E.l.f. Beauty lifts full-year outlook after 51% sales jump

E.l.f. Beauty on Wednesday beat Wall Street expectations, posting a 51% increase in net sales in its second fiscal quarter.

The beauty company said it recorded its 31st consecutive quarter of net sales growth, which it attributed to strong performance across its portfolio. It said the revenue rise was driven by both retail and e-commerce channels in the U.S. and internationally.

“The thing I’m most pleased about is we saw strength across our entire portfolio,” CEO Tarang Amin told CNBC in an interview. “Every one of our brands contributed strong growth this quarter.”

Amin added that E.l.f. is the most-searched brand on TikTok Shop and the No. 2 brand in cosmetics on the platform. The company also reported strong results for Rhode, the skincare brand it acquired last year.

After the better-than-expected quarter, the company raised its full fiscal-year guidance. It now expects net sales of $2 billion to $2.03 billion, up from a previous range of $1.94 billion to $1.97 billion. It lifted its adjusted EBITDA projection to $421 million to $427 million from $401 million to $407 million.

E.l.f. said it now expects adjusted earnings per share for the year of $3.82 to $3.86, above prior guidance of $3.50 to $3.55. It also expects net income of $231 million to $233 million, up from a previous range of $212 million to $215 million.

The company had already raised its guidance last quarter after outperforming its expectations.

Amin said the company is “very bullish” on the holiday season and expects high sales through the end of the year.

Here is how the company performed in its second fiscal quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: $1.21 adjusted vs. 60 cents expected
• Revenue: $520.8 million vs. $470.3 million

For the period ended Sept. 30, E.l.f. reported net income of $30.03 million, or 50 cents per share, up significantly from roughly $3 million, or 5 cents per share, the year prior.

Net sales grew 51% to $520.8 million. E.l.f. also saw significant growth in its international channels, with business up 165%. Amin told CNBC that only 25% of the company’s business is outside the U.S. and that it has a “tremendous opportunity” to build on that momentum.

The company also said its gross margin increased 1.6% during the quarter, including a 0.3% benefit from tariff refunds. Amin previously said the retailer planned to fully reinvest that money into pricing and marketing to keep driving growth.

Though E.l.f. received most of its refunds in its first fiscal quarter, some of those funds flowed through the second quarter, and the company expects to receive a yearly total of around $55 million. Amin told CNBC on Wednesday that the company lowered the price of about 10% of its units by $1 because of the tariff benefits.

“We’re seeing great unit momentum based on that,” he said.