REVENUE RECOGNITION

9 Months Ended

Mar. 31, 2025

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

Accounts Receivable

Accounts receivable, net is stated net of the allowance for doubtful accounts, including credit losses, and customer deductions totaling $37 million and $26 million as of March 31, 2025 and June 30, 2024, respectively. Payment terms are short-term in nature and are generally less than one year.

Changes in the allowance for credit losses are as follows:

(In millions)	March 31, 2025
Balance at June 30, 2024	$	14
Provision for expected credit losses	12
Write-offs, net & other	(1)
Balance at March 31, 2025	$	25

The remaining balance of the allowance for doubtful accounts and customer deductions of $12 million as of March 31, 2025 and June 30, 2024 relates to non-credit losses, which are primarily due to customer deductions.

Deferred Revenue

Changes in deferred revenue during the period are as follows:

	Three Months Ended March 31,				Nine Months Ended March 31,
(In millions)	2025		2024		2025		2024
Deferred revenue, beginning of period	$	562	$	610	$	560	$	572
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	(38)		(26)		(293)		(275)
Revenue deferred (released) during the period	(29)		(38)		229		255
Other	1		(4)		—		(10)
Deferred revenue, end of period	$	496	$	542	$	496	$	542

Transaction Price Allocated to the Remaining Performance Obligations

At March 31, 2025, the combined estimated revenue expected to be recognized in the next twelve months related to performance obligations for customer loyalty programs, gift with purchase promotions, purchase with purchase promotions, gift card liabilities and the Marcolin license arrangement related to TOM FORD that are unsatisfied (or partially unsatisfied) is $276 million. The remaining balance of deferred revenue at March 31, 2025 will be recognized beyond the next twelve months, of which $214 million relates to the non-refundable upfront payment received as part of the Marcolin licensing arrangement that is being recognized on a straight-line basis over the estimated economic life of the license, which is 20 years.

Royalty Revenue – License Arrangements

The Company’s contractually guaranteed minimum royalty amounts due during future periods under its existing license arrangements is disclosed in the notes to consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024.