Sally Beauty 2025 Q4 Earnings Beats Expectations with 3.9% Net Income Growth

Sally Beauty (SBH) reported fiscal 2025 Q4 earnings on Nov 14, 2025, with net income rising 3.9% to $49.93 million. The company exceeded revenue expectations, reporting $947.08 million, a 1.3% increase from 2024 Q4. Despite a 4.77% month-to-date stock drop, the earnings beat and improved gross margin to 52.2% suggest positive momentum. Guidance for 2026 projects 1-1.6% sales growth, driven by customer activation and digital initiatives.

Revenue

Sally Beauty’s total revenue grew 1.3% to $947.08 million in Q4 2025. The Sally Beauty Supply segment contributed $542 million, up 1.4% year-over-year, while the Beauty Systems Group (BSG) segment reported $406 million, a 1.1% increase. Both segments saw strong e-commerce growth, with Sally U.S. and Canada’s digital sales rising 34% and BSG’s e-commerce up 15%.

Earnings/Net Income

Sally Beauty’s EPS rose 8.1% to $0.51 in Q4 2025 from $0.47 in Q4 2024. Net income increased by 3.9% to $49.93 million, reflecting disciplined cost management and margin expansion. The 8.1% EPS growth and 3.9% net income increase highlight Sally Beauty’s effective cost management and strategic initiatives.

Price Action

The stock price of Sally Beauty edged up 0.21% during the latest trading day and 1.21% for the week but dropped 4.77% month-to-date. The combination of SBH’s strong current performance, positive future outlook, and strategic focus on growth areas makes this a compelling case for buying the stock when revenue beats expectations and holding for a 30-day period. However, broader market conditions and risks should be considered.

CEO Commentary

Denise Paulonis, President and CEO, emphasized Sally Beauty’s resilience in a challenging macroeconomic environment. She highlighted a 1.3% comparable sales growth, 100 basis point gross margin expansion to 52.2%, and $275 million in operating cash flow. Strategic priorities for 2026 include customer activation, digital value, and product innovation, with a $120 million cumulative cost savings target under the Fuel for Growth program.

Guidance

For fiscal 2026, Sally Beauty expects consolidated net sales of $3.71–$3.77 billion, with 1–1.6% growth. Q1 guidance includes $935–$945 million in sales and adjusted EPS of $0.43–$0.47. The company plans $100 million in capital expenditures and $200 million in free cash flow, supporting long-term value creation through digital innovation and cost efficiency.

Additional News

Sally Beauty announced a $120 million cumulative cost savings target by 2026 under its Fuel for Growth program, up from $74 million in 2025. The company also launched the Sally Ignited store refresh, with 30 locations renovated to enhance customer experience and drive cross-category sales. Additionally, Sally U.S. and Canada’s e-commerce sales grew 34% in Q4, reflecting strong digital momentum.