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Beauty brands, particularly those focused on value, continue to hold strong in the face of inflation.
E.l.f. Beauty delivered a 76% year over year sales jump in its fiscal first quarter, building off its momentum from Q4. The company raised its full-year outlook from $705 million–$720 million to $792 million–$802 million as a result.
- Its color cosmetics segment grew 48%, while E.l.f. Skin, its skincare line, saw 127% sales growth.
E.l.f. has now posted 18 consecutive quarters of net sales growth, the only one of ~800 cosmetics brands Nielsen tracks to do so, the company said.
Chairman and CEO Tarang Amin said he believes E.l.f, whose average price point is $6, creates “accessibility in the category.” With student loan payments set to resume in September and put additional pressure on consumers, he said the brand is “very well positioned,” especially as it’s decided not to raise prices in the US.
L’Oréal also beat analysts’ expectations in its Q2, with like-for-like sales jumping 13.7% from Q1. Its consumer products division, which includes mass cosmetics brands NYX (which saw a bump from its Barbie collab) and Maybelline, scored record half-year growth with a 15% bump. While North American sales, up 9.7%, decelerated from the previous quarter, CEO Nicolas Hieronimus said the brand doesn’t see a slowdown, even in the US, where “beauty is very dynamic.”
“When you’ve got high interest rates, people tend to be a bit shyer in real estate, cars, expensive items. And typically, this benefits beauty,” Hieronimus said.