duty-free sales toward North America, Japan and online channels. Its third-quarter operating profit increased 52.4% to 70.4 billion won, but remained 30.5% below the market's 101.3 billion won forecast. The beauty business narrowed its operating loss to 10.9 billion won from 48.6 billion won without reaching profitability.
North America had overtaken China as LG H&H's largest of those two regional businesses in the second quarter of 2026. Revenue in North America rose 47.3% year over year to 205.8 billion won, with the company's own brands contributing about half, according to Hanwha Investment & Securities figures reported by Aju Press.
The overhaul included selling the U.S. Avon business for 8.4 billion won after investing about 517 billion won in it. The disposal resulted in a loss of about 58.5 billion won. LG H&H's third-quarter net profit fell 45.2% to 12.8 billion won.
The company's original acquisition price was separate from that broader investment total. LG H&H bought the Avon North American business, New Avon LLC, now The Avon Company, in 2019 for $125 million, or about 145 billion won. Aju Press reported that the 2026 sale price of $6 million, about 8.4 billion won, was less than 5% of the purchase price.
The business had recorded revenue of 269.2 billion won and a net loss of 30.1 billion won in 2025. At year-end, liabilities exceeded assets by 136.1 billion won, according to Hanwha Investment & Securities, as reported by Aju Press. Buyer Regent, a global investment firm, had acquired Avon International from Brazil's Natura & Co. in January 2026. Its purchase of the North American business brought the two Avon operations under common ownership for the first time since 2016.
LG H&H's total overseas revenue declined 12.5% to 432.3 billion won in the third quarter. Excluding the Avon impact, North American revenue grew about 5%. China recorded a 21.1% decline while the company reorganized its online business there. Shinhan Investment & Securities expects efficiency-related expenses to continue into the first half of 2027.
Contract manufacturers face less currency exposure
Analysts see a relatively stronger outlook for original design manufacturing, or ODM, companies that produce cosmetics for brands. A large share of their supplies to domestic brands is billed in won, leaving them less exposed to exchange-rate movements.
Brokerages forecast third-quarter operating profit of 79.0 billion to 79.6 billion won for COSMAX, above consensus expectations. Their estimates for Kolmar Korea range from 88.0 billion to 89.8 billion won.
Kolmar Korea also plans to double its current production capacity of about 770 million units by expanding its Sejong plant. The expansion is scheduled for the second half of 2027, according to Businesskorea.
