Covergirl makeup, owned by Coty Inc., is seen for sale in Manhattan, New York City, U.S., February 7, 2022. REUTERS/Andrew Kelly

(Reuters) -Cosmetics maker Coty said on Tuesday it has launched a strategic review of its consumer beauty business following a recent tepid quarterly sales outlook and plans to more closely integrate its prestige beauty and mass fragrance segments.

Coty's review will focus on its $1.2 billion mass color cosmetics segment, which includes brands such as CoverGirl, Rimmel, Sally Hansen and Max Factor, as well as its standalone Brazil business.

Last month, Coty projected a fourth‑quarter sales decline as demand for its beauty products softened. Retailers in the U.S. are increasingly cautious due to tariffs and are destocking inventories as cost-conscious consumers tighten spending on some beauty and skincare products.

To reinforce its fragrance business, the primary driver of its revenue and profit, Coty plans to consolidate all fragrance and scenting brands, while its prestige division aims to maintain steady growth in cosmetics and skincare.

As part of the reorganization, Chief Brands Officer Stefano Curti and Chief Commercial Officer of Consumer Beauty Alexis Vaganay will step down, the company said.

Coty said the review will explore all options, including partnerships, divestitures, and spin-offs, aiming to maximize long-term value and strengthen the balance sheet.

(Reporting by Nilutpal Timsina and Ruchika Khanna in Bengaluru; Editing by Sonia Cheema and Sherry Jacob-Phillips)