Q1 2025 elf Beauty Inc Earnings Call Transcript
Key Points
- e.l.f. Beauty Inc (ELF) reported a 50% increase in net sales for Q1 fiscal 2025, marking its 22nd consecutive quarter of sales growth and market share gains.
- The company achieved a significant gross margin improvement of approximately 80 basis points, reaching 71% in Q1.
- e.l.f. Beauty Inc (ELF) continues to outperform in the color cosmetics and skincare categories, with e.l.f. SKIN growing 45% in tracked channels.
- International sales grew by 91% in Q1, driven by expansion into new markets and increased presence in existing ones.
- The company raised its fiscal 2025 outlook, expecting net sales growth of 25% to 27% and adjusted EBITDA between $297 million to $301 million.
- The adjusted EBITDA margin for Q1 was 24%, which is lower than the previous year due to increased marketing and digital investments.
- The company faces potential future challenges from tariffs, which could impact costs and pricing strategies.
- Despite strong growth, e.l.f. Beauty Inc (ELF) is still under-spaced in major retailers compared to legacy brands, indicating room for improvement in shelf presence.
- The company is experiencing higher inventory levels, partly due to taking ownership of inventory earlier in the supply chain.
- There is a cautious outlook on consumer sentiment, with some commentary on consumers being more selective in their purchases.
Thank you for joining us today to discuss elf Beauty's first quarter fiscal 2025 results. I'm KC Katten, Vice President of Corporate Development and Investor Relations.
With me today are Tarang Amin, Chairman and Chief Executive Officer; and Mandy Fields, Senior Vice President and Chief Financial Officer. We encourage you to tune into our webcast presentation for the best viewing experience, which you can access on our website at investor.elfbeauty.com.
Since many of our remarks today contain forward-looking statements, please refer to our earnings release and reports filed with the SEC, where you'll find factors that could cause actual results to differ materially from these forward-looking statements.
In addition, the Company's presentation today includes information presented on a non-GAAP basis. Our earnings release contains reconciliations of the differences between the non-GAAP presentation and the most directly comparable GAAP measure.
With that, let me turn the webcast
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