e.l.f. Beauty (ELF) Q2 2027 Earnings Report

The call was strongly positive, supported by 51% Q2 net sales growth, 86% adjusted EBITDA growth, broad-based brand momentum, successful international and retail launches, and raised full-year guidance. Management acknowledged second-half gross-margin pressure from Rhode's retail expansion, lower expected Q4 growth due to launch comparisons, and a low-teens second-half adjusted EBITDA margin due to planned reinvestment and spending timing.

For fiscal 27, management expects net sales growth of approximately 22-24%, up from 18-20% previously, organic net sales growth of 9% to 11%, up from 6-7% previously, adjusted EBITDA of $421 million to $427 million, adjusted net income of $231 million to $233 million, and adjusted EPS of $3.82 to $3.86 per diluted share, versus $3.50 to $3.55; it continues to expect an adjusted tax rate of approximately 25-26% and approximately 60.5 million fully diluted shares. Second-half net sales growth is expected to be approximately 7-10%, up from the implied 6-9% previously, with Q3 net sales growth above that range and Q4 below that range, while each brand is expected to contribute to growth for the balance of the year. Gross margin is expected to increase approximately 250 basis points year over year versus 200 basis points previously, or approximately flat gross margin versus prior year excluding tariff refunds; marketing and digital investment is expected at the higher end of the 23-25% of net sales range, adjusted EBITDA growth is expected to be approximately 26-27% versus 20-21% previously, adjusted EBITDA margin is expected to expand approximately 50 basis points year over year versus 20 basis points previously, and second-half adjusted EBITDA margin is expected in the low-teens.