e.l.f. Beauty, Inc. (ELF)

CIK: 0001600033. SIC: 2844 Perfumes, Cosmetics & Other Toilet Preparations. Latest 10-K as of: 2026-05-21.

SIC breadcrumb: Manufacturing > Chemicals And Allied Products > SIC 2844 Perfumes, Cosmetics & Other Toilet Preparations

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1600033. Latest filing source: 0001600033-26-000020.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-21. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001600033.json. Derived margins are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Missing metrics are omitted rather than fabricated.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-21. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001600033.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

Quarterly Charts

Macro Cross-References

• CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
• UNRATE - Unemployment Rate
• FEDFUNDS - Federal Funds Effective Rate
• CES0500000003 - Average Hourly Earnings of All Employees, Total Private
• DFEDTARU - Federal Funds Target Range - Upper Limit
• DFEDTARL - Federal Funds Target Range - Lower Limit
• DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
• DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
• DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
• DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
• T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
• CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
• CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
• CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
• CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
• PCEPI - Personal Consumption Expenditures: Chain-type Price Index
• PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
• PPIACO - Producer Price Index by Commodity: All Commodities
• T10YIE - 10-Year Breakeven Inflation Rate
• U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
• PAYEMS - All Employees, Total Nonfarm
• CIVPART - Labor Force Participation Rate
• EMRATIO - Employment-Population Ratio
• UNEMPLOY - Unemployed
• CE16OV - Employment Level
• ICSA - Initial Claims
• JTSJOL - Job Openings: Total Nonfarm
• JTSQUR - Quits: Total Nonfarm
• GDPC1 - Real Gross Domestic Product
• A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
• INDPRO - Industrial Production: Total Index
• TCU - Capacity Utilization: Total Index
• HOUST - New Privately-Owned Housing Units Started: Total Units
• PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
• RSAFS - Advance Retail Sales: Retail Trade
• PCE - Personal Consumption Expenditures
• DSPIC96 - Real Disposable Personal Income
• PSAVERT - Personal Saving Rate
• M2SL - M2
• BOPGSTB - U.S. International Trade in Goods and Services: Balance
• MSPUS - Median Sales Price of Houses Sold for the United States
• HSN1F - New One Family Houses Sold: United States
• RHORUSQ156N - Homeownership Rate in the United States
• TTLCONS - Total Construction Spending: Total Construction in the United States
• RRVRUSQ156N - Rental Vacancy Rate in the United States
• TOTALSL - Total Consumer Credit Owned and Securitized
• REVOLSL - Revolving Consumer Credit Owned and Securitized
• DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
• GDP - Gross Domestic Product
• GPDI - Gross Private Domestic Investment
• GCE - Government Consumption Expenditures and Gross Investment
• PCEC - Personal Consumption Expenditures
• NETEXP - Net Exports of Goods and Services
• GFDEBTN - Federal Debt: Total Public Debt
• GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
• FYFSD - Federal Surplus or Deficit
• FGRECPT - Federal Government Current Receipts
• FGEXPND - Federal Government: Current Expenditures
• MANEMP - All Employees, Manufacturing
• USCONS - All Employees, Construction
• USTRADE - All Employees, Retail Trade
• USFIRE - All Employees, Financial Activities
• USGOVT - All Employees, Government
• AWHAETP - Average Weekly Hours of All Employees, Total Private
• DGORDER - Manufacturers' New Orders: Durable Goods
• NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
• BUSINV - Total Business Inventories
• EXPGS - Exports of Goods and Services
• IMPGS - Imports of Goods and Services
• IR - Import Price Index (End Use): All Commodities
• PPIFIS - Producer Price Index by Commodity: Final Demand

Latest quarter (10-Q)

Latest 10-Q source: 0001600033-26-000007.

Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high. Filing date: 2026-02-05. Report date: 2025-12-31.

Item 2. Management’s discussion and analysis of financial condition and results of operations.

Management’s discussion and analysis of financial condition and results of operations (“MD&A”) should be read together with the MD&A presented in the Annual Report on Form 10-K for the year ended March 31, 2025 (the “Annual Report”) and the unaudited condensed consolidated financial statements and accompanying notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q (this “Quarterly Report”), which include additional information about our accounting policies, practices and the transactions underlying our financial results.

Overview and Business Trends

e.l.f. Beauty, Inc., a Delaware corporation (“e.l.f. Beauty” and together with its subsidiaries, the “Company”), is a multi-brand beauty company that offers inclusive, accessible, clean, vegan and cruelty free cosmetics and skin care products. The Company's mission is to make the best of beauty accessible to every eye, lip and face.

We believe our ability to deliver cruelty free, clean, vegan and premium-quality products at accessible prices with broad appeal differentiates us in the beauty industry. Additionally, we believe the combination of our passionate team of owners, value proposition, powerhouse innovation, disruptive marketing engine and productivity model have positioned us well to navigate the competitive beauty market.

The Company's family of brands includes e.l.f. Cosmetics, e.l.f. SKIN, Naturium, Well People, Keys Soulcare, and rhode. The Company's brands are available online and across leading beauty, mass-market and specialty retailers. The Company has strong relationships with its retail customers such as Target, Walmart, Ulta Beauty, Amazon and other leading retailers that have enabled the Company to expand distribution both domestically and internationally.

Potential Impact of Tariffs

The majority of our products are sourced and manufactured in China and have been subject to a US 25% tariff since May 2019. Furthermore, in March and April 2025, the Trump administration announced a series of additional tariffs on products from countries worldwide. Since then, some of these tariffs have been increased, reduced, or temporarily paused.

The US tariff policies are continuing to evolve. As a result, our risks and mitigation plans will also continue to evolve as further developments arise. Any alteration of trade agreements and terms between China and the United States, including limiting trade with China, imposing additional tariffs on imports from China and potentially imposing other restrictions on imports from China to the United States may result in further or higher tariffs or retaliatory trade measures by China. We are in the process of determining our incremental tariff cost exposure in light of continuing changes to tariff policies, and the full extent of our potential mitigation plans, as well as the associated timing to implement such plans. To mitigate our risk of ongoing exposure to tariffs, the Company raised prices globally for all products sold as of August 1, 2025. The Company may also seek to shift production outside of China into regions where we expect tariffs to be lower and to source the same products in more than one region, to the extent it is possible and not cost-prohibitive. Moreover, the United States has imposed, increased, or indicated a willingness to continue to impose or increase tariffs on other countries where we source our products or into which we make sales. Such tariffs may lead to retaliatory actions, including counter-tariffs and increased production costs, disruptions to global supply chains and otherwise create operational challenges for us.

See the risk factor titled “Additional US tariffs or other restrictions placed on imports, retaliatory trade measures taken by other countries and resulting trade wars may have a material adverse impact on our financial condition and results of operations” included as part of Item 1A. Risk Factors of this Quarterly Report on Form 10-Q for additional information regarding risk related to tariffs.

Our Acquisition of rhode

On August 5, 2025, we consummated the acquisition of HRBeauty LLC (“rhode”), the fast-growing, multi-category lifestyle beauty brand founded by Hailey Bieber for a purchase price of $897.5 million in a combination of cash, equity consideration, and potential earnout.

Fifth Amendment to Amended Credit Agreement

On August 5, 2025, we entered into the Fifth Amendment to the Amended and Restated Credit Agreement, pursuant to which we borrowed an incremental term loan in a principal amount equal to $600.0 million (the “Incremental Term Loan”), together

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with available cash from our balance sheet and additional borrowings under our Amended Revolving Credit Facility, to consummate and pay related fees and expenses in connection with our acquisition of rhode.

Seasonality

Our results of operations are subject to seasonal fluctuations, with net sales in the third and fourth fiscal quarters typically being higher than in the first and second fiscal quarters. The higher net sales in our third and fourth fiscal quarters are largely attributable to the increased levels of purchasing by retailers for the holiday season and customer shelf reset activities, respectively. Lower inventory builds from our retailers in preparation for the holiday season or shifts in customer shelf reset activity could have a disproportionate effect on our results of operations for the entire fiscal year. To support anticipated higher sales during the third and fourth fiscal quarters, we make investments in working capital to ensure inventory levels can support demand. Fluctuations throughout the year are also driven by the timing of product restocking or rearrangement by our major retail customers as well as expansion into new retail customers. Because a limited number of our retail customers account for a large percentage of our net sales, a change in the order pattern of one or more of our large retail customers could cause a significant fluctuation of our quarterly results or impact our liquidity.

Results of operations

The following table sets forth our consolidated statements of operations data in dollars and as a percentage of net sales for the periods presented:

Three months ended December 31,

Nine months ended December 31,

(in thousands)

2025

2024

2025

2024

Net sales

$

489,505 

$

355,320 

$

1,187,180 

$

980,872 

Cost of sales

142,010 

102,015 

356,286 

282,225 

Gross profit

347,495 

253,305 

830,894 

698,647 

Selling, general and administrative expenses

279,955 

218,220 

706,929 

584,936 

Operating income

67,540 

35,085 

123,965 

113,711 

Other (expense) income, net

(1,325)

(5,278)

1,834 

(1,300)

Interest expense, net

(12,351)

(3,527)

(24,136)

(10,953)

Loss on extinguishment of debt

— 

— 

(674)

— 

Income before provision for income taxes

53,864 

26,280 

100,989 

101,458 

Income tax provision

(14,488)

(9,019)

(25,306)

(17,622)

Net income

$

39,376 

$

17,261 

$

75,683 

$

83,836 

Three months ended December 31,

Nine months ended December 31,

(percentage of net sales)

2025

2024

2025

2024

Net sales

100 

%

100 

%

100 

%

100 

%

Cost of sales

29 

%

29 

%

30 

%

29 

%

Gross margin

71 

%

71 

%

70 

%

71 

%

Selling, general and administrative (“SG&A”) expenses

57 

%

61 

%

60 

%

60 

%

Operating income

14 

%

10 

%

10 

%

12 

%

Other (expense) income, net

— 

%

(1)

%

— 

%

— 

%

Interest expense, net

(3)

%

(1)

%

(2)

%

(1)

%

Loss on extinguishment of debt

— 

%

— 

%

— 

%

— 

%

Income before provision for income taxes

11 

%

7 

%

9 

%

10 

%

Income tax provision

(3)

%

(3)

%

(2)

%

(2)

%

Net income

8 

%

5 

%

6 

%

9 

%

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Comparison of the three months ended December 31, 2025 to the three months ended December 31, 2024

Net sales

Net sales increased $134.2 million, or 38%, to $489.5 million for the three months ended December 31, 2025, compared to $355.3 million for the three months ended December 31, 2024. Net sales growth was driven by both our retailer and e-commerce channels. The rhode Acquisition contributed $128.2 million to our growth in the three months ended December 31, 2025, with the remaining $6.0 million contributed from our existing business. Net sales increased $67.5 million, or 101%, in our e-commerce channels and $66.8 million, or 23%, in our retailer channels. From a price and mix perspective, higher average item price and mix drove $136.0 million increase in net sales as compared to the three months ended December 31, 2024. This was partially offset by lower volume impacting sales by $1.8 million.

Gross profit

Gross profit increased $94.2 million, or 37%, to $347.5 million for the three months ended December 31, 2025, compared to $253.3 million for the three months ended December 31, 2024. Higher average item price and mix drove an increase of $95.5 million, offset by lower volume impacting gross profit by $1.3 million. Gross margin decreased approximately 30 basis points to 71% when compared to the three months ended December 31, 2024. The decrease in gross margin was primarily driven by tariffs, partially offset by pricing and mix.

Selling, general and administrative expenses

SG&A expenses were $280.0 million for the three months ended December 31, 2025, an increase of $61.7 million, or 28%, from $218.2 million for the three months ended December 31, 2024. The $61.7 million increase was primarily related to an increase in marketing, merchandising and distribution costs of $24.7 million, increased compensation and benefits expense of $22.0 million, increased depreciation and amortization of $9.9 million, and increased professional fees $2.1 million.

Other (expense) income, net

Other expense, net totaled $1.3 million for the three months ended December 31, 2025, as compared to other expense, net of $5.3 million for the three months ended December 31, 2024. The year-over-year variance is primarily due to an decrease in foreign currency exchange loss in the period primarily attributable to foreign currency rate fluctuation between the British pound and US dollar.

Interest expense, net

Interest expense, net was $12.4 million for the three months ended December 31, 2025, as compared to $3.5 million for the three months ended December 31, 2024. The year-over-year variance was primarily due to the Fifth Amendment which established the Term Facility and increased debt. See Note 6, “Debt,” in the Notes to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details on our debt.

Income tax provision

The income tax provision was $14.5 million, or an effective rate of 26.9%, for the three months ended December 31, 2025, as compared to a provision of $9.0 million, or an effective rate of 34.3%, for the three months ended December 31, 2024. The change in the income tax provision was primarily driven by the tax effects of an increase in income before taxes of $27.6 million, which was partially offset by an increase in discrete tax benefits of $4.2 million, primarily related to stock-based compensation.

Comparison of the nine months ended December 31, 2025 to the nine months ended December 31, 2024

Net sales

Net sales increased $206.3 million, or 21%, to $1,187.2 million for the nine months ended December 31, 2025, compared to $980.9 million for the nine months ended December 31, 2024. The rhode Acquisition contributed $180.6 million to our growth in the three months ended December 31, 2025, with the remaining $25.7 million contributed from our existing business. Net sales growth was driven by both our retailer and e-commerce channels. Net sales increased $109.5 million, or 14%, in our retailer channels and $96.9 million, or 56%, in our e-commerce

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high. Filing date: 2026-05-21. Report date: 2026-03-31.

Item 7. Management’s discussion and analysis of financial condition and results of operations.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report on Form 10-K.

Unless otherwise stated, the following discussion and analysis are for the fiscal year ended March 31, 2026, compared to the fiscal year ended March 31, 2025. Discussion and analysis for the fiscal year ended March 31, 2025 compared to the year ended March 31, 2024 may be found in the section titled “Management’s discussion and analysis of financial condition and results of operations” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025, filed with the SEC on May 29, 2025.

Overview and Business Trends

e.l.f. Beauty, Inc., a Delaware corporation (“e.l.f. Beauty” and together with its subsidiaries, the “Company”), is a multi-brand beauty company that offers inclusive, accessible, clean, vegan and cruelty free cosmetics and skin care products. The Company's mission is to make the best of beauty accessible to every eye, lip and face.

We believe our ability to deliver cruelty free, clean, vegan and premium-quality products at accessible prices with broad appeal differentiates us in the beauty industry. Additionally, we believe the combination of our passionate team of owners, value proposition, powerhouse innovation, disruptive marketing engine and productivity model have positioned us well to navigate the competitive beauty market.

The Company's family of brands consists of e.l.f. Cosmetics, e.l.f. SKIN, rhode, Naturium, and Well People. The Company's brands are available online and across leading beauty, mass-market and specialty retailers. The Company has strong relationships with its retail customers such as Target, Walmart, Amazon, Sephora and other leading retailers that have enabled the Company to expand distribution both domestically and internationally.

For additional information regarding our business, see Part I, Item 1, “Business.”

Update on Tariffs

The majority of our products are sourced and manufactured in China and have been subject to a US 25% tariff since May 2019. Throughout 2025 we were subject to a range of tariff rates on imports from China ranging from 25% to as high as 170%.

On July 31, 2025, the US administration issued a formal Executive Order modifying the reciprocal tariff regime under the IEEPA. However, in February 2026, the Supreme Court of the United States ruled that the IEEPA does not authorize the US administration to impose tariffs, and the tariffs paid by importers under the Executive Order are subject to refund. We are evaluating the impact of the Supreme Court ruling and the subsequent order issued by the CIT, and are monitoring related developments from the CBP regarding its plan to process refunds to importers of record, including the launch on April 20, 2026 of the CBP's Consolidated Administration and Processing of Entries (“CAPE”) system for submitting refund claims, as well as the administration’s decision on whether or not to appeal the CIT’s order. Effective February 24, 2026, the US administration has imposed a 10% global tariff under Section 122 of the Trade Act of 1974 that could remain in place for up to 150 days, and may, by legislative action, be extended. Multiple legal challenges to the Section 122 tariffs have been filed, and on May 7, 2026, the U.S. Court of International Trade ruled that the Section 122 tariffs are unlawful; however, the court's injunction applies only to the named plaintiffs, and the tariffs remain in effect for all other importers pending appeal. During the fiscal year 2026, the Company paid approximately $58.5 million of IEEPA Tariffs. These tariffs, as well as a government’s adoption of “buy national” and similar policies or retaliation by another government against such tariffs or policies, could introduce significant uncertainty into the market and may affect the prices of and supply of the products available to us. Tariffs also can impact our or our suppliers’ ability to source products efficiently or create other supply chain disruptions. We may not be able to fully or substantially mitigate the impact of these or future tariffs, pass price increases on to our customers or secure adequate alternative sources of products or materials for our products, which would have a material adverse effect on our business, financial condition and results of operations.

See the risk factor titled “Changes in the US and international trade policies, including tariffs, trade restrictions and retaliatory trade measures taken by other countries and resulting trade wars may have a material adverse impact on our business,

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financial condition and results of operations” included as part of Item 1A. Risk factors of this Annual Report on Form 10-K for additional information regarding risk related to tariffs.

Our Acquisition of Naturium

On October 4, 2023, we consummated our acquisition of Naturium LLC, a Delaware limited liability company (“Naturium”), and TCB-N Prelude Blocker Corp., a Delaware corporation (“Blocker”), pursuant to a Securities Purchase Agreement, dated August 28, 2023 (the "Purchase Agreement"), by and among the Company, e.l.f. Cosmetics, Inc., Naturium, Blocker and various sellers. Pursuant to the Purchase Agreement, we acquired all rights, title and interest in and to the outstanding equity securities of Naturium and Blocker for a purchase price of $333.0 million paid in cash and shares of our common stock. See Note 3, “Acquisitions,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Our Acquisition of rhode

On August 5, 2025, we consummated the acquisition (the “rhode Acquisition”) of HRBeauty LLC (“rhode”), the fast-growing, multi-category lifestyle beauty brand founded by Hailey Bieber for a purchase price of $897.5 million in a combination of cash, shares of our common stock, and potential earnout. See Note 3, “Acquisitions,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Fifth Amendment to Amended Credit Agreement

On August 5, 2025, we entered into the Fifth Amendment to the Amended and Restated Credit Agreement (the “Fifth Amendment”). The Fifth Amendment, among other things, established a term loan facility in an aggregate original principal amount of $600.0 million (the “Term Facility”), made customary changes in connection with adding a term loan facility, increased the maximum permitted consolidated total net leverage ratio financial covenant, increased the interest rate margin for loans under our existing Revolving Credit Facility and increased the unused line fee under our existing Revolving Credit Facility. The proceeds of the Term Facility were made available to e.l.f. Cosmetics and certain of our other subsidiaries to pay a portion of the consideration for the rhode Acquisition. The maturity date of the Term Facility is March 3, 2030.

Components of our results of operations and trends affecting our business

Net sales

We develop, market and sell beauty products under the e.l.f. Cosmetics, e.l.f. SKIN, rhode, Naturium and Well People brands. Our net sales are derived from sales of these beauty products, net of provisions for sales discounts and allowances, product returns, markdowns and price adjustments.

Year over year changes in net sales is driven by a number of factors, including beauty category performance, levels of consumer spending, innovation and our ability to drive awareness of and demand for our products. We seek to continue to grow with our retailers through improved sales per linear foot in our existing space, expanded space allocation, as well as adding new retail customers globally.

Our business faces challenges and uncertainties, including our ability to introduce new products that will appeal to a broad consumer base, our ability to service demand, the ability of our major retail customers to drive traffic and keep products in stock, our ability to continue to grow our customer base and competitive threats from other beauty companies.

Our largest customers, Target, Walmart, Amazon and Sephora, accounted for 18%, 13%, 11% and 10%, respectively, of our net sales in the fiscal year ended March 31, 2026. No other individual customer accounted for 10% or more of our net sales in the fiscal year ended March 31, 2026. National and international retailers comprised 76% of our net sales. The remaining 24% came from e-commerce channels in the fiscal year ended March 31, 2026.

The primary market for our products is in the United States, which accounted for 79% of our net sales in the fiscal year ended March 31, 2026. The remaining 21% was attributable to international markets, primarily the UK, Canada and Germany.

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Gross profit

Gross profit is our net sales less cost of sales. Cost of sales includes the aggregate costs to procure our products, including the amounts invoiced by our third-party contract manufacturers for finished goods as well as costs related to transportation to our distribution center, customs and duties. Cost of sales also includes the effect of changes in the balance of reserves for excess and obsolete inventory. Gross margin measures our gross profit as a percentage of net sales.

We have an extensive network of third-party manufacturers from whom we purchase substantially all of our finished goods. We have worked to evolve our supply chain to increase capacity and technical capabilities while maintaining or reducing overall costs as a percentage of sales.

Historically, we have improved our gross margin largely through changes in our product mix, pricing, and cost reductions in our supply chain. Other drivers of changes in gross margin, include fluctuations in foreign exchange rates, tariffs, certain costs related to space expansion and retailer activity, changes in customer mix, and changes in the balance of reserves for excess and obsolete inventory, among other things.

Selling, general and administrative expenses

Our selling, general and administrative (“SG&A”) expenses primarily consist of marketing and digital expenses, personnel-related costs, including salaries, bonuses, benefits and stock-based compensation, warehousing and distribution costs, costs related to merchandising, depreciation of property and equipment, amortization of retail product displays and amortization related to intangible assets and cloud computing costs. See “Critical accounting policies and estimates — stock-based compensation” below for more detail regarding stock-based compensation.

Change in fair value of contingent consideration

In connection with the rhode Acquisition, we recorded a liability at fair value for the contingent consideration potentially payable to the sellers of rhode subject to achievement of certain earnout thresholds, with a maximum payment of $200.0 million. We expect to pay (if due and owing) annually within four months after each measurement period ending September 30, 2026, 2027, and 2028. The fair value of the liability is calculated using Monte Carlo simulation based on corresponding projected revenue. We evaluate the fair value of the contingent consideration each reporting period and adjust the carrying value as new information becomes available. See Note 3, “Acquisitions,” and Note 7, “Fair value of financial instruments,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Other income, net

We are exposed to periodic currency fluctuations given our purchasing and selling activities in various countries. Other income (expense), net is primarily related to foreign exchange rate movements.

Interest expense, net

Interest expense primarily consists of cash interest and fees on our outstanding indebtedness. See “Financial condition, liquidity and capital resources” below and a description of our indebtedness in Note 8, “Debt,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Income tax provision

The provision for income taxes represents federal, foreign, state and local income taxes. The effective rate differs from statutory rates due to the effect of state and local income taxes and certain permanent tax adjustments. Our effective tax rate will change from period to period based on recurring and nonrecurring factors including, but not limited to, the geographical mix of earnings, enacted tax legislation, state and local income taxes, tax audit settlements, the interaction of various tax strategies and the impact of permanent tax adjustments, such as those related to stock-based compensation and executive compensation deduction limitations.

Net income

Our net income for future periods will be affected by the various factors described above.

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Results of operations

The following table sets forth our consolidated statements of operations data in dollars and as a percentage of net sales for the periods presented.

Fiscal year ended March 31,

(in thousands)

2026

2025

2024

Net sales

$

1,636,472 

$

1,313,517 

$

1,023,932 

Cost of sales

479,125 

377,831 

299,836 

Gross profit

1,157,347 

935,686 

724,096 

Selling, general and administrative expenses

1,026,066 

777,659 

574,418 

Change in fair value of contingent consideration

57,649 

— 

— 

Operating income

73,632 

158,027 

149,678 

Other income, net

2,785 

1,294 

1,210 

Impairment of equity investment

— 

— 

(2,875)

Interest expense, net

(35,284)

(13,813)

(7,023)

Loss on extinguishment of debt

(674)

(13)

— 

Income before provision for income taxes

40,459 

145,495 

140,990 

Income tax provision

(14,141)

(33,406)

(13,327)

Net income

$

26,318 

$

112,089 

$

127,663 

Fiscal year ended March 31,

(percentage of net sales)

2026

2025

2024

Net sales

100 

%

100 

%

100 

%

Cost of sales

29 

%

29 

%

29 

%

Gross profit

71 

%

71 

%

71 

%

Selling, general and administrative expenses

63 

%

59 

%

56 

%

Change in fair value of contingent consideration

4 

%

— 

%

— 

%

Operating income

4 

%

12 

%

15 

%

Other income, net

— 

%

— 

%

— 

%

Impairment of equity investment

— 

%

— 

%

— 

%

Interest expense, net

(2)

%

(1)

%

(1)

%

Loss on extinguishment of debt

— 

%

— 

%

— 

%

Income before provision for income taxes

2 

%

11 

%

14 

%

Income tax provision

(1)

%

(3)

%

(1)

%

Net income

2 

%

9 

%

12 

%

Comparison of the fiscal year ended March 31, 2026 to the fiscal year ended March 31, 2025

Net sales

Net sales increased $323.0 million, or 25%, to $1,636.5 million in the fiscal year ended March 31, 2026, from $1,313.5 million in the fiscal year ended March 31, 2025. The rhode Acquisition contributed $293.5 million to our growth in the fiscal year ended March 31, 2026, with the remaining $29.5 million contributed from our existing business. The $323.0 million increase was driven by both our retailer and e-commerce channels. Net sales increased $178.3 million, or 16%, in our retailer channels and $144.7 million, or 63%, in our e-commerce channels. From a price and volume perspective, a higher average item price and mix drove $333.5 million increase in net sales as compared to the fiscal year ended March 31, 2025. This was partially offset by lower volume impacting sales by $10.5 million.

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Gross profit

Gross profit increased $221.7 million, or 24%, to $1,157.3 million in the fiscal year ended March 31, 2026, compared to $935.7 million in the fiscal year ended March 31, 2025. Higher average item price and mix drove an increase of $229.2 million, offset by lower volume impacting gross profit by $7.5 million. Gross margin was 70.7% in the fiscal year ended March 31, 2026, a decrease of approximately 50 basis points as compared to 71.2% gross margin in the fiscal year ended March 31, 2025. The decrease in gross margin rate was primarily driven by tariffs, partially offset by pricing.

Selling, general and administrative expenses

SG&A expenses were $1,026.1 million in the fiscal year ended March 31, 2026, an increase of $248.4 million, or 32%, from $777.7 million in the fiscal year ended March 31, 2025. SG&A expenses as a percentage of net sales was 63% for the fiscal year ended March 31, 2026 and 59% for the fiscal year ended March 31, 2025. The increase on a dollar basis was primarily related to increased marketing, merchandising and distribution costs of $129.1 million, compensation and benefits expense of $55.1 million, increased depreciation and amortization of $35.0 million, increased professional fees of $20.6 million, and increased regulatory fees of $8.6 million.

Change in fair value of contingent consideration

In connection with the rhode Acquisition, the Company recorded a fair value adjustment of $57.6 million for the fiscal year ended March 31, 2026, driven by the outperformance of rhode's revenue results relative to the earnout thresholds set forth in the merger agreement entered into in connection with the rhode Acquisition.

Other income, net

Other income, net was $2.8 million in the fiscal year ended March 31, 2026, as compared to other income, net of $1.3 million in the fiscal year ended March 31, 2025. The year-over-year variance is primarily due to an increase in income from insurance recovery, and a decrease in foreign currency exchange loss for the period primarily attributable to foreign currency rate fluctuations between the US dollar and both the euro and British pound.

Interest expense, net

Interest expense increased $21.5 million, to $35.3 million in the fiscal year ended March 31, 2026, as compared to $13.8 million in the fiscal year ended March 31, 2025. The year-over-year variance was primarily due to the Fifth Amendment which established the Term Facility and increased debt. See Note 8, “Debt,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details on our debt.

Income tax provision

The income tax provision was $14.1 million, or an effective rate of 35%, for the twelve months ended March 31, 2026, as compared to a provision of $33.4 million, or an effective rate of 23%, for the twelve months ended March 31, 2025. The change in the income tax provision was primarily driven by a decrease in income before the provision for income taxes of $105.0 million.

Financial condition, liquidity and capital resources

Overview

As of March 31, 2026, we had $289.7 million of cash and cash equivalents. In addition, as of March 31, 2026, we had borrowing capacity of $243.3 million under the Amended Revolving Credit Facility.

Our primary cash needs are for working capital, fixturing, retail product displays and digital investment. Cash needs typically vary depending on strategic initiatives selected for the fiscal year, including investments in infrastructure, digital capabilities and expansion within or to additional retailer store locations. We expect to fund ongoing cash needs from existing cash and cash equivalents, cash generated from operations and, if necessary, draws on our Amended Revolving Credit Facility.

Our primary working capital requirements are for product and product-related costs, payroll, rent, distribution costs and marketing. Fluctuations in working capital are primarily driven by the timing of when a retailer rearranges or restocks its products, expansion of space within our existing retailer base, expansion to new retailers, and the general seasonality of our business. As of March 31, 2026, we had working capital, excluding cash, of $163.5 million, compared to $214.8 million as of

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March 31, 2025. Working capital, excluding cash and debt, was $193.5 million and $214.8 million as of March 31, 2026 and March 31, 2025, respectively.

We believe that our operating cash flow, cash on hand and available financing under the Amended Revolving Credit Facility will be adequate to meet our planned operating, investing and financing needs for the next twelve months. The unused balance of the Amended Revolving Credit Facility as of March 31, 2026 was $243.3 million. If necessary, we can borrow funds under the Amended Revolving Credit Facility to finance our liquidity requirements, subject to customary borrowing conditions. To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all.

Our ability to meet our operating, investing and financing needs depends to a significant extent on our future financial performance, which will be subject in part to general economic, competitive, financial, regulatory and other factors that are beyond our control, including those described elsewhere in Part I, Item 1A “Risk factors”. In addition to these general economic and industry factors, the principal factors in determining whether our cash flows will be sufficient to meet our liquidity requirements will rely on our ability to provide innovative products to our consumers, manage production and our supply chain.

Cash flows

Fiscal year ended March 31,

(in thousands)

2026

2025

2024

Net cash provided by (used in):

Operating activities

$

212,511 

$

133,840 

$

71,154 

Investing activities

(605,248)

(19,097)

(284,660)

Financing activities

533,919 

(74,449)

200,945 

Cash provided by operating activities

For the fiscal year ended March 31, 2026, net cash provided by operating activities was $212.5 million. This included net income, before deducting depreciation, amortization and other non-cash items of $262.0 million, partially offset by acquisition-related seller expenses of $47.1 million in connection with the rhode Acquisition, and an increase in working capital of $2.3 million. The increase in net working capital was primarily driven by a $67.4 million increase in prepaid and other assets and $17.5 million increase in accounts receivable, partially offset by a $75.3 million increase of accounts payable and accrued expenses and a $7.3 million decrease in inventory.

For the fiscal year ended March 31, 2025, net cash provided by operating activities was $133.8 million. This included net income, before deducting depreciation, amortization and other non-cash items of $238.9 million, partially offset by an increase in net working capital of $105.0 million. The increase in net working capital was primarily driven by a $2.7 million increase in accounts receivable, a $75.9 million increase in prepaid and other assets, a $7.9 million decrease in other liabilities, and a $23.4 million decrease of accounts payable and accrued expenses, partially offset by a $4.9 million decrease in inventory.

For the fiscal year ended March 31, 2024, net cash provided by operating activities was $71.2 million. This included net income, before deducting depreciation, amortization and other non-cash items of $205.5 million, partially offset by an increase in net working capital of $123.8 million and payment of acquisition-related seller expenses of $10.5 million in connection with the Naturium Acquisition. The increase in net working capital was primarily driven by a $93.9 million increase in inventory. The increase was reflective of building inventory to support net sales growth, as well as $10.0 million related to Naturium inventory, and $7.8 million related to a change in certain vendor arrangements where we now take ownership of inventory at shipment from China versus when it enters our US distribution center. Additional changes in working capital include a $49.6 million increase in accounts receivable, a $55.2 million increase in prepaid and other assets, and a $6.3 million decrease in other liabilities, partially offset by an $81.2 million increase of accounts payable and accrued expenses.

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Cash used in investing activities

For the fiscal year ended March 31, 2026, net cash used in investing activities was $605.2 million primarily related to the rhode Acquisition and capital expenditures related to leasehold improvements and equipment.

For the fiscal year ended March 31, 2025, net cash used in investing activities was $19.1 million. This includes capital expenditures related to fixturing, equipment and software of $18.5 million, and contributions to other investment of $0.6 million.

For the fiscal year ended March 31, 2024, net cash used in investing activities was $284.7 million. This includes $275.0 million paid for the Naturium Acquisition, net of cash acquired, capital expenditures related to fixturing, equipment and software of $8.7 million, and contributions to other investment of $1.0 million.

Cash provided by (used in) financing activities

For the fiscal year ended March 31, 2026, net cash provided by financing activities was $533.9 million and was primarily driven by proceeds from long term debt of $600.0 million, proceeds from the revolving line of credit of $50.0 million and cash received from the exercise of stock options of $5.8 million. This was offset by the repayment of previous Revolving Credit line of $50.0 million, repurchases of our common stock of $50.0 million, repayments on the Amended Term Loan Facility of $15.0 million and payment of debt issuance costs of $6.9 million associated with the new Revolving Credit Facility.

For the fiscal year ended March 31, 2025, net cash used in financing activities was $74.4 million and was primarily driven by the repayment of previous Revolving Credit line of $89.5 million, repurchases of our common stock of $67.1 million, repayments on the Amended Term Loan Facility of $173.4 million and payment of debt issuance costs of $2.1 million associated with the new Revolving Credit Facility. This was offset by proceeds from long term debt of $256.7 million and cash received from the exercise of stock options of $1.0 million.

For the fiscal year ended March 31, 2024, net cash provided by financing activities was $200.9 million and was primarily driven by proceeds from the Amended Term Loan Facility of $115.0 million and Amended Revolving Credit Facility of $89.5 million and cash received from the exercise of stock options of $5.6 million. This was partially offset by repayment on the Amended Term Loan Facility of $7.9 million and payment of debt issuance costs of $0.7 million associated with the Second Amendment.

Description of indebtedness

Amended Credit Agreement

On April 30, 2021, we amended and restated our prior credit agreement (such amended and restated credit agreement, as further amended, supplemented or modified from time to time, the “Amended Credit Agreement”) and refinanced all loans under the prior credit agreement. The Amended Credit Agreement has a five year term and consists of a $100.0 million revolving credit facility (the “Amended Revolving Credit Facility”) and a $100.0 million term loan facility.

The Amended Credit Agreement contains a number of covenants that, among other things and subject to certain exceptions, restrict our ability to pay dividends and distributions or repurchase capital stock, incur additional indebtedness, create liens on assets, engage in mergers or consolidations and sell or otherwise dispose of assets. The Amended Credit Agreement also includes reporting, financial and maintenance covenants that require us to, among other things, comply with certain consolidated total net leverage ratios and consolidated fixed charge coverage ratios.

Second Amendment to Amended Credit Agreement

On August 28, 2023, we entered into the Second Amendment to Amended and Restated Credit Agreement (the “Second Amendment”). Pursuant to the Second Amendment, we borrowed incremental term loans in an aggregate original principal amount of $115.0 million under the Amended Credit Agreement (the “Incremental Term Loan”). We used the Incremental Term Loan, together with cash from our balance sheet and additional borrowings under our Amended Revolving Credit Facility, to consummate the acquisition of Naturium (as defined in Note 3, “Acquisitions,” in the Notes to our unaudited condensed consolidated financial statements included elsewhere in this Annual Report on Form 10-K) and to pay related fees and expenses in connection with the acquisition of Naturium and Second Amendment.

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Third Amendment to Amended Credit Agreement

On August 26, 2024, we entered into the Third Amendment to Amended and Restated Credit Agreement (the “Third Amendment”). Pursuant to the Third Amendment, we increased our capacity to make restricted payments, provided that after giving effect to any such payment, we comply with a certain consolidated total net leverage ratio.

Fourth Amendment to Amended Credit Agreement

On March 3, 2025, we entered into the Fourth Amendment to Amended and Restated Credit Agreement and First Amendment to Pledge and Security Agreement (the “Fourth Amendment”). The Fourth Amendment, among other things, established a revolving credit facility in an aggregate principal amount of $500.0 million (the “Revolving Credit Facility”), refinanced the existing indebtedness under the Amended Credit Agreement and reduced the interest rate margin for loans. Additionally, certain baskets under the Amended Credit Agreement were increased as part of the Fourth Amendment. The proceeds of the Revolving Credit Facility are available to e.l.f. Cosmetics and certain of our other subsidiaries for working capital, capital expenditures and other general corporate purposes, including to finance acquisitions and investments permitted under the Amended Credit Agreement and other permitted distributions on account of our and our subsidiaries’ equity interests. In addition, up to $35.0 million of the Revolving Credit Facility is available for issuing letters of credit. The maturity date of the Revolving Credit Facility is March 3, 2030.

The Fourth Amendment also replaced the fixed charge coverage ratio financial covenant with a minimum interest coverage ratio of at least 3.50 to 1.00, to be tested as of the last day of each fiscal quarter. The minimum interest coverage ratio is based on the ratio of trailing twelve month EBITDA for the four fiscal quarter period most recently ended to cash interest expense for such period.

The Fourth Amendment also amended the Pledge and Security Agreement, dated as of December 23, 2016, among us, certain of our subsidiaries, and the Agent pursuant to which certain covenants and thresholds set forth therein were amended, amongst other changes.

Fifth Amendment to Amended Credit Agreement

On August 5, 2025, we entered into the Fifth Amendment. The Fifth Amendment, among other things, established the Term Facility, made customary changes in connection with adding a term loan facility, increased the maximum permitted consolidated total net leverage ratio financial covenant, increased the interest rate margin for loans under our existing Revolving Credit Facility and increased the unused line fee under our existing Revolving Credit Facility. The proceeds of the Term Facility were made available to e.l.f. Cosmetics and certain of our other subsidiaries to pay a portion of the consideration for the rhode Acquisition. The maturity date of the Term Facility is March 3, 2030.

Loans under the Amended Credit Agreement will bear interest at a rate per annum equal to, at e.l.f. Cosmetics’ election: SOFR (subject to a 0.00% floor) or an alternate base rate (subject to a 1.00% floor) as set forth in the Fifth Amendment, plus an interest rate margin, to be determined based on consolidated total net leverage ratio levels, ranging from, (i) in the case of SOFR loans, 1.50% to 2.25%, and (ii) in the case of alternate base rate loans, 0.50% to 1.25%.

Unused commitments under our existing Revolving Credit Facility are subject to a fee, to be determined based on consolidated total net leverage ratio levels, ranging from 0.15% to 0.25%.

The interest rate as of March 31, 2026 for the Amended Credit Agreement was approximately 5.4%.

The interest rate as of March 31, 2026 for the Revolving Credit Facility was approximately 5.4%. The unused balance of the Revolving Credit Facility as of March 31, 2026 was $243.3 million.

Off-balance sheet arrangements

We are not party to any off-balance sheet arrangements.

Critical accounting policies and estimates

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Our consolidated financial statements included elsewhere in this Annual Report have been prepared in accordance with US generally accepted accounting principles. The preparation of our financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. While our significant accounting policies are more fully described in Note 2, “Summary of significant accounting policies,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following accounting policies and estimates are critical to our business operations and understanding of our financial results.

Revenue recognition

We recognize revenue when control of promised goods or services is transferred to a customer in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. Control of the substantial majority of the products that we sell is transferred at a point in time. Factors that determine the specific point in time a customer obtains control and a performance obligation is satisfied are when we have a present right to payment for the goods, whether the customer has physical possession and title to the goods, and whether significant risks and rewards of ownership have transferred. Delivery is typically considered to have occurred at the time the title and risk of loss passes to the customer.

In the normal course of business, we offer various incentives to customers such as sales discounts, markdown support and other incentives and allowances, which give rise to variable consideration. The amount of variable consideration is estimated at the time of sale based on either the expected value method or the most likely amount, depending on the nature of the variability. We regularly review and revise, when deemed necessary, our estimates of variable consideration based on both customer-specific expectations as well as historical rates of realization. A provision for customer incentives and allowances is included on the consolidated balance sheet, net against accounts receivable.

Business Combinations

We allocate the purchase price of a business acquisition to the assets acquired and liabilities assumed based upon their estimated fair values at the business combination date. The excess of purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Determining fair value of identifiable assets, particularly intangibles, and liabilities acquired also requires us to make estimates, which are based on all available information and in some cases assumptions with respect to the timing and amount of future revenues and expenses associated with an asset. Unanticipated events or circumstances may occur that could affect the accuracy of our fair value estimates, and under different assumptions, the resulting valuations could be materially different, which could impact the operating results we report.

Contingent Consideration

In connection with the rhode Acquisition, we recorded a liability at fair value for the contingent consideration potentially payable to the sellers of rhode subject to achievement of certain earnout thresholds, with a maximum payment of $200.0 million. We expect to pay (if due and owing) annually within four months after each measurement period ending September 30, 2026, 2027, and 2028. The fair value of the liability is estimated using discounted future cash flows based on a Monte Carlo simulation methodology using significant level 3 inputs such as forecasts of revenue. We evaluate the fair value of the contingent consideration each reporting period and adjust the carrying value as new information becomes available. See Note 3, “Acquisitions,” and Note 7, “Fair value of financial instruments,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Impairment of long-lived assets, including goodwill and intangible assets

We assess potential impairments to our long-lived assets, which include property and equipment, retail product displays, and amortizable intangible assets, whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of an asset is measured by a comparison of the carrying amount of an asset group to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset. There were no material impairment charges recorded on long-lived assets during the fiscal years ended March 31, 2026, March 31, 2025 or March 31, 2024.

We evaluate our indefinite-lived intangible asset to determine whether current events and circumstances continue to support an indefinite useful life. In addition, our indefinite-lived intangible asset is tested for impairment annually. The indefinite-lived

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intangible asset impairment test consists of a comparison of the fair value of each asset with its carrying value, with any excess of carrying value over fair value being recognized as an impairment loss. We are also permitted to make a qualitative assessment of whether it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying value prior to applying the quantitative assessment. If based on our qualitative assessment it is more likely than not that the carrying value of the asset is less than its fair value, then a quantitative assessment may be required.

The goodwill impairment test consists of a comparison of each reporting unit’s fair value to its carrying value. The fair value of a reporting unit is an estimate of the amount for which the unit as a whole could be sold in a current transaction between willing parties. If the carrying value of a reporting unit exceeds its fair value, goodwill is written down to its implied fair value. We are also permitted to make a qualitative assessment of whether it is more likely than not that the fair value of a reporting unit is less than its carrying value prior to applying the quantitative assessment. If based on our qualitative assessment it is more likely than not that the carrying value of the reporting unit is less than its fair value, then a quantitative assessment may be required. We have identified a single reporting unit for purposes of impairment testing.

We have selected October 1 as the date on which to perform our annual impairment tests. We also test for impairment whenever events or circumstances indicate that the fair value of goodwill or indefinite-lived intangible assets has been impaired. No impairment of goodwill or our indefinite-lived intangible asset was recorded during the fiscal years ended March 31, 2026, March 31, 2025 or March 31, 2024.

Stock-based compensation

We have several stock award plans, which are described in detail in Note 12, “Stock-based compensation,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. We account for stock-based compensation under Accounting Standards Codification (“ASC”) 718, “Compensation-Stock Compensation.” We recognize expense over the requisite service period of the award, net of an estimate for the impact of award forfeitures.

We have no current plans to pay a regular dividend.

New accounting pronouncements

See Note 2, “Summary of significant accounting policies,” in the Notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding new accounting pronouncements.

We comply with any new or revised accounting standards on the relevant dates on which adoption of such standards is required for publicly traded companies that are not emerging growth companies.