After a surprising tumble in Q4, Ulta Beauty’s sales rebound with growth across fragrance, body care, and sun care.
The retailer reported its Q1 2025 results on Thursday which include a 4.5% net sales increase to reach $2.8 billion for the quarter, up from $2.7 billion year-over-year.
“Consumer engagement with beauty remains healthy, and our insights indicate beauty and wellness remain a top priority for beauty enthusiasts who tell us they’re more willing to make trade-offs in other discretionary areas to maintain their beauty regimens,” said Kecia Steelman, Ulta Beauty CEO and president. “At the same time, they’re cautious, and value is an increasingly important priority as they navigate ongoing wallet pressures.”
In March, the retailer reported a 1.9% net sales decrease to reach $3.5 billion in sales for its Q4 2024. In response to the dip, Steelman unveiled an “Ulta unleashed” plan to drive core business growth, scale new accretive businesses and realign the company’s foundation through organizational changes and streamlined decision-making, plus improved store presentation, inventory levels and assortment.
On Thursday, Steelman reported successful progress. “Fiscal 2025 is off to an encouraging start,” she said. “Amidst considerable macro noise and uncertainty, guests responded positively to key actions that we took to drive our business, including improved execution, exciting new and exclusive brand launches, evolved promotional plans, and relevant marketing.”
Other highlights include 3% growth in Ulta Beauty’s rewards program to reach 45 million members and double-digit sales growth across women’s, unisex, men’s and Valentine’s Day fragrance sets, Steelman said.
“The skin-care and wellness category increased in the high single-digit range, driven by robust growth in body care, sun care and wellness,” Steelman said. “The hair-care category was roughly flat for the quarter, with growth in hair color and accessories offset by decreases in hair-care tools and masks.”
The retailer also continues to lean into its wellness offering. It launched nine new brands online during the last quarter, including Garden of Life supplements, women’s care brand Hatch Mama and sleep accessory brand NodPod.
“Bearing any major economic event, we expect the promotional environment to stay rational,” said CFO Paula Oyibo about H2. “Obviously, things could deteriorate if the consumer deteriorates, but what we’re focusing on … [is] promo optimization and clarity of our offers, making sure that we are driving optimal and profitable growth through our promotional strategies.”
“[We] are working in close partnership with our brands to mitigate potential impacts of higher tariffs,” Steelman said. “Many consumers indicate that they’re leaning into beauty as a comfort and escape from the stress of macro uncertainty, and we expect this emotional connection will support the category’s resilience going forward.”
Finally, the retailer’s international expansion is set to debut soon. “We are targeting our first store openings in Mexico City, Kuwait City and Dubai later this year,” Steelman said.
As previously reported by Glossy, Ulta Beauty underwent major executive changes at the top of the year. This included the exit of CEO Dave Kimbell and CMO Michelle Crossan-Matos, both in January. Kimbell was replaced as CEO and president by Steelman, former COO and 10-year veteran of the organization. Meanwhile, Kelly Mahoney stepped into the CMO role after nine years in various marketing roles at the company.
Ulta Beauty is the largest brick-and-mortar beauty retailer in the U.S., with more than 1,451 retail stores across 50 states. This quarter, the retailer opened six new stores, relocated two stores and remodeled four locations.
