Beauty, cosmetics, and personal care retailer Ulta Beauty (NASDAQ: ULTA) reported Q2 CY2026 results topping the market’s revenue expectations, with sales up 8.9% year on year to $3.04 billion. Its GAAP profit of $6.55 per share was 5.6% above analysts’ consensus estimates.
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Ulta (ULTA) Q2 CY2026 Highlights:
- Revenue: $3.04 billion vs analyst estimates of $2.98 billion (8.9% year-on-year growth, 1.8% beat)
- EPS (GAAP): $6.55 vs analyst estimates of $6.20 (5.6% beat)
- EPS (GAAP) guidance for the full year is $28.85 at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 12.5%, in line with the same quarter last year
- Free Cash Flow Margin: 1.3%, similar to the same quarter last year
- Same-Store Sales rose 3.8% year on year (6.7% in the same quarter last year)
- Market Capitalization: $23.35 billion
Company Overview
Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ: ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
With $12.96 billion in revenue over the past 12 months, Ulta is a mid-sized retailer, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale.
As you can see below, Ulta grew its sales at a tepid 6.5% compounded annual growth rate over the last three years, but to its credit, it opened new stores and increased sales at existing, established locations.
This quarter, Ulta reported year-on-year revenue growth of 8.9%, and its $3.04 billion of revenue exceeded Wall Street’s estimates by 1.8%.
Looking ahead, sell-side analysts expect revenue to grow 4.7% over the next 12 months, a slight deceleration versus the last three years. We still think its growth trajectory is attractive given its scale and suggests the market is forecasting success for its products.
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Store Performance
Number of Stores
The number of stores a retailer operates is a critical driver of how quickly company-level sales can grow.
Over the last two years, Ulta opened new stores at a rapid clip by averaging 6.9% annual growth, among the fastest in the consumer retail sector. This gives it a chance to become a large, scaled business over time.
When a retailer opens new stores, it usually means it’s investing for growth because demand is greater than supply, especially in areas where consumers may not have a store within reasonable driving distance.
Note that Ulta reports its store count intermittently, so some data points are missing in the chart below.
Same-Store Sales
A company’s store base only paints one part of the picture. When demand is high, it makes sense to open more. But when demand is low, it’s prudent to close some locations and use the money in other ways. Same-store sales gives us insight into this topic because it measures organic growth for a retailer’s e-commerce platform and brick-and-mortar shops that have existed for at least a year.
Ulta’s demand has been spectacular for a retailer over the last two years. On average, the company has increased its same-store sales by an impressive 4.1% per year. This performance suggests its rollout of new stores is beneficial for shareholders. We like this backdrop because it gives Ulta multiple ways to win: revenue growth can come from new stores, e-commerce, or increased foot traffic and higher sales per customer at existing locations.
In the latest quarter, Ulta’s same-store sales rose 3.8% year on year. This performance was more or less in line with its historical levels.
Key Takeaways from Ulta’s Q2 Results
It was encouraging to see Ulta beat analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Overall, this print had some key positives. The stock remained flat at $545.05 immediately after reporting.
Ulta may have had a good quarter, but does that mean you should invest right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
