E.l.f. Beauty's upbeat forecast shows cosmetics demand and Hailey Bieber's 'clean' look are still going strong

By Bill Peters

The cosmetics maker raises its full-year profit guidance and touts market-share gains, and its CEO says consumers have 'accepted' price increases made in response to tariffs

E.l.f. Beauty reported third-quarter results on Wednesday.

Shares of e.l.f. Beauty rallied Thursday after the cosmetics maker boosted its full-year outlook, as shoppers continue to seek out lower-priced cosmetics and as its acquisition of Hailey Bieber's minimalist beauty and skincare brand Rhode shows signs of paying off.

The company (ELF) said it now expects full-year sales of $1.6 billion to $1.612 billion, up from a prior forecast for $1.55 billion to $1.57 billion, as demand for Rhode, which e.l.f. bought last year for $1 billion, exceeds expectations.

During e.l.f.'s earnings call late-Wednesday, Chief Financial Officer Mandy Fields said the company expects Rhode to deliver around $260 million to $265 million in sales for the year. That was up from earlier expectations for $200 million.

E.l.f. expects adjusted earnings per share of $3.05 to $3.10, up from a range of $2.80 to $2.85 a share.

The stock 7.9% in premarket trading Thursday, which puts it on track to open with a 20% gain for this year.

The upbeat forecast arrived as demand for cosmetics and skin-care products continues to hold up despite rising prices and tariffs. E.l.f. raised prices last year to cover the extra costs related to those higher import taxes. But on Wednesday, Amin said e.l.f.'s core cosmetics have gained market share, and that consumers had "accepted" those higher prices.

The outlook also arrives as some beauty-industry observers debate the state of the so-called "clean girl" look - the natural, clear-complexion aesthetic that Bieber has become known for - and whether its popularity might give way to something bolder, or at least different, this year. CEO Tarang Amin said during the call there was "tremendous pent-up demand for Rhode," which recently launched in Sephora outlets in the U.K.

Management on Wednesday also said it continues to lean on products priced under $10, which make up a majority of its selections, while expanding into stores like Target Corp. (TGT) and Dollar General Corp. (DG).

For e.l.f.'s fiscal third quarter, the company reported adjusted earnings of $1.24 a share, with sales up 38% to $489.5 million, helped by growth in physical stores and by online sales in the U.S. and abroad.

Analysts polled by FactSet had expected e.l.f. Beauty to report adjusted earnings per share of 72 cents for its fiscal third quarter, on $461.8 million in sales.

-Bill Peters

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02-05-26 0629ET