Net Sales Increase 1.7% for Ulta Beauty in Q3 2024

Net sales for Ulta Beauty in Q3 2024 increased 1.7% to $2.53 billion compared to $2.49 billion the prior-year quarter.

Company officials attribute the increase to new store contribution, partially offset by a decline in other revenue.

Comparable sales (sales for stores open at least 14 months and e-commerce sales) increased 0.6% compared to an increase of 4.5%, driven by a 0.5% increase in transactions and a 0.1% increase in average ticket. Gross profit was $1.0 billion compared to $992.1 million. As a percentage of net sales, gross profit decreased to 39.7% compared to 39.9%, primarily due to deleverage of store and supply chain fixed costs and lower other revenue, partially offset by favorable channel mix and lower inventory shrink.

Selling, general and administrative (SG&A) expenses were $682.3 million compared to $661.4 million. As a percentage of net sales, SG&A expenses increased to 27.0% compared to 26.6%, primarily due to deleverage of store payroll and benefits, and corporate overhead, primarily due to strategic investments, partially offset by lower incentive compensation.

“The Ulta Beauty team delivered better-than-expected sales and profitability reflecting improved sales trends and strong financial discipline,” said Dave Kimbell, CEO. “I am proud of the progress we’ve made and encouraged by early signs that our efforts to reinforce our market position and drive improved performance are gaining traction. As we look to the remainder of fiscal 2024, we are focused on executing with excellence across our key initiatives to deliver in a dynamic environment,” said Dave Kimbell, chief executive officer. “We remain confident that our model and strategies will drive long-term profitable growth and share leadership by enhancing our position as the destination for beauty enthusiasts for a lifetime.”

First Nine Months of Fiscal 2024

For the first nine months of fiscal 2024, net sales increased 2.0% to $7.8 billion compared to $7.7 billion, primarily due to new store contribution and growth in other revenue. Comparable sales increased 0.3% compared to an increase of 7.3%, driven by a 0.3% increase in average ticket. Gross profit was $3.1 billion compared to $3.0 billion. As a percentage of net sales, gross profit decreased to 39.1% compared to 39.7%, primarily due to lower merchandise margin, partially offset by deleverage of store fixed costs. SG&A expenses were $2.0 billion compared to $1.9 billion. As a percentage of net sales, SG&A expenses increased to 25.5% compared to 24.5%, primarily due to deleverage of corporate overhead due to strategic investments and deleverage of store payroll and benefits and store expenses, partially offset by lower incentive compensation.

Fiscal 2024 Outlook

For fiscal 2024, the company anticipates net sales to be between $11.1 billion to $11.2 billion.