Prime Highlight:
- E.l.f. Beauty reported a significant earnings beat in the third quarter and raised its full-year outlook, driven by strong global demand and momentum across retail and e-commerce channels.
- The newly acquired skincare brand Rhode delivered a major boost, exceeding expectations and prompting the company to lift its sales forecast for the brand.
Key Facts:
- Adjusted earnings reached $1.24 per share on revenue of $490 million, surpassing analyst estimates of $0.72 per share and $460 million in revenue.
- Rhode contributed $128 million to third-quarter net sales growth, and E.l.f. now expects the brand to generate up to $265 million in net sales this fiscal year.
Background
E.l.f. Beauty reported a sharp rise in earnings for the third quarter of its fiscal year and raised its full-year guidance, supported by strong global demand and the contribution from its newly acquired skincare brand, Rhode.
The cosmetics company reported adjusted earnings of $1.24 per share for the quarter, well above analyst expectations of 72 cents. Revenue rose to $490 million, beating estimates of $460 million, according to data from LSEG. Following the announcement, E.l.f. shares rose as much as 15% in after-hours trading before giving up most of those gains.
Net sales climbed 38% year-on-year to $489.5 million, compared with $355 million in the same quarter last year. Adjusted net income increased to $74.5 million from $43 million a year earlier. The company said growth was driven by strong demand across international markets, physical retail stores and e-commerce platforms.
A major contributor to the quarter’s performance was Rhode, the skincare brand founded by model and entrepreneur Hailey Bieber. E.l.f. completed the acquisition in a deal valued at about $1 billion. Rhode added $128 million to net sales growth in the third quarter. The company now expects the brand to generate up to $265 million in net sales this fiscal year, raising its earlier forecast by $65 million.
E.l.f. also lifted its full-year revenue outlook, increasing guidance by $42 million to $50 million. The company cited steady market share gains and successful product launches as key reasons for the improved outlook.
Chief Executive Officer Tarang Amin said the results reflect the company’s consistent growth strategy. He highlighted strong innovation, competitive pricing and marketing strength, along with a record launch of Rhode at Sephora in the U.K., as major drivers behind the performance.
