Ulta Beauty has revised its financial outlook for 2025, citing a combination of consumer uncertainty, rising competition, and operational challenges. The company’s new CEO, Kecia Steelman, has characterized the year as one of “transition,” with planned investments aimed at repositioning the retailer for sustainable long-term growth.
Ulta Beauty now projects flat to 1% growth in comparable sales for 2025, missing analysts’ expectations of a 1.2% increase. The company also forecasts full-year earnings per share to fall between $22.50 and $22.90, below Wall Street’s consensus estimate of $23.47.
Steelman, who succeeded long-time CEO Dave Kimbell in January, acknowledged that the brand lost market share for the first time in 2024. The company faces increased pressure from specialty competitors like Sephora and mass retailers expanding their beauty offerings.
In its fiscal fourth quarter, Ulta exceeded both earnings and revenue expectations, largely due to an increase in average transaction size. However, the retailer experienced a decline in the number of overall transactions.
Ulta’s efforts to regain momentum include a commitment to enhancing its in-store experience and addressing operational issues, such as fulfillment challenges and weak product execution.
Ulta’s performance reflects the increasingly competitive landscape of the cosmetics and personal care industry. As mass merchants and online platforms intensify their beauty offerings, Ulta is working to strengthen its physical store experience and optimize its logistics to maintain its position in the market.
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