01—Abstract
Summary
Summary of the 8-K filed March 13, 2025. Cited figures are marked; the original filing is the authoritative source.
Ulta Beauty, Inc. (NASDAQ: ULTA) reported fourth-quarter fiscal 2024 results for the thirteen weeks ended February 1, 2025, compared with a fourteen-week quarter a year earlier that included an extra 53rd week.
Net sales were $3.5 billiona ($3,487.6 million) versus $3.6 billion ($3,554.3 million), and comparable sales increased 1.5%. Operating income was $516.3 million, or 14.8% of net sales, and diluted EPS was $8.46 versus $8.08, including a $0.46 benefit from the extra week. For the full fiscal year, net sales were $11.3 billion, comparable sales rose 0.7%, operating income was $1.6 billion (13.9% of net sales, down from 15.0%), and diluted EPS was $25.34 versus $26.03.
The company ended the year with $703.2 millionb in cash, merchandise inventories of $2.0 billion (up 13.0%), and no borrowings under its revolving credit facility. It repurchased $1.0 billion of shares in fiscal 2024, and $2.7 billion remained under its $3.0 billion repurchase program as of February 1, 2025. The company operated 1,445 stores at year-end after opening 66 new stores during the year.
For fiscal 2025, Ulta guided to net sales of $11.5 billion to $11.6 billionc, comparable sales of 0% to 1%, an operating margin of 11.7% to 11.8%, and diluted EPS of $22.50 to $22.90. CEO Kecia Steelman said fiscal 2025 will be a pivotal year with purposeful investments aimed at future growth, which the company expects will weigh on near-term margins, with approximately $900 million planned for share repurchases.
02—Key points
Key Highlights
- Q4 fiscal 2024 net sales of $3.5 billion ($3,487.6 million), down from $3.6 billion in the 14-week prior-year quarter that included an extra week worth approximately $181.9 million in net sales.
- Q4 comparable sales increased 1.5%, driven by a 3.0% increase in average ticket and a 1.4% decrease in transactions.
- Q4 diluted EPS of $8.46 versus $8.08, including a $0.46 benefit from the extra week; gross margin rose to 38.2% from 37.7%.
- Full-year fiscal 2024 operating margin fell to 13.9% from 15.0%, as SG&A rose to 24.9% of net sales from 24.0%; diluted EPS was $25.34 versus $26.03.
- Fiscal 2025 guidance calls for net sales of $11.5 billion to $11.6 billion, comparable sales of 0% to 1%, operating margin of 11.7% to 11.8%, and diluted EPS of $22.50 to $22.90.
- Merchandise inventories rose 13.0% to $2.0 billion, and the company repurchased $1.0 billion of shares in fiscal 2024 with $2.7 billion remaining under its $3.0 billion program.
- Cash of $703.2 million at year-end, and no revolver borrowings outstanding after the company repaid its third-quarter draw of $199.7 million.
03—Questions
Frequently Asked Questions
How did Ulta Beauty perform in the fourth quarter of fiscal 2024?
Net sales were $3.5 billion, down from $3.6 billion, mainly because the prior-year quarter included an extra week of sales. Comparable sales rose 1.5%, and diluted EPS was $8.46 versus $8.08. Gross margin improved to 38.2% of net sales, while SG&A deleveraged to 23.4%.
Why did full-year operating margin decline?
Operating margin fell to 13.9% of net sales from 15.0%. The filing attributes the decline to lower merchandise margin, deleverage of store fixed costs, higher supply chain costs, and SG&A that rose to 24.9% of net sales from 24.0%, primarily from store payroll and benefits, corporate overhead tied to strategic investments, and store expenses.
What is Ulta Beauty's outlook for fiscal 2025?
The company expects net sales of $11.5 billion to $11.6 billion, comparable sales of 0% to 1%, an operating margin of 11.7% to 11.8%, and diluted EPS of $22.50 to $22.90. It plans to open approximately 60 net new stores, make share repurchases of approximately $900 million, and spend $425 million to $500 million on capital expenditures.
How is Ulta Beauty returning capital to shareholders?
In fiscal 2024 the company repurchased 2.5 million shares for $1.0 billion, including 620,053 shares for $249.5 million in the fourth quarter. As of February 1, 2025, $2.7 billion remained under the $3.0 billion repurchase program announced in October 2024.
What did management say about fiscal 2025?
CEO Kecia Steelman said fiscal 2025 will be a pivotal year, with purposeful investments intended to fuel future growth and optimize the business. She said it will take time to see the impact, but that the investments are expected to reignite momentum and support sustained long-term value for shareholders.
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