01—Abstract
Summary
Summary of the 10-Q filed December 4, 2025. Cited figures are marked; the original filing is the authoritative source.
Ulta Beauty, Inc. reported its third-quarter fiscal 2025 results for the 13 weeks ended November 1, 2025 in this Form 10-Q, filed December 4, 2025.
Net sales rose $327.5 milliona, or 12.9%, to $2.9 billion, driven by a comparable sales increase of 6.3%, the acquisition of Space NK, and net new store contribution. Net income declined to $230.9 million from $242.2 million, as SG&A expenses rose $158.7 million, or 23.3%, to $840.9 million, outpacing the $150.0 million increase in gross profit. Gross margin improved to 40.4% of net sales from 39.7%, mainly on lower inventory shrink and higher merchandise margin.
For the 39 weeks ended November 1, 2025, net sales increased $686.4 millionb, or 8.8%, to $8.5 billion, and net income was $796.8 million compared with $807.8 million a year earlier. Cash from operating activities was $322.2 million, while the company spent $655.5 million in investing activities, including $386.8 million for the Space NK acquisition. Short-term debt rose to $551.7 million from none at fiscal year-end, and cash and cash equivalents fell to $204.9 million from $703.2 million.
The company repurchased $699.1 millionc of common stock in the 39-week period, and $2.0 billion remained available under the October 2024 repurchase program. The filing states that macroeconomic pressures, including inflation and tariffs, could continue to weigh on consumer spending and sales trends for the remainder of fiscal 2025. The company's Interim Chief Financial Officer concluded that disclosure controls were effective as of November 1, 2025, and the filing reports no material changes to risk factors from the fiscal 2024 Form 10-K.
02—Key points
Key Highlights
- Net sales increased 12.9% to $2,857.6 million in the 13 weeks ended November 1, 2025, with comparable sales up 6.3%, driven by a 3.8% increase in average ticket and a 2.4% increase in transactions.
- Net income fell to $230.9 million from $242.2 million, as SG&A expenses rose 23.3% to $840.9 million, primarily due to higher incentive compensation, store payroll and benefits, and higher store expenses.
- Gross profit margin improved to 40.4% of net sales from 39.7%, attributed to lower inventory shrink and higher merchandise margin.
- For the 39 weeks, net sales reached $8.5 billion, up 8.8%, while diluted EPS was $17.65 compared with $16.93 a year earlier.
- The company acquired Space NK, a U.K. and Ireland luxury beauty retailer, on July 10, 2025 for a preliminary net purchase price of $399.2 million, recording goodwill of $381.7 million.
- Short-term debt rose to $551.7 million at November 1, 2025 from zero at February 1, 2025, and cash and cash equivalents declined to $204.9 million.
- The company repurchased 1,658,206 shares for $699.1 million in the 39 weeks, leaving $2.0 billion available under the October 2024 share repurchase program.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2026, Ulta Beauty kept $0.08.
- Revenue$2.86B100.0%
- Cost of revenue−$1.70B59.6%
- Gross profit$1.16B40.4%
- Operating costs−$846.2M29.6%
- Operating income$309.4M10.8%
- Interest, other & tax−$78.5M2.7%
- Net income$230.9M8.1%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed December 4, 2025Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Revenue | $2.86B$2.53B | +12.9% |
| Cost of Revenue | $1.70B$1.52B | +11.6% |
| Gross Profit | $1.16B$1.01B | +14.9% |
| SG&A Expenses | $840.92M$682.26M | +23.3% |
| Operating Income | $309.42M$318.50M | −2.9% |
| Net Income | $230.88M$242.18M | −4.7% |
| EPS (Basic) | $5.16$5.16 | 0.0% |
| EPS (Diluted) | $5.14$5.14 | 0.0% |
| Shares Outstanding (Basic) | 44.73M46.93M | −4.7% |
| Shares Outstanding (Diluted) | 44.90M47.09M | −4.7% |
05—Questions
Frequently Asked Questions
How did Ulta Beauty perform in the third quarter of fiscal 2025?
Net sales grew 12.9% to $2.9 billion, supported by a 6.3% comparable sales increase, the Space NK acquisition, and net new stores. Net income declined to $230.9 million from $242.2 million because SG&A expenses grew faster than gross profit.
What drove the increase in SG&A expenses?
The filing attributes the increase to higher incentive compensation, store payroll and benefits, higher store expenses, and amortization of cloud-based software investments. SG&A rose to 29.4% of net sales from 27.0%.
How did the Space NK acquisition affect the balance sheet?
The company recorded goodwill of $381.7 million and net assets acquired of $399.2 million, and the acquisition was funded with cash on hand and borrowings under the existing credit facility. The filing states the acquisition is not material to the consolidated financial statements.
What is the company's liquidity position and debt situation?
Cash and cash equivalents were $204.9 million, down from $703.2 million at February 1, 2025. Borrowings under the $1.0 billion revolving Loan Agreement totaled $488.3 million, and the Space NK facility had $63.4 million outstanding, for total short-term debt of $551.7 million. The company stated it was in compliance with all covenants.
What outlook did management provide for the remainder of fiscal 2025?
The filing states that persistent inflationary and macroeconomic pressures, including existing and potential tariffs, could contribute to lower sales trends for the remainder of fiscal 2025 and could further affect the company's ability to grow sales and maintain historical profitability levels.
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