Quick Facts
- Global beauty and personal care revenue is projected at $698.38 billion in 2026, growing at a 3.16% annual rate through 2031.
- U.S. prestige beauty sales rose 7% to $17.1 billion in the first half of 2026, but unit demand is flat or declining in several categories.
- Coty reported a 5% like-for-like sales decline and a 26% drop in adjusted EBITDA for Q4, while Ulta Beauty posted 11.1% net sales growth in the same period.
The global beauty industry is growing. But not every company is growing with it. Earnings reports from the first half of 2026 show a widening split between brands capturing demand and those losing ground to more selective consumers.
The global beauty and personal care market is projected to generate $698.38 billion in revenue in 2026, according to industry data. McKinsey reports the sector grew roughly 7% annually from 2022 to 2024, outpacing most consumer goods categories. NielsenIQ’s State of Beauty 2026 report puts global market growth at 10% year-over-year, with e-commerce expanding six times faster than in-store sales.
In the United States, the market leads globally at $107 billion. Circana data shows prestige retail beauty sales climbed 7% to $17.1 billion in the first six months of the year, while mass retail beauty rose 7% to $39.2 billion. But underneath those numbers, unit sales are flat or falling in several categories as higher prices drive revenue growth.
The Winners
Ulta Beauty posted net sales of $3.16 billion, up 11.1% year-over-year. Comparable sales grew 5.3%, improving from 2.9% in the year-ago quarter. Earnings per share climbed 15.5% to $7.74, beating analyst consensus of $6.90. The company launched more than 20 new brands during the quarter, including Rare Beauty, and its fragrance category grew from 11% to 12% of total revenue.
CEO Kecia Steelman credited broad-based growth across all channels and noted that Ulta’s new TikTok Shop launch contributed to results. The company also completed its acquisition of Space NK during the period.
Estee Lauder is showing signs of recovery. CEO Stephane de La Faverie said organic sales rose 3% for fiscal 2026, with the fourth consecutive quarter of accelerating growth at 5%. The company is betting on premium fragrances and China demand to sustain momentum. De La Faverie acknowledged a harder truth: “We have had 10 years of market share loss in the US.”
Puig reported net revenue of 2.354 billion euros in the first half of 2026, up 4.4% on a like-for-like basis. Adjusted EBITDA rose 3.2% to 460 million euros. Carolina Herrera led prestige fragrance performance, Byredo posted double-digit growth in niche fragrances, and Charlotte Tilbury drove makeup gains. Asia-Pacific was Puig’s fastest-growing region at 20.9%.
Unilever upgraded its full-year 2026 outlook after a strong first half. The company now expects underlying sales growth in the second half to land within its 4% to 6% guidance range rather than at the bottom end, and anticipates a modest improvement in underlying operating margin versus its 20% margin in 2025.
The Losers
Coty reported a 5% like-for-like sales decline for fiscal 2026. Adjusted EBITDA fell 26% year-over-year in Q4 and 22% for the full year. While the prestige market grew roughly 6% in the second half and mass beauty grew 5%, Coty’s prestige sellout declined 1% and its Consumer Beauty sellout fell 2%.
Coty management said consumers are “increasingly selective,” with some trading up to premium products and others seeking more accessible options. Coty is not winning either segment.
E.l.f. Beauty is facing a different problem. The company plans to roll back some tariff-driven price increases after unit sales slowed. CEO Tarang Amin told CNBC that consumers pulled back in response to higher prices, putting the company in a difficult position between protecting margins and sustaining volume.
What Operators Should Watch
The NielsenIQ report found that 49% of consumers now receive generative AI recommendations and 53% purchase beauty products through social platforms. Discovery and conversion are shifting fast. Ulta’s TikTok Shop launch is one early data point showing retailers moving to meet consumers where they are.
Fragrance is the standout growth category across multiple companies this cycle. Brands without a meaningful fragrance presence are missing the sector’s strongest current driver.
As Business of Fashion and McKinsey noted, beauty’s era of effortless growth is ending. Companies that cannot win on premium positioning or price accessibility are getting squeezed from both ends.
