e.l.f. Beauty's Q1 2026: Navigating Tariffs, Marketing Spend, and Consumer Trends Amid Contradictions

Tariff impact and mitigation, marketing spend as a percentage of sales, consumer behavior and market trend observations, international growth and channel strategy, price elasticity and consumer response to price increases are the key contradictions discussed in e.l.f. Beauty's latest 2026Q1 earnings call.



Revenue and Market Share Growth:
- E.l.f. Beauty reported 9% growth in Q1 net sales, building on the 50% growth in Q1 of the previous year, and gained 210 basis points of market share.
- This growth is attributed to the company's value proposition, powerhouse innovation, and disruptive marketing engine, as well as its strong performance in color cosmetics and skin care.

International Expansion:
- International net sales grew 30% in Q1, driven by expansion into new markets and strong performance in existing markets like the U.K.
- Success in new markets like the Netherlands and Belgium, and upcoming launches with Rossmann and Sephora, are key factors contributing to this growth.

Acquisition and Strategic Moves:
- The acquisition of Rhode, a fast-growing beauty brand, closed with an upfront transaction of $800 million.
- The acquisition is expected to enhance e.l.f.'s position as a leading player in accessible beauty and accelerate brand awareness and retail expansion.

Tariff Impact and Mitigation:
- E.l.f. is addressing the impact of 170% tariffs on its products, now subject to 55% tariffs, with plans to mitigate through pricing, supply chain optimization, and business diversification.
- Gross impact of these tariffs is estimated at approximately $50 million annually if the 30% incremental tariff level remains.