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Elf Beauty’s net sales were up 9 per cent year-on-year to $353.7 million in the first quarter of fiscal 2026, the company said on Wednesday, beating expectations. It was Elf’s first earnings report following the company’s $1 billion acquisition of Hailey Bieber’s beauty brand Rhode, which closed on Tuesday. Stocks surged 12 per cent following the announcement.
“I’m proud of our incredible Elf Beauty team for delivering another quarter of industry-leading results,” chair and CEO Tarang Amin said during the company’s earnings call. “As we look ahead, we see the potential to more than double our business over the coming years, given the significant white space we see in colour cosmetics, skincare and international [growth]. We believe the acquisition of Rhode, which closed yesterday, enhances our position as a leading player in accessible beauty.”
“We’re pleased with what we’re seeing out of Rhode,” CFO Mandy Fields told investors. “They had their Lemontini Lip Peptide launch, which went really well for them. We’re so excited about all the signals that we’re seeing on the Rhode side.” Amin likened the company’s acceleration plans to the approach they took to skincare brand Naturium, and added that they will invest back into marketing to drive brand awareness.
Don’t expect a slew of Rhode product launches under Elf. The brand, known for its tight assortment, has been slow to build out its collection. “It’s incredibly thoughtful, it has a beautiful aesthetic and you’re seeing that in terms of the response from consumers and just how much they can’t get enough of Rhode,” Amin said. “There will be additional launches as we go forward, but we’ll continue to make sure that it matches that focus on the brand.”
In the first quarter of fiscal 2026, Elf’s sales in the US grew 1 per cent year-on-year, while international sales grew 30 per cent. The latter was fuelled by both growth in existing markets as well as expansion into new markets, Amin said. Today, Elf sells $266 million worth of products internationally, representing 20 per cent of sales. In the UK (Elf’s largest market outside of the US), Elf Beauty outpaced category growth threefold. “As we look to new international markets, we’ve seen success with our engagement model across social platforms, driving consumer demand well before we enter a country,” Amin said. This autumn, Elf is expanding into Sephora in the six countries of the Gulf Cooperation Council (GCC).
Rhode, which announced its own plans to enter Sephora before the acquisition announcement, will launch in all stores across the US and Canada in September and the UK by the end of the year, Amin said. Beyond this, the company is planning for international growth down the line. “The vast majority of Hailey’s followers are outside the US, but that business still only has about 20 per cent outside the US, so we have massive runway for growth for Rhode, similar to the pent-up demand that we see for Elf every time we go into a new country,” Amin said.
This quarter, tariffs weighed on performance, with profits down 30 per cent year-on-year to $33.3 million from $47.6 million in 2024. It’s due to the high levies on China, where Elf produces about 75 per cent of its products. Between 9 April and 13 May, Elf was subject to tariffs of 170 per cent, Fields said. Now, it’s subject to tariffs at the 55 per cent level until 12 August. (This includes a 30 per cent levy on top of the pre-existing 25 per cent tariff.)
Effective 1 August, Elf has increased its prices by $1 to mitigate tariff impact — the brand’s third price increase in its history, Amin said. “With 75 per cent of Elf’s product portfolio remaining under $10 post-increase, our community continues to praise our commitment of making the best of beauty accessible to every eye, lip and face,” he said.
Due to the “wide range of potential outcomes” related to tariffs — especially given Elf’s China exposure — the company isn’t yet offering full-year guidance. “For context, if tariffs were to remain at this incremental 30 per cent level, we estimate the gross impact to our cost of goods sold to be approximately $50 million on an annualised basis,” Fields said. The company did say that it anticipates sales growth above the 9 per cent net sales uplift reported in Q1. In the second quarter, Rhode will be incorporated into Elf’s financials, Fields confirmed.
“As we look ahead, we remain confident in our ability to continue to gain share and capture the significant white space ahead of us,” Amin said. “We believe that opportunity is further accelerated with our acquisition of Rhode, a breakthrough high-growth beauty brand founded by Hailey Bieber. The acquisition closed yesterday, and we’re thrilled to officially welcome the talented Rhode team to the Elf Beauty family.”
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