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ELF's Q1 sales rose 9% Y/Y to $353.7M, beating estimates and marking continued market share expansion.
Adjusted EPS of 89 cents beat estimates but declined from $1.10 a year ago.
ELF expects H1 FY26 sales growth to outpace Q1, though EBITDA margins will face tariff-driven pressure.
e.l.f. Beauty, Inc. ((ELF - Free Report) ) reported results for the first-quarter fiscal 2026, wherein both top and bottom lines beat the Zacks Consensus Estimate. While net sales increased, earnings decreased from the year-ago period’s actuals.
The company delivered strong fiscal first-quarter results, highlighted by a 210-basis-point gain in market share, continuing its streak of 26 consecutive quarters of category-leading growth. The company attributes its performance to a compelling value proposition, powerhouse innovation and a disruptive marketing engine. Management remains confident about the significant growth potential ahead, reaffirming its commitment to making high-quality beauty accessible to all.
ELF’s Quarterly Performance: Key Insights
The company delivered adjusted earnings per share of 89 cents, beating the Zacks Consensus Estimate of 84 cents. The bottom line decreased from $1.10 in the same quarter last year.
Net sales increased 9% year over year to $353.7 million, marginally beating the consensus estimate of $353 million. This increase was primarily driven by strength across the company’s retailer and e-commerce channels in the United States and internationally.
Insight Into ELF’s Costs & Margins Performance
In the quarter under review, the gross margin contracted 215 basis points (bps) to 69%, due to tariffs, partially offset by favorable foreign exchange impacts and mix.
Adjusted selling, general, and administrative expenses rose $12.9 million from the first quarter of fiscal 2025, reaching $177.3 million. This increase was primarily caused by higher professional fees, retail fixturing and visual merchandising costs, marketing and digital spending, as well as increased depreciation and amortization. These were partially offset by lower compensation and benefits expenses, along with reduced operational costs.
Adjusted EBITDA was $87.1 million, up 12% from the year-ago quarter. This represents an adjusted EBITDA margin of 25%.
ELF’s Financial Health Snapshot
The company ended the quarter with cash and cash equivalents of $170 million, long-term debt of $256.7 million and a total shareholders’ equity of $804.9 million. ELF provided net cash of $27.2 million from operating activities in the three months ending June 30, 2025.
Sneak Peek Into ELF’s Outlook
Due to ongoing uncertainty around potential tariff impacts, the company has not provided a full-year financial outlook for fiscal 2026. However, for the first half of fiscal 2026, the company expects net sales growth to exceed the 9% increase reported in the first quarter. Adjusted EBITDA margins are anticipated to be approximately 20% compared with roughly 23% in the first half of fiscal 2025, primarily indicating the impact of higher tariff costs.
Shares of this Zacks Rank #3 (Hold) company have gained 62.5% in the past three months compared with the industry’s 38.1% growth.
Image Source: Zacks Investment Research
Key Picks
Levi Strauss & Co. ((LEVI - Free Report) ) designs, markets, and sells apparels and related accessories for men, women, and children in the United States and internationally. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Levi’s current fiscal-year earnings indicates growth of 4% from the year-ago actual. LEVI delivered a trailing four-quarter average earnings surprise of 25.9%.
Stitch Fix, Inc. ((SFIX - Free Report) ) sells a range of apparel, shoes and accessories for women's, petite, maternity, men's, plus, and kids through its website and mobile application in the United States. It has a Zacks Rank #2 (Buy) at present. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
The Zacks Consensus Estimate for Stitch Fix’s fiscal 2025 earnings indicates growth of 71.7% from the fiscal 2024 reported level.
Bath & Body Works, Inc. ((BBWI - Free Report) ) operates as a specialty retailer of home fragrance, personal and body care, soaps, and sanitizer products. It presently has a Zacks Rank of 2. BBWI delivered a trailing four-quarter average earnings surprise of 4.7%.
The Zacks Consensus Estimate for Bath & Body Works’ current fiscal-year earnings and sales indicates growth of 5.8% and 2.4%, respectively, from the year-ago actuals.
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e.l.f. Beauty Q1 Earnings Beat Estimates, Sales Rise 9% Y/Y
Key Takeaways
e.l.f. Beauty, Inc. ((ELF - Free Report) ) reported results for the first-quarter fiscal 2026, wherein both top and bottom lines beat the Zacks Consensus Estimate. While net sales increased, earnings decreased from the year-ago period’s actuals.
The company delivered strong fiscal first-quarter results, highlighted by a 210-basis-point gain in market share, continuing its streak of 26 consecutive quarters of category-leading growth. The company attributes its performance to a compelling value proposition, powerhouse innovation and a disruptive marketing engine. Management remains confident about the significant growth potential ahead, reaffirming its commitment to making high-quality beauty accessible to all.
ELF’s Quarterly Performance: Key Insights
The company delivered adjusted earnings per share of 89 cents, beating the Zacks Consensus Estimate of 84 cents. The bottom line decreased from $1.10 in the same quarter last year.
e.l.f. Beauty Price, Consensus and EPS Surprise
e.l.f. Beauty price-consensus-eps-surprise-chart | e.l.f. Beauty Quote
Net sales increased 9% year over year to $353.7 million, marginally beating the consensus estimate of $353 million. This increase was primarily driven by strength across the company’s retailer and e-commerce channels in the United States and internationally.
Insight Into ELF’s Costs & Margins Performance
In the quarter under review, the gross margin contracted 215 basis points (bps) to 69%, due to tariffs, partially offset by favorable foreign exchange impacts and mix.
Adjusted selling, general, and administrative expenses rose $12.9 million from the first quarter of fiscal 2025, reaching $177.3 million. This increase was primarily caused by higher professional fees, retail fixturing and visual merchandising costs, marketing and digital spending, as well as increased depreciation and amortization. These were partially offset by lower compensation and benefits expenses, along with reduced operational costs.
Adjusted EBITDA was $87.1 million, up 12% from the year-ago quarter. This represents an adjusted EBITDA margin of 25%.
ELF’s Financial Health Snapshot
The company ended the quarter with cash and cash equivalents of $170 million, long-term debt of $256.7 million and a total shareholders’ equity of $804.9 million. ELF provided net cash of $27.2 million from operating activities in the three months ending June 30, 2025.
Sneak Peek Into ELF’s Outlook
Due to ongoing uncertainty around potential tariff impacts, the company has not provided a full-year financial outlook for fiscal 2026. However, for the first half of fiscal 2026, the company expects net sales growth to exceed the 9% increase reported in the first quarter. Adjusted EBITDA margins are anticipated to be approximately 20% compared with roughly 23% in the first half of fiscal 2025, primarily indicating the impact of higher tariff costs.
Shares of this Zacks Rank #3 (Hold) company have gained 62.5% in the past three months compared with the industry’s 38.1% growth.
Image Source: Zacks Investment Research
Key Picks
Levi Strauss & Co. ((LEVI - Free Report) ) designs, markets, and sells apparels and related accessories for men, women, and children in the United States and internationally. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Levi’s current fiscal-year earnings indicates growth of 4% from the year-ago actual. LEVI delivered a trailing four-quarter average earnings surprise of 25.9%.
Stitch Fix, Inc. ((SFIX - Free Report) ) sells a range of apparel, shoes and accessories for women's, petite, maternity, men's, plus, and kids through its website and mobile application in the United States. It has a Zacks Rank #2 (Buy) at present. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
The Zacks Consensus Estimate for Stitch Fix’s fiscal 2025 earnings indicates growth of 71.7% from the fiscal 2024 reported level.
Bath & Body Works, Inc. ((BBWI - Free Report) ) operates as a specialty retailer of home fragrance, personal and body care, soaps, and sanitizer products. It presently has a Zacks Rank of 2. BBWI delivered a trailing four-quarter average earnings surprise of 4.7%.
The Zacks Consensus Estimate for Bath & Body Works’ current fiscal-year earnings and sales indicates growth of 5.8% and 2.4%, respectively, from the year-ago actuals.