e.l.f. Beauty, Inc. Q2 FY2026 earnings call

• Net sales grew 14% in Q2, with $66 million in adjusted EBITDA. It's the 27th consecutive quarter of net sales growth. - Acquired Rhode in August, with a record-breaking launch in Sephora North America. - Implemented a $1 global portfolio wide price increase on August 1, shipments resumed after resolving issues with retailers. - International expansion plans: launching with Rossmann in Poland, Sephora in 6 GCC countries, expanding in Germany. - Innovation: Power Grip Primer is #1 SKU, Mega Power Grip Primer went viral, e.l.f. SKIN's Bright Icon Vitamin C + E + Ferulic Serum launched with strong value proposition.

In Q2, the e.l.f. brand grew 7% this quarter, 3x the category and 140 basis points market share gain. The acquisition of Rhode contributed $52 million (approximately 17 percentage points) to net sales in Q2, with annualized net sales expected to be approximately $300 million, growing ~40% year-over-year. Naturium ran its first-ever awareness campaign. Revenue contribution: e.l.f. brand's growth was significant, Rhode's acquisition provided a substantial boost, and Naturium continued its initiatives.

• Full year net sales growth expected 18% to 20% year-over-year. - Organic net sales excluding Rhode expected up ~3% to 4%. - Rhode expected to contribute about $200 million in net sales in fiscal '26, with annualized net sales of ~$300 million. - Adjusted EBITDA expected $302 million to $306 million. - Marketing and digital spend targeted 24% to 26% of net sales for full year, higher in second half due to timing.

• Tariffs: significant headwind, with an average 60% tariff impact this year, 3,500 basis points of tariff headwinds. - Shipments vs consumption mismatch due to cycling space expansions in retailers like Dollar General and Target in fiscal '26.

Q: Dara Mohsenian from Morgan Stanley asked about corporate top line guidance, shipments vs consumption, and pricing with retailers.

A: Mandy Fields and Tarang Amin responded, discussing consumption outperforming category, resolution of pricing issues with retailers, and expectations for consumption and shipments netting out over time.

Q: Olivia Tong at Raymond James inquired about international growth, tariffs, and marketing spend.

A: Mandy Fields addressed international growth driven by comps and tariffs, and marketing spend timing related to Rhode and other initiatives.

Q: Andrea Teixeira from JPMorgan followed up on consumption post-price increase, Rhode's net sales, and tariffs.

A: Mandy Fields talked about consumption holding strong post-price increase, Rhode's net sales contribution, and tariff impacts.

Q: Sydney Wagner from Jefferies asked about category expectations and Rhode's channel mix.

A: Tarang Amin responded on category growth expectations and Rhode's focus on both wholesale and DTC channels.

Q: Anna Lizzul from Bank of America questioned EBITDA guidance, marketing spend, and pricing.

A: Mandy Fields and Tarang Amin discussed EBITDA margins, marketing spend timing, and pricing value proposition.

Q: Peter Grom from UBS asked about EBITDA accretion from Rhode and international growth.

A: Mandy Fields and Tarang Amin addressed EBITDA accretion expectations and international growth opportunities.

Q: Bonnie Herzog from Goldman Sachs inquired about core business organic growth and innovations.

A: Mandy Fields talked about strong consumption, innovation performance, and shipment headwinds from space expansions.

Q: Susan Anderson from Canaccord Genuity asked about Naturium growth and Rhode margins.

A: Tarang Amin and Mandy Fields discussed Naturium's momentum and Rhode's margin expectations.

Q: Oliver Chen from TD Cowen asked about organic growth and Rhode inventory.

A: Mandy Fields and Tarang Amin responded on organic growth drivers and Rhode inventory management.

Q: Steve Powers from Deutsche Bank asked about international growth magnitude, shipment headwinds, and Rhode's P&L.

A: Mandy Fields addressed international growth components, shipment headwind magnitudes, and Rhode's P&L impacts.

Q: Rupesh Parikh from Oppenheimer asked about adjusted EBITDA margins and Rhode's performance vs expectations.

A: Mandy Fields discussed EBITDA margin expectations and Rhode's strong performance post-acquisition