e.l.f. Beauty, Inc. (NYSE:ELF)'s growth story right now has a very famous face behind it. Rhode, the skincare and makeup brand founded by Hailey Bieber, was bought by e.l.f. for $1 billion a year ago. It contributed about $160 million of the $479.4 million in sales the company posted last quarter, helping total sales climb 36% and beat Wall Street's expectation of $431.2 million. By contrast, the core e.l.f. Brand actually declined.
Ulta Beauty, Inc. (NASDAQ:ULTA) told a very different story earlier this summer: its fiscal first-quarter sales climbed 11% to $3.16 billion as wealthier shoppers traded up to prestige brands.
Both retailers just beat expectations, but e.l.f. Beauty, Inc. (NYSE:ELF)'s growth is now riding almost entirely on one celebrity-founded brand while its own namesake line shrinks. Ulta's is coming from affluent shoppers splurging on prestige names.
That leaves a real question: is e.l.f.'s Rhode-powered growth a sign of real momentum, or a company becoming dangerously dependent on a single brand?
Rhode's appeal goes well beyond its Gen Z fanbase. CFO Mandy Fields said "everybody looks at her and aspires to do what she's doing," adding that women in their 40s are lining up for Rhode products too, a sign the brand isn't confined to one age group. Rhode's narrow, curated approach, going deep on a handful of categories like blushes, lips, and bronzer rather than chasing one viral hit, has driven strength broadly across its lineup. e.l.f. Beauty, Inc. (NYSE:ELF) also raised full-year guidance meaningfully: adjusted EPS to $3.50-$3.55 from $3.27-$3.32 and sales to $1.94 billion-$1.97 billion from $1.84 billion-$1.87 billion, both ahead of Wall Street's prior estimates. Management said trends for the core e.l.f. brand have already started improving, and it expects growth across every brand for the rest of the year. Profit also got a boost because Rhode outperformed the earnout targets set in the acquisition deal, prompting e.l.f. to record a $16.1 million fair value adjustment.
#Growth #year
Ulta Beauty, Inc. (NASDAQ:ULTA) told a very different story earlier this summer: its fiscal first-quarter sales climbed 11% to $3.16 billion as wealthier shoppers traded up to prestige brands.
Both retailers just beat expectations, but e.l.f. Beauty, Inc. (NYSE:ELF)'s growth is now riding almost entirely on one celebrity-founded brand while its own namesake line shrinks. Ulta's is coming from affluent shoppers splurging on prestige names.
That leaves a real question: is e.l.f.'s Rhode-powered growth a sign of real momentum, or a company becoming dangerously dependent on a single brand?
Rhode's appeal goes well beyond its Gen Z fanbase. CFO Mandy Fields said "everybody looks at her and aspires to do what she's doing," adding that women in their 40s are lining up for Rhode products too, a sign the brand isn't confined to one age group. Rhode's narrow, curated approach, going deep on a handful of categories like blushes, lips, and bronzer rather than chasing one viral hit, has driven strength broadly across its lineup. e.l.f. Beauty, Inc. (NYSE:ELF) also raised full-year guidance meaningfully: adjusted EPS to $3.50-$3.55 from $3.27-$3.32 and sales to $1.94 billion-$1.97 billion from $1.84 billion-$1.87 billion, both ahead of Wall Street's prior estimates. Management said trends for the core e.l.f. brand have already started improving, and it expects growth across every brand for the rest of the year. Profit also got a boost because Rhode outperformed the earnout targets set in the acquisition deal, prompting e.l.f. to record a $16.1 million fair value adjustment.
#Growth #year
23 days ago
