Ulta Beauty on Thursday raised its full-year sales outlook after topping Wall Street’s fiscal third-quarter expectations and seeing shoppers splurge on perfumes, skincare items and more.
The beauty retailer said it now expects net sales for the year to be approximately $12.3 billion, higher than its previous expectations of $12 billion to $12.1 billion. That would would represent an increase from last fiscal year’s net sales of $11.3 billion. It expects earnings per share of $25.20 to $25.50, up from its prior expectations of $23.85 to $24.30.
It anticipates comparable sales, a metric that includes sales at stores open at least 14 months and e-commerce sales, to rise by 4.4% to 4.7%, up from its prior outlook of 2.5% to 3.5%.
Ulta has raised its sales and profit outlook for two consecutive quarters. The company’s stock rose more than 6% in extended trading.
In a news release, CEO Kecia Steelman said “exciting assortment newness, improved in-store and digital experiences, and bold marketing efforts are resonating with our guests and drove strong sales results.”
On the company’s earnings call, she said that Ulta is “pleased with our Black Friday and Cyber Monday performance” and ready for the shopping season — even one when consumers may be more selective about spending.
“Our insights suggest beauty consumers’ budgets are tight and they are focused on value,” she said. “Despite this, beauty enthusiasts tell us that they spend intend to spend on beauty for seasonal needs, affordable splurges and gifts for loved ones. They are focused on replenishing their essentials and strategically making smart purchases around strong value.”
Here’s what the retailer reported for the fiscal third quarter compared with what Wall Street expected, according to LSEG:
- Earnings per share: $5.14 vs. $4.64 expected
- Revenue: $2.86 billion vs. $2.72 billion expected
Ulta has benefitted from shoppers who have kept spending on beauty, even as they trim the budget or seek out lower-priced options in other discretionary categories. Yet the company faces stiffer competition from a wide range of rivals, including big-box retailers like Walmart, online players like Amazon and upstarts like TikTok Shop.
Beauty sales have been strong overall this year in the U.S., according to data from market research firm Circana. In the first nine months of 2025, prestige beauty sales in terms of dollars rose 4% and mass beauty sales rose 5% year over year.
According to Circana, beauty is poised to be a popular category during the holidays, with the market researcher’s surveys indicating that more consumers plan to gift beauty products than a year ago, particularly those in households with higher-incomes and those with children.
Revenue rose from $2.53 billion in the year-ago quarter.
Comparable sales jumped by 6.3% year over year. Shoppers visited Ulta’s stores and websites more and spent more during visits. Average ticket rose 3.8% and transactions increased by 2.4% year over year.
In the three-month period that ended Nov. 1, Ulta reported net income of $230.9 million, or $5.14 per share, compared with $242.2 million, or $5.14 per share, in the year-ago quarter.
Though consumer confidence is weak, Steelman said on Ulta’s earnings call that “beauty engagement remained healthy.” She said sales of both mass and prestige beauty items grew by mid single-digits year over year.
Fragrance was its strongest category in the quarter, with double-digit sales growth year over year, as shoppers bought luxury scents from Valentino and Dolce & Gabbana and also lower-priced scents like Squishmallows perfumes.
Steelman said that in October, Ulta added more shelf space for fragrance in more than 60% of its U.S. stores to try to get ready for higher demand during the holidays and beyond.
In skincare, the retailer’s second-fastest growing category, sales grew by high single digits year over year, she said. Shoppers bought items they discovered on social media, including Korean or K-beauty brands and purchased merchandise from Rihanna’s Fenty Skin Body collection, which launched in the fall.
To drive growth, Ulta has also been expanding internationally and launched a third-party marketplace in October. In July, it announced it had acquired Space NK, a British beauty retailer, from Manzanita Capital. The deal allows Ulta to enter a new international market, since Space NK has 83 stores in the United Kingdom and Ireland.
During the third quarter, Ulta opened seven stores in Mexico through its joint venture partnership with Grupo Bakso. It opened its first Ulta store in the Middle East in Kuwait last month through a franchise partnership with Al-Shabaab.
Through its marketplace, Ulta has added more than 120 brands and over 3,500 unique items to its online assortment, Steelman said. She said the company is “pleased with the initial performance and optimistic about how this new capability can help us strengthen our existing category, attract new guests, and capitalize on incremental growth opportunities in new subcategories,” such as wellness.
Higher tariffs have influenced some of the prices of items carried by Ulta, too. The company saw more brand-driven price increases in the third quarter than the second quarter, interim Chief Financial Officer Chris Lialios said.
Sales in the haircare category grew by mid single-digits, despite a sales decline in personal styling tools that have felt pressure from tariff-related price increases, Steelman said.
Ulta announced in October that Christopher DelOrefice, the chief financial officer of medical technology company Becton Dickinson & Company, will become its new CFO. He will start in the role on Dec. 5.
As of Thursday’s close, Ulta’s shares have risen about 23% so far this year. That surpasses the S&P 500’s nearly 17% gains during the same period.
Published Date : 2025-12-04 22:31:00
Source : www.cnbc.com
