E.l.f. Beauty’s sales grew 38% to US$489.5m in the third quarter, driven by the blockbuster launch of Hailey Bieber’s Rhode at Sephora.
The model’s buzzy beauty brand, which e.l.f. Beauty acquired in August 2025, delivered an “outstanding quarter”, said Tarang Amin, Chairman and CEO of e.l.f. Beauty.
The acquisition of Rhode contributed $128m to sales growth in the three months to 31 December 2025, said Mandy Fields, Senior VP and CFO at e.l.f. Beauty on a call with investors.
“This better-than-expected performance was supported by strong retail sell-throughs in Sephora North America, a record-breaking launch in Sephora UK, and a strong holiday period on rhodeskin.com,” she said.
Rhode became the top selling brand in Sephora, North America, when it debuted at the LVMH-owned retailer in September, and notched up a record-breaking launch in Sephora in the UK in November.
“This was the largest launch in Sephora UK history, outperforming the previous record holder by five times,” said Amin on a call with investors.
“In terms of what is next, we are excited to launch Rhode in Australia and New Zealand with Mecca this month to further its global reach.
“We are seeing significant pent-up global appetite for Rhode.
“International drives approximately 20% of Rhode’s direct-to-consumer (DTC) sales, while 74% of the brand’s social followers are from outside the US.”
Excluding Rhode, net sales at e.l.f. Beauty were up 2% year-on-year across the business, which includes e.l.f. Cosmetics and skin care brand Naturium.
“This was lower than anticipated, given some softer trends we have seen in the UK and Germany, our largest international markets,” said Fields.
“We are seeing weaker consumption in the UK and we are cycling our largest international launch to date with Rossmann Germany.
“Outside of those markets, international consumption remains strong.”
Higher tariff costs weighed on gross margin, which declined 30 basis points to 71%, although this was partially offset by pricing and mix benefits.
An increase in marketing, merchandising and distribution costs, compensation and benefits, depreciation and amortisation, as well as professional fees, drove up selling, general and administrative (SG&A) expenses by $61.7m to $280m
e.l.f. Beauty’s 2026 outlook
E.l.f. Beauty has raised its profit forecast for the 2026 financial year “primarily driven by Rhode’s outperformance”, said Fields.
Net sales growth for the 2026 fiscal year is now expected to be between 22% and 23% year-on-year, up from the 18% to 20% growth previously expected.
“We expect Rhode to contribute approximately $260m to $265m in net sales to fiscal 2026, versus our expectation for $200m previously,” said Fields.
“On an annualised basis, our outlook assumes Rhode will achieve net sales growth of approximately 70% year-over-year.
“Looking to the second half, our guidance implies 31% to 33% net sales growth.”