Hilli Bieber attends the UK Road launching ceremony with Healy Bieber in Sheltran Firehus on May 17, 2023 in London, England.
Dave Bennett Dave Bennett Group Gety pictures
Gamal dwarf An advertisement was announced on Wednesday to obtain a beauty brand, Healy Bieber Road, in a deal amounting to one billion dollars, as the cosmetic company is looking to expand skin care.
The acquisition – the largest Elf at all, according to FactSet – consists of $ 800 million in cash and shares, as well as additional additional payments worth $ 200 million based on Road’s performance over the next three years. The deal is expected to be closed in the second quarter of the company’s 2026 – or later this year.
“I was 34 years old, and it was detonated by seeing this brand over time. In less than three years, they moved from zero to 212 million dollars in net sales, only to the consumer only, with only 10 products. I did not think that was possible,” CNBC CEO said in an interview. “So the level of disorder definitely caught our attention.”
In a press release, Bieber said she was enthusiastic about partnership with Elf to bring her brand to “more faces, places and spaces.”
“From the first day, my vision of Rhode was to make basic skin care and hybrid makeup that you can use every day,” Bieber said. “After only three years of this trip, our partnership with Elf Beauty is a great opportunity to raise and accelerate our ability to reach more of our society through more innovative products and expand our distribution worldwide.”
ELF shares increased by 11 % on Thursday after the company announced the acquisition and issued results for the fourth fiscal quarter. The company topped Wall Street’s quarterly estimates, but it has not provided guidance due to the Trump’s changing tariff policy. Elf gets an impatient amount of its products from China.
On Thursday’s note, Goldman Sachs said they see Road’s deal “as a strategic positive as it expands Elf to skin care with a brand and the diversity of its customer base.”
“Although Rod is a DTC brand, it is expected to be put in place in the field of retail, including in Sevora, which we believe will support growth in the future,” they added.
Why is a dwarf on Rod?
Rhode was launched in 2022, more than twice the base of its customer over the past year and achieved $ 212 million in the 12 months ending on March 31. The company’s growth came primarily through its website, but it is planning to launch Sephora stores throughout North America and the United Kingdom before the end of the year.
As part of the acquisition, Bieber will work as the chief creative official of Rhode and the head of innovation, supervision of creativity, innovation and marketing of products. The brand was launched along with two founders, Michael and Lauren Ratner, but the influence of Bieber and his name was that turned it into a billion dollar brand.
Under its supervision, Rudd last year became the No. 1 Brand of Skin Care in the value of the acquired media-or exposure through methods other than the paid advertisement-with 367 % growth on an annual basis.
Rudd is an Elf, which has seen growth in recent years in large parts to its digital ingenuity. The company has hordes of online fans known as Tiktok marketing, which is more natural for consumers.
The company is also looking to search for skin care, which has become more popular for all age groups, especially the ENF primary consumer. In 2023, she acquired the NaturiUm brand for $ 355 million. She will allow her to acquire Rod to build on skin care growth and reach a higher income consumer.
Amin said: “ELF cosmetics are about $ 6.50 at the basic entry point point, on average, in the twenties of the twentieth century, so I say that it brings us a different group of consumer to the company in general, but the same approach regarding how to engage and entertain it.”
The deal is logical for ELF, and it was a competitive step to disrupt the brand before the competitors do, but it comes in an undievate and difficult time for the company. Even with the expected prices increasing, Chinese definitions may reduce ELF profits over time, and $ 600 million of the deal is funded with debt at a time of high interest rates.
The acquisition is a bet that consumers will continue to spend on advanced skin care, even during economic slowdown or stagnation.
A dwarf out of profit estimates
Elf released this announcement because it published the results of the fourth fiscal quarter, which beat Wall Street’s expectations at the top and bottom.
Here’s how to perform retail dealers compared to what Wall Street expected, based on a survey of analysts by LSEG:
- Arrow’s profits: 78 cent modification For 72 cents expected
- profit: $ 333 million for $ 328 million expected
The net income of the company was reported for a period of three months that ended on March 31, 28.3 million dollars, or 49 cents per share, compared to $ 14.5 million, or 25 cents per share, a year ago. Sales increased to $ 332.7 million, an increase of about 4 % from 321.1 million dollars.
ENF sales have increased rapidly in recent years, but investors have grown as this growth began to slow down and the threats of definitions began to influence their business. The company’s sources of about 75 % of its products from China, which are currently facing 30 % on exports to the United States last week, announced plans to raise prices by one dollar to compensate for the high costs of customs tariffs that start on August 1.
While the duties of the United States on Chinese imports are now 30 %, this may change as president Donald Trump He negotiates with Beijing. As a result, Elf said that it does not provide a financial view of 2026 “due to a wide range of possible definition results.”
Amin said that ELF paid more than 145 % in duties before Trump agreed to reduce fees on Chinese goods, but these costs were not present during the quarter and the company’s reports will appear in its financial profits 2026 in the first quarter.
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