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ULTA
Earnings call · Jul 2026 (Q2 FY27)

Ulta Beauty Q2 FY27 earnings call ULTA

Aug 27, 2026 Source

Executive summary

Ulta Beauty Q2 FY27 — Strong Sales and Profit Growth, Raised Full-Year Outlook

Ulta Beauty delivered strong Q2 FY27 results, exceeding expectations with robust sales and profit growth, leading to an upward revision of full-year guidance. The company's differentiated omnichannel model, strategic promotional execution, and focus on brand innovation continue to resonate with consumers, driving market share gains in a dynamic environment. Management remains confident in its strategy to deliver sustainable long-term value.

Highlights

5

  • Net sales grew 8.9% to $3 billion.

  • Operating profit grew 10.1% to $380 million, with operating margin expanding to 12.5%.

  • Diluted EPS increased 13.3% to $6.55 per share.

  • Comparable sales increased 3.8%, driven by average ticket.

  • Loyalty program active members expanded by 3% to 47 million.

Concerns

3

  • Mass makeup declined in the low single-digit range due to lack of newness from major brands.

  • Total skin care and wellness category declined modestly, primarily due to lower sales in body care.

  • Gross margin decreased modestly to 39.1% of sales, primarily due to Space NK business mix.

Guidance & targets

CategoryTargetConfidence
Full-year FY26 Net Sales Growth
6.7% to 7.2%
high materiality
High
Full-year FY26 Comp Sales Growth
3.2% to 3.7%
high materiality
High
Full-year FY26 Operating Profit Growth
8.3% to 9.3%
high materiality
High
Full-year FY26 Stock Repurchases
$1.8 billion
high materiality
High
Full-year FY26 Diluted EPS
$28.70 to $29.00
high materiality
High
Full-year FY26 Weighted Average Share Count
approximately 43 million shares
low materiality
Medium
Full-year FY26 Tax Rate
approximately 24.5%
low materiality
Medium
Full-year FY26 Operating Margin
modest improvement, up to 20 basis points
medium materiality
Medium
Full-year FY26 Gross Margin
roughly flat
medium materiality
Medium
Full-year FY26 SG&A Expenses Growth
less than revenue growth
medium materiality
Medium
Full-year FY26 Interest Expense
$14 million to $16 million
low materiality
Medium
Second Half FY26 Net Sales Increase
4% to 5%
medium materiality
Medium
Second Half FY26 Comp Sales Growth
2% to 3%
medium materiality
Medium
Second Half FY26 2-year Stacked Comp
greater than 8%
medium materiality
Medium
Second Half FY26 Operating Profit Increase
6% to 8%
medium materiality
Medium
Second Half FY26 SG&A Growth
low single-digit range
medium materiality
Medium
Second Half FY26 Diluted EPS Growth
9% to 12%
medium materiality
Medium
Q3 vs Q4 FY26 EPS Growth Seasonality
less EPS growth in Q3 versus Q4
low materiality
Medium

ULTA operating KPIs by quarter

ULTA operating KPIs stated on its earnings calls, by fiscal quarter
KPI Jan 2026 Q4 FY26 Apr 2026 Q1 FY27This call Jul 2026 Q2 FY27Change vs prior quarter
Loyalty program members
46.7M We grew our loyalty program by 5% to a record 46.7 million active members, driven by strong growth in reactivated members and strong retention of existing members. Source transcript
<47M During the quarter, we expanded our Ulta Beauty Rewards loyalty program to nearly 47 million members, up 4% year-over-year. Source transcript
~47M Our robust loyalty program, which now encompasses about 47 million active members, remains central to inspiring members through personalized experiences meaningful rewards and exclusive benefits that deepen engagement and build lasting relationships with Ulta Beauty. Source transcript
—

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

ProductTypeDetails
Cloud R by Drake's Better World fragrancelaunch
XO Blue by Khloé Kardashian fragrancelaunch
Pacro Summer by Megan Stallion fragrancelaunch
Victor & Roth’s Bond collection fragrancelaunch
Dr. Milan Nelonen (K-Beauty)launch
Dr. Rio (K-Beauty)launch
Dia (K-Beauty)launch
Centalin24 (K-Beauty)launch
Bath & Body Workslaunch
Frenshelaunch
JUNOCOlaunch
Good Day by Patchologylaunch
HigherDOSElaunch
L'Oreal's infallible cushion foundationlaunch
Charlotte Tilburys's exagger-eyes waterproof eyeshadow stickslaunch
Saltair's shimmering body oillaunch
Multi-SKU purchases via Google Geminilaunch
Ulta AI shopping agentupdate

Deals & partnerships

Space NK International operations in the U.K. and Ireland

Celebrated 1-year anniversary of acquisition. Performance continues to be strong.

Alshaya Franchise partner for Middle East store expansion

Making progress on several new store openings planned for later this year, navigating geopolitical environment.

Google Gemini Collaboration for AI-powered shopping capabilities

Leveraged partnership to launch first-to-market capabilities, including multi-SKU purchases.

Risks & headwinds

Consumer choicefulness due to economic uncertainty ongoing

not quantified

Mitigation:Emphasizing multiple ways to deliver meaningful value, including assortment across price points, seamless omnichannel experience, and value-rich loyalty program.

Intensifying competitive environment ongoing

not quantified

Mitigation:Leaning into Ulta Beauty's differentiated model, focusing on unmatched choices, brand partnerships, and loyalty. Guidance includes flexibility for promotional activity if needed.

Gross margin pressure in second half from prior year timing Q3 FY26

not quantified

Mitigation:SG&A growth in low single-digit range expected to more than offset planned pressure from gross margin. Full-year gross margin expected to be roughly flat.

What to watch in Q3 FY27

Makeup category performance

Second half of FY26
Current Approximately flat comp sales in Q2, low single-digit decline in mass makeup.
Target Green shoots / improvement in mass makeup and overall category.

Why it matters

Makeup is a significant category, and its recovery or continued weakness will impact overall comp sales and investor sentiment.

But we are seeing some encouraging activity in the category like when you're looking at what we're seeing going into the second half, this fuller face look, more expressive eye, et cetera. And then we're also very optimistic at some of the newness that we're seeing that's coming with the category in the back half.

Q&A highlights

What is the industry trend for makeup, especially given flat comps, and what are the expectations for the back half, including any "green shoots"?

Mass makeup was flat due to a lack of newness from major brands. However, new trends like "fuller face" and "expressive eye" are emerging, and newness is expected in both mass and prestige makeup in the back half, suggesting potential "green shoots" for the category.

“Mass makeup performance was mostly a reflection of lack of newness from some of the major brands as they lack some strength from last year. But we are seeing some encouraging activity in the category like when you're looking at what we're seeing going into the second half, this fuller face look, more expressive eye, et cetera.”

asked by Rupesh Parikh · answered by Kecia Steelman

2 min read 6 chapters

Detailed narrative

Omnichannel Ecosystem & Store Performance

Ulta Beauty's U.S. business drives overall performance, with 13 net new stores opened and modest comp growth in existing stores. Effective execution of key promotions and newness, alongside over 40,000 in-store events, fueled traffic and sales. E-commerce delivered double-digit growth, with over 50% of online orders fulfilled through the vast network of more than 1,500 convenience store locations, leveraging "Buy Anywhere, Fill Anywhere" capabilities.

Merchandising Innovation & Brand Building

The company focuses on continuous discovery, curating innovation across established, emerging, and exclusive brands. Fragrance is highlighted as an important growth driver, with several new and exclusive launches and high-impact marketing campaigns leading to meaningful market share expansion. K-Beauty momentum continued with the addition of five new brands and robust double-digit sales growth, with nearly half of K-Beauty sales coming from exclusive brands or products.

Marketing & Loyalty Program

Ulta Beauty strengthens its position at the intersection of beauty, culture, and community through campaigns like "Rewrite to Rule Summer" and activations at BottleRock and Lollapalooza. The robust loyalty program, now encompassing about 47 million active members, is central to inspiring members through personalized experiences, meaningful rewards, and exclusive benefits. The company is advancing personalization capabilities by leveraging first-party data and technology to drive engagement and incremental sales.

Scaling New Businesses (International & Marketplace)

International operations continue to scale, with Space NK celebrating its one-year anniversary and driving robust sales growth and market share expansion in the U.K. and Ireland. In Mexico, a new store opening brought the total to 12. The marketplace initiative expanded to over 450 brands and 12,000 SKUs, attracting new and reactivating lapsed loyalty members, and fueling UB Media growth.

AI Capabilities & Operational Efficiency

Ulta Beauty leverages AI across its business, from supply chain optimization for speed and efficiency to enhancing the guest experience. AI-powered sourcing optimizes omnichannel inventory, while customer-facing AI, including partnerships with Google Gemini for multi-SKU purchases and an enhanced Ulta AI shopping agent, drives meaningful increases in site traffic and improved conversion. The company is also applying AI internally to enhance productivity.

Operating Landscape & Value Proposition

In a dynamic operating landscape characterized by consumer choicefulness due to economic uncertainty and higher everyday expenses, Ulta Beauty is uniquely positioned. The company emphasizes its value proposition through an assortment spanning all price points, a seamless omnichannel experience, and a value-rich loyalty program. This strategy aims to deepen engagement, drive sales growth, and consistently capture market share.

AI-generated summary of the company's earnings call. Not investment advice.