e.l.f. Beauty, Inc. Q3 FY2026 earnings call

• Category-leading growth: 28th consecutive quarter of net sales growth, one of six public consumer companies with 28 straight quarters of growth and at least 20% sales growth per quarter.
• Brand performances: e.l.f. Cosmetics grew 8% in U.S., increased market share by 130 basis points; Rhode had outstanding quarter with number one brand in Sephora NA and record launch in UK; Nutarium expanding retail presence.
• Innovation: Spring 2026 launches include Glow Reviver Slipstick and Soft Glam Satin Concealer; disruptive marketing with collaborations like Liquid Death, H&M, and Super Bowl commercial.
• Retail expansions: Rhode launching in Australia and New Zealand with Mecca; Notorium expanding to Walmart in U.S.

In Q3, e.l.f. Beauty grew net sales 38% and adjusted EBITDA 79%. The e.l.f. Cosmetics brand grew 8% in the U.S. this quarter with a 130 basis point increase in market share. Nutarium, the acquired skincare brand, continues to drive strong growth. Rhode, acquired in August, was the number one brand in Sephora North America and had a record launch in Sephora UK. Net sales in the U.S. grew 36% year over year, while international net sales grew 44%. Pricing and product mix added approximately 38 points to net sales growth, with Q3 gross margin at 71%.

• Raised full-year net sales guidance to 22%-23% year over year from 18%-20%, with Rhode expected to contribute $260M-$265M vs previous $200M.
• Adjusted EBITDA expected to be $323M-$326M vs previous $302M-$306M.
• Second half net sales growth expected at 31%-33%, organic sales up ~2%.

• Tariffs impacted gross margin year over year.
• Softer trends in UK and Germany, largest international markets, affecting organic sales trends.

Q: Better understanding about spending and guidance, specifically EBITDA margins in Q4 A: Mandy Fields mentioned EBITDA margin for second half around 19%, up from previous, with costs shifting from Q3 to Q4 including marketing spend and investments in team/infrastructure Q: Expansion of Rhode A: Tarang Amin stated Rhode growth has been phenomenal with strong launches in Sephora NA and UK, and launching in Australia/New Zealand with Mecca next week, focusing on disciplined rollout Q: Core e.l.f. Brand incremental growth plans A: Tarang Amin mentioned using value proposition, powerhouse innovation, and disruptive marketing engine, with strong retail partnerships and international expansions like DM in Germany Q: Innovation and subcategories for e.l.f.

A: Tarang Amin discussed building strength in segments with large share positions and conquesting undershared categories, with innovation in lip, eye, and skincare segments Q: Rhode expansion and KPIs A: Tarang Amin talked about Rhode's strong growth, upcoming launch in Australia/New Zealand, and key KPIs for international including consumer penetration, productivity, and sub-metrics Q: Marketing spend and Super Bowl ad A: Mandy Fields mentioned marketing spend targeting 24-26% of net sales, with Super Bowl activation on Peacock and Univision, running ad for additional eight weeks with estimated reach of nearly 300M Q: Full-year guidance and e.l.f. Brand growth A: Mandy Fields explained raised guidance due to global consumption rate, with e.l.f. Brand organic sales up ~2% in second half, offset by pipeline headwind Q: U.S. consumption and innovation impact A: Mandy Fields stated global consumption rate at ~6%, with timing shifts of shipments and spring innovation resets starting now, expecting to see benefits in March Q: UK softness and Rhode investment cycle A: Tarang Amin mentioned UK has higher promotional environment, using value proposition reinforcement, new EMEA leader, and innovation, while Rhode investment focuses on supply, team building, and global aspirations Q: Tariffs and shipment impact A: Mandy Fields stated tariffs at 45% since November 10, fully resolved on pricing and shipment, no further changes Q: Space expansion spending and return on investment A: Mandy Fields explained four-point headwind is net of space expansion, with space spend including incremental and refreshed costs, and Tarang Amin noted historical good payout from retail space expansions but potential for efficiency improvements