Ulta Beauty Inc
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: −4.49%.
Did ULTA Beat Earnings? Q3 2025 Results
Ulta Beauty posted a stronger-than-expected third quarter, with diluted EPS of $5.14 beating the $4.52 consensus estimate by 13.63% and net sales of $2.53 billion edging past expectations by 1.30% on 1.6% year-over-year growth, sending shares up roughly 10% in the session that followed. The results came despite modest margin compression, as operating income slipped to $318.50 million and gross margin contracted 20 basis points to 39.7%, pressured by fixed-cost deleverage and lower other revenue. A key contributor to the earnings beat was a lower share count, which lifted EPS to $5.14 from $5.07 a year ago even as net income dipped to $242.18 million, supported by $267.00 million in buybacks during the quarter alone. CEO Dave Kimbell also pointed to progress navigating post-implementation challenges from the company's ERP overhaul as a tailwind for inventory management. Looking ahead, Ulta raised its full-year diluted EPS guidance to a range of $23.20 to $23.75 and narrowed net sales expectations to $11.10 billion to $11.20 billion, signaling growing confidence in its competitive positioning heading into the holiday season.
- New store contribution drove net sales growth of 1.7%
- Comparable sales increased 0.6% driven by 0.5% transaction growth and 0.1% average ticket increase
- Favorable channel mix and lower inventory shrink partially offset gross margin pressure
- Skincare gained share rising to 23% of net sales from 22%; fragrance rose to 10% from 9%
- Lower incentive compensation partially offset SG&A deleverage
“The Ulta Beauty team delivered better-than-expected sales and profitability reflecting improved sales trends and strong financial discipline. I am proud of the progress we've made and encouraged by early signs that our efforts to reinforce our market position and drive improved performance are gaining traction. As we look to the remainder of fiscal 2024, we are focused on executing with excellence across our key initiatives to deliver in a dynamic environment.”
Ulta Beauty CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2024, Ulta Beauty updated its guidance: net sales of $11.1 billion to $11.2 billion (narrowed from $11.0–$11.2 billion), comparable sales of (1%) to 0% (improved from (2%) to 0%), 60–65 new stores, 40–45 remodel/relocation projects, operating margin of 12.9% to 13.1% (narrowed from 12.7%–13.0%), diluted EPS of $23.20 to $23.75 (raised from $22.60–$23.50), share repurchases of approximately $1 billion, interest income of $13–$14 million, effective tax rate of approximately 24%, capital expenditures of $400–$425 million (tightened from $400–$450 million), and depreciation and amortization of $265–$270 million.
ULTA YoY Financials
Figures from SEC filings and company reports. Not investment advice.