Ulta Beauty sees sales climbing, leaning into wellness and chasing Gen Z and Millennial self-care trends with more shelf space, in-demand brands and an upcoming invite-only online marketplace
Ulta Beauty added some serious sparkle in Q2, but the real glow comes from its wellness ambitions.
The beauty retailer beat Wall Street expectations, with net sales climbing 9.3% to $2.79 billion. Ulta also raised its full-year outlook to $12.0 to $12.1 billion, with growth across every major category. In particular, sales in the skin care and wellness category rose in the high single digits. But the message that popped? CEO Kecia Steelman, who took the helm earlier this year, emphasized just how central wellness has become to Ulta’s strategy.
It’s one that has already taken shape inside Ulta stores. Earlier this month, the beauty retailer revealed a major expansion of The Wellness Shop, growing its in-store wellness footprint to roughly 370 locations and plans to introduce new elevated fixtures in 50 additional stores in the third quarter.
The buildout, driven by consumer demand for everything from recovery tech to supplements to feminine and intimate wellness products, brings in names like Ritual, Therabody, Nutrafol, Revive Collagen, Vital Proteins, Rael, Mary Ruth’s, Bloom, aromatherapy brand Saje Natural Wellness, Scarlet by Red Drop and more. Joining them is the wellness-centric and Gwyneth Paltrow-founded Goop Beauty, which has entered 800 of Ulta’s stores. In line with the experiential retail push, Ulta is planning classes, pop-ups and other in-store activations with several of the brands.
Steelman also noted that wellness performance was boosted by the launch of brands like feminine health company Honey Pot and colostrum leader Armra, along with new products from supplements and Kourtney Kardashian Barker’s Lemme. Even with several popular names already on its shelves, she emphasized that wellness is more than a side category.
“We do believe in the long term that wellness can be a billion-dollar business over time,” she told analysts during Thursday’s earnings call, noting that the wellness market was about $410 billion in 2024 and is growing faster than beauty.
And if you’ve spent any time in an Ulta lately, you’ll notice the crowd is suddenly skewing younger, at times almost comically so, a reflection of Gen Z’s affinity for beauty and wellness. It’s also likely fueled in part by #GRWM clips on TikTok, short “get ready with me” videos where users share their wellness routine or apply makeup while talking through their day or whatever is on their mind.
Consumer data backs up the shift. A recent Bread Financial and Ulta Beauty survey found that 74% of consumers prioritize self-care and wellness in their beauty rituals, with younger generations leading the charge. Gen Z, in particular, is redefining beauty as self-expression: more than half (52%) use products to showcase their identity and style, while 43% say they find joy in getting ready with friends. Even in a somewhat shaky economy, consumer spending in the category has proven resilient, according to Bread Financial. It’s perhaps a sign of the “lipstick effect” at play: a theory that shoppers may cut back on big-ticket items but still splurge on affordable luxuries like skincare, makeup, or wellness products as feel-good boosters.
That dynamic helps explain why Ulta is showing up everywhere Gen Z and Millennials are, with activations at Coachella and Lollapalooza, where festival goers could stop in for a glow-up or hair tinseling, and serving as the official beauty retail partner of Beyoncé’s Cowboy Carter tour.
Beyond in-person events, Ulta is also broadening its digital reach, with an invitation-only online marketplace set to launch in the third quarter featuring both established and emerging brands.
“We’re focused on leveraging our position as a trusted leader to expand more meaningfully into wellness,” Steelman said. “Our goal is to establish ourselves as a one-stop shop for relevant products to support living a well-balanced lifestyle through improvements to the mind, body and spirit.”
