Ulta Beauty, in conjunction with its annual investor’s day, detailed strategic priorities intended to drive profitable growth while the retailer sets new long-term financial targets.
- Assortment: Curating the best of all things beauty and wellness for beauty enthusiasts.
- Experience: Empowering authentic human connections that inspire, delight and engage guests at all touchpoints.
- Access: Engaging customers wherever they want to shop by expanding the company’s reach through easy, immersive omnichannel operations.
- Loyalty: Building lifelong engagement and brand passion through member growth and personalization.
To act on the priorities, Ulta intends to accelerate new store openings, targeting 1,800-plus stores in the long-term while driving loyalty program growth to 50 million members by 2028. The beauty retailer said it will enhance the in-store experience by investing in key differentiators, including store associates and stylists, distinct service offerings and signature events, while simultaneously fueling online discovery through continued innovation and streamlining of the shopping experience. To heighten omnichannel satisfaction, Ulta stated it would meet every guest where they are via a robust suite of offerings and increased speed to customer.
In addition, the company plans to assume a leadership position in wellness with an expanded assortment and elevated experience while deepening customer engagement through community building and advanced personalization. Ultra reported it will emphasize product newness through a differentiated portfolio of exclusive, emerging and established brands, including the Ulta Beauty Collection.
Ulta’s new long-term financial targets for 2026 and beyond include 4% to 6% net sales growth, mid‐single‐digit operating profit growth and operating margins around 12% of net sales while driving low double‐digit diluted earnings per share growth.
In what it maintained is a disciplined capital allocation agenda that will efficiently fund ongoing operations, Ulta said intends to reinvest in the business to drive growth with capital expenditures remaining between 4% and 5% of net sales and a return of excess cash to shareholders through share repurchases.
“Ulta Beauty is a market leader in a robust, healthy consumer category, and we have delivered strong and consistent profitable growth and shareholder value over time,” said Paula Oyibo, Ulta CFO. “While we expect 2024 and 2025 will be transitional years as we manage through near-term category dynamics, over the long-term, we see additional opportunity to expand our leadership position, delivering both profitable growth and compelling shareholder value.”
Dave Kimbell, Ulta CEO noted, “Ulta Beauty is a leader in a growing category with a proven model and substantial financial strength to invest and power our long-term growth. More than 30 years ago, Ulta Beauty was the original disruptor in beauty bringing ‘All Things Beauty. All In One Place.’ While beauty has continued to expand and evolve, we remain true to our core purpose: We champion beauty for everyone, helping every guest discover their own possibilities through the power of beauty.
“The strategic priorities announced today are designed to amplify our differentiated model and drive relevant innovation to meet evolving guest needs, positioning Ulta Beauty as the destination for beauty enthusiasts for a lifetime,” Kimbell continued. “This plan will enable us to drive strong growth and capture greater market share in beauty and wellness. We have consistently delivered exceptional results over time, and we are well positioned to build on this record of profitable growth and shareholder value creation.”
