E.l.f. Beauty has confidently issued its full-year forecast for 2026 after a cautious approach last quarter due to the effects of tariffs. The beauty brand, which encompasses E.l.f., Naturium, and Rhode, anticipates net sales between $1.55 billion and $1.57 billion for fiscal 2026, up from $1.31 billion in 2025. However, the company expects adjusted net income to be lower, projected between $165 million and $168 million, compared to $198 million previously.
In its second quarter, E.l.f. Beauty reported a 14 percent increase in net sales, reaching $343.9 million for the quarter ending September 30. This figure fell short of Wall Street’s expectation of $366 million. The adjusted net income for the quarter stood at $40.7 million, a decrease from $44.9 million a year prior, while adjusted diluted earnings per share were 68 cents, slightly above analysts’ predictions of 57 cents but below last year’s 77 cents.
Chairman and CEO Tarang Amin expressed pride in the company’s market share gains, reporting a 140 basis point increase for the E.l.f. brand. He highlighted the impressive launch of Rhode, which E.l.f. acquired earlier this year for $1 billion, noting it was the largest launch in Sephora North America’s history—two-and-a-half times larger than their previous record.
Regarding the company’s second-quarter performance, Amin explained that the delayed guidance for full-year 2026 was due to significant uncertainties surrounding tariffs, with the current average rate at 56 percent compared to 25 percent last year. He emphasized the strength of the sales guidance amid these challenges.
On the topic of potential acquisitions, Amin mentioned that while their strong balance sheet allows for further investments, they would only pursue opportunities that align closely with their strategic vision, like Rhode or Naturium. He reiterated that their primary focus remains on organic growth across their diverse portfolio, suggesting that the company holds great potential for expansion.
E.l.f. Beauty is navigating a complex market landscape with proactive strategies and robust brand performance, positioning itself strongly for future opportunities despite challenges presented by tariffs.