e.l.f. Beauty reported a 51% increase in net sales to $520.8 million for the second quarter of its 2027 fiscal year, which ended on September 30, 2026, and raised its outlook for the full year. The company discussed the results on an earnings call on Wednesday, November 4. The result extends an unbroken run of 31 quarters of rising net sales for the US cosmetics group.
Chairman, Chief Executive and President Tarang Amin pointed to a 51% rise in sales alongside an 86% jump in adjusted EBITDA as the defining measures of the quarter. Net sales for the first half reached about $1 billion, an increase of 43%.
Revenue came in slightly below analyst expectations of about $535.8 million, while adjusted earnings per share of $1.21 compared with an estimate of $0.62. GAAP net income was $30.0 million, or $0.50 per diluted share.
| Measure | Second quarter, fiscal 2027 |
|---|---|
| Net sales | $520.8 million, up 51% |
| Adjusted EBITDA | $123.4 million, up 86%, 24% of sales |
| GAAP net income | $30.0 million ($0.50 per diluted share) |
| Adjusted EPS | $1.21 |
| Gross margin | 71%, up about 160 basis points |
| Cash at September 30, 2026 | $350.8 million |
What Drove e.l.f. Beauty Sales: Rhode, Volume and Pricing
Rhode contributed about 16 percentage points of the growth. That figure covers the one month before the acquisition reached its anniversary on August 5, after which the brand is part of the comparison base. Organic net sales growth was about 35%, and Chief Financial Officer Mandy Fields said all brands contributed to it.
Unit volumes added 31 points to growth, while pricing and mix added about 20 points. Volume was therefore the larger of the two drivers, which indicates that the quarter was not reliant on price increases alone. Connected commerce accounted for 31% of consumption.
Beyond Rhode, the group operates the Naturium and Well People labels alongside its three e.l.f. lines: Cosmetics, SKIN and Hair. Sales in the US climbed 25% in the quarter, while sales outside the country rose 165%.
Rhode Sephora Europe Launch and Global Expansion
Part of the international gain reflects initial orders supplied for the Rhode Sephora Europe launch, which the company described as a record debut. Rhode, the brand founded by Hailey Bieber, is the clearest example of how e.l.f. Beauty intends to widen its reach beyond the US market.
The Rhode global expansion also has consequences for profitability. Management anticipates a decline in gross margin compared with the prior year during the second half, as the brand widens its distribution across retailers, which reflects the cost of entering new wholesale channels.
The retail push comes as other groups reposition their beauty portfolios. Our report, Gucci Beauty to Join L’Oréal in 2027 as Coty Exits for $400 Million, explores another significant shift in the category.
Margins, Profit and Cash in the e.l.f. Beauty Earnings
Gross margin was 71%, an increase of about 160 basis points, which the company attributed to lower tariffs and product mix. Around 30 basis points came from tariff refunds, so the underlying improvement was smaller than the headline change.
Selling, general and administrative expenses fell to 53% of sales from 56% a year earlier. Marketing and digital spending was 21% of sales, compared with 23% in the previous year, and the group closed the quarter with $350.8 million in cash.
Adjusted EBITDA reached $123.4 million, equal to 24% of sales. The gap between that figure and GAAP net income of $30.0 million shows how much of the profit measure rests on adjustments, a point investors will weigh when assessing the e.l.f. Beauty earnings.
e.l.f. Beauty Raised Outlook and the Second-Half Slowdown
The e.l.f. Beauty raised outlook now points to fiscal 2027 net sales growth of 22% to 24%, up from the previous range of 18% to 20%. Personal Care Insights reported that this equates to full-year sales above $2 billion. Adjusted EBITDA is now guided at $421 million to $427 million, and adjusted EPS at $3.82 to $3.86.
The e.l.f. Beauty second-half outlook is considerably more restrained, with net sales growth of about 7% to 10%. The company expects the third quarter to land above that range and the fourth quarter below it, and it projects an adjusted EBITDA margin in the low 10s.
The deceleration is consistent with the timing of the Rhode acquisition, which no longer adds growth from outside the existing base once it has been owned for a full year. Growth in the remaining quarters will therefore depend far more on organic performance.
The figures stand apart from the wider luxury sector, where several groups are managing slower demand. Our report, Kering Revenue Flat as Gucci Sales Fall 6% in Third Quarter, explores the wider business backdrop.
What to Expect From e.l.f. Beauty Sales Next
The next test for e.l.f. Beauty sales will be the third quarter, which the company expects to exceed its second-half range. The fourth quarter is guided below that range, so the pace of the slowdown will be visible within a single reporting cycle.
Several questions remain open. It is not yet clear how far the retail expansion of Rhode will reduce gross margin, or how quickly the brand can sustain its European momentum once launch demand settles. The group has also not detailed how organic growth is expected to perform across the full year.
For further context on the beauty category, read our coverage of Dove’s first fine fragrance and Dior’s Medallion Lip Balm, or browse our Luxury Business coverage.
Frequently Asked Questions
How much did e.l.f. Beauty sales grow in the second quarter?
Net sales rose 51% year on year to $520.8 million in the quarter ended September 30, 2026. The quarter marked 31 periods in a row of higher net sales.
How much did Rhode contribute to e.l.f. Beauty’s growth?
Rhode added about 16 percentage points to growth, covering the one month before the acquisition reached its anniversary on August 5. Organic net sales growth was about 35%.
What is the new e.l.f. Beauty full-year outlook?
The company now expects fiscal 2027 net sales growth of 22% to 24%, up from 18% to 20%. It also guides adjusted EBITDA of $421 million to $427 million and adjusted EPS of $3.82 to $3.86.
What is the e.l.f. Beauty second-half outlook?
The company expects net sales growth of about 7% to 10% in the second half, with the third quarter above that range and the fourth below it. It also anticipates a year-on-year decline in gross margin as Rhode broadens its presence with retailers.
How did international sales perform?
Sales outside the US climbed 165%, helped by shipments tied to the record European debut of Rhode at Sephora. US net sales rose 25%.
How profitable was e.l.f. Beauty in the quarter?
Adjusted EBITDA was $123.4 million, or 24% of sales, up 86%. GAAP net income was $30.0 million, or $0.50 per diluted share.
Which brands does e.l.f. Beauty own?
Alongside the three e.l.f. lines (Cosmetics, SKIN and Hair), the group owns Rhode, Naturium and Well People.
Will e.l.f. Beauty sales exceed $2 billion this year?
Personal Care Insights reported that the raised guidance of 22% to 24% growth equates to full-year sales above $2 billion. The company’s own guidance is expressed as a growth rate.
