Ulta $ULTA Q1 EPS +15.5% to $7.74; FY2026 EPS guide lifted

Ulta Beauty $ULTA posted fiscal Q1 diluted EPS of $7.74, up 15.5% year over year and above the $6.86 analyst estimate cited by Reuters, while net sales rose 11.1% to $3.164B. The company also lifted fiscal 2026 EPS guidance to $28.36 to $28.80 from $28.05 to $28.55, making the report a concrete earnings beat with a guidance raise.

The first-quarter sales mix was broad enough to matter beyond a single product category. Comparable sales increased 5.3%, compared with 2.9% a year earlier, driven by a 3.7% increase in average ticket and a 1.6% increase in transactions. That combination points to both higher basket size and more customer traffic, a cleaner retail signal than price alone.

Profitability moved in the same direction. Gross profit rose 13.8% to $1.268B, and gross margin expanded to 40.1% of net sales from 39.1% a year earlier. Ulta attributed the improvement primarily to lower inventory shrink and higher merchandise margin. Operating income rose 11.6% to $448.3M, or 14.2% of net sales.

The balance sheet and capital-return line added another measurable element. Ulta ended the quarter with $166.3M in cash and equivalents, $55.0M in short-term investments, and $144.9M in short-term debt. Merchandise inventories increased 12.5% to $2.4B, reflecting new brand launches, the Space NK acquisition, key category investments, and 70 net new stores since May 3, 2025.

Capital return was sizable for the quarter. The company repurchased 958,323 shares for $555.0M, leaving $1.3B available under the $3.0B authorization announced in October 2024. That buyback figure is material relative to first-quarter net income of $340.5M.

For fiscal 2026, Ulta left net sales growth unchanged at 6% to 7% and comparable sales growth unchanged at 2.5% to 3.5%. It raised the low end of operating income growth guidance to 6.5% from 6%, kept the high end at 9%, and lifted EPS guidance by $0.31 at both ends of the range. The next test is whether the company can sustain 5.3% comp growth while inventories are up 12.5% and store expansion continues.

Not investment advice. Verify all figures with primary sources before acting.