When e.l.f. Beauty announced in May 2025 that it had acquired Hailey Bieber’s rhode for an enterprise value of up to $1 billion, industry reactions were sharply divided. Many industry experts viewed the transaction as mutually beneficial: e.l.f. could give rhode international distribution, and rhode could give e.l.f. its first prestige brand and a golden ticket into Sephora. But the skeptics questioned whether it was ludicrous to pay $1 billion for a three-year-old company, particularly one centered completely around its celebrity founder. What would happen if Bieber’s popularity waned?
Instead, the company will hit the one-year anniversary of its rhode acquisition this month with a record-breaking report card.
When rhode launched at Sephora North America in September 2025, it quickly became the top-selling skincare brand, selling three rhode products every second, according to the company.
rhode's November 2025 debut at Sephora UK was the largest launch in Sephora UK history, outperforming the previous record holder by five times, according to the company.
e.l.f. silenced the naysayers Wednesday on its first-quarter fiscal 2027 results call, when the company announced it had exceeded Wall Street expectations, growing net sales 36% year over year to $479.4 million, with rhode accounting for approximately $160 million in sales. The company also forecasted its full-year revenue growth rate to increase 18% to 20%, a range between $1.94 billion and $1.97 billion.
“We believe rhode could be the fastest beauty brand to achieve $1 billion in net sales,” Tarang Amin, Chairman and Chief Executive Officer of e.l.f. Beauty, said during the call. He cited strong international demand, noting rhode's Sephora launch across 19 European countries this September as the first step in a broader global expansion. “If you take a look at Hailey's followers or rhode's followers, I think over 70% of them are outside the US. We've been hearing plenty of signals of pent-up demand, and Sephora would love to have this brand in every one of their doors globally, but we're going to sequence it one step at a time,” Amin said.
This past quarter, which ended June 30, Bieber and rhode demonstrated the gravity of their power and reach when the brand’s latest summer product launch drove $27 million of DTC sales in a single day. “To put that in perspective, we often talk about Nielsen tracking 1,800 cosmetics and skincare brands. rhode did in one day more than what 98% of those brands do in an entire year,” said Amin. “We acquired 90,000 new consumers that day, while also seeing strong repeat purchases, with over 70% of sales coming from existing consumers.”
Amin also said that the company is excited about Naturium’s planned expansion to Sephora in Mexico and Canada. And according to Circana and Nielsen data, e.l.f.-acquired Naturium is the fastest-growing skincare brand among the top 50.
In the last three months of the quarter, e.l.f. Beauty received approximately $50 million in tariff refunds, which boosted its net income and increased its adjusted EBITDA roughly 93%. Despite the huge bump, shares traded lower after hours as investors weighed the one-time nature of the tariff refunds alongside underlying operating trends.
“The tariff funds will be fully reinvested in both pricing, to have a superior value proposition, as well as increased marketing across our entire portfolio of brands,” Amin said in an interview. “We feel we never should have had the tariffs to begin with, so let’s invest in our brands to drive the strength that we see.” While much of the funding is earmarked for marketing, e.l.f. Beauty intends to reverse or eliminate the tariff surcharge.
e.l.f’s core collection, which makes up 70% of sales, declined as per the company’s prediction. Amin acknowledged the sluggish volume trends and a 3% decline in unit volumes for the quarter alongside high single-digit sales declines. But, he was optimistic about the core brand’s new haircare line, a collection of six products all priced under $10, which was introduced in June of this year.
Nearly every concern surrounding e.l.f.'s rhode acquisition centered on whether a celebrity-founded brand could sustain its early momentum. One year later, the debate has shifted. Investors are no longer asking whether rhode can grow; they're asking just how big it can become. The bigger question for e.l.f. now is whether rhode's momentum and renewed investment in its core business can translate into durable growth across the broader portfolio.
