e.l.f. Beauty, Inc. (ELF): BCG Matrix [Dec-2025 Updated]

You're looking for a clear-eyed view of e.l.f. Beauty, Inc.'s portfolio, and the BCG Matrix is the perfect tool to map their current strategic position and capital allocation needs. We'll break down where the core brand's 15% U.S. share and viral hits shine as Stars, how the 81% mass retail sales and 71% gross margin fuel the operation as Cash Cows, which legacy brands and China exposure are Dogs, and how the massive rhode acquisition and nascent international growth, still only 20% of total net sales, present high-stakes Question Marks. Dive in to see exactly where this beauty powerhouse needs to invest, hold, or divest resources right now.

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

e.l.f. Beauty, Inc., headquartered in Oakland, California, started operations back in the year 2004. The company's core mission centers on making high-performance, clean, vegan, and cruelty-free beauty accessible at affordable price points. You know the flagship brand, e.l.f. Cosmetics, which has built a cult following by offering prestige-inspired products like the Power Grip Primer at a fraction of the cost of luxury alternatives. The portfolio of purpose-driven brands also includes e.l.f. SKIN, Naturium, W3LL PEOPLE, and Keys Soulcare.

The performance leading up to late 2025 shows a company still delivering significant top-line growth, though perhaps at a decelerating pace. For the full Fiscal 2025 year, which ended on March 31, 2025, e.l.f. Beauty, Inc. grew net sales by an impressive 28%, reaching $1,313.5 million. This growth helped them gain 190 basis points of market share in the U.S. during that fiscal year. The gross margin for the full Fiscal 2025 year settled at 71%.

Looking at the more recent results, the second quarter of Fiscal 2026 (ending September 30, 2025) saw net sales increase by 14% year-over-year to $343.9 million. In that quarter, the namesake e.l.f. brand specifically captured 140 basis points of market share. A major strategic move was the definitive agreement signed on May 28, 2025, to acquire Hailey Bieber's rhode brand for up to $1 billion, which diversifies e.l.f. Beauty, Inc. into the prestige channel. This acquisition already contributed $52 million to the Q2 Fiscal 2026 net sales, accounting for about 17 percentage points of that quarter's growth.

In terms of market positioning, e.l.f. Beauty, Inc. has solidified its presence with key retailers. The brand achieved the #1 rank in Target, representing 21% of their entire cosmetics category there, and moved up from the #4 to the #2 brand at Walmart. Despite this momentum, the stock was trading around $69.90 in late November 2025, significantly below its 50-day moving average of ~$118, with a Price-to-Earnings ratio of 49.23. Management issued guidance for the full Fiscal 2026 year, setting an expected Earnings Per Share range between 2.800-2.850.

e.l.f. Beauty, Inc. (ELF) - BCG Matrix: Stars

The core e.l.f. Cosmetics brand is positioned firmly as a Star within the portfolio. This brand is recognized for holding a 15% unit share in the U.S. color cosmetics market. This high market share in a growing category is a key indicator of its Star status, meaning it is a market leader that requires significant investment to maintain its growth trajectory.

The momentum is clearly visible in recent performance metrics. For the full fiscal year 2025, e.l.f. Beauty grew net sales by 28%. Specifically for the flagship brand, the U.S. market share gains reached 190 basis points in fiscal year 2025, which ended March 31, 2025. This performance places e.l.f. as the #1 brand in the U.S. by unit share within the cosmetics category.

Viral product lines are essential drivers of this success, especially when contrasted with the broader market. For instance, franchises like Halo Glow demonstrated strength in Q2 fiscal 2025. The brand is driving category-leading growth, being the fastest-growing among the top 20 brands in the U.S. by a wide margin. To support this growth, international revenue, which now represents 20% of sales, grew by 60% in FY2025.

The brand's connection with younger consumers remains a critical competitive advantage. The e.l.f. brand has secured its dominance as the favorite teen cosmetics brand for the eighth consecutive year as of 2025. This loyalty is a powerful indicator of future Cash Cow potential if market growth slows while share is retained.

Here's a look at some of the key performance indicators that define this Star quadrant:

• The flagship brand captured 190 basis points of U.S. market share in Fiscal 2025.
• Net sales for e.l.f. Beauty grew 28% in Fiscal 2025.
• International net sales growth reached 91% in Q2 Fiscal 2025.
• The brand is the #1 U.S. color cosmetics brand in unit share.
• The company ended Fiscal 2025 with $148.7 million in cash and cash equivalents.

You can see how the high growth and market leadership translate into financial scale:

Stars consume significant cash to fuel their high-growth, high-share positioning. For example, Adjusted SG&A (Selling, general and administrative) expenses for Fiscal 2025 were $690.9 million, representing 53% of net sales. This heavy investment in marketing and digital spend is what keeps the brand at the forefront, ensuring it can eventually transition to a Cash Cow when the market growth rate naturally decelerates.

e.l.f. Beauty, Inc. (ELF) - BCG Matrix: Cash Cows

Cash Cows for e.l.f. Beauty, Inc. are anchored by the core brand's established dominance in the mature mass retail segment, which reliably generates the capital to fund growth initiatives elsewhere in the portfolio.

The U.S. mass retail distribution channel remains the primary engine, with International net sales accounting for 20% of total sales in the first quarter of fiscal year 2026, implying the U.S. channel represents approximately 80% of the business for that period. This channel is mature but high-volume, fitting the Cash Cow profile perfectly. The company's financial performance in fiscal year 2025 reflected this strength, with full-year net sales reaching $1,313.5 million.

Profitability is robust, evidenced by the company's consistently high gross margin, which stood at approximately 71% for the full fiscal year 2025, a figure achieved through favorable foreign exchange impacts and cost savings. This high margin on a high-volume base is the definition of a cash generator.

Market leadership within this segment is clear, providing the high market share component of the Cash Cow quadrant. For instance, in the first quarter of fiscal 2025, the core e.l.f. brand held a 21% cosmetics share at Target, its longest-standing national retail customer. Nationally, e.l.f. was the number two mass brand on a dollar basis with approximately 12% share as of the first quarter of fiscal 2025. The company is actively building on this foundation, reportedly picking up additional shelf space at retailers like Walmart.

The established product base generates the necessary cash flow, as promotion and placement investments are optimized rather than aggressively scaled, unlike in high-growth segments. The focus here is on efficiency and maintaining share.

These mature, high-volume assets are critical for corporate funding needs. The cash flow generated supports the entire enterprise structure, including administrative overhead and debt servicing. The company ended fiscal 2025 with $148.7 million in cash and cash equivalents.

• Investments are directed toward infrastructure supporting efficiency, such as supply chain optimization, which contributed to the 71% gross margin in fiscal 2025.
• The core brand's market leadership allows for lower relative promotional spending compared to newer or emerging brands.
• This segment's high profitability funds the acquisition strategy, such as the agreement to acquire rhode, which has a potential earnout of up to $200 million.
• The company continues to gain share, adding 190 basis points in the U.S. during fiscal 2025.

e.l.f. Beauty, Inc. (ELF) - BCG Matrix: Dogs

You're looking at the parts of e.l.f. Beauty, Inc. that aren't driving the high-growth narrative, the units that require careful management to prevent cash drain, even if they currently break even. These are the Dogs in the portfolio, characterized by low market share in low-growth areas.

The brands explicitly positioned as smaller or legacy additions, like Keys Soulcare and Well People, fall into this potential category, existing alongside the high-flyers like e.l.f. Cosmetics and Naturium. The company's overall net sales for the full fiscal year ended March 31, 2025, reached $1,313.5 million, but the performance of these smaller units is likely dilutive or neutral to the overall growth rate.

The beauty tools and accessories segment represents a category inherently lower-margin and less differentiated compared to the core color cosmetics and skincare innovations. While the consolidated gross margin for fiscal year 2025 was 71.2%, this segment typically operates at a lower margin profile, consuming management focus without delivering premium returns.

Any older product SKUs that are not part of the current viral or core 'Holy Grail' innovation strategy are candidates for minimization. The company's success is tied to its rapid innovation cycle, meaning products not refreshed or achieving viral status can quickly become cash traps with low inventory turnover.

Financial exposure to geopolitical risk anchors the potential downside for any unit heavily reliant on the existing supply chain structure. As of mid-2025, about 75% of e.l.f. Beauty, Inc.'s product volume is manufactured in China, making the business highly susceptible to trade headwinds.

Here's the quick math on the tariff headwind, which impacts the cost structure of all manufactured goods:

The pressure from these costs is evident in the margin compression seen in the most recent reported quarter. For the three months ended September 30, 2025 (Q2 Fiscal 2026), the gross margin decreased approximately 165 basis points to 69%, primarily driven by higher tariff costs. This margin erosion on existing product lines, which includes the Dogs, highlights why expensive turn-around plans are often avoided in favor of divestiture or minimization.

The immediate actions taken to offset these costs suggest a defensive posture for the entire portfolio, which disproportionately affects lower-margin or slower-moving inventory:

• The company reported a sharp 30% decline in quarterly profits for the period ending June 30, 2025, directly attributed to the tariff impact.
• Net income for that same quarter (Q1 FY2026) was $33.3 million, down from $47.6 million in the prior year's Q1 (GAAP basis for the period ending June 30, 2024, was $47.6 million).
• The company is accelerating efforts to shift production outside of China, aiming for China to account for significantly less of production by the end of fiscal 2026.
• The company is holding back a full Fiscal 2026 financial outlook due to tariff uncertainty.

e.l.f. Beauty, Inc. (ELF) - BCG Matrix: Question Marks

Question Marks for e.l.f. Beauty, Inc. (ELF) represent business units or brands operating in high-growth markets but currently holding a relatively low market share, thus consuming cash while holding significant potential to become Stars. These areas demand heavy investment to rapidly capture market share.

The most significant recent investment consuming capital is the acquisition of the rhode brand. e.l.f. Beauty, Inc. entered into a definitive agreement to acquire rhode for a total consideration of up to $1.0 billion. The upfront payment at closing was $800.0 million, structured as $600.0 million in cash and $200.0 million in stock, with an additional potential earnout consideration of up to $200.0 million based on future growth over three years. This acquisition is a clear investment to gain share in the prestige segment, as rhode's annual sales were reported at $212 million prior to the deal, which is small relative to e.l.f. Beauty, Inc.'s fiscal 2025 net sales of $1,313.5 million.

The entire international business fits the Question Mark profile due to its high growth rate coupled with a still-modest contribution to overall revenue. For instance, non-U.S. markets represented 20% of total net sales as of Q2 Fiscal Year 2025 reporting, up from 16% a year prior. This segment demonstrated substantial growth, with net sales increasing 91% year-over-year in Q2 Fiscal Year 2025. The strategy here is heavy investment to scale this low-share, high-growth area.

Specific brand expansions within the international or new channel context also fall under this quadrant. The Naturium skincare brand, acquired for $355 million in 2023, is being strategically deployed internationally, with plans for expansion into Sephora Australia. This represents an investment to build market share for a specific brand in a new, growing international territory.

The entry into Dollar General represents a high-risk, high-reward play in a new retail channel, aligning with the mission to democratize beauty access. Dollar General has over 20,000 stores, with approximately 80% serving markets of 20,000 people or fewer. The e.l.f. brand is displacing some existing brands in this channel, which began in November. This is a cash-consuming effort to establish share in a value-focused, geographically distinct segment.

Here is a summary of the key financial and statistical metrics associated with these Question Mark areas as of the latest available 2025 data:

The strategy for these Question Marks is clear: heavy investment is required to rapidly convert the high-growth potential, particularly for rhode and the international segment, into established Star status. Failure to gain share quickly means these cash consumers risk becoming Dogs.

• Invest heavily in rhode to capitalize on prestige market entry.
• Fund international expansion to grow the 20% sales mix.
• Support Naturium's entry into new markets like Sephora Australia.
• Monitor initial performance and required investment in the Dollar General channel.