Ulta Magnificence on Thursday forecast full-year revenue beneath Wall Avenue estimates after elevated provide chain prices and elevated promotions harm margins, sending its shares down 4.5 p.c in prolonged buying and selling.

Regardless of the sweetness retailer’s efforts to spice up gross sales by way of steep reductions, inflation-weary customers reduce spending on discretionary objects akin to cosmetics and hair care merchandise.

Though strain from retail shrink, the place stock is misplaced or broken attributable to theft and breakage, has risen over the previous few years, it persists as a problem for retailers with a number of firms flagging an affect on margins.

Ulta Magnificence now expects its annual working margin to vary between 14.0 p.c and 14.3 p.c, down from 15.0 p.c reported in 2023.

The corporate forecast annual adjusted earnings per share between $26.20 and $27 per share, the mid-point of which fell beneath analysts’ common estimate of a revenue of $27 per share, in response to LSEG information.

It expects fiscal 2024 income to be between $11.7 billion and $11.8 billion, largely above LSEG estimates of $11.69 billion.

The wonder retailer reported a revenue of $8.08 per share for the fourth quarter ended Feb. 3, in contrast with expectations of $7.53.

Quarterly income rose about 10 p.c year-on-year to $3.6 billion, forward of analysts’ expectations of $3.53 billion.

Shares of the Illinois-based firm hit an intra-day file excessive on Thursday earlier than closing down at $565.44. The inventory has surged round 15 p.c in 2024.

By Annett Mary Manoj; Modifying by Shweta Agarwal

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Ulta Magnificence Raises Annual Forecasts, Longtime CFO Settersten to Retire

Scott Settersten who has been with the corporate for almost 20 years will likely be succeeded by Paula Oyibo, the corporate’s senior vice chairman of finance who joined in 2019.