Elf Beauty raised its annual sales and profit forecasts on Wednesday, attributing the upward revision to strong demand for its budget-friendly cosmetics like lip oils and liquid blushes, both in the U.S. and abroad. The news sent the company’s shares soaring 9% in after-hours trading.
As consumers increasingly seek affordable makeup and skincare products, Elf has benefited from capturing market share in a tough economic environment, where traditional beauty giants such as Estee Lauder and L’Oreal have struggled to boost demand.
The company now expects net sales to reach between $1.32 billion and $1.34 billion, up from a previous forecast of $1.28 billion to $1.30 billion. This growth is attributed to Elf’s strategy of offering “dupes” of high-end cosmetics at price points ranging from $2 to $10, making it an attractive option for price-conscious shoppers.
Elf’s success has been further fueled by expanding its presence in mass-market retailers like Walmart, Target, and Amazon, helping the brand reach a broader audience in the U.S. Additionally, Elf plans to extend its reach into select Dollar General stores in November, CEO Tarang Amin confirmed, targeting consumers who typically have limited access to legacy mass beauty brands.
For the quarter ending September 30, Elf reported a 40% increase in net sales, totaling $301.1 million—surpassing analysts’ expectations of $285.8 million. On an adjusted basis, the company earned 77 cents per share, well above the anticipated 43 cents.
The company also raised its adjusted annual earnings per share forecast to between $3.47 and $3.53, up from its previous range of $3.36 to $3.41.
Elf’s international growth, including price hikes in markets like India and Germany, and its focus on cost-saving initiatives, also contributed to a 40-basis point increase in its second-quarter gross margin, bringing it to 71%.
According to Amin, Elf’s appeal spans across income levels, with the company’s core strategy centered on providing high-quality products at exceptional, accessible price points.
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