Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

Estée Lauder Cos. Inc., consolidated balance sheet: liabilities and stockholders’ equity

US$ in millions

	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019	Jun 30, 2018
Current debt	997)	268)	32)	1,222)	516)	183)
Accounts payable	1,670)	1,822)	1,692)	1,177)	1,490)	1,182)
Current operating lease liabilities	357)	365)	379)	375)	—)	—)
Employee compensation	546)	693)	670)	424)	574)	579)
Accrued sales incentives	321)	278)	—)	—)	—)	—)
Deferred revenue	323)	312)	322)	222)	314)	33)
Other	2,026)	2,077)	2,203)	1,759)	1,711)	1,333)
Other accrued liabilities	3,216)	3,360)	3,195)	2,405)	2,599)	1,945)
Current liabilities	6,240)	5,815)	5,298)	5,179)	4,605)	3,310)
Long-term debt, excluding current maturities	7,117)	5,144)	5,537)	4,914)	2,896)	3,361)
Long-term operating lease liabilities	1,698)	1,868)	2,151)	2,278)	—)	—)
Other noncurrent liabilities	1,943)	1,651)	2,037)	1,448)	1,244)	1,186)
Noncurrent liabilities	10,758)	8,663)	9,725)	8,640)	4,140)	4,547)
Total liabilities	16,998)	14,478)	15,023)	13,819)	8,745)	7,857)
Redeemable noncontrolling interest	832)	842)	857)	—)	—)	—)
Common stock, $.01 par value	6)	6)	6)	6)	6)	6)
Paid-in capital	6,153)	5,796)	5,335)	4,790)	4,403)	3,972)
Retained earnings	13,991)	13,912)	12,244)	10,134)	9,984)	9,040)
Accumulated other comprehensive loss	(934)	(762)	(470)	(665)	(563)	(434)
Treasury stock, at cost	(13,631)	(13,362)	(11,058)	(10,330)	(9,444)	(7,896)
Stockholders’ equity, The Estée Lauder Companies Inc.	5,585)	5,590)	6,057)	3,935)	4,386)	4,688)
Noncontrolling interests	—)	—)	34)	27)	25)	22)
Total equity	5,585)	5,590)	6,091)	3,962)	4,411)	4,710)
Total liabilities, redeemable noncontrolling interest and equity	23,415)	20,910)	21,971)	17,781)	13,156)	12,567)

Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30).

Total liabilities have experienced a substantial increase over the observed six-year period, rising from 7,857 million US$ in 2018 to 16,998 million US$ in 2023. This growth is driven by expansions in both current and noncurrent obligations, with noncurrent liabilities showing the most significant escalation, particularly between 2019 and 2020, and again in 2023.

Current Liabilities and Short-Term Obligations: Current liabilities grew from 3,310 million US$ in 2018 to 6,240 million US$ in 2023. This trend is characterized by volatility in current debt, which peaked at 1,222 million US$ in 2020 before dropping sharply to 32 million US$ in 2021 and rebounding to 997 million US$ by 2023. Accounts payable and other accrued liabilities have maintained a general upward trajectory, suggesting an increase in operational scale and short-term credit utilization.
Long-Term Debt and Noncurrent Liabilities: Noncurrent liabilities more than doubled from 4,547 million US$ in 2018 to 10,758 million US$ in 2023. Long-term debt, excluding current maturities, is the primary driver of this increase, rising from 3,361 million US$ in 2018 to 7,117 million US$ in 2023. Notable surges occurred in 2020 and 2023, indicating periods of significant borrowing. Conversely, long-term operating lease liabilities peaked in 2020 at 2,278 million US$ and have since trended downward to 1,698 million US$ in 2023.
Equity Composition and Treasury Stock: Total equity has remained relatively stable compared to liabilities, moving from 4,710 million US$ in 2018 to 5,585 million US$ in 2023. A divergence is observed between retained earnings and treasury stock; while retained earnings grew steadily from 9,040 million US$ to 13,991 million US$—reflecting consistent profitability—this growth was largely offset by aggressive share repurchases. Treasury stock increased from 7,896 million US$ to 13,631 million US$ over the period, effectively reducing the overall equity base.
Capitalization and Leverage Trends: The relationship between total liabilities and total equity indicates a significant shift in leverage. In 2018, total liabilities were approximately 1.67 times the total equity; by 2023, this ratio increased to approximately 3.04 times. This trend signifies a transition toward a more debt-heavy capital structure to fund operations or strategic initiatives, while simultaneously returning value to shareholders through buybacks.

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Estée Lauder Cos. Inc. (NYSE:EL)

Balance Sheet: Liabilities and Stockholders’ Equity