Ulta Beauty Reports Net Sales of $2.3 Billion in Q3

Ulta Beauty, Inc.’s net sales for the third quarter and 39-week period ended October 29, 2022 compared were $2.3 billion, compared to $2.0 billion in the year-ago quarter. 

 

The figure represents a 17.2% increase. 

 

“Amidst a challenging macro environment, the Ulta Beauty team delivered yet another outstanding quarter, with strong top and bottom-line results and growth across all major categories and channels,” said Dave Kimbell, chief executive officer. “Our third quarter results reflect the sustained resilience of the beauty category and the strong emotional connection and loyalty we have cultivated with our guests. I am confident our business model, which offers unmatched breadth, value, and convenience, is even more relevant today and unlocks opportunities to further delight guests as we continue to lead the beauty category.”

 

Comparable sales (sales for stores open at least 14 months and e-commerce sales) increased 14.6% compared to an increase of 25.8% in the third quarter of fiscal 2021, driven by a 10.7% increase in transactions and a 3.5% increase in average ticket.

 

Gross profit increased 22.0% to $962.8 million compared to $789.5 million in the third quarter of fiscal 2021. As a percentage of net sales, gross profit increased to 41.2% compared to 39.6% in the third quarter of fiscal 2021, primarily due to leverage in fixed costs, strong growth in other revenue, and higher merchandise margin, partially offset by higher inventory shrink.

Selling, general and administrative (SG&A) expenses increased 18.6% to $597.2 million compared to $503.4 million in the third quarter of fiscal 2021. As a percentage of net sales, SG&A expenses increased to 25.5% compared to 25.2% in the third quarter of fiscal 2021, primarily due to deleverage in store payroll and benefits and corporate overhead due to strategic investments, partially offset by lower marketing expenses.

 

Operating income increased 27.3% to $361.9 million, or 15.5% of net sales, compared to $284.2 million, or 14.2% of net sales, in the third quarter of fiscal 2021.

 

During the third quarter of fiscal 2022, the company repurchased 340,271 shares of its common stock at a cost of $137.5 million. During the first nine months of fiscal 2022, the Company repurchased 1.5 million shares of its common stock at a cost of $571.9 million. As of October 29, 2022, $1.4 billion remained available under the $2.0 billion share repurchase program announced in March 2022.