MW Ulta Beauty CEO says investments in growth 'will take time' to pay off, but shares still rally

By Bill Peters

The beauty-products retailer's stock was up 6% after hours Thursday

Beauty-products retailer Ulta Beauty Inc.'s stock climbed after hours Thursday, after the company offered a full-year forecast that was shy of Wall Street's estimates but fourth-quarter results that came in above expectations.

The chain earned $8.46 a share during the fourth quarter, with revenue slipping year over year to $3.49 billion. Same-store sales rose 1.5%.

Analysts polled by FactSet expected Ulta to report fourth-quarter earnings of $7.13 a share, on revenue of $3.47 billion and same-store sales growth of 0.8%.

For its full fiscal year, which runs through January, the company said it expects revenue of $11.5 billion to $11.6 billion, with same-store sales coming in flat to up 1%. The company forecast earnings per share of $22.50 to $22.90.

Analysts expected earnings of $23.51 a share, with revenue of $11.67 billion and same-store sales up 1.2%.

"Fiscal 2025 will be a pivotal year as we make purposeful investments to fuel our future growth and move quickly to optimize our business," Chief Executive Kecia Steelman, who took the helm in January, said in a statement. "While it will take time to see the impact of these efforts, we are confident these investments will help reignite our momentum and unlock sustained growth and long-term value for our shareholders."

Ulta Beauty shares $(ULTA)$ jumped more than 6% after hours.

The company reported the results as beauty-products retailers face more competition from bigger playeres like Walmart Inc. $(WMT)$ and Amazon.com Inc. $(AMZN)$, as well as the likes of Sephora (FR:MC) $(LVMUY)$. Higher costs of living have also crimped demand for beauty products overall.

As Steelman settles into the job, Jefferies analyst Ashley Helgans in January noted that the chain's prestige cosmetics assortment leaned toward older brands, while the smaller ones that line its shelves were still unproven.

-Bill Peters

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March 13, 2025 16:41 ET (20:41 GMT)

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