Ulta Beauty (ULTA) Q1 2026: Revenue Growth and EPS Increase — Positive Outlook

Ulta Beauty, Inc. (NASDAQ: ULTA) reported a strong performance for the first quarter of fiscal 2026, with net sales increasing by $315.5 million or 11.1% year-over-year, reaching $3.2 billion. This growth reflects a robust demand across all channels and major product categories, indicating a solid start to the fiscal year.

Key Financial Metrics:

• Net Sales: Increased by $315.5 million or +11.1% YoY to $3,163.9 million.
• Comparable Sales: Increased by 5.3%, driven by a 3.7% increase in average ticket and a 1.6% increase in transactions.
• Operating Income: Increased by $46.5 million or +11.6% to $448.3 million.
• Diluted EPS: Increased by $1.04 or +15.5% to $7.74.
• Gross Profit: Increased by $153.4 million or +13.8% to $1.3 billion, with a gross margin of 40.1%.
• SG&A Expenses: Increased by $104.1 million or +14.6% to $814.7 million, representing 25.8% of net sales.

Analyst View:

This quarter is a positive outcome for shareholders, showcasing Ulta's ability to drive revenue growth and improve profitability despite rising expenses. The increase in diluted EPS to $7.74 reflects effective cost management and operational efficiency, which is encouraging for investors. The company’s strategic initiatives, including the acquisition of Space NK and the opening of new stores, have contributed to this growth, demonstrating a strong execution of its business model.

Capital Return and Guidance:

Ulta Beauty returned $555.0 million to shareholders through share repurchases during the quarter. The company has also updated its fiscal 2026 guidance, maintaining its net sales growth outlook at 6% to 7% and comparable sales growth at 2.5% to 3.5%. However, it has slightly adjusted its operating income growth forecast to 6.5% to 9% and increased its diluted EPS guidance to a range of $28.36 to $28.80.

Forward Catalyst:

Investors should watch for the continued impact of Ulta's strategic initiatives, particularly the integration of Space NK and the performance of new store openings. Additionally, the company's ability to manage costs effectively while driving sales growth will be crucial in the upcoming quarters. The next earnings report will provide further insights into how these strategies are translating into sustained financial performance.

Note: The amounts in the following tables are in thousands.

Exhibit 1: Ulta Beauty, Inc. Consolidated Statements of Income

	13 Weeks Ended May 2, 2026	13 Weeks Ended May 3, 2025
Net sales	$3,163,857	$2,848,367
Cost of sales	$1,896,237	$1,734,148
Gross profit	$1,267,620	$1,114,219
Selling, general and administrative expenses	$814,699	$710,613
Pre-opening expenses	$4,665	$1,829
Operating income	$448,256	$401,777
Interest income, net	-$652	-$3,547
Income before income taxes	$448,908	$405,324
Income tax expense	$106,860	$99,644
Income before equity net loss of affiliate	$342,048	$305,680
Equity net loss of affiliate	$1,579	$628
Net income	$340,469	$305,052
Net income per common share: Basic	$7.78	$6.72
Net income per common share: Diluted	$7.74	$6.70
Weighted average common shares outstanding: Basic	43,781	45,362
Weighted average common shares outstanding: Diluted	43,964	45,508

Exhibit 2: Ulta Beauty, Inc. Condensed Consolidated Balance Sheets

	May 2, 2026	January 31, 2026	May 3, 2025
Current assets: Cash and cash equivalents	$166,300	$424,243	$454,629
Current assets: Short-term investments	$55,000	$70,000	$0
Current assets: Receivables, net	$248,240	$296,217	$225,146
Current assets: Merchandise inventories, net	$2,386,417	$2,181,127	$2,121,519
Current assets: Prepaid expenses and other current assets	$165,647	$169,361	$138,396
Current assets: Prepaid income taxes	$0	$3,198	$0
Total current assets	$3,021,604	$3,144,146	$2,939,690
Property and equipment, net	$1,420,091	$1,434,062	$1,251,287
Operating lease assets	$1,849,896	$1,813,074	$1,658,834
Goodwill	$224,628	$226,421	$10,870
Other intangible assets, net	$201,596	$203,288	$0
Deferred compensation plan	$52,606	$53,391	$47,467
Other long-term assets	$124,824	$124,912	$78,541
Total assets	$6,895,245	$6,999,294	$5,986,689
Current liabilities: Accounts payable	$713,775	$685,887	$537,518
Current liabilities: Accrued liabilities	$462,065	$551,380	$346,960
Current liabilities: Deferred revenue	$541,199	$582,378	$462,843
Current liabilities: Current operating lease liabilities	$309,576	$306,671	$285,764
Current liabilities: Accrued income taxes	$132,565	$35,739	$130,765
Current liabilities: Short-term debt	$144,899	$62,287	$0
Total current liabilities	$2,304,079	$2,224,342	$1,763,850
Non-current operating lease liabilities	$1,847,968	$1,813,103	$1,689,439
Deferred income taxes	$101,220	$98,766	$46,013
Other long-term liabilities	$61,023	$59,632	$57,084
Total liabilities	$4,314,290	$4,195,843	$3,556,386
Total stockholders’ equity	$2,580,955	$2,803,451	$2,430,303
Total liabilities and stockholders’ equity	$6,895,245	$6,999,294	$5,986,689

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