For the third quarter, Ulta Beauty easily exceeded Wall Street profit and revenue estimates as lesser COVID-19 concerns helped boost sales, and it launched initiatives that included launching operations at Target stores.
Net income came in at $215.3 million, or $3.94 per diluted share, versus $74.8 million, or $1.32 per diluted share, in the 2020 quarter.
The company topped a MarketBeat-published analyst consensus earnings estimate of $2.51 per diluted share and a sales estimate of $1.88 billion.
Net income reported for the third quarter in the year past included a one-time adjustment to $92.5 million, or $1.64 per diluted share.
Comparable sales gained 25.8% in the quarter year over year, Ulta stated. A 16.8% increase in transactions and a 7.7% increase in average ticket drove the comp increase, the company noted. Versus the 2019 third quarter, comps increased 14.3%.
Net sales increased 28.6% from the 2020 quarter to $2 billion. Fewer concerns and restrictions relating the COVID-19 pandemic versus the 2020 third quarter helped boost sales, according to Ulta. Operating income increased to $284.2 million from $101.3 million in the year-previous period.
In a conference call, Dave Kimbell, Ulta CEO, said four initiatives launched or advanced in the third quarter deserved some emphasis. Ulta debuted its Beauty to Go guarantee, which promised that buy online, pick up in-store orders would be ready to go within two hours or less. He related that, during the third quarter, BOPIS orders increased 28% year over year to reach 20% of e-commerce sales versus 16% in the year-prior period.
Also, Ulta partnered with DoorDash, on the launch of same-day delivery in Atlanta, Boston, Chicago, Los Angeles, Houston and Boise. Then, in October, Ulta launched two exclusive salon services in all stores and relaunched skin services in select stores. In addition, Ulta rolled out at 92 Target stores in the quarter and has since hit its initial goal of initiating operations at 100 Target locations.
In delivering the financial results, Kimbell said, “For the third quarter, we delivered record sales and earnings, increased our market share and expanded our Ultamate Rewards loyalty program to nearly 36 million members. This strong third-quarter performance reflects the strength and resiliency of the beauty category, the power of the Ulta Beauty differentiated model, and the impact of our winning culture and team.”