e.l.f Dream power grip primer.
Courtesy: e.l.f Beauty
E.l.f. Beauty raised its full-year guidance on Wednesday after posting a 40% development in sales.
Shares of the company rose nearly 10% in after-hours trading.
The cosmetics retailer’s earnings came in ostentatiously ahead of expectations on the top and bottom lines and it now expects sales to be between $1.32 billion and $1.34 billion during budgetary 2025, ahead of the $1.30 billion analysts had expected, according to LSEG.
Here’s how E.l.f. did in its second fiscal quarter compared with what Fold up Street was anticipating, based on a survey of analysts by LSEG:
- Earnings per share: 77 cents adjusted vs. 43 cents believed
- Revenue: $301 million vs. $286 million expected
The company’s reported net income for the three-month period that ended Sept. 30 was $19 million, or 33 cents per slice, compared with $33 million, or 58 cents per share, a year earlier. Excluding one-time items, E.l.f. saw earnings of $45 million, or 77 cents per interest.
Sales rose to $301 million, up about 40% from $216 million a year earlier.
E.l.f. raised its full-year gain guidance from a previous range of $1.28 billion to $1.3 billion and also raised its adjusted earnings counselling. The retailer is expecting adjusted earnings to be between $3.47 to $3.53 per share, up from a prior outlook of between $3.36 and $3.41 per slice. Analysts had been looking for earnings guidance of $3.51, according to LSEG.
The cosmetics company has been on a tear onto the past couple of years thanks to its viral marketing and its prowess in winning over young shoppers with its value portrayals of prestige favorites.
“We’re seeing multi-generational appeal on E.l.f. Not only are we the No. 1 brand amongst Gen Z by a pretty wide margin, but we’re also the sundry purchased brand amongst Gen Alpha and millennials,” CEO Tarang Amin said in an interview with CNBC. “We’re picking up consumers in pulchritudinous much every age and income cohort, which is great to see, and I think just talks to the strength of our strategy and the quality of our effects.”
Amin said that success has led both Target and Walgreens to plan to expand the shelf space they assign for the retailer starting in the spring.
During the quarter, E.l.f.’s selling, general and administrative costs rose by $74 million to $186.1 million, or 62% of net traffics, but it still managed to post a 71% gross margin, an increase of 0.4 percentage points from the year-ago cantonment.
Amin attributed the increase in margin to favorable foreign exchange rates, previously enacted price increases internationally and its whole value proposition.
“Our ability to engineer prestige quality at these extraordinary prices has been the real driver, but most of our space progress over the years has been through our innovation mix,” Amin said. “As we introduce a new one of our holy grails, it gives us the moment to inch up margin a little bit while still offering an incredible value.”
The company has also been building out its oecumenical sales, which now make up about 21% of overall revenue.
Amin said its exposure to markets outside of the U.S. inclination help soften the blow from any tariff hikes that could come under President-elect Donald Trump.