THE WHAT? Ulta Beauty has reported its results for the first quarter of fiscal 2023. The US beauty retailer saw net sales rise 12.3 percent yoy to US$2.6 billion in the first three months of the financial year, while comparable sales increased 9.3 percent.
THE DETAILS Gross profit was up 12.1 percent to US$1.1 billion, although as a percentage of net sales, gross profit decreased to 40 percent marginally down on the prior year’s 40.1 percent due to higher inventory shrink, lower merchandise margins and higher supply chain costs, Ulta said.
The company has revised its 2023 forecast, now predicting sales of US$11 billion to US$11.1 billion (previously US$10.95 billion to US$11.05 billion) and an operating margin of 14.5 percent to 14.8 percent, down from the 14.7percent to 15 percent forecast previously.
THE WHY? Dave Kimbell, Chief Executive Officer, commented, “The year is off to a positive start as the Ulta Beauty team delivered revenue, operating margin, and diluted EPS consistent with our internal expectations. Store traffic remained healthy, member growth showed continued strength, we delivered growth across key categories, and we strengthened engagement with the Ulta Beauty brand. While we expect the operating environment to continue evolving, we remain confident in the resilience of the beauty category and in our ability to drive share and profitable growth with our proven business model, a diverse, best-in-class assortment, an industry-leading loyalty program, and our world-class team.”