April 3, 2024

Ulta Beauty (ULTA), an established beauty products retailer, has observed a slowdown in business in the early two months of its fiscal first quarter, causing shares to sharply fall nearly 15% during intraday trading on Wednesday. In the event of this deceleration persisting, the company anticipates its current-quarter comparable store sales to hover at the lower limit of its previous prediction.

CEO Dave Kimbell discussed the downturn during a retail conference, explaining that it spread “across price points and segments.” This noticeable decline, according to Kimbell, arrived earlier than expected and was slightly larger in magnitude.

On the premise that this sluggish trend continues, Ulta forecasts current-quarter comparable store sales to rest at the low end of its earlier guidance – a minimal single-digit percentage increase. Nevertheless, Kimbell expressed the company’s expectancy for a moderation in the pullback later in the year. He also mentioned that Ulta is experiencing stiff competition’s brunt, especially in the categories of prestigious makeup and hair care products.

Wednesday’s market saw Ulta shares plummet 14.6% as of 1:45 p.m. ET, pushing them into negative territory for 2024. These remarks had a cascading down effect and impacted shares of other sector players such as Estee Lauder (EL) and Bath & Body Works (BBWI), which experienced declines of 4.3% and 3% respectively.