Cosmetics company Coty Inc. (NYSE:$COTY) released a shocking report for its fourth quarter in which the company posted a net loss. Coty Inc. also cautioned consumers that it may lower the stock of some of the products it acquired from Procter & Gamble Co (NYSE:$PG) until mid-2018. As a result, Coty’s stock has fallen by about 12% during trading on Tuesday, August 22nd.

Most likely due to the struggles and changes the retail industry have faced lately, shelf-space for popular makeup brands that Coty had acquired from P&G back in 2016 – like CoverGirl and Clairol – had been getting smaller and smaller. As well, the brands face competition from rising brands like Tom Ford and Smashbox. “Shelf space loss has been an issue that we faced in the fourth quarter and it will continue to impact us until the second half of fiscal 2018,” Coty’s CEO Camillo Pane warned investors and consumers alike.

The loss of shelf-space has contributed to the 10% fall in the company’s organic cosmetic sales. The decline in sales, along with the cost of acquiring P&G’s brands and marketing for product launches, have contributed to the adjusted net loss of $3.4 million Coty reported in its fourth quarter. Earnings per share broke even, lower than the average analysts’ expectation of an earnings per share of $0.09. In a statement addressing the company’s disappointing earnings, Pane said that Coty is working to address and fix the problem of its fixed cost. It will be one of the key focuses for fiscal 2018, Pane added. Coty’s costs went up to 53.1% for its fourth quarter – about a 7% rise from the 46.6% in costs the company saw in the year prior.

Investors may be getting increasingly concerned after Coty’s disappointing quarterly earnings, particularly since the company’s competition Estee Lauder (NYSE:$EL) released an earnings report last week that had beat expectations. Before investors and shareholders could go into further panic, however, it wasn’t all losses at Coty. The company saw a 5% in revenue year-over-year to see a constant currency based and adjusted revenue of $2.24 billion.

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