ELF Beauty (ELF) gave weaker-than-expected outlook late Wednesday after posting a surprise earnings gain for its fiscal fourth quarter. ELF Beauty stock sank in late trade but slashed initial losses.

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ELF Beauty Earnings

Estimates: Analysts expected ELF Beauty to report a 21% drop in earnings to 33 cents per share, according to FactSet. Revenue was seen growing 56%, year over year, to $292.6 million.

Results: ELF Beauty earnings jumped 26% to 53 cents per share, vs. expectations for a 21% decline. Sales jumped 71% to $321.1 million, driven by strength across retail and e-commerce channels, the company said in an earnings release.

Outlook: The company forecast EPS of $3.20-$3.25 in fiscal 2025. Analysts were expecting $3.56, FactSet shows. Revenue guidance of $1.23 billion-$1.25 billion for the fiscal year also came in below views for $1.268 billion. ELF Beauty’s fiscal year ends in March.

ELF Beauty Stock

Shares of the cosmetics company, which especially appeals to millennial and Gen Z customers, sank 2.2% in late trading after initially plunging more than 10%. The beauty stock  lost 2.1% to 155.65 in the regular session on the stock market today. ELF Beauty stock has been sliding since early March, trading above the 200-day line but below the sliding 50-day line.

The relative strength line has also been lagging since March after a strong rally, a sign of ELF stock’s recent underperformance vs. the S&P 500 index. The RS line is the blue line in the chart shown.

On Monday, Stifel analysts flagged ELF Beauty’s declining U.S. market share, offsetting their expectations for robust sales growth in 2025. ELF stock initially undercut the 50-day line on April 3 amid a broad beauty stock sell-off as Ulta Beauty (ULTA) acknowledged slower growth this year.

But on Wednesday morning, Target (TGT) sounded a reassuring note on beauty sales while issuing a glum earnings report.

The big-box retailer said shoppers bought beauty items but less of other discretionary items, such as apparel and home products. Target and Ulta Beauty stores both stock ELF Beauty products.

Ulta Beauty is set to report earnings on May 30 after the market close.

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