Comparable Sales Growth Driven by Higher Average Ticket
Comparable sales increased 3.8% in Q2 FY2026, driven by a 3.9% increase in average ticket. This compares to a 6.7% comparable sales increase in the year-ago quarter.
Source: 10-Q Item 2 MD&A
Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Ulta Beauty's second quarter of fiscal 2026 was defined by continued comparable-sales growth, the inclusion of the Space NK acquisition, and a double-digit increase in diluted EPS. Management attributed the higher net sales primarily to increased comparable sales, the Space NK acquisition, and new stores, with comparable sales driven by a higher average ticket. Gross margin was slightly lower due to Space NK's business mix, while interest expense switched from a net benefit to a cost; these were partly offset by SG&A leverage that lifted operating margin. Operating cash flow improved year over year, but cash balances declined as the company accelerated share repurchases.
Revenue
$3.04B
+8.87% YoY
EPS (Diluted)
$6.55
+13.32% YoY
Gross Margin
39.1%
-0.1 pts YoY
Operating Income
$379.64M
+10.09% YoY
Source: SEC XBRL
Ulta Beauty (ULTA) reported Q2 FY2026 revenue of $3.04B, up 8.9% year over year. Operating margin was 12.5%, up 0.1 points from 12.4% a year earlier. ULTA's fiscal Q2 FY2026 corresponds to calendar Q3 2026.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Sep 2026 | 6.55 | 6.31 | Beat +3.8% |
| Jun 2026 | 7.74 | 7.00 | Beat +10.6% |
| Mar 2026 | 8.01 | 8.18 | Miss -2.1% |
| Dec 2025 | 5.14 | 4.73 | Beat +8.7% |
Compiled by AI from 10-Q Item 2 of this filing
Comparable sales increased 3.8% in Q2 FY2026, driven by a 3.9% increase in average ticket. This compares to a 6.7% comparable sales increase in the year-ago quarter.
Source: 10-Q Item 2 MD&A
The $247.2 million net sales increase was primarily due to increased comparable sales, the acquisition of Space NK, and sales from new stores. Store count reached 1,622 at quarter end, up from 1,556 a year earlier.
Source: 10-Q Item 2 MD&A
Gross profit margin decreased to 39.1% from 39.2% a year ago, primarily due to the impact of the Space NK business mix.
Source: 10-Q Item 2 MD&A
SG&A expenses as a percentage of net sales declined to 26.4% from 26.6%, primarily due to lower incentive compensation and leverage of corporate overhead from strategic enterprise investments, partially offset by higher advertising expenses.
Source: 10-Q Item 2 MD&A
Operating cash flow increased to $381.6 million in the first 26 weeks, while cash and cash equivalents plus short-term investments fell to $213.5 million from $494.2 million at fiscal year-end, reflecting higher share repurchases and short-term borrowings.
Source: 10-Q Item 2 MD&A
Compiled by AI from this SEC filing · 0 high, 4 medium, 1 low
Cash and cash equivalents fell 34.7% year over year to $158.5 million. This reduces the company's cushion to absorb working capital needs, especially ahead of the holiday inventory build.
Source: 10-Q Balance Sheet (XBRL)
Total liabilities rose 7.3% to $4.32 billion while stockholders' equity increased only 1.5%, pushing the debt-to-equity ratio to 1.63. Interest expense, net swung to a $3.7 million expense from $1.4 million interest income a year earlier, reflecting higher borrowings under credit facilities.
Source: 10-Q Balance Sheet (XBRL)
Financing cash outflows more than doubled to $512.9 million in the first 26 weeks, driven by $793.2 million in share buybacks, up 65.5% year over year. While buybacks support EPS, they reduce cash and may limit financial flexibility if operating cash flow weakens.
Source: 10-Q Cash Flow Statement (XBRL)
Equity net loss of affiliate increased to $2.1 million in Q2 FY2026 from $0.6 million a year earlier, related to the Mexico joint venture. Continued losses or capital needs from international expansion could pressure earnings.
Source: 10-Q Income Statement (XBRL)
Gross margin declined 10 basis points to 39.1% because the acquired Space NK business carries a different margin profile. If Space NK or other lower-margin businesses grow faster than the core U.S. operations, overall profitability could remain under pressure.
Source: 10-Q Income Statement (XBRL)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 3.04 $B | 2.79 $B | +8.87% |
Cost of Revenue $B | 1.85 $B | 1.70 $B | +8.96% |
Gross Profit $B | 1.19 $B | 1.09 $B | +8.73% |
Operating Income $M | 379.64 $M | 344.85 $M | +10.09% |
Net Income $M | 282.01 $M | 260.88 $M | +8.10% |
EPS (Basic) $ | 6.57 $ | 5.80 $ | +13.28% |
EPS (Diluted) $ | 6.55 $ | 5.78 $ | +13.32% |
SG&A Expense $M | 802.78 $M | 741.74 $M | +8.23% |
Answers draw on this SEC filing and the data on this page
Ulta Beauty delivered strong Q1 FY2026 growth, with revenue up 11.1% to $3.2B and net income up 11.6% to $340.5M, driven by 5.3% comparable-sales growth, Space NK acquisition-related sales, new stores, and a 0.9-percentage-point gross-margin improvement. Source: 10-Q Item 2 MD&A, p.20
ULTA Beauty delivered 9.7% revenue growth to $12.4B in FY2025, but rising SG&A expenses (+17.4%) compressed operating margin by ~150bps to 12.4%, resulting in a 4.0% decline in net income to $1.15B.
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