e.l.f. Beauty NYSE: ELF reported what executives described as a seventh consecutive year of “industry-leading” results, with fiscal 2026 net sales up 25% and adjusted EBITDA up 13%, while also signaling a more cautious near-term outlook for its core e.l.f. brand.
Chairman and Chief Executive Officer Tarang Amin said the fourth quarter marked the company’s 29th consecutive quarter of net sales growth. He said e.l.f. Beauty is “one of only six public consumer companies out of 546” to grow for 29 straight quarters while averaging at least 20% sales growth per quarter.
For the fourth quarter, Senior Vice President and Chief Financial Officer Mandy Fields said net sales rose 35% year over year. The acquisition of Rhode contributed $113 million, or about 34 percentage points, to that growth. Excluding Rhode, organic sales increased approximately 1% from the year-earlier period.
U.S. net sales grew 26% in the quarter, while international net sales rose 75%. Fields said pricing and product mix added approximately 40 points to net sales growth, while unit volumes were down approximately 5 points.
Rhode and Naturium Add Momentum to Portfolio
Amin emphasized the growing breadth of the company’s brand portfolio, saying four of its brands have surpassed $200 million in global retail sales. e.l.f. Cosmetics delivered approximately $1.8 billion in global retail sales in fiscal 2026, while e.l.f. SKIN delivered about $200 million.
Naturium, the skincare brand acquired nearly three years ago, delivered nearly $250 million in global retail sales, doubling its pre-acquisition level, Amin said. In the fourth quarter, he said Naturium was the fastest-growing brand among the top 50 skincare brands.
Rhode, the beauty brand founded by Hailey Bieber and acquired last August, “continues to exceed our expectations,” Amin said. On an annualized basis in fiscal 2026, Rhode delivered more than $500 million in global retail sales and approximately $390 million in net sales, with net sales growing more than 80% year over year. The brand achieved the No. 1 beauty brand ranking in Sephora North America and had launches with Sephora in the U.K. and Mecca in Australia and New Zealand.
Amin said Rhode is in less than 20% of Sephora’s global stores, leaving what he described as “tremendous opportunity” in coming years. He also said the company plans to launch Rhode with Sephora in Europe across 19 countries in September.
Core e.l.f. Brand Growth Moderates
Despite the company’s overall growth, executives acknowledged softer momentum in the core e.l.f. brand. Amin said e.l.f. brand global consumption moderated from high single-digit growth in fiscal 2026 to low single-digit growth over the last 12 weeks.
“Our spring 2026 innovation is off to a slower start than we expected,” Amin said, adding that the company is not seeing the same lift across core items that spring innovation has historically produced.
The company is responding through four areas: value, innovation, international growth and leadership changes. Amin said e.l.f. took a $1 price increase across all e.l.f. brand SKUs in August 2025 in response to tariffs, inflation and other factors, but has recently seen a more pronounced decline in units.
As a test, the company reduced the price of e.l.f.’s Halo Glow Skin Tint from $18 to $14. Amin said initial results showed a 38% lift on Amazon and a 36% lift across all retailers, including a triple-digit sales lift on TikTok Shop. He said the company is exploring additional pricing opportunities to improve value and unit velocity.
On innovation, Amin said the company has fast-tracked products that were not part of its original fiscal 2027 plans and aims to have them in market before the holidays. In response to an analyst question, he said fall innovation is expected to go out “in the next month,” and that retailers are showing “real excitement” about both planned fall launches and incremental innovation.
Profitability Pressured by Marketing, Tariffs and Investment
Fourth-quarter gross margin was 73%, up approximately 140 basis points from the prior year, largely due to pricing benefits, partially offset by higher tariffs. Adjusted selling, general and administrative expenses were 67% of net sales, compared with 52% a year earlier, driven primarily by higher marketing and digital spend as well as investments in team and infrastructure.
Marketing and digital investment was 31% of net sales in the quarter, compared with 23% in the prior-year quarter. For the full year, marketing and digital investment was 24% of net sales.
Adjusted EBITDA in the fourth quarter was $59 million, down from $81 million a year earlier. Adjusted net income was $19 million, or $0.32 per diluted share, compared with $45 million, or $0.78 per diluted share, in the prior-year period. Fields attributed the decline in profitability metrics primarily to higher investments in marketing and digital spending, team and infrastructure.
For the full fiscal year, e.l.f. Beauty delivered adjusted EBITDA margins of 20%. Fields said the company navigated an average tariff rate of approximately 55% in fiscal 2026, more than double the 25% rate it faced a year earlier.
The company ended the year with $290 million in cash, compared with $149 million a year ago. It repurchased approximately $50 million of common stock during the year, and had about $400 million remaining under a previously authorized $500 million repurchase program. Fields said the company’s liquidity position remains strong, with less than two times net debt to adjusted EBITDA.
Fiscal 2027 Outlook Calls for Slower Sales Growth
For fiscal 2027, e.l.f. Beauty expects net sales growth of approximately 12% to 14%, adjusted EBITDA of $379 million to $385 million, adjusted net income of $198 million to $201 million, and adjusted earnings per diluted share of $3.27 to $3.32.
Fields said the annualization of the Rhode acquisition is expected to contribute approximately 9 percentage points to full-year net sales growth, including about $140 million in net sales in the first four months of the fiscal year. Organic net sales are expected to grow approximately 4% to 5% for the year.
In the first quarter, the company expects organic net sales to decline in the high single digits as it laps a heavy shipping period tied to last year’s ERP cutover. Organic net sales growth is expected to rebound in the second quarter in the mid-teens range as Rhode begins contributing to organic growth and the company laps a period when it temporarily stopped shipments on orders that did not reflect its price increase.
Gross margin is expected to be approximately flat year over year. Fields said the outlook assumes tariff rates remain at the current 35% level. She also noted potential inflationary pressure from commodities and transportation costs amid conflict in the Middle East; if oil prices average around $100 per barrel, the company estimates it could face $15 million to $20 million of incremental cost headwinds in fiscal 2027. That potential impact is not included in the outlook, nor is the effect of any tariff refunds.
Fields said the company is pursuing a refund on approximately $58.5 million of IEPA tariffs paid last year. During the question-and-answer session, Amin said any one-time tariff refunds would be used to invest in value and accelerating unit growth.
Leadership Changes and Brand Focus
Amin also outlined several leadership changes. Kory Marchisotto has been appointed president of e.l.f. Brands, a newly created role focused on expanding the e.l.f. brand across categories and geographies. Oshiya Savur has joined as chief marketing officer of e.l.f. Brands, and Ekta Chopra has been appointed chief technology and AI officer.
The company has also decided to transfer the Keys Soulcare brand to Alicia Keys. Amin said the move allows the company to better focus on its five brands, all of which grew in fiscal 2026.
“We remain bullish on our overall portfolio and the white space opportunity we see across our brands, categories, and geographies,” Amin said.
About e.l.f. Beauty NYSE: ELF
e.l.f. Beauty NYSE: ELF is an American cosmetics company known for offering an extensive range of affordable, trend-driven makeup and skincare products. The company's portfolio spans foundations, lipsticks, mascaras, brushes, serums, masks and other beauty essentials, all positioned at accessible price points. e.l.f. Beauty maintains a direct-to-consumer platform through its e-commerce site and engages in widespread retail partnerships with major chains such as Target, Walmart, Ulta Beauty and Amazon.
Founded in 2004 and headquartered in Oakland, California, e.l.f.
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