E.l.f. Beauty cuts prices on some products as sales slowdown tempers fiscal 2027 outlook

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E.l.f. Beauty cuts prices

Highlights

E.l.f. Beauty cut the $18 Halo Glow skin tint price by $4, generating about a 40% business lift after recent unit sales softness.
Fiscal Q4 revenue reached $449 million versus expected $423 million, with adjusted EPS of 32 cents and a net loss of $49.4 million due to a $57.6 million Rhode acquisition charge.
Fiscal 2027 sales guidance of $1.84–$1.87 billion and adjusted EPS of $3.27–$3.32 missed forecasts, reflecting margin tradeoffs and weaker consumer demand.

Pricing tests and quarterly performance

As reported by CNBC, E.l.f. Beauty says it is rolling back some tariff-driven price increases after seeing unit sales weaken in recent months as consumers face higher costs. Chief Executive Tarang Amin says the company has seen a sharper drop in volumes lately and plans to test lower pricing on additional product lines to reinforce its value positioning.

The company recently cut the price of its $18 Halo Glow skin tint by $4 in a test and says that generated nearly a 40% lift in the business, highlighting current consumer sensitivity to pricing. Last August, E.l.f. raised prices by $1 across its full assortment, but it is now using selective reductions to try to restore unit growth.

E.l.f. reports adjusted earnings per share of 32 cents for its fiscal fourth quarter, ahead of expectations for 29 cents, while revenue reaches $449 million versus the $423 million analysts expected. Sales for the quarter ended March 31 rise about 35% from a year earlier, although the company posts a net loss of $49.4 million, or 82 cents per share, compared with net income of $28.3 million, or 49 cents per share, a year earlier.

The quarterly loss is affected by a $57.6 million charge tied to the Rhode acquisition following stronger-than-expected performance from that brand. Excluding that cost and other one-time items, E.l.f. says net income totals $19.4 million, or 32 cents per share.

Margin gains face softer consumer demand

E.l.f. says gross margin improves by 1.4 percentage points to 73% during the quarter, helped largely by the pricing strategy that it is now beginning to reverse. Amin also says a $55 million tariff refund is expected to help soften the effect on profitability going forward.

Even so, the company's fiscal 2027 guidance falls short of market expectations. E.l.f. projects sales of $1.84 billion to $1.87 billion, compared with expectations of $1.87 billion, and adjusted earnings per share of $3.27 to $3.32, below the forecast of $3.61.

The combination of selective price cuts and softer guidance points to a tougher consumer environment for the beauty sector, as companies balance value messaging, margins and demand recovery. For E.l.f., the next phase of pricing tests is likely to be closely watched for signs that lower shelf prices can revive volumes without causing a deeper hit to profitability.

Our earlier update on Estée Lauder’s Q3 results and EL share performance highlighted a recovery narrative tempered by uneven demand, especially across Asian and duty-free channels. We also noted the stock was trading below key moving averages with mixed technical signals, while delayed Puig merger talks added uncertainty alongside the guidance upgrade.

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