Why did ELF outperform forecasts in 2025?

e.l.f. Beauty Inc. (ELF) outperformed forecasts in 2025 due to several key factors:

1. **Strong Sales Growth**: ELF achieved a 31% increase in net sales for Q3, marking the 24th consecutive quarter of net sales growth and market share gains. This robust performance is a testament to the company's successful market positioning and product offerings.
2. **Market Share Increase**: The company saw a 220 basis point increase in U.S. market share in Q3, indicating a significant gain in its market share within the competitive beauty industry. This expansion likely contributed to the overall sales growth.
3. **International Sales Growth**: ELF experienced a 66% increase in international sales for Q3, driven by expansion into new markets and strong performance in existing ones. This diversification has helped the company offset any potential softness in the U.S. market.
4. **Digital Consumption Growth**: The company reported nearly a 30% year-over-year increase in digital consumption trends for Q3. This shift in consumer behavior towards online channels likely contributed to the sales growth, as it aligns with the current trend of e-commerce expansion.
5. **Beauty Squad Loyalty Program**: With over 5.6 million members, the Beauty Squad loyalty program has been instrumental in driving customer retention and repeat purchases. This loyalty program likely played a crucial role in sustaining the sales growth.

In summary, ELF's outperformance in 2025 can be attributed to its strong sales growth, market share increase, international sales expansion, digital consumption trends, and the success of its loyalty program. These factors collectively contribute to the company's robust financial performance and positive market outlook.