Ulta Beauty Increases Annual Profit Forecast Amid Strong Quarterly Results

Ulta Beauty has raised its annual profit projection after exceeding expectations for its quarterly performance, driven by a combination of lower inventory losses and new product launches, including Milk Makeup and K-Beauty skincare brands. These efforts have bolstered consumer demand at their stores.

Following the announcement, Ulta Beauty’s stock saw an uptick of approximately 8% in after-hours trading.

The cosmetics retailer reported an increase in sales, particularly from younger shoppers drawn to trendy and affordable brands like Elf Beauty.

To further engage customers, Ulta has enhanced foot traffic by introducing celebrity-backed brands, such as Fenty Beauty from Rihanna, while also making strategic investments in marketing and digital platforms.

As a result, the company now expects annual profits to fall between $22.65 and $23.20 per share, up from its previous forecast of $22.50 to $22.90 per share.

For the quarter, Ulta Beauty posted sales of $2.85 billion, surpassing analysts’ estimates of $2.79 billion, according to data from LSEG. The company’s comparable sales grew by 2.9% compared to the same period last year, driven by a 2.3% increase in average transaction value and a 0.6% rise in the number of transactions.

Ulta Beauty’s adjusted quarterly profit came in at $6.70 per share, exceeding the consensus estimate of $5.81 per share.

Budget-friendly brand Elf Beauty reported a solid quarter due to sustained demand, while luxury cosmetics companies, such as Estée Lauder, continued to face challenges due to tariff volatility.

Recent shifts in tariff policies under the Trump administration have created uncertainty, leading to disrupted businesses and consumer caution, especially amid fears of a potential economic downturn.

Ulta Beauty has revised its fiscal 2025 comparable sales forecast to a range of flat to +1.5%, compared to the earlier projection of flat to +1%.