Ulta beauty On Thursday there were weak guidelines for the coming year when there were a number of internal missteps, increasing competition and what it described as “uncertainty of consumers”.
The retailer, who appointed Kecia Steelman as the new CEO in January, expects comparable sales in 2025 to grow flat or 1%, while analysts had expected that they would increase by 1.2% according to Street Account.
The total annual profit is expected between $ 22.50 and $ 22.90 and, according to LSEG, lower than $ 23.47.
Ulta is the youngest company that predicts a rocky year. While it took into account unusual consumer expenses in its instructions, the retailer also navigates a number of company -specific challenges and views in 2025 as a transition year. Removal of these problems costs money, which is one of the reasons why the expectation of profits that are expected in the coming year to be expected lower than Wall Street.
“I shared our plan to make important investments in the guests.” These investments will put pressure on profitability in 2025, but we believe that they are of crucial importance for long -term sustainable growth in a competitive, innovative category. “
The stocks rose by 6%of expanded trade.
In the fourth quarter of the financial year, the cosmetic dealer did compared to what Wall Street expected, based on a survey of LSEG analysts:
- Win each share: $ 8.46 compared to $ 7.12
- Revenue: 3.49 billion US dollars expected compared to 3.46 billion US dollars
The company's net profit for the three -month period, which ended on February 1, was $ 393 million or $ 8.46 per share compared to USD $ 394 million or $ 8.08 per share in the previous year.
Sales fell to 3.49 billion US dollars, which declined to decrease of around 2% compared to 3.55 billion US dollars in the previous year. Like other retailers, Ulta benefited from an additional sales week in the previous season that negatively distorted the results.
Beauty has been one of the brightest places in retail in recent years, but Ulta has fallen back due to a number of self -inflicted challenges. The company's company has become more complex than it has grown, and Ulta stumbled when it brought new fulfillment selection options such as online purchase, collection, delivery on the same day and ship out of the store.
“As a result, our presentation and guest experience in the shop are not as strong as we would like,” said Steelman. “These are opportunities in our control.”
In January, Ulta announced that his long -time CEO Dave Kimbell has been replaced by his then operational operational officer Steelman, who has been with the retailer for more than a decade. Her experience as an operations -Guru makes her well suited to tackle some of the execution problems that Ulta has plagued.
During her first income as CEO, Steelman was open about what Ulta does right and what it does wrong. She said that the company will reset its business next year and work on withdrawing the market share that it has lost.
“The competitive environment in beauty has never been more intense,” said Steelman. “For the first time in 2024 we lost the market share in the category beauty.”
During the holiday quarter in Ulta, comparable sales rose by 1.5% and, according to StreetCcount, exceeded the expectations of 0.8% growth. Customers spent more in the quarter, which led to an average ticket by 3%, but fewer buyers came to Ulta's branches to buy beauty products. The transactions in the quarter took back by 1.4%.
Part of it is likely because so many other companies are expanding in beauty. It not only competes with the rival Sephora, but also with mass traders such as Macy'sPresent Walmart And Amazon have made beauty a cornerstone of their strategies and expanded all their selection of make -up and skin care products.
Last year Ulta warned of a cooling beauty market, but companies like Elf Beauty And curiosity It saw no similar dynamic and the beauty sales remained strong among retailers such as Macy's and Target.
In the meantime, Ulta has focused on increasing profitability. It was possible to expand the result in the quarter, even if one week was sold less.
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