e.l.f. Beauty, Inc. (NYSE:ELF) Q3 2024 Earnings Conference Call February 6, 2024 4:30 PM ET

Company Participants

Kristina Casey Katten - Vice President of Corporate Development and Investor Relations

Tarang Amin - Chairman and Chief Executive Officer

Mandy Fields - Senior Vice President and Chief Financial Officer

Conference Call Participants

Andrea Teixeira - JP Morgan

Ashley Helgans - Jefferies

Olivia Tong - Raymond James

Linda Bolton-Weiser - D.A. Davidson

Bill Chappell - Truist Securities

Dara Mohsenian - Morgan Stanley

Peter Grom - UBS

Susan Anderson - Canaccord Genuity

Anna Lizzul - Bank of America Merrill Lynch

Korinne Wolfmeyer - Piper Sandler

Mark Astrachan - Stifel

Operator

Thank you for joining us today to discuss e.l.f. Beauty's Third Quarter Fiscal ‘24 Results. I'm KC Katten, Vice President of Corporate Development and Investor Relations. With me today are Tarang Amin, Chairman and Chief Executive Officer, and Mandy Fields, Senior Vice President and Chief Financial Officer. We encourage you to tune into our webcast presentation for the best viewing experience, which you can access on our website at investor.elfbeauty.com.

Since many of our remarks today contain forward-looking statements, please refer to our earnings release and reports filed with the SEC where you'll find factors that could cause actual results to differ materially from these forward-looking statements.

In addition, the company's presentation today includes information presented on a non-GAAP basis. Our earnings release contains reconciliations of the differences between the non-GAAP presentation and the most directly comparable GAAP measure.

With that, let me turn the webcast over to Tarang.

Tarang Amin

Thank you, KC, and good afternoon, everyone. Today, we will discuss the drivers of our Q3 results and our raised outlook for fiscal ‘24. I want to start by recognizing the e.l.f. Beauty team for delivering another phenomenal quarter.

In Q3, we grew net sales by 85%, increased gross margin by nearly 350 basis points, and delivered $59 million in adjusted EBITDA, up 61% versus prior year. Our vision is to create a different kind of beauty company by building brands that disrupt norms, shape culture, and connect communities through positivity, inclusivity, and accessibility.

We've executed against this vision and delivered exceptional, consistent category leading growth. Q3 marked our 20th consecutive quarter of net sales growth, putting e.l.f. Beauty in a rarefied group of consistent, high growth consumer companies. We're one of only five public consumer companies out of 274, that has grown for 20 straight quarters and averaged at least 20% sales growth per quarter. Across our business, we've continued to prioritize three areas with significant runway for growth, color cosmetics, skincare and international. Let me update you on our progress in Q3.