e.l.f kicks off fiscal 2026 with 9% increase in Q1 net sales
The results reflect a strong net sales increase driven by broad market acceptance, strong international growth, and digital channel expansion.
USA – e.l.f. Beauty kicked off fiscal 2026 with a strong performance in the first quarter, posting a 9% increase in net sales year-over-year to USD 353.7 million.
This marks the company’s 26th consecutive quarter of net sales growth and market share expansion, continuing its consistent category-leading growth trajectory.
According to the brand, the sales growth was driven by strength across both retailer and e-commerce channels in the U.S. and internationally, with international sales surging 30% and U.S. sales rising 5% in the quarter.
The company also reported adjusted diluted earnings per share (EPS) of USD 0.89, beating analyst estimates of USD 0.84.
Despite the 9% sales increase, gross margin declined by about 215 basis points to 69%, primarily due to higher tariff costs on products imported from China.
To mitigate these cost pressures, e.l.f. Implemented a USD 1 price increase across its product portfolio, the third in its 21-year history.
Digital sales, particularly via the Amazon channel, contributed notably to growth, with e-commerce revenue growing close to 20% and now representing about 20% of total sales.
Retail partnerships remained key, with e.l.f. gaining triple-digit market share increases in key cosmetic segments including face, lip, and eye makeup.
However, profits were affected by rising costs, with net income on a GAAP basis falling to USD 33.3 million, a 30% drop compared to the previous year, reflecting the impact of tariffs despite overall revenue growth.
Adjusted net income, excluding one-time items, was USD 51.3 million.
Tarang Amin, CEO at e.l.f highlighted e.l.f.’s resilience amid tariff challenges and praised the brand’s strong engagement via social platforms and retail expansion, including new channels like Dollar General, where a significant portion of purchases came from new customers.
The results reflect a robust net sales increase driven by broad market acceptance, strong international growth, and digital channel expansion.
Looking ahead, e.l.f. Beauty expects net sales growth to exceed the first quarter’s 9% increase for the first half of fiscal 2026, but anticipates adjusted EBITDA margins to be slightly lower due to ongoing tariff-related costs.
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