Elf Beauty raises annual forecasts as demand for cosmetics and skin care continues

By Granth Vanaik

(Reuters) – Elf Beauty raised its annual sales and profit estimates after beating estimates for the first quarter on Thursday, as more customers visited stores and websites to buy cosmetics and skin care products at affordable prices.

Beauty company Elf, like its peers in the segment, has supported the post-pandemic demand boom as low-cost products from its brands such as Naturium, Skin and Cosmetics continue to attract customers, including those on tight budgets due to a sticky inflation.

Retailers such as Target, which carry Elf products, have also seen an increase in beauty sales in recent months.

“We have seen that consumers are becoming more demanding, but they are choosing Elf,” CEO Tarang Amin told Reuters.

However, Elf’s stock has fallen about 14% year to date after investors expressed concern over the possibility of increased tariffs on imports of finished goods that are nearly 80% made in China and higher shipping costs, among other factors.

CEO Amin said an increase in tariffs on imports from China, if Republican presidential candidate Donald Trump comes to power, would have a major impact on the company in fiscal 2026.

Earlier this year, Trump floated the idea of ​​reimposing tariffs on China if he wins the November presidential election and said the rate for such tariffs could exceed 60 percent.

“We don’t like the 60 percent tariff just because we think it’s a tax on American consumers,” Amin said, adding that the impact of the tariffs will be addressed by increasing product prices and diversifying supply chain operations.

Elf now sees 2025 sales of between $1.28 billion and $1.30 billion, compared to previous expectations of $1.23 billion and $1.25 billion.

It now expects full-year adjusted earnings per share to be between $3.36 and $3.41, up from previous projections of $3.20 and $3.25.

Net sales rose 50% to $324.5 million in the quarter ended June 30, beating estimates of about $304.7 million. Adjusted earnings of $1.10 per share also beat LSEG expectations of 84 cents.

(Reporting by Granth Vanaik in Bengaluru; Editing by Mohammed Safi Shamsi)