Q2 2026 Ulta Beauty Inc Earnings Call Transcript
Key Points
- Ulta Beauty Inc (ULTA) delivered strong financial results with 8.9% net sales growth, 10.1% operating profit growth, and 13.3% diluted EPS growth, leading to raised full-year guidance.
- The company continues to gain market share in prestige beauty, with fragrance and hair care categories delivering high-teen and high-single-digit comp growth, respectively.
- E-commerce momentum remains robust, with six consecutive quarters of double-digit growth, and the app now accounts for over 60% of online sales.
- The loyalty program expanded to 47 million active members, up 3%, with increased average spend per member, driving deeper guest engagement.
- Strategic initiatives like TikTok Shop, marketplace expansion, and AI-powered personalization are driving incremental sales and operational efficiencies, with TikTok generating over 100 million impressions.
- The overall promotional environment has intensified, with Ulta Beauty Inc (ULTA) increasing promotional activity to protect market share, which could pressure margins.
- Mass makeup comps declined in the low single-digit range due to a lack of newness from major brands, and the category remains a challenge.
- Skin care and wellness comps declined modestly, with body care sales lower as the company laps significant brand expansions from the prior year.
- Gross margin decreased modestly to 39.1% of sales, impacted by the Space NK business mix and rising fuel costs, with expectations for flat gross margin for the year.
- The company faces an uncertain macro environment with elevated fuel costs and consumer choicefulness, leading to a more cautious outlook for the second half with comp growth expected to slow to 2-3%.
Good afternoon, everyone. My name is Ryan, and I will be your conference operator today. At this time, I'd like to welcome you all to Ulta Beauty's Second Quarter and Fiscal 2026 Earnings Call. This conference is being recorded (Operator Instructions)
I'd like to turn the call over to Ms. Kiley Rawlins, Senior Vice President of Investor Relations. Ms. Rawlins, please proceed.
Thank you, Ryan. Good afternoon, everyone, and thank you for joining us for a discussion of Ulta Beauty's results for the second quarter of fiscal 2026. Hosting our call today are Kecia Steelman, Chief Executive Officer; and Chris DelOrefice, Chief Financial Officer. During today's webcast, our presentation is being displayed live and has been posted to our website, ulta.com/investor.
As a reminder, today's earnings release and the comments made by management during this call include forward-looking statements. These statements are subject to risks and uncertainties that could cause our actual
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