Key Takeaways
- e.l.f. Beauty has acquired Hailey Bieber’s Rhode for $1 billion, boosting its portfolio.
- Fiscal 2025 saw e.l.f. Beauty’s net sales increase by 28%, with a notable Q4 performance.
- The company has not provided 2026 guidance due to uncertainties around tariffs.
Acquisition of Rhode Enhances e.l.f. Beauty’s Portfolio
e.l.f. Beauty has announced the acquisition of Rhode, the beauty brand founded by Hailey Bieber, for $1 billion. This move is expected to further enhance e.l.f.’s diverse brand portfolio, making prestige products more accessible. The acquisition is structured with $800 million payable at the closing in cash and stock, alongside an earnout potential of $200 million based on future growth over three years.
Rhode has seen remarkable growth, doubling its consumer base in the past year and generating $212 million in net sales for the fiscal year ending March 31, 2025. The brand is preparing for a significant expansion into North American and U.K. Sephora locations later this year. Bieber will remain heavily involved as chief creative officer, focusing on product innovation and marketing strategies.
e.l.f. Beauty’s chairman and CEO, Tarang Amin, expressed enthusiasm for the acquisition, highlighting Rhode’s alignment with the company’s mission to “break beauty barriers.” Bieber echoed this sentiment, emphasizing her vision for Rhode’s growth and innovation as they venture into this new chapter together.
Strong Financial Performance in Fiscal 2025
In a separate announcement, e.l.f. Beauty reported a solid fiscal 2025, with a 28% increase in net sales, reaching $1.313 billion. The company’s Q4 results included a 4% rise in net sales to $332.6 million, driven by strong performance in retail and e-commerce channels. The gross margin improved by approximately 50 basis points to 71%, and net income stood at $28.3 million on a GAAP basis.
Amin noted the company’s ability to gain market share during a dynamic period, including a 190 basis point increase in the U.S. market. e.l.f. Beauty’s ongoing international expansion strategies and the new acquisition of Rhode are expected to contribute to sustained growth in the competitive beauty industry over the coming years. The company has opted not to provide guidance for 2026, attributing the decision to the uncertainty surrounding tariffs affecting product pricing.
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