On Thursday Ulta Beauty raised its full-year revenue and earnings outlook for FY 2025, supported by strong demand for its makeup, skincare and fragrance products, particularly as the holiday season approaches. The stock is up about 14% on the session, also helped by quarterly results beating expectations. The chain, which targets young consumers with trendy, affordable products, reported a 12.9% growth in its sales in Q3 to $2.86bn, vs. $2.72bn expected.
CEO Kecia Steelman noted that customers remain mindful of their budgets but continue to seek a good value for money. Ulta benefited from effective marketing campaigns and the popularity of brands such as Rihanna's Fenty Beauty. The improvement in profitability was also attributed to lower logistics costs for e-commerce and better management of inventory losses. The quarterly earnings per share came in at $5.14, topping the $4.64 forecast.
Ulta now expects FY revenue of about $12.3bn, vs. the prior range of $12bn to $12.1bn. Comparable store sales are expected to rise 4.4% to 4.7%, instead of the initial 2.5% to 3.5%. EPS is now expected between $25.20 and $25.50, up sharply from the previous range of $23.85 to $24.30. The revisions reflect a favorable momentum for Ulta, despite a more uncertain consumer discretionary backdrop.
