E.l.f. Beauty surges 32% in June on growth, tariff refund prospects

E.l.f. Beauty shares jumped 32% in June, driven by accelerating sales growth and the company's push for a $58.5 million tariff refund.

The Oakland-based cosmetics maker reported fiscal fourth-quarter sales of $449 million, up 35% from a year earlier, according to its earnings release. Gross margin expanded 1.3 percentage points to 73%, though that improvement came from price increases implemented to offset higher tariffs.

The tariff rate on e.l.f.'s products reached 55% in fiscal 2026, more than double the prior year. The company is working to secure a $58.5 million refund from the government. Its makeup line gained 9.2 percentage points in dollar share rank over the past seven years, the most of any brand by a wide margin, according to Nielsen data. Its skincare line climbed to No. 11 in 2026 from No. 25 in 2021.

The stock remains about flat year to date and 65% below its all-time high, trading at 20 times forward earnings. The June rally shows renewed investor confidence as e.l.f. enters the hair care category with a six-product line that drew 96% positive sentiment in a pilot run, with 65% of buyers new to the brand.

The company last year acquired Rhode, the luxury brand founded by model Hailey Bieber, adding a new growth vector beyond its core mass-market cosmetics business. The acquisition contributed to a net loss that pushed the trailing price-to-earnings ratio to 171, though the forward multiple of 20 reflects underlying earnings power.

E.l.f.'s expansion into hair care opens a new addressable market. The six-product line received strong early feedback, with social media sentiment running 96% positive during a pilot phase. The company's ability to attract new customers — 65% of hair care pilot buyers were first-time e.l.f. purchasers — suggests the brand's reach is expanding beyond its traditional makeup customer base.

The tariff situation remains a key risk. E.l.f. has relied on price increases to protect margins, and the $58.5 million refund, if secured, would provide a meaningful offset. The company's ability to gain share across categories while managing tariff exposure will determine whether the June rally extends. Investors will watch for updates on the refund status and the hair care category's early sales data in the coming quarters.

This article is for informational purposes only and does not constitute investment advice.