THE WHAT? Ulta Beauty has announced better-than-expected sales for the third quarter of fiscal 2020. The US retailer saw sales drop 8.9 percent yoy to US$1.6 billion. However, despite market expectations of a steeper decline, shares fell last week as Ulta forecast further decreases over the holiday season hinting that the road to recovery could be long and slow-going.
THE DETAILS Indeed, the company has begun the quarter with nearly all stores open for retail, it said, but as COVID-19 prevalence increases, restrictions may also return, resulting in reduced operating hours, limitations on in-store capacity and even mandated store closures.
THE WHY? With mask-wearing mandates still in place and Biden’s recent declaration that they would remain so for his first 100 days in office, make-up sales are slow. CEO Mary Dillon’s assurances that ‘engagement with the category remains strong’ hasn’t quelled market fears that recovery will be slow and painful. However, Dillon remained upbeat, “As a well-loved brand curating all things beauty, all in one place, we take great pride in our responsibility to lead the industry and redefine beauty experiences for guests, inclusive of safety measures. As the prevalence of COVID-19 increases across the country, we will continue to monitor closely and adjust operations as needed to ensure the safe delivery of beauty essentials.”