Ulta Beauty Shines Bright with Upbeat Earnings Forecast
The cosmetics retailer Ulta Beauty has sent its shares soaring with a revised annual profit forecast, indicating a strong resurgence in demand for perfumes and makeup during the holiday season. Younger shoppers are driving this growth, seeking out both affordable mass products and high-end prestige brands like Elf Beauty and Clinique by Estee Lauder.
Early Deals and Steep Promotions Pay Off
Ulta’s strategy of rolling out early deals in November and offering aggressive discounts during Black Friday has clearly paid off. The company has also slightly adjusted the lower end of its annual sales forecast, now expecting sales to fall between $11.1 billion and $11.20 billion.
Beating Expectations
Ulta’s quarterly net sales rose 1.7% to $2.53 billion, surpassing analysts’ estimates of $2.50 billion. This growth was driven in part by the contribution of new stores, with the company opening 28 new locations, remodeling 27, and closing two during the third quarter.
Strong Profit Performance
The company’s profit per share for the quarter came in at $5.14, beating estimates of $4.54 per share. This strong performance is all the more impressive given the current market trends, with beauty giants Estee Lauder and L’Oreal reporting waning demand for their premium products in the United States.
A Bounce Back in Store Traffic
After a dip in September, Ulta’s store traffic bounced back in October, with a 4.5% increase compared to the same period last year. This growth was driven by Halloween offerings and seasonal sales, according to data from Placer.ai.
Annual Profit Forecast Revised Upwards
Ulta now expects annual profit per share to fall between $23.20 and $23.75, up from its prior expectation of $22.60 to $23.50. This revised forecast is a clear indication of the company’s confidence in its ability to drive growth during the holiday season.
Leave a Reply