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Ulta Beauty raises lower end of annual guidance

Published Nov 30, 2023 22:10 Updated Dec 01, 2023 14:44
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Investing.com -- Ulta Beauty (NASDAQ:ULTA) shares jumped on Friday after the cosmetics retailer lifted the lower end of its annual guidance, citing solid consumer demand that has given it "confidence" going into the key holiday shopping season.

The firm described the operating environment as "dynamic" in the final weeks of the year. Ulta has largely been able to weather the downturn in spending on big-ticket items due to broader macroeconomic uncertainty and elevated interest rates, with its customers continuing to open up their wallets for luxury beauty and skincare products.

In its current quarter, Chief Financial Officer Scott Settersten said Ulta had "refined" its expectations to reflect the "resilience of the beauty category" as well as potential risks from cautious consumer spending and higher promotional activity.

The company now expects to report full-year earnings per share of $25.20 to $25.60 on revenue of $11.10B to $11.15B, compared with a prior outlook of $25.10 to $25.60 and revenue of between $11.05B to $11.15B. Comparable sales growth is seen at 5% to 5.5%, versus a prior range of 4.5% to 5.5%.

Speaking in an earnings call, Chief Executive Officer Dave Kimball said Ulta's third-quarter results bolstered the group's decision to narrow its outlook.

Per-share diluted earnings of $5.07 and sales of $2.5 billion in the three months ended on Oct. 28 topped expectations, thanks in part to consumer interest in dermatologist-recommended brands such as La Roche-Posay and CeraVe that helped offset an uptick in supply chain costs and higher inventory shrink.

Ulta also announced that Settersten will be stepping down in April of next year after almost two decades at the firm. He will be succeeded by current Senior Vice President of Finance Paula Oyibo.

Yasin Ebrahim contributed to this report.

Ulta Beauty raises lower end of annual guidance
 

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