U.S. regulators are formally investigating whether Avon broke bribery laws overseas, and the cosmetics company said it was again reassessing its strategy after quarterly profit fell far short of expectations.

Shares of Avon fell as much as 19.6 percent on Thursday, as analysts questioned whether the company can come up with a turnaround plan as quickly as it expects to.

Analysts, as they have in past quarters, again took Chairman and Chief Executive Andrea Jung to task during the company's quarterly conference call.

Why should investors believe management and the board have any control over the business at this point? asked Stifel Nicolaus' Mark Astrachan, who downgraded Avon to hold.

Look, the buck stops with me, replied Jung, who has been CEO since 1999 and chairman since 2001.

U.S. regulators also subpoenaed Avon Products Inc over its contact with analysts and others as part of an investigation related to fair disclosure under Regulation FD.

Under Jung, Avon has turned in poor performances in Brazil and Russia, poured tens of millions of dollars into its international bribery investigation and struggled to stem declines in a sluggish U.S. market.

Avon, which has been celebrating its 125th anniversary with celebrity-studded events throughout the year, now plans to assess long-range business plans and give an update at a meeting during the first quarter of 2012.

It strikes me that you guys are so totally screwed up, in so many ways, the change has to be radical, said Citigroup analyst Wendy Nicholson, who noted that a first-quarter meeting may not give Avon enough time for a comprehensive review.

Another potential red flag is that Avon cannot fully fund its dividend with free cash flow. The payout was raised to a quarterly rate of 23 cents per share earlier this year.

Avon has had disappointing cash management as well as one-time cash outlays, said Charles Cramb, vice chairman of the developed market group and interim chief finance officer.

Everything is part of the overall business review, said Cramb, who will end his six years as Avon's CFO next month.

Avon changed its corporate structure and shook up management in February. It already had overhauled operations and cut thousands of jobs under a restructuring laid out in November 2005 and updated in February 2009, and eliminated the dual role of president and chief operating officer in 2006, leaving business units to report directly to Jung.

Avon's incoming CFO, Kimberly Ross of Royal Ahold, will join in late November and be involved in the review, Jung said.

SEC PROBE

Avon said on Thursday that it received the subpoena from the U.S. Securities and Exchange Commission on Wednesday. The SEC is investigating the company's contact during 2010 and 2011 with certain analysts and other representatives of the financial community, Avon said in its quarterly filing.

The SEC adopted Regulation FD, short for fair disclosure, in 2000 to prevent companies from tipping off analysts and investors about material information.

It is not surprising that Reg FD could occur because Avon operates all over the world, said Paul Argenti, professor of corporate communication at Dartmouth's Tuck School of Business. You don't see this being revealed by a lot of other companies. It is better that they be transparent about it and reveal it, rather than wait.

The SEC issued a formal order of investigation of both Regulation FD matters and the Foreign Corrupt Practices Act matter that Avon itself has been investigating since June 2008. The company has been cooperating with the SEC and the U.S. Department of Justice on that matter since 2008.

Meanwhile, Avon blamed disappointing results in Brazil on poor implementation of an unforgiving new computer system and said tough economic conditions in several areas crimped sales.

The company no longer expects revenue to grow by a mid-single-digit percentage rate this year.

The CEO is responsible for the overall outcome of a company, and she has to be under pressure with these results, said Bernstein analyst Ali Dibadj. It would be unfair to shareholders if there weren't pressure on management at this point.

Avon's third-quarter profit fell to $164.2 million, or 38 cents per share, from $166.7 million, or 38 cents a share, a year earlier. Revenue rose 5.7 percent to $2.76 billion.

The results missed Wall Street estimates of earnings of 46 cents per share and revenue of $2.83 billion, according to Thomson Reuters I/B/E/S.

Avon also sold 5 percent fewer products in the quarter.

In North America, sales continued to slide, falling 8 percent in constant dollars as more sales representatives dropped out, while operating profit fell 85 percent.

Blaming rising product costs, Avon said gross margin fell 0.4 percentage points to 63.9 percent.

The company no longer expects operating margins to improve between 0.5 percentage point and 0.7 percentage point this year.

Avon shares were down 17.6 percent at $18.95 on Thursday afternoon, off an earlier low at $18.51.

(Reporting by Jessica Wohl in Chicago; Additional reporting by Brad Dorfman in Chicago and Phil Wahba and Jonathan Stempel in New York, editing by Dave Zimmerman, Lisa Von Ahn and Matthew Lewis)