Ulta Beauty Inc. reported modest gains in comparable sales in earnings for its fiscal Q4 and full year ended Feb. 1, 2025, reflecting a year marked by cautious consumer spending.
Including ecommerce, Ulta Beauty comparable sales rose 1.5% in Q4. This was down from 2.5% growth during the same quarter a year before.
Despite the slowdown, Ulta reported growth across both store and digital channels. On the retailer’s March 13 earnings call, chief financial officer Paula Oyibo said ecommerce sales in Q4 grew in the mid-single-digit range. However, the company did not share specific figures.
To reignite growth, Ulta is investing in digital initiatives, store remodels and other upgrades. The company plans to launch a new online marketplace this fall and roll out enhanced features on its app and website.
Ulta Beauty ranks No. 36 in the Top 2000. The database is Digital Commerce 360’s ranking of North America’s leading online retailers by annual web sales. Digital Commerce 360 projects that Ulta Beauty’s online sales will reach $2.53 billion in 2025.
Ulta Beauty web sales by year
Ulta Beauty’s CEO notes market challenges sharing Q4 earnings
Ulta’s Q4 earnings report marks the first under new CEO Kecia Steelman, who took the opportunity to address recent market challenges.
During the earnings call, Steelman acknowledged that Ulta lost market share in the beauty category in 2024 — a first in the company’s history.
“The beauty landscape has fundamentally changed,” Steelman said. “Guest expectations continue to rise, and the pace of change is accelerating. The competitive environment in beauty has never been more intense.”
For Q4, Ulta reported net sales of $3.49 billion, a 1.9% decline from $3.55 billion a year earlier. The drop reflects an additional sales week in fiscal 2023 that contributed approximately $181.9 million, Ulta said.
Net income for the quarter totaled $393.3 million, slightly lower than the previous year’s $394.4 million.
On an annual basis, Ulta comparable sales rose just 0.7% in 2024. This was a marked slowdown compared to 5.7% growth in 2023. Annual net sales increased modestly, up 0.8% to $11.3 billion from $11.21 billion.
Throughout fiscal 2024, Ulta continued to invest in its store presence. The retailer opened 66 new stores, remodeled 41, and closed six, ending the year with a total of 1,445 stores. It also launched 100 new Ulta Beauty at Target shop-in-shop locations, Steelman said.
Another bright spot for the retailer was its revamped loyalty program, rebranded as Ulta Beauty Rewards in early 2024. The loyalty initiative helped membership grow 3%, reaching a record 44.6 million members, Steelman said.
Ulta’s strategic plan emphasizes digital and marketplace growth
To position the company for future growth, Steelman unveiled the retailer’s new “Ulta Beauty Unleashed” strategy, which is organized around three core priorities:
- Driving core business growth
- Scaling new business opportunities
- Realigning company operations for future success
To boost core growth, Ulta plans major investments in brand building, enhanced personalization, and digital acceleration, she said. Steelman said customers can soon expect new and improved features on Ulta’s app and website, aimed at enhancing the shopping experience.
In the second half of the year, Ulta will launch the Ulta Beauty Marketplace, broadening its ecommerce product selection to include more beauty and wellness brands, she said. Steelman highlighted that loyalty members will earn points from marketplace purchases and enjoy the convenience of in-store returns.
In addition, Ulta plans to expand its wellness product assortment, build out its Ulta Beauty Media advertising platform, and grow its international footprint. Steelman noted the company has begun preparations to launch in Mexico and recently announced plans to enter the Middle East market in 2025.
Leadership shifts aim for streamlined operations
For the full year, Ulta said it plans to remodel 40 to 45 stores and open approximately 60 net new locations.
Steelman also announced leadership changes aimed at streamlining operations:
- Monica Arnaudo, chief merchandising and digital officer, will retire this spring. A successor is expected to be announced soon.
- Amiee Bayer-Thomas was promoted to the new role of chief retail officer, overseeing all store operations.
- Mike Maresca, chief technology officer since 2023, expands his role as chief technology and transformation officer.
- Kelly Mahoney, former senior vice president of customer and growth marketing, has been promoted to chief marketing officer.
- Rene Casares, previously chief legal officer at Academy Sports + Outdoors, will join as chief legal officer, replacing retiring general counsel Jodi Caro.
Modest outlook for 2025
For fiscal 2025, Ulta forecasts net sales between $11.5 billion and $11.6 billion. Comparable sales growth is expected to range from flat to a 1% increase.
“Fiscal 2025 will be a pivotal year as we make purposeful investments to fuel our future growth and move quickly to optimize our business,” Steelman said in prepared remarks. “While it will take time to see the impact of these efforts, we are confident these investments will help reignite our momentum and unlock sustained growth and long-term value for our shareholders.”
Do you rank in our databases?
Submit your data and we’ll see where you fit in our next ranking update.
Sign up
Stay on top of the latest developments in the ecommerce industry. Sign up for a complimentary subscription to Digital Commerce 360 Retail News. Follow us on LinkedIn, Twitter and Facebook. Be the first to know when Digital Commerce 360 publishes news content.
Favorite