E.l.f. Beauty Sales Jump 51% to $520.8M as Innovation Outpaces Pricing

E.l.f. Beauty posted a 51% year-over-year jump in second-quarter net sales, reaching $520.8 million, according to a Wednesday press release. Net income climbed to roughly $30 million, up from just under $3 million in the prior-year quarter — a tenfold increase.

The growth engine isn't pricing power, CEO Tarang Amin told analysts on a Wednesday call. It's the innovation pipeline. A May price-reduction test backs that claim: 90% of SKUs were already appropriately priced, and only 10% of items saw outsized unit growth when prices dropped by $1.

That's a notable admission in a category where discounting is the default lever. In plain terms, E.l.f. thinks it can grow without buying volume with margin.

What changed in the outlook?

The company raised its fiscal year 2027 guidance. E.l.f. now expects net sales growth of 22% to 24%, up from its earlier forecast of 18% to 20% — a four-point bump at the low end.

How solid are these numbers?

A 51% growth rate invites skepticism, and William Blair analysts addressed it head-on in an emailed note Wednesday. They confirmed the figures are real.

"We believe in our thesis that e.l.f. Beauty's distinctive value proposition and go-to-market capabilities will enable it to further its pursuit of becoming a global leader in beauty," the William Blair analysts said.

The caveat: analysts have clearer visibility into Rhode — the brand E.l.f. acquired and which sits alongside its namesake line and Naturium — than into the core E.l.f. brand itself.

What about Rhode and the core brand?

TD Cowen analysts flagged the split in a Thursday note. Rhode's momentum looks durable; the core brand is harder to read.

"We believe Rhode momentum will likely extend into next year even against tougher comparisons, but the core e.l.f. brand performance remains difficult to assess," the TD Cowen analysts said. "The Beauty category remains more resilient in the current environment."

Takeaway: Rhode is carrying visible strength, but nobody outside the company can cleanly separate it from the base brand's contribution.

Where is distribution heading next?

Executives on the call emphasized relationships with key U.S. mass retailers, naming Sephora, Target and Walmart. Amin highlighted the Target exclusivity deal for the newer E.l.f. Hair care collection.

"We have seen great success initially in the first three months at our exclusive launch with Target," Amin told analysts. "E.l.f. Hair is already in the top 20 brands in hair care, top 7 in styling. And in terms of our expansion plans, we're currently in exclusivity with Target. We will eventually expand distribution of e.l.f. Hair similar to what we've done with e.l.f. Skin, and that will come with incremental space."

Three months in, the line already ranks top 20 in hair care and top 7 in styling — though rankings this early rest on launch hype as much as steady demand. The broader rollout, modeled on E.l.f. Skin's path, will bring additional shelf space and a wider test of whether the momentum holds.

The raised guidance signals management's confidence that the innovation pipeline, not price cuts, keeps the 51% pace going — but sustaining that rate against tougher comparisons next year is the open question.