Ulta Beauty (ULTA) 5 Dec 242025 Q3 Earnings call transcript

Good afternoon, and welcome to Ulta Beauty's conference call to discuss results for the Ulta Beauty Third Quarter 2024 Earnings Results. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Ms. Kiley Rawlins, Vice President of Investor Relations. Ms. proceed. may you Rawlins,

today Good Steelman, a and session. results discussion of will Chief for our third Julian. Officer; us Chief joining Paula join and and for you Chief us quarter Oyibo, call Hosting XXXX. for of Officer; fiscal Q&A Dave afternoon, you, Kimbell, thank Executive Kecia everyone, Financial for the are President Thank the Ulta Officer, Beauty's Operating

language. Many from we only the find harbor and cause Before will X, a you I'd results company's contain you will release remind differ like as refer filings, our forward-looking to could December speak actual to our of you of number these forward-looking begin, to today, XXXX. which statements. of today We where which materially SEC earnings remarks safe statements, of factors,

We'll Paula. afternoon and remarks from begin Dave with this prepared

our we'll Following comments, prepared the call questions. for open

be the any IR As for follow-up available the after questions team always, will call.

over to turn Now Dave. to the I'd like call Dave?

and Kiley, We in Beauty. good everyone. you, Thank interest appreciate Ulta your afternoon,

Our quarter sales this profitability. with improved team and performance better-than-expected delivered for

net quarter, comparable per EPS $X.X $X.XX billion X.X% the increased X.X%. For increased Diluted X.X% sales increased share. to sales to and

a shared a the last we we prestige number and in normalization beauty. consumer call, As elevated the of environment U.S. are our including dynamic navigating headwinds, category on of beauty competition, particularly

from benefit making performance. to taking are are to reinforce position we abated, starting the while And our actions headwinds and market are improve see have We progress. we our not

weeks continue The and improvements driven Circana market strength makeup data skin hair by prestige ended trends care. fragrance XX and flat resulting see based share improved, in and on market this In quarter, the XXXX. primarily share we in trend X, November our to the third was in for quarter

in e-commerce trend mass with the performance consistent stores channels. trends by beauty the and quarter stronger driven quarter. second Comp across improved both growth was from Our transaction second share

ending program, members, last million expand the active quarter than with our X% We loyalty more continue to year. XX.X

lapsed members to We continued convert member existing improved new we retention. and reactivated more We members.

tentpole strategies optimize Our to stronger and earned marketing drive across new events we to teams help the a progress ERP media and inventories deliver buzz, delivered and growth our experience. to system new processes, support relevance in value made and our our better guest sentiment. double-digit And and balance network adapt

continuing working a experiences working strengthen guest position, market are all and teams environment. thank Our to drive our for I dynamic hard collaboratively operating to in performance great while to of our improved want to deliver associates

franchises performance to men's Valentino. of driven high assortment, fragrance, new Eilish gender-neutral Fragrance including from the exclusive driving strongest our products, established and and The fragrance primarily interest sets. this engagement. increasing, gender-neutral category. summer fragrance, from is sense appeal newness fueled new Consumer Billie was growth Paul delivering launched and is an of was gift guest by and and Turning Gaultier and Armani in by category, single-digit by YSL Jean and fall our NOYZ, growth, including holiday fragrances comp men's

NEST to YSL to exclusive new Beauty both Orebella, Valentino, Ulta women's and Jenner Kylie brands, fragrances also growth. women's category from and New and overall contributed

was in The strong skincare La performance SACHEU, as de in from body newer part The offset Roche-Posay exciting body brands Touchland, by and mass OLEHENRIKSEN, flat. deliver prestige the skin guests which driven Bubble continues DIME care. skincare, category. quarter brand newness in introduced others And care Janeiro, which delivered from to was resonated growth large this with prestige mid-single-digit compelling Naturium, care while and Beauty engage newness. In guests innovation engagement with was a growth growth Sol exclusivity. in skin care strong by and category partially Mass decline of comp care skin

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flat. Prestige makeup was

collaboration XX Tilbury, Fall Charlotte in-store with investments, by and newness, the of received brands, quarter, Clinique. beauty. including guests DIBS Beauty Beauty with for MAC prestige brand, our Days performed well, product growth Promotional engaging during highlighted compelling makeup and while Eliot and for New exclusive Beauty driving Haul resonated r.e.m. delivered brands, several established well brands, events combined and Wicked growth was

category, to hair Odele the In the category Beauty by Comp also range. guest decreased guests. for Exciting new growth Redken Divi and from with the hair newness single-digit offset newness delivered healthy care continued brands drive low OUAI, this This lines. in year. softness key and in growth Dyson product sales while Hero with for was distribution Matrix, with from products and Shark their expanded tools, resonated limited engagement

styling Our to Services services get and acquisition makeup participating core well, and driven guest also to salon brands. to continue takeovers, business Ear delivered back-bar guests treatments. including growth, services, color, and product for in which hair an opportunity new brands single-digit introduce and our low comp drive by primarily piercing stylists performed engagement attachment

to existing to We designed strategic innovation are October, needs also of seeing we in evolving strengths improvements the beauty strengthening enthusiasts. into are meet shared our while market framework driving In and and refreshed we our position our performance lean on focused business, further. our

As love point, at the authentic leadership longer the intend of engage to seamless and and wellness by building through Beauty beauty to wherever the enthusiasts and want and reach growth we brand delight our growth engaging Wellness member and over immersive our destination of omnichannel in All lifelong loyalty curating all and share through experiences through inspire, personalization. and that beauty drive Things every a expanding for shop term guests they best fostering touch and connections human market profitable empowering lifetime, beauty

position. areas near in we these And We are earnings on the drive foundational addressing areas competitive revenue the confident term, key and our focus long will our reinforce over growth are term. stronger to

progress highlights the quarter, our some share efforts of strengthen with starting assortment. made to this me Let our

enhancing are our to drive category We brand portfolio growth.

DIBS Eliot and as brand, launched Beauty, third as makeup the Beauty new skincare Beauty During Essentials. emerging Oak quarter, brands, RMS we well

wellness we Pot emerging our brands, with and Additionally, Joylux. The expanded offerings Honey

we prestige quarter, with an Apothékary, the exciting ahead, brand and brand, clinical brand. planned ingredients, Tatcha, celebrated fourth KHLOÉ, proven skincare emerging botanicals exclusive announced pipeline Khloe recently of balancing including Japanese by the launches wellness Looking an created for have an for Kardashian XO fragrance brand timeless

launched exclusive to addition we this brands, quarter. In X collaborations new exciting

of First, price points key key limited-edition with brand as across and beauty Pictures with NBCUniversal's the exclusive we brands with products worked multiple partner categories. the -- develop retail a collection Wicked, the movie for to

products well brands, features beauty With both stores of life Beauty collection Beauty in through others. Wicked-inspired OPI came Scunci, in-store among to including through our and exclusive digital and The Beauty Ulta as channels XXXX, and to by Beekman from Ulta experiences engaging Wicked and as are leading Target. Ulta immersive r.e.m. Ariana displays, Grande which at

and with unique offering sales Supergoop!. e.l.f., awareness, brands, NYX, we traffic a which engagement, Gen millennial from consumer disruptive especially products Z these of Brands, of Both and beauty XX Second, are Mini the strong and members. collaborations offers replicas Mini best-selling includes popular including versions driving exclusive Drybar and beloved launched XX brands. This miniature of Brands beauty tiny an collection first-ever of

across experiences differentiation, focused are As value, our experiences business drive loyalty and on and we we authentic, meaningful discussed channels. at engaging Day, personalized our creating guest all recent Investor

In and hosted founder unique in-store QX, events we XX,XXX more brand including celebrity care-focused events, events, than and events. multi-branded skin

salon-worthy stylists. to invited talented also create to stores in-store more We blowouts while personalized event, and our coaching and the salon learn guests recommendations our expanded how workshop receiving customized to from

enhancing to We our drive traffic are digital and sales. experiences

activations During delivered the double-digit and guest quarter, growth. program key drove engagement our sampling online expanded sales

drove and improving including enriched the delivering our site product enhanced navigation experience stronger pages merchandising conversion digital guest conversion are optimization guided Our strategies, trends. and and search, efforts

saw we third adoption. continue for of from basis growth QX, the member increased the up year. our with sales accounted to engagement points we app, last app XXX In which X/X in in double-digit about Importantly, about drive e-commerce quarter,

experiences We discovery to introduce digital trial. continue resources to and new and drive

experiences precision looks skin a user our of the includes new sharing stability, and enhanced hair to makeup we analysis interface and which quarter, Try-On Virtual and capabilities. X.X, and a suite new engine XD launch includes of that enhance AI-enabled shoppable with This GLAMlab

immersive new to that educational tips launched meaningful world digital while UB connection have we engine beauty providing form beauty beauty connect, engage guests launched product connections. inclusive Community, search buying also content, in with optimization, amplify with deepen we to for the of learn, We enthusiasts, and the digital To authentic foster guides and empower welcoming guests a recommendations.

million active provides our in an role lives. joy, wellness unique beauty, sales. of Ulta already user unmatched Rewards Ulta initial members' Beauty drive target, amplifies our October, with asset to in plays consumer our Launched that than count the and us more With XX intersection strategic our is confirming the meaningful community Xx Beauty is members, and insights

expanded with reactivated we and experiences, across members personalization greater QX, both channels site channels, targeted recommendations, replenish campaigns owned and we and with paid life into channels. social In cycle Leaning retargeted efficiency. reminders, enhanced digital in product

marketing engagement. and diamond position in continue social personalized social authentic Additionally, frequently that advocacy, leveraging base, evolving the spend customer we're gifting connection each at of events Platinum unique grew relevance beauty, browse our and Increasingly, early like drives shop and exclusive and media earned member strategies launches, to to drive access more diamond and and value key we our accelerate especially platinum retain offers more brand and best-in-class rates. to incentives and brand center at members visit to and and growth.

trends, growth brands marketing third emerging new quarter, leveraged and lean to the our events. key we and amplify social During into activate capabilities trend-focused

UB buzz talent innovative new key also engagement. events program key program, our as and tentpole founders affiliate launches, ambassador ways and collaborations We exclusive brand across support new Ulta as to and well our engage Collective, social to in guest drive brand and channels our associate Beauties, from

efforts growth, key These brand and delivered metrics. EMV expanded health increased impression accelerated

Media. to ultimate Roblox, products ads category, services universe the innovative to product retail to beauty UB continue tech capabilities grow partners. enhance non-endemic our AI network, create partnering introduce We to outside our our company, media partnered recently virtual are we with opportunities the advertising for Rokt, and and for e-commerce We with

Ultraverse, the and has Over the growing our our Ultaverse through in Media interest the beauty at grown capabilities. to those our intersection exciting brands unlocking XX million attracting UB in bring participate new years, gaming, over With possibilities visits. on media Roblox, life one new of beauty to innovation largest of to into brands we're ways from games

especially quarter, our glossy we hair lessons products. featured showcasing second traffic. trend, a new strong in new this from leveraging offer, reiterate a and and strong and sales a drove to event Event, and our the hair with results We on offering event & Hair and evolve promo drive the quarter and new year's items expectations Dyson tailor began our last Gorgeous strong Shine the spotlight Now exceeded the stores, for continue in brands. fall to strategies replacing event Gloss value exclusive promotional participating

versus end XX and social new of acquisition surprised of we the with compelling We the and beloved which back At with beauty growth successful up event, robust strong wrapped bonus Days guests. with offers, marketing August, and event, drove of event. mass offers combined Haul events that deals, member-only quarter Beauty delighted brought last XX member delivered Fall our Beauty and engagement year's support, a Days new

and loyalty audience of optimized timing strengthening and these tentpole offers. our proactively events, target addition pending evolving type to we our In the merchandising offers,

trend. result, half a promotional improved from our As first effectiveness the

formal plans our full significant through and encouraged The we is our several performance ahead. weeks holiday by to now holiday still Cyber And expectations we're flight. have season for holiday. while Monday, Shifting in sales

insights are value. economic to While that concerns consumers suggest on driving a continue focus our greater spend,

and diverse touch celebrate engaged ready and to points, products they the excited, help deliver assortment and positioned teams our holiday. joyful our omnichannel to are as price we compelling a our points, With support of them convenient guests season are well and offers

the from small Our reminder this the year joy authentic that and connection. campaign drive from but the moments gifts comes A beauty, holiday Find Joy only that Present. in big is, of of emotional not

is integrated channels social campaign goal as and activation With PR deeper and robust on digital across our experiences in emotional stores driving our as media, marketing, the festive with supported member and well platforms. engagement, of

and positioning We compressed have holiday selling competitive season. through strategies our the in place to fortify manage

make real-time the our consumers tailored for drive concierge transforming our value to greater the with guides are and go-to holidays. fun tips Ulta gift providing into and creating experiences solutions, needs We to guests' channels for all-things-holiday and Beauty that awareness beauty a destination

wants that strong core to Our across gift Whether merchandising items created have and with exciting holiday has make every and with kits and budget. team exclusives treat newness category an value-driven assortment, themselves, holiday focus gifts. a curated others great guests we balanced on options thoughtfully or

corporate working guests all and guests, is Ulta And teams for the year demonstrations our season. to holiday supply with drive ready bring build new hard this ready Our to ensure store and and traffic. chain teams to bring have events to sales holiday life been our Beauty joy and to are connection our guest in-store

And tools holiday ready shop. successful same-day it's been in options more shop confident messaging, and positioned multiple delivery to deliver incredible holiday this marketplaces, ways to engaging and innovative season. our assortment, With recommendations never to well with another and for Beauty. DoorDash I to knowledgeable BOPIS, holiday, new digital Instacart associates Ulta easier at launched participation our convenient guidance we provide and soon-to-be holiday or am new are

performance to growth. associates with authentic touch long-term our We will business experiences in all by combined the are optimistic we category enable are beauty about plans. to we committed profitable the offering will trends deliver reinforce who remain stronger are am holiday we market position outstanding confident seeing of actions the points are drive I our and guests inclusive taking us and resilient, our summary, across the to and In believe our improving encouraged

our Now share in our sales Chief XXXX. in plan outstanding our share Ulta has most want before to XXXX, to in furthering from Beauty loved be elevated have financial market Since Monica the assortment deliver joining of Officer, to Paula us Ulta spring helped discusses ways beauty Monica our her has that guests destination. results, built I announced mission that while Beauty an and retire Merchandising team Arnaudo, growth, remarkable and

and I has she as on she the team want to has a our everything thank Monica organization. impact for contributed had for executive member our of

Beauty is While committed Ulta transition. we to a and successful work Monica's supporting successor, to her identify team fully she with

turn for will the of call discussion I results. financial a Paula Paula? to now And over the

Monica for echo all Thanks, a our Dave, sentiments of Dave's afternoon, grateful Monica. steadfast and has . congratulate are trusted and good leader and we everyone. want ambassador I and brands, to our so of been contributions.

our provide Now results full begin our fourth and of financials. expectations. with color financial quarter our turning on more a to and third I'll quarter discussion then year

performance For the trends. reflecting third across expense continued growth, quarter, better-than-expected top the discipline P&L, financial we and delivered and stronger shrink management line favorable

lower stores partially was quarter the increase and sales X.X% X.X%, comp other from in increased revenue. Net contribution sales a new sales for offset by

in we quarter, by average in and stores XX increase XX and sales new remodeled opened The a X the comp stores, was closed ticket. stores. During increase driven transactions a X.X% X.X% increase

efforts, to Other revenue program, card declined to were related an loyalty member our primarily million, expansion engagement in by increase of $X due increase the offset credit from to an income program. revenue million driven which our partially our deferred $XX in

performance stronger of September. primarily in of resulted compared sales sales channel event, our timing the a growth. Comp the the decreased second mid-single-digit due August a cadence semiannual sales e-commerce trend at comp stores which delivered Days previous shift in in Beauty period. of but compared Looking modestly throughout from quarter. slightly in trends XX improved to last softened decreasing in year. sales channel the perspective, were From our quarter, comp positive The to October to

which the quarter, decreased basis fixed costs For lower was costs lower to and decline due to XX.X% by shrink. favorable other was deleverage revenue, due margin shipping offset XX.X% to last and gross year. mix to compared lower primarily channel of The points e-commerce XX partially

in supply Lower fixed revenue chain growth store of resulted deleverage costs. and

chain expansion more network of pressured and our areas. the new Additionally, openings these supply store

than a inventory of lower sales, percentage As year. was last shrink

new helping control fixtures us for shrink. our processes in field inventory enhanced combined are management and investments inventory fragrance teams training Our with secure

we will as lower flat primarily of Merchandise offset sales a Beauty mix. with brand of with expect to margin and year. relaunch last roughly flat full is shrink percentage Year-to-date, continue the year, inventory unfavorable shrink be to Collection, the related for reserves Ulta by flat was

$XXX planned million. increased SG&A quarter, this management. expenses. better SG&A to expense was due to spend focused primarily to Moving X.X% again Overall, than

lower As growth, to line expenses quarter. of XX% year, compared basis top reflecting deleveraged XX.X% percentage most points SG&A last XX a sales, increased to this

due addition, average deleverage, higher benefits, to overhead, primarily primarily In and primarily due payroll rates higher store to wage corporate to investments. strategic SG&A due higher and

These for that operational chain compensation, internal incentive lower pressures million were below was the primarily reflecting quarter targets. and performance offset million due our to store partially to new by $XX $XX was investments. Depreciation compared supply last year,

X.X% $XXX.X profit Operating decreased million. to

of $X.XX to sales to operating diluted year, of to of percentage XX.X% and XX.X% compared $X.XX sales, last As GAAP increased last compared per a margin earnings share year. sales X.X% was

the capital quarter capital in including and to needs million priorities, allocation ended expenditures. equivalents to quarter ongoing last million Similar our working debt. We cash revolving facility share with and priorities. $XXX Moving credit balance the and on during in to sheet drew capital year, we $XXX short-term capital and our support quarter cash repurchases the third and allocation

Total X.X% year. $X.X inventory million investments net we through $X.X was operating new fixtures. $XXX quarter, cash quarter, last Year-to-date, existing impact IT Capital of were to The the stores, primarily primarily to compared the $XXX in for and billion investments merchandise increase million to in third billion XX flow. new stores. due reflecting generated and the expenditures increased

end through million meeting we of program share October. under we returned quarter, billion capital our quarter, of investor had XXX,XXX shareholders $X.X the our $XXX of at repurchase to billion third in At the the In we announced $X repurchase remaining the our shares.

Now turning to outlook. our

-- quarter view reflect results, consumer sales to cautious guidance and the continuing third our the operating to EPS for and take environment. while have of a for We fiscal our refined fiscal XXXX

comp between X% $XX.X be and billion growth for expect We sales billion, will and with negative flat. net between year sales the $XX.X

stores to to and XX we new year, open to XX XX stores. XX or continue relocate to remodel plan the net approximately For

operating margin XX.X% We we from expect XX.X% net be $XX.XX. reflecting will now with diluted top SG&A, expectations. deleverage these line Reflecting sales, to margin year the will gross come expect and between and assumptions, and $XX.XX of be for both between our EPS

I about the QX. to left With how thinking X share quarter want in we are year,

holiday encouraged around are a the demand. performance will our impacted dynamic that results operating by continued we While also likely third and a our acknowledge uncertainty quarter fourth compressed consumer quarter by be and underlying we environment quarter-to-date, season,

will expect single-digit modeling QX operating margin decline purposes, between be XX.X%. low and range we For sales in XX.X% and comp will the

One final update.

have We $XXX million million expect for $XXX remodels million maintenance in between store for $XXX and $XX and XXXX, $XXX year and IT; the stores, spend including expenditure capital in and approximately updated million and fixtures; our full now to and expectations CapEx for fiscal merchandise about million supply for others. chain new

drive In closing, and from term. to it along know but we confident financial see with our stronger sales investments we time operational go-to-market will will and us discipline long remain full to benefits the over creation that our enable strategies the value efforts, take continued and

turn call over moderate I'll the our now the And to to Q&A session. back operator

Simeon Markets. [Operator Instructions] from Capital BMO from Our question Siegel first comes

quarter any this And thinking the had the about how impact progress October? of margin any over Dave, in pressure your you're just job. further year the on can And holiday? you margin views how broader quantify you any given points initial competitive then share landscape and full guide-lift you're Paula, and quarter, about of promotional those color Nice today's gross thinking us in could you then as beyond? just next

just broader and promotional and up and the Simeon, some areas. Paula, holidays Thanks, can start of I'll competitive pick margin-specific to you landscape, you well. Great. with on happy the as

the we've as throughout And I as third -- what that managing competitive So to this we frame. discussing intensely quarter, and in been see -- for as remarks, an the the year. mentioned continue we time

us in us. made our our we prestige dynamics performance, particularly quarter space, we in we like helped the in the but continue, The feel We of performance, adjustments the our strengthen work also we're but recognize more have actions, improve seeing third ahead progress. marketplace the

core that deliver program, we loyalty aspects assortment, Ulta key continue experience delivers only the be always and presence, our our to our the proposition, to unique been through drivers. our our have of business points And

after Promotionally, COVID. third experienced of quarter in what normalization some right out reduced the coming was we promotion continued

So we in year, into anticipated into saw QX. -- coming that that QX this coming we

Our than personalization leveraging lower but program QX, promotional made promotional to somewhat efforts But rates to mentioned more and our year. strategy higher business. the overall our tentpole I effective and our in CRM last than lean as efforts in are in events, amplify efforts remarks, our driving still adjust our the QX our were

a look do the very frame. quarter navigate As share our we into frame, certainly fourth this as year. most dynamics, promotional have what promotional through we the we'll of on anticipating that? results, continued so holiday. and Paula, holiday, That's we to intensity, is time true obviously talk time outside And it expect we're about but not reflections this far the but overall promotional would want significantly you

year, discipline. Simeon. performance our Sure. would about say reflecting expectations to gross so reflecting and the QX, gross also continue full margin line to delever. operating margin of about expect kind we raised we I continue we think EPS, top generally will and year competitive environment, full margin QX What and a think for expense the deleverage, in Yes, ongoing QX, we as when

trends all the we've really, continue. will year And seen

category will headwinds mix. are see fixed we given a and margin cost pressure the merchandise So promotions expect from continue perspective, to deleverage

would from range. speaking then some tailwinds, the sales. still SG&A an been deleverage growth QX. range. we've costs, in all we most offsets perspective, And to on growth maintain have But think And expenses in single-digit low to to that. expecting we'll the be which continue a to year discipline that of lower I But second... provide or as our to expect lower full I our financial about We the QX, from we'll we're transportation the expecting continue year, mid-single-digit say in

sorry, didn't you off. to Great. No mean cut I [indiscernible].

No, all good.

from question comes next Our Kelly Citi. Crago,

just prestige the I'm I prestige pipeline the provide little in innovation in on industry prestige believe talking if -- said to flat if if prestige context see you overall? talk it sorry bit And makeup, wanted was before could just the more a about beauty makeup. about I it quarter. was for could I'm you the I How

If you about pipeline could the talk there. innovation

those just kind for competitive points drag the you to when you've then pressures we're specifically way any seen to those And with headwinds in the expect new and distribution where of quantify sort of line secondly, further? time of abate from the at

core with our important Great. And makeup, an was improvement we've performing are largest that flat I'd the with for the been and ILIA strong drivers our brands category, ensure portfolio, obviously, that trends. programs Clinique strong some guests starting we're behind and pleased is that our key highlight quarter Well, Beauty, thanks, category. of some of brands our start makeup, delivering is prestige on closely XX Kelly. like continue and saying, execution prestige Yes, for and our quarter let's was the of across on overall, with our which for us, like makeup we're of our real well third a prestige other guests course, Days working from that of which we see, to The to and emphasis innovation that like coming the focused into to launch MAC them. in respond brands

single we're we category, on to we've able pleased Overall, do was bit a the digits. strengthen its in a up able focused that -- we and category category the -- been saw And time really makeup long so that total category, for it low prestige we're to the performance really this than in us more that. were

in share second the still from our although performance, pressured quarter. improved So pressure we while saw share,

that. and with making we're headway, pleased we're So

environment, the competitive asked competitive on you about openings. Overall

throughout our over about And that new been half that we've certainly experienced continues have previous least as dynamic As be more I of couple that's to a more opening points been been marketplace. there's of prestige a one at has that's meaningful competitive the last in than pressure, in years. shared been the and dynamic a in X,XXX multiple competitive that of than going beauty and openings, year, distribution that discussions had the on stores XX% have talking

taking. This positive seen able back the new but our contributors we're in historically actions absorb we're number ability stores dynamic We that, our we've do store said confident over in just opening that. that We're of period short to of know sheer then new the given openings. term. confident turn to shorter-term long business Having into scale, the the we're time. to stores -- a different the hit, is our in the But a

that performance we did the improvements in We stronger QX versus had total in QX. see QX to in contributed

headway we're feel like not we in But we we're saw that. but the of it's it. So some -- in -- midst still

that continue continue do so to strengthen are we got focus us into claiming things are and do. no we on and progress I work XXXX going to by our there online And as that And and earlier activity, dynamics. through drive experiences business. it. we're our all highlighted the our us what in stores best, into through our of We're more our are we We've helped means make to those working that that this quarter is strengths other to what do things lean

next Piper Wolfmeyer, Korinne Our from Sandler. question comes

the mass. -- mass I lot positively lot competitiveness about touch been larger talk like broader the business. want but little of I'd do to about piece quarter. like a I on A the understand beauty. to on the a the on bit mass Congrats mass we more feel little prestige, retailers have of talking bit a

into you beauty, the about would the stores mass dollar piece got for competitive forward the and expanding XXXX? piece so And heading thinking you landscape how that impacting You've business? are how is going this say more of in

with attractive is beauty I'll saying Korinne. very Thanks, yes. a -- start The category. that, Well,

And that's on and many been is the luxury, side, that category prestige so fact times talked all mass of going emphasizing category, side, the the investing anybody we've competitors. about in our in beauty, in whether the across

And that important In that for the us. an business, it's total continues to mass the in that -- quarter for total perform mid-single-digit -- mass. yes, business range mass-specific in the category

one strength know, and key of the business luxury. in masstige is you as and differentiators -- prestige of our As mass and

we mass role and business focused on the it plays. so important be to And continue our

aware So of the that dynamics. we're well

brands continued there's in is seeing makeup category, mass skin, seen more are decelerate. which category important been have strength us. we're but a Certainly, for that business -- the across total pressured, mass as We strength category stronger, has but the an

we're on delivering sure ability them and know ability excite business to price the across love, be make our engage drive our them points all and So to to us mass and to focused continue mass with our the continuing confident business. in engage our we're in that guests assortment we

And Anthony Market. from our Loop question comes Chukumba, Capital next

more promotions? Would you changes? talked your the touched could just it And you've what, had of And the can be it perspective, like you if I from sort about, hear would and you understand one us but be it it like performance? of you on the performance, a or what Mini some the improvement -- stack-rank with Obviously, partnerships the to a Wicked give a almost keep us you some help had whatever. effective to of things, drove me Hopefully, question. guess, of different okay. to very kind in performance. few better the improvement sequential just thought you sequential Brands merchandising in I'll to led Yes, Would if impressive be

we really thing. thing I wouldn't the drives was There Yes, mean, of about our one not And Anthony. quarter. talked that coming Thanks, one to out second business. Great. ever point I

of we key aspects that some leaned and we several into with to areas clear pleased we're we factors. business, of were the While our address, on needed

key into I quarter, the like that critical. always was quarter. certainly and played drove also is third an enthusiasm, The driver the collaborations you and excitement important newness, mentioned role. ILIA of a always assortment highlighted in is some the Bringing Assortment in brands

as value We promotional learnings tentpole that quarter. built Days Our had our very we hair core our pressure were how personalized. in Beauty, throughout third our promotions XX and events Leaning well we in smart, quarter we adapted with promotional effectiveness, some purposeful in, environment. of and targeted effective strengthening as had we that our guests complementary quarter the the as Haul learnings into more there Ulta from sales, Beauty, second a from the Fall event faced

a that So strong effectiveness. drove

We quarter. worked throughout hard the

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the -- I'd our highlighted some -- were improvements mention thing second products changes to to in also be. we some the disruption we system sure needed they and made make from quarter, And is we that space last where in and

-- into and we're It contributed. elements pleased said stronger and we've holistic as pleased. we was through we multiple we we're holiday work across We're know over XXXX to with that, sequential the on improvement effort both the and beyond. improvement really the focused more So period got are do. while organization, Having move time a

we a continue broader the we'll So things and strategies lot into those to lean detail went Investor that all in through at our of in of Day October.

Horvers, question next JPMorgan comes Chase from & Company. Christopher Our

a I'll throw quick as So there X-parter in well.

X days thinking a you and on you mentioned same encouraging, strong fewer are think the about on would following the how positive then question, thoughts January any part very business follow-through. X gift a you the further first fewer card 'XX. how quarter-to-date? but suggest So days are at up earlier time, about substantial You balance and the an between is, And

talked XX% about change all? XX% plus, at point how this long-term view, a if that of did quarter You floor of

to the and we will off thanks comp is, quarter-to-date. I into say necessarily our get holiday specifically question. season would a that, What details well. But our are executing is what solid of is start won't the I say teams Chris, for

seeing, We in weeks dynamic. is ahead the recognize important environment holiday are an of encouraged by we also even us season have several we that but what operating we're

QX we to sales expecting low that the we're that in is why comp so single-digit range. And decline shared

our from expectations that's would that contemplating that as So a a about days perspective. we're is QX. the spend, for environment quarter dynamic is sort say, obviously thinking what consumers component the and we things of fewer of shopping to And I how related there we yes, think that are

As getting March, with strong. XXXX, consistent closing holiday closing left about weeks color we again, provide when to on on we additional think us, what our several provide of and the we we guidance we're -- strong do. out ahead fiscal and still will And in XXXX focused typically a important year

we color Day Now Investor the that that same. being I directional would provided say, said, our at the remains

as reaccelerate least XXXX at a investments -- invest and position in we delivering to for enable but make growth, that above ensure to transitional expect us continue We period will be we we're that our operating to expect we to XXXX XX%. to term, margin to and long XXXX stronger make will decisions

Goldman Sachs. comes question Kate from McShane, next Our

This provided on partners? that to be, do what wondering vendor We it considering help operating contributing is how your margin with at you Ghosh, the the Kate. UB it does to competitive big a Media, of Media moat Investor Day? is relationship think UB you much long-term for outlook especially were how on Emily And could

Great. forward. think on Thanks, is very we're -- business the UB role will excited about play Emily. and the and we Media our Yes, going that optimistic

breadth business, a really beauty suggest, across all engagement and and you is of understanding unmatched. ages of data because have transactions all As competitive opportunity scale the our of geographies all real we have, enthusiasts the the really and we of that beauty

we've worked we've strong their seen the an do most to and adds for growth so importantly, able our that that. that we're partners experience business hard media value adds reinforces And in investments in to and brand that that ROI deliver

will confident be roadblocks give because the related the the continue in But business talk we the -- to be a grow have category, investment business did that the on today of play we about a can -- other on Paula, those that impact as ways this at to . our are Day, further I over We're do our of that brands continued you our earlier to relationships role call capabilities. highlighted we Investor that about talk opportunity want couple and positive and time to grow we brand the capabilities opportunities. business. and this will we impact? financial

What margin help merchandise offset shared it to in about of way margin role think is other the gross in contributing of a would We some serve investments for pressure. we help certain important feel, pressures. offset Media, and will an it it and us, positively as currently brand plays would have things to those is beyond XXXX and building Sure. to UB we I Emily, say in some over that time that is make

Cowen. And our Oliver from TD next question comes Chen,

expect On like categories of that surprising to mid-single-digit terms in a you? your softer. And fair achieving term, on continue thinking sales, comp It volatility. longer to fixed October comp? of in the see leverage bit Was on-store what know And the those the to is Anything on may being what -- that bit of see as will based you opportunities? Kecia, [ a perhaps it biggest you sounds ] take cost commentary leverage on occupancy. it we a should was about terms positive

Oliver, let's see.

we about continuing as guests store online point expand the talked and beauty our key innovating growth, our pillars back our course, comps. touch or new have So both first wellness of We in as love. strengths combination on best entire stores, going about delighting We then, accelerated deliver reinforcing ecosystem assortment our every experience, we detail at across as and and in our of access, that availability, X go as across as brand positive what's to really would I strong contributors loyalty well with having Investor our assortment, established and guess performance. in to long-term key expressions leaning to openings Day. well what platforms a I talked to building see

having question, and It's innovation right about third ready When we're each working to for a both I driving quarter sure the our in will Oliver, things We're do and foundation. those you experience our online. thing, contributed And that. really that on that quarter. is long come across It's business we Those is the improvement the stronger It's of to touch what about talked and are assortment points the earlier is that focused loyalty time. the -- versus us our an second together. making and the in-store tracked know driving what core and are fundamentals.

couple much ago, months really -- all it, drive of just our aspects So that forward. shared are business going those of a the will we

is this Oliver, Paula. And Yes.

not about October question say asked mentioned and Dave events. and -- surprised. a and timing is, no, of -- whether and some we thought we tentpole or the we talked I we you Given our about What were as would with

in to performance that And had play the of role in kind so QX. a by period

point, specifically from a about things and had X%. you question past perspective, and think I we then we've in a leverage shared about to think And is points, one don't expense a the specific disclose rent around way

that think comp perspective. about And and so maybe think growth, in it as total you about

Katai, our Bank. And comes from next Deutsche question Krisztina

Congrats on a nice quarter.

worst could is for year-over-year. to up pressures then you quarter, learnings maybe biggest behind just is you seeing market follow maintain share least So that in obviously I Dave, return say from I reinforcing strategy. abate, you members the on to gains enabled the to share when your the as at flat fair think, early diamond market up line and prestige. the in a you market just gains? think in competitive us? platinum both talked And engagement? time wanted It the share maybe you is are it to opening program your in some Where there of third are about member And

Well, let's see.

obviously we're performance continue to business. guest engagement, of the diamond spend. to to on we've and seen high are across where from see and our high strong And engagement, yes, which what our highlighted that business, call been them, continue it's Elite part our an -- board, we pleased the seeing focused Platinum Guest, our But best on So that something important members. is grow we're . you we They our our we've

of lot and that opportunity we're one was program total -- quarter, of that over for bring talked combination about new in had in to members loyalty in the ahead, things attract program X% of continuing the into we still our time, was them up growth and we've was in loyalty our of a business. though and lot attracting Our members as a even a see we October new

And that, for important growth. future of course, is fuel

once least a at months. also a to the the purchased group, with had a lapsed going in personalized and last -- reactivating is hasn't that And that of see we the us part for lapsed program continue focused member We success that. have success program we but is members, somebody very XX CRM with after has

continue our that environment, but intense they strong. our is demonstrate is And retention then Ulta is to what guests offering. There an competitive like

remains And so retention healthy.

all seeing strength come of business. those enthusiasts, which it beauty things all across together. so And all of across part our ages, types an important We're geographies, is

something predict completely that, Competitively, we've the it's this moving difficult in about that to past lay for would dynamics or exactly shared asked us through you And we out the I continue experienced concentrated us we've say to new there. such a is, in see when the confidence. have store scale we said something is, which because in time. Having the I We've mentioned seen of it earlier reiterate period I'll this never of before openings. data

recover to to able are and return strong stores contributors. Our

we're in it, take impacted The through, through but stores focus that totally continue our that data behind QX. positively, But continue by been as now, competitive that saw that to XXXX. All and perform in do to fully evolving, and dynamics as is -- we it's and had not not performance and We're did This What the make into better it's are learning in QX, I right. us. move improved disruption to would a every a, period. we see progress we opening XXX%; okay, how we the meaningful category.

us So I will today. Thank all. with you that, joining you for up. wrap thank

across in I by I to Ulta delivering corporate unique guest XX,XXX across focus commitment our our distribution than associates appreciate team. in stores, all together our thanking our to continued working want Beauty and So sincerely our memorable experiences their close and and more out channels. centers entire

great so you all. we all a and plans, we get shop we So Ulta shopping sure season. you wish March again when Thank to make holiday still holiday There's happy time your Beauty, into fiscal and healthy put XXXX you to you look for at speaking XX. forward results a want out Have I evening. as to to and that report on close,

Thank you. That does conclude today's teleconference.

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