Avon encouraged Wall Street with an increase in adjusted earnings, but there was no cheering for the U.S. market where net sales tumbled double digits.

Sheri McCoy, Avon CEO, said the company continued to see “signs of stabilization” and positive results from its cost savings initiatives in the first quarter. While net earnings in the quarter declined $13 million, Avon reported adjusted net income of $112 million, or 26 cents a share, higher than expected, boosting the stock.

Some analysts still expressed concern that Avon hadn’t gained more traction from its turnaround efforts. In order to “assuage fears of my investors,” Ali Dibadj of Sanford C. Bernstein & Co. sought reassurance that the company was taking the right approach.

Confident that Avon is “on the right track and will continue to make progress,” Sheri remarked that 2013 is a “pivotal year and we are working with a sense of urgency.”

In the U.S., the world’s largest beauty market, Avon’s sales dropped 15% to $406.2 million. Active representatives fell 13%, attributed to ongoing upheaval from the implementation of redistricting and new management programs. “The U.S. frankly is a drain on the overall business,” conceded McCoy. Efforts are underway to restore field health, rebalance earnings opportunities for reps, improve the product portfolio, bolster brand image and improve marketing and merchandising programs, she said.

In the U.K., a longtime Avon stronghold, sales fell 9%—or 8% in constant dollars. McCoy said new management has been installed and should bring improvements. The company also said it is exiting Ireland. Meanwhile, China has not rebounded with sales sliding 30%—or 31% in constant dollars, as the company shifts its efforts behind a retail model.

Avon’s net revenue slid 4% to $2.5 billion—or flat in constant dollars.

Total beauty sales dropped 5% companywide—or 1% in constant dollars. Fragrance delivered growth of 1%—or 6% in constant dollars, with help from the Candy and Latin Attitude scents in Mexico and Brazil. Otherwise, personal care slid 3%, color fell 6% and skin care dipped 12%—or in constant dollars, the categories were flat, fell 2% and 9%, respectively. The loss in skin care was particularly disappointing, said Sheri. “We have terrific products. We have to do a better job in marketing and merchandising.” The category is being re-evaluated to clarify brands and reduce cannibalization, she noted.

On the positive side, Russia and Brazil both showed signs of strengthening. Russia’s revenue grew 3%—or 4% in constant dollars, thanks to an increase in representatives and the launch of the high-end Luxe cosmetics. In Russia the company has also implemented a new continuity incentive program where reps earn bonuses for successive orders. It has also moved to 100% online rep ordering and improved delivery. In Brazil, sales were down 2%, or up 11% in constant dollars driven by increases in average order size and the number of representatives. Mexico saw a sales uptick of 6%—or 3% in constant dollars also due to more reps.

Kimberly Ross, chief financial officer, advised that “turnarounds tend not to be linear” and there are likely to be “bumps in the road”. Looking ahead, the company is planning for launches later this year and is energized by its new chief marketing officer, Patricia Perez-Ayala.