Ulta Beauty (ULTA) The 44th Annual William Blair Growth Stock Conference summary

Macro and industry environment

• Consumer confidence is pressured by economic uncertainty and cultural dynamics, leading to more cautious spending.

• Beauty remains a healthy, emotionally resonant category with consistent growth, though recent growth has moderated from post-pandemic highs.

• Competitive intensity is at unprecedented levels, with over 1,000 new physical distribution points added in two years.

• Despite headwinds, positive indicators include increased brand awareness, loyalty, and e-commerce share gains.

Competitive landscape and market share

• Held share in total beauty for Q1 and 2023, with gains in prestige e-commerce.

• Pressure is most acute in prestige makeup and hair care within brick-and-mortar stores due to new competitors.

• Confident in regaining share over time, leveraging experience with competitive store openings.

• Loyalty program growth and engagement are key to long-term share gains.

Loyalty program and omnichannel strategy

• Loyalty program has nearly 44 million active members, driving over 95% of sales and enabling personalized engagement.

• Omnichannel guests spend 2.5 to 3 times more than store-only shoppers.

• Initiatives focus on increasing share of wallet through cross-channel and cross-category engagement.

• Online channel represents about 20% of sales, with high single-digit comp growth and strong traffic.