Q2 FY2027
Filed Nov 4, 2026e.l.f. Beauty Announces Second Quarter Fiscal 2027 Results – Delivered 51% Net Sales Growth – – Raises Fiscal 2027 Outlook
Net sales increased 51% to $520.8 million, gross margin increased approximately 160 basis points to 71%, adjusted EBITDA increased 86% year over year to $123.4 million, and the Company raised fiscal 2027 net sales and adjusted EBITDA outlook.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, three months ended September 30GAAP | $520.8M | – | 51% |
| Cost of sales, three months ended September 30GAAP | 150.6M | – | – |
| Gross profit, three months ended September 30GAAP | 370.2M | – | – |
| Gross margin, three months ended September 30GAAP | 71% | – | increased approximately 160 basis points |
| Selling, general and administrative expenses, three months ended September 30GAAP | $300.1M | – | – |
| Adjusted selling, general and administrative expenses, three months ended September 30non-GAAP | $275.1M | – | – |
| Change in fair value of contingent consideration, three months ended September 30GAAP | 17.68M | – | – |
| Operating income, three months ended September 30GAAP | 52.43M | – | – |
| Other income (expense), net, three months ended September 30GAAP | 563K | – | changed by $2.4 million year over year |
| Interest expense, net, three months ended September 30GAAP | −9.98M | – | – |
| Loss on extinguishment of debt, three months ended September 30GAAP | — | – | – |
| Income (loss) before (provision for) benefit from income taxes, three months ended September 30GAAP | 43.01M | – | – |
| Income tax (provision) benefit, three months ended September 30GAAP | −12.98M | – | – |
| Net income, three months ended September 30GAAP | $30.03M | – | – |
| Adjusted net income, three months ended September 30non-GAAP | $72.66M | – | – |
| Basic earnings per share, three months ended September 30GAAP | $ 0.51 | – | – |
| Diluted earnings per share, three months ended September 30GAAP | $ 0.50 | – | – |
| Adjusted diluted earnings per share, three months ended September 30non-GAAP | $ 1.21 | – | – |
| Weighted average shares outstanding - basic, three months ended September 30GAAP | 59,030,317 | – | – |
| Weighted average shares outstanding - diluted, three months ended September 30GAAP | 60,089,314 | – | – |
| Adjusted EBITDA, three months ended September 30non-GAAP | $123.4M | – | up 86% year over year |
| Adjusted EBITDA margin, three months ended September 30non-GAAP | 24% of net sales | – | – |
| Net sales, six months ended September 30GAAP | $1.00B | – | 43% |
| Cost of sales, six months ended September 30GAAP | 231.1M | – | – |
| Gross profit, six months ended September 30GAAP | 769.1M | – | – |
| Gross margin, six months ended September 30GAAP | 77% | – | increased approximately 760 basis points |
| Selling, general and administrative expenses, six months ended September 30GAAP | $580.4M | – | – |
| Adjusted selling, general and administrative expenses, six months ended September 30non-GAAP | $535.8M | – | – |
| Change in fair value of contingent consideration, six months ended September 30GAAP | 33.76M | – | – |
| Operating income, six months ended September 30GAAP | 154.9M | – | – |
| Other income, net, six months ended September 30GAAP | 232K | – | decreased by $2.9 million year over year |
| Interest expense, net, six months ended September 30GAAP | −17.79M | – | – |
| Loss on extinguishment of debt, six months ended September 30GAAP | — | – | – |
| Income before provision for income taxes, six months ended September 30GAAP | 137.3M | – | – |
| Income tax provision, six months ended September 30GAAP | −40.68M | – | – |
| Net income, six months ended September 30GAAP | $96.63M | – | – |
| Adjusted net income, six months ended September 30non-GAAP | $177.2M | – | – |
| Basic earnings per share, six months ended September 30GAAP | $ 1.64 | – | – |
| Diluted earnings per share, six months ended September 30GAAP | $ 1.61 | – | – |
| Adjusted diluted earnings per share, six months ended September 30non-GAAP | $ 2.96 | – | – |
| Weighted average shares outstanding - basic, six months ended September 30GAAP | 59,087,140 | – | – |
| Weighted average shares outstanding - diluted, six months ended September 30GAAP | 59,898,471 | – | – |
| Adjusted EBITDA, six months ended September 30non-GAAP | $291.6M | – | up 90% year over year |
| Adjusted EBITDA margin, six months ended September 30non-GAAP | 29% of net sales | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Fiscal 2027 outlook
- Revenue$2,003-2,029 million
- Tax rate25-26%
- NoteNet sales: expected 22-24% year-over-year increase
- NoteAdjusted EBITDA: $421-427 million
- NoteAdjusted net income: $231-233 million
- NoteAdjusted diluted earnings per share: $3.82-3.86
- NoteWeighted average diluted shares outstanding: 60.5 million
Capital returns
- Repurchase of common stock: $(49,982) (in thousands) for the six months ended September 30, 2026.
What drove it
- Strong performance in both retailer and e-commerce channels, in the US and internationally, drove net sales growth.
- Quarterly gross-margin expansion included approximately 30 basis points of benefit from incremental IEEPA tariff refunds flowing through cost of sales.
- Six-month gross-margin expansion included approximately 520 basis points of benefit from IEEPA tariff refunds flowing through cost of sales.
- The remaining gross-margin improvement was primarily driven by lower year-over-year tariffs and favorable mix, partially offset by price investments.
- SG&A growth was primarily related to marketing, merchandising and distribution costs, compensation and benefits, and depreciation and amortization.
- The $17.7 million quarterly and $33.8 million six-month contingent-consideration fair-value adjustments reflected rhode revenue outperformance relative to earnout thresholds.
Concerns
- Price investments partially offset the benefits from lower tariffs and favorable mix.
- GAAP results included a $17.7 million quarterly and $33.8 million six-month increase in the fair value of contingent consideration related to the rhode Acquisition.
- Interest expense, net was $(9,978) (in thousands) for the quarter and $(17,786) (in thousands) for the six-month period.
- Total debt was $826.7 million as of September 30, 2026.
- Other income, net decreased by $2.9 million year over year to $0.2 million for the six months ended September 30, 2026, primarily due to a decrease in foreign currency gains.
What to watch
- Delivery against updated fiscal 2027 net sales guidance of $2,003-2,029 million and expected 22-24% year-over-year growth.
- Delivery against updated fiscal 2027 adjusted EBITDA guidance of $421-427 million.
- The persistence of tariff-related benefits, including IEEPA tariff refunds, in gross margin.
- The impact of price investments on gross margin.
- Marketing, merchandising and distribution costs, compensation and benefits, and depreciation and amortization within SG&A.
- rhode revenue performance relative to earnout thresholds and associated contingent-consideration fair-value adjustments.
Balance sheet and cash flow
- Cash and cash equivalents were $ 350,799 (in thousands) as of September 30, 2026, compared with $ 289,685 (in thousands) as of March 31, 2026 and $ 194,403 (in thousands) as of September 30, 2025.
- Total debt was $826.7 million as of September 30, 2026, compared with $856.7 million as of September 30, 2025.
- Current portion of long-term debt was $ 30,000 (in thousands) and long-term debt was $ 794,646 (in thousands) as of September 30, 2026.
- Accounts receivable, net was $ 246,229 (in thousands), inventory, net was $ 260,612 (in thousands), and total current assets were $ 977,625 (in thousands) as of September 30, 2026.
- Intangible assets, net were $ 530,843 (in thousands), goodwill was $ 853,475 (in thousands), and total assets were $ 2,567,248 (in thousands) as of September 30, 2026.
- Current portion of contingent consideration was $ 30,000 (in thousands) and long-term contingent consideration was $ 68,507 (in thousands) as of September 30, 2026.
- Total liabilities were $ 1,341,738 (in thousands) and total stockholders' equity was $ 1,225,510 (in thousands) as of September 30, 2026.
- Net cash provided by operating activities was $ 126,310 (in thousands) for the six months ended September 30, 2026, compared with $ 50,648 (in thousands) for the six months ended September 30, 2025.
- Purchase of property and equipment was $(3,981) (in thousands), and net cash used in investing activities was $(4,221) (in thousands), for the six months ended September 30, 2026.
- Repayment of long-term debt was $(15,000) (in thousands), net cash used in financing activities was $(61,058) (in thousands), and net increase in cash, cash equivalents and restricted cash was $ 61,114 (in thousands) for the six months ended September 30, 2026.
Analysis
e.l.f. Beauty reported strong second-quarter fiscal 2027 growth, with net sales increasing 51% to $520.8 million. The Company attributed growth to strong retailer and e-commerce performance in the US and internationally. For the six months ended September 30, 2026, net sales increased 43% to $1,000.2 million, and management said the Company delivered its 31st consecutive quarter of net sales growth.
Profitability improved materially. Quarterly gross margin increased approximately 160 basis points to 71%, including approximately 30 basis points from incremental IEEPA tariff refunds. For the six-month period, gross margin increased approximately 760 basis points to 77%, including approximately 520 basis points from IEEPA tariff refunds. Lower year-over-year tariffs and favorable mix were additional drivers, while price investments were a partial offset.
The Company continued to invest in operating capacity and demand generation. Quarterly GAAP SG&A increased $69.0 million to $300.1 million, while adjusted SG&A increased $81.9 million to $275.1 million, primarily reflecting marketing, merchandising and distribution, compensation and benefits, and depreciation and amortization. A $17.7 million quarterly fair-value adjustment to contingent consideration, driven by rhode revenue outperformance against earnout thresholds, affected GAAP earnings. GAAP net income was $30.0 million and adjusted net income was $72.7 million, while adjusted EBITDA rose 86% year over year to $123.4 million, or 24% of net sales.
Liquidity increased, with cash and cash equivalents of $350.8 million as of September 30, 2026, while total debt was $826.7 million. Six-month operating cash flow was $126.3 million, and the Company repurchased $49.982 million of common stock during the six-month period. The Company raised fiscal 2027 net sales guidance to $2,003-2,029 million from $1,938-1,968 million and raised adjusted EBITDA guidance to $421-427 million from $401-407 million. Updated adjusted diluted earnings per share guidance is $3.82-3.86, compared with previous guidance of $3.50-3.55.
Management, verbatim
I am proud of the e.l.f. Beauty team for delivering our 31st consecutive quarter of net sales growth, with net sales up 51% driven by strength across our portfolio. With this momentum, we are raising our full-year net sales guidance to 22 to 24 percent.
Tarang Amin, Chairman and CEO
Not in the filing
stated, not guessed- Prior-quarter comparisons for reported income-statement metrics were not provided.
- Reportable segment revenue and segment-level growth were not provided.
- Free cash flow was not provided.
- Quarterly operating cash flow was not provided.
- Dividend declaration or payment information was not provided.
- Fiscal 2027 gross-margin guidance was not provided.
- Fiscal 2027 operating-expense guidance was not provided.
- A previous-release outlook section was not provided for actual-versus-prior-guidance comparison.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.