elf-20260630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

_______________________________________________________________

FORM 10-Q

_______________________________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2026


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from ______ to ______

Commission File Number: 001-37873

_______________________________________________________________

e.l.f. Beauty, Inc.

(Exact name of registrant as specified in its charter)

_______________________________________________________________


Delaware						46-4464131
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


601 12th Street, 14th Floor
Oakland,	CA	94607

(Address of principal executive offices)(Zip code)

_______________________________________________________________


(510)			778-7787

(Registrant’s telephone number, including area code)

_______________________________________________________________


Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	ELF	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐

Non- accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The number of shares of the registrant’s common stock, par value $0.01 per share, outstanding as of July 30, 2026 was 59,007,996 shares.

CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains forward-looking statements within the meaning of the federal securities laws concerning our business, operations and financial performance and condition, as well as our plans, objectives and expectations for our business operations and financial performance and condition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “positioned,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements are based on management's current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management’s beliefs and assumptions and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. Although we believe that the expectations reflected in the forward-looking statements contained herein are reasonable, our actual results and the timing of selected events may differ materially. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under Part II, Item 1A. “Risk factors” and elsewhere in this Quarterly Report. Potential investors are urged to consider these factors carefully in evaluating the forward-looking statements. These forward-looking statements speak only as of the date of this Quarterly Report. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

SUMMARY OF MATERIAL RISKS ASSOCIATED WITH OUR BUSINESS

The principal risks and uncertainties affecting our business include the following:

•The beauty industry is highly competitive, and if we are unable to compete effectively our results will suffer.

•Our new product introductions may not be as successful as we anticipate.

•Any damage to our reputation or brands may materially and adversely affect our business, financial condition and results of operations.

•Our success depends, in part, on the quality, performance and safety of our products.

•We may not be able to successfully implement our growth strategy.

•Our growth and profitability are dependent on a number of factors, and our historical growth may not be indicative of our future growth.

•We may be unable to continue to grow our business effectively or efficiently, which would harm our business, financial condition and results of operations.

•We have significant operations in China, which exposes us to risks inherent in doing business in that country.

•Changes in the US and international trade policies, including tariffs (and uncertainty related to the enforceability and implementation thereof), trade restrictions and retaliatory trade measures taken by other countries and resulting trade wars may have a material adverse impact on our business, financial condition and results of operations.

•A disruption in our operations, including a disruption in the supply chain for our products, could materially and adversely affect our business.

•We rely on a number of third-party suppliers, manufacturers, distributors and other vendors, and they may not continue to produce products or provide services that are consistent with our standards or applicable regulatory requirements, which could harm our brands, cause consumer dissatisfaction, and require us to find alternative suppliers of our products or services.

•Adverse economic conditions in the United States or any of the other countries in which we conduct significant business could negatively affect our business, financial condition and results of operations.

•We depend on a limited number of retailers for a large portion of our net sales, and the loss of one or more of these retailers, or business challenges at one or more of these retailers, could adversely affect our results of operations.

•We are subject to international business uncertainties.

•Acquisitions or investments could disrupt our business and harm our financial condition.

•If we are unable to protect our intellectual property, the value of our brands and other intangible assets may be diminished, and our business may be adversely affected.

•Our success depends on our ability to operate our business without infringing, misappropriating or otherwise violating the trademarks, patents, copyrights and other proprietary rights of third parties.

The summary risk factors described above should be read together with the text of the full risk factors below in the section titled “Risk factors” and the other information set forth in this Quarterly Report, including our unaudited condensed consolidated financial statements and the related notes, as well as in other documents that we file with the US Securities and Exchange Commission (the “SEC”). The risks summarized above or described in the section titled “Risk factors” are not the only risks that we face. Additional risks and uncertainties not precisely known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, results of operations and future growth prospects.

e.l.f. Beauty, Inc.

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PART I. FINANCIAL INFORMATION			5
Item 1. Financial statements (unaudited)			5
Condensed consolidated balance sheets			5
Condensed consolidated statements of operations			6

Condensed consolidated statements of comprehensive income			7
Condensed consolidated statements of stockholders’ equity			8
Condensed consolidated statements of cash flows			9
Notes to condensed consolidated financial statements (unaudited)			10

Item 2. Management’s discussion and analysis of financial condition and results of operations			24

Item 3. Quantitative and qualitative disclosures about market risk			30

Item 4. Controls and procedures			30

PART II. OTHER INFORMATION			31

Item 1. Legal proceedings			31

Item 1A. Risk factors			31

Item 2. Unregistered sales of equity securities and use of proceeds			64

Item 3. Defaults upon senior securities			64

Item 4. Mine safety disclosures			64

Item 5. Other information			65

Item 6. Exhibits			66

SIGNATURES			67

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PART I. FINANCIAL INFORMATION

Item 1. Financial statements (unaudited)

e.l.f. Beauty, Inc. and subsidiaries

Condensed consolidated balance sheets

(unaudited)

(in thousands, except share and per share data)


	June 30, 2026		March 31, 2026		June 30, 2025
Assets
Current assets:
Cash and cash equivalents	$	344,241	$	289,685	$	170,029
Accounts receivable, net	174,529		174,644		173,352
Inventory, net	246,814		220,246		170,379
Prepaid expenses and other current assets	94,257		104,792		88,766
Total current assets	859,841		789,367		602,526
Property and equipment, net	39,692		41,496		39,182
Intangible assets, net	541,976		553,110		203,348
Goodwill	853,475		853,475		340,582
Other assets	165,665		156,710		129,258
Total assets	$	2,460,649	$	2,394,158	$	1,314,896

Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	30,000	$	30,000	$	—
Current portion of contingent consideration	28,240		26,227		—
Accounts payable	95,918		97,467		74,603
Accrued expenses and other current liabilities	183,498		182,470		110,136
Total current liabilities	337,656		336,164		184,739
Long-term debt	801,996		809,348		256,676
Long-term contingent consideration	52,589		38,522		—
Deferred tax liabilities	6,208		6,197		17,009
Long-term operating lease obligations	89,659		69,928		50,351
Other long-term liabilities	3,651		3,469		1,269
Total liabilities	1,291,759		1,263,628		510,044

Commitments and contingencies (Note 7)

Stockholders' equity:
Common stock, par value of $0.01 per share; 250,000,000 shares authorized as of June 30, 2026, March 31, 2026 and June 30, 2025; 58,936,996, 59,089,708 and 56,734,903 shares issued and outstanding as of June 30, 2026, March 31, 2026 and June 30, 2025, respectively	589		590		566
Additional paid-in capital	1,256,706		1,284,987		952,015
Accumulated other comprehensive income	925		882		1,207
Accumulated deficit	(89,330)		(155,929)		(148,936)
Total stockholders' equity	1,168,890		1,130,530		804,852
Total liabilities and stockholders' equity	$	2,460,649	$	2,394,158	$	1,314,896

The accompanying notes are an integral part of these condensed consolidated financial statements.

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e.l.f. Beauty, Inc. and subsidiaries

Condensed consolidated statements of operations

(unaudited)

(in thousands, except share and per share data)


	Three months ended June 30,
		2026		2025
Net sales		$	479,373	$	353,739
Cost of sales		80,533		109,198
Gross profit		398,840		244,541
Selling, general and administrative expenses		280,319		195,832
Change in fair value of contingent consideration		16,080		—

Operating income		102,441		48,709
Other (expense) income, net		(331)		5,037

Interest expense, net		(7,808)		(2,632)

Income before provision for income taxes		94,302		51,114
Income tax provision		(27,703)		(17,803)
Net income		$	66,599	$	33,311

Net income per share:
Basic		$	1.13	$	0.59
Diluted		$	1.12	$	0.58
Weighted average shares outstanding:
Basic		59,144,587		56,328,483
Diluted		59,727,575		57,675,035

The accompanying notes are an integral part of these condensed consolidated financial statements.

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e.l.f. Beauty, Inc. and subsidiaries

Condensed consolidated statements of comprehensive income

(unaudited)

(in thousands)


	Three months ended June 30,
		2026		2025
Net income		$	66,599	$	33,311
Other comprehensive income, net of tax
Foreign currency translation adjustment		43		686
Other comprehensive income, net of tax		43		686
Comprehensive income		$	66,642	$	33,997

The accompanying notes are an integral part of these condensed consolidated financial statements.

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e.l.f. Beauty, Inc. and subsidiaries

Condensed consolidated statements of stockholders’ equity

(unaudited)

(in thousands, except share data)


	Common stock			Additional paid-in capital		Accumulated other comprehensive income		Accumulated deficit		Total stockholders' equity
	Shares	Amount
Balance as of March 31, 2026	59,089,708	$	590	$	1,284,987	$	882	$	(155,929)	$	1,130,530
Net income	—	—		—		—		66,599		66,599
Stock-based compensation	—	—		19,678		—		—		19,678
Exercise of stock options and vesting of restricted stock	747,351	8		2,014		—		—		2,022
Repurchase of common stock	(900,063)	(9)		(49,973)		—		—		(49,982)
Foreign currency translation adjustment	—	—		—		43		—		43
Balance as of June 30, 2026	58,936,996	$	589	$	1,256,706	$	925	$	(89,330)	$	1,168,890


	Common stock			Additional paid-in capital		Accumulated other comprehensive income		Accumulated deficit		Total stockholders' equity
	Shares	Amount
Balance as of March 31, 2025	55,730,037	$	556	$	942,025	$	521	$	(182,247)	$	760,855
Net income	—	—		—		—		33,311		33,311
Stock-based compensation	—	—		9,879		—		—		9,879
Exercise of stock options and vesting of restricted stock	1,004,866	10		111		—		—		121
Foreign currency translation adjustment	—	—		—		686		—		686
Balance as of June 30, 2025	56,734,903	$	566	$	952,015	$	1,207	$	(148,936)	$	804,852

The accompanying notes are an integral part of these condensed consolidated financial statements.

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e.l.f. Beauty, Inc. and subsidiaries

Condensed consolidated statements of cash flows

(unaudited)

(in thousands)


	Three months ended June 30,
	2026		2025
Cash flows from operating activities:
Net income	$	66,599	$	33,311
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	26,101		13,192
Non-cash lease expense	3,196		2,843
Stock-based compensation expense	19,677		9,868
Amortization of debt issuance costs and discount on debt	473		134
Deferred income taxes	1,782		14,216




Change in fair value of contingent consideration	16,080		—
Other, net	2		911
Changes in operating assets and liabilities:
Accounts receivable	198		(46,170)
Inventory	(26,524)		18,684
Prepaid expenses and other assets	8,202		(16,332)
Accounts payable and accrued expenses	(2,429)		(1,542)
Other liabilities	(1,692)		(1,882)
Net cash provided by operating activities	111,665		27,233

Cash flows from investing activities:

Purchase of property and equipment	(1,431)		(7,095)

Other, net	(240)		(464)
Net cash used in investing activities	(1,671)		(7,559)

Cash flows from financing activities:



Repayment of long-term debt	(7,500)		—

Repurchase of common stock	(49,982)		—
Cash received from issuance of common stock	2,022		121




Net cash (used in) provided by financing activities	(55,460)		121

Effect of exchange rate changes on cash and cash equivalents	22		1,542

Net increase in cash and cash equivalents	54,556		21,337
Cash and cash equivalents - beginning of period	289,685		148,692
Cash and cash equivalents - end of period	$	344,241	$	170,029

The accompanying notes are an integral part of these condensed consolidated financial statements.

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e.l.f. Beauty, Inc. and subsidiaries

Notes to condensed consolidated financial statements (unaudited)

Note 1—Nature of operations

e.l.f. Beauty, Inc., a Delaware corporation (“e.l.f. Beauty” and together with its subsidiaries, the “Company”), is a multi-brand beauty company that offers inclusive, accessible, clean, vegan and cruelty free cosmetics and skin care products. The Company's mission is to make the best of beauty accessible to every eye, lip and face.

The Company believes its ability to deliver cruelty free, clean, vegan and premium-quality products at accessible prices with broad appeal differentiates it in the beauty industry. Further, the Company believes the combination of its passionate team of owners, value proposition, powerhouse innovation, disruptive marketing engine and productivity model have positioned it well to navigate the competitive beauty market.

The Company’s family of brands consists of e.l.f. Cosmetics, e.l.f. SKIN, e.l.f. Hair, rhode, Naturium and Well People. The Company’s brands are available online and across leading beauty, mass-market and specialty retailers. The Company has strong relationships with its retail customers such as Target, Walmart, Amazon, Sephora and other leading retailers that have enabled the Company to expand distribution both domestically and internationally.

Note 2—Summary of significant accounting policies

Basis of presentation

The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with US generally accepted accounting principles (“US GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Company, these interim financial statements contain all adjustments, including normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2026, March 31, 2026 and June 30, 2025, and its results of operations and stockholders' equity for the three months ended June 30, 2026 and June 30, 2025 and its cash flows for the three months ended June 30, 2026 and June 30, 2025. All intercompany balances and transactions have been eliminated in consolidation.

These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2026 (the “Annual Report”). Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year.

Use of estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Fair Value Measurements

Accounting Standards Codification (“ASC”) 820, Fair Value Measurement ("ASC 820") defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:

Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs, which rely on the reporting entity’s assumptions when there is little or no market data.

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The Company performs valuations of assets acquired and liabilities assumed in acquisitions accounted for as a business combination and recognizes the assets acquired and liabilities assumed at their acquisition-date fair value. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. For additional information on fair value measurement as part of our acquisition of rhode, see Note 3, “Acquisition,” in these Notes to our unaudited condensed consolidated financial statements.

Property and equipment and other assets

Property and equipment is stated at cost and is depreciated on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or the useful lives of the assets. Repairs and maintenance expenditures are expensed as incurred.

Useful lives by major asset class are as follows:


			Estimated useful lives
Machinery, equipment and software			2 - 5 years
Leasehold improvements			up to 10 years
Furniture and fixtures			3 - 5 years
Store fixtures			1 - 3 years

As of June 30, 2026 and June 30, 2025, included in other assets are retail product displays, net, of $68.2 million and $68.9 million, respectively, that are generally amortized over a period of three years. Amortization expense for retail product displays was $10.7 million and $7.6 million for the three months ended June 30, 2026 and June 30, 2025, respectively.

As of June 30, 2026 and June 30, 2025, included in prepaid expenses and other current assets are internal-use software costs related to cloud applications, net, of $64.5 million and $56.3 million, respectively, that are generally amortized over a period of three years. Amortization expenses for internal-use software costs related to cloud applications was $4.4 million and $1.6 million for the three months ended June 30, 2026 and June 30, 2025, respectively.

Segment reporting

Operating segments are components of an enterprise for which separate financial information is available that is evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources and in assessing performance. Utilizing these criteria, the Company manages its business on the basis of one operating segment and one reportable segment. It is impracticable for the Company to provide revenue by product line.

The Company’s CODM, who is the Chief Executive Officer, assesses performance of the segment and decides how to allocate resources based on consolidated net income as reported on the statements of operations. The CODM reviews measures of segment profits or loss by comparing budgeted versus actual and forecasted results, for purposes of assessing performance, allocating resources and making decisions. See Note 13, “Segment information,” in these Notes to unaudited condensed consolidated financial statements for additional information about the Company’s reported segment revenue, significant segment expenses and segment net income.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

The following table provides disaggregated revenue from contracts with customers by geographical market, as the nature, amount, timing and uncertainty of revenue and cash flows can differ between domestic and international customers (in thousands).


	Three months ended June 30,
Net sales by geographic region:		2026		2025
United States		$	368,045	$	284,609
International		111,328		69,130
Total net sales		$	479,373	$	353,739

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Significant accounting policies

The Company made no material changes in the application of its significant accounting policies that were disclosed in Note 2, “Summary of significant accounting policies,” to the audited consolidated financial statements as of and for the fiscal year ended March 31, 2026 included in the Annual Report.

Business combinations

The purchase price of a business acquisition is allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the business combination date. The excess of purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Determining fair value of identifiable assets, particularly intangibles, and liabilities acquired also requires the Company to make estimates, which are based on all available information and in some cases assumptions with respect to the timing and amount of future revenues and expenses associated with an asset. Unanticipated events or circumstances may occur that could affect the accuracy of the Company’s fair value estimates, and under different assumptions, the resulting valuations could be materially different.

Costs that are incurred to complete the business combination, such as legal and other professional fees, are not considered as a part of consideration transferred and are charged to selling, general and administrative expense as they are incurred.

Contingent Consideration

In connection with the acquisition of rhode, the Company recorded a liability at fair value for the contingent consideration potentially payable to the sellers of rhode subject to achievement of certain earnout thresholds, with a maximum payment of $200.0 million. The Company expects to pay contingent consideration (if due and owing) annually within 45 days after each measurement period ending September 30, 2026, 2027, and 2028 in which the earnout milestones are achieved. The fair value of the liability is estimated using discounted future cash flows based on a Monte Carlo simulation methodology using significant level 3 inputs such as forecasts of revenue. The Company evaluates the fair value of the contingent consideration each reporting period and adjusts the carrying value as new information becomes available. See Note 3, “Acquisition,” in these Notes to unaudited condensed consolidated financial statements.

Revenue recognition

The Company distributes products both through national and international retailers, as well as direct-to-consumers through its e-commerce channel and other e-commerce retailers. The marketing and consumer engagement benefits that the direct-to-consumer channel provides are integral to the Company’s brand and product development strategy and drive sales across channels. As such, the Company views its two primary distribution channels as components of one integrated business, as opposed to discrete revenue streams.

The Company sells a variety of beauty products but does not consider them to be meaningfully different revenue streams given similarities in the nature of the products, the target consumer and the innovation and distribution processes. See “Segment reporting” section above for the table providing disaggregated revenue from contracts with customers by geographical market, as the nature, amount, timing and uncertainty of revenue and cash flows can differ between domestic and international customers.

As of June 30, 2026, other than accounts receivable, the Company had no material contract assets, contract liabilities or deferred contract costs recorded on its unaudited condensed consolidated balance sheet.

Recent accounting pronouncements

New accounting pronouncements issued but not yet adopted

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). The standard requires additional disclosures in the notes to financial statements of specified information about certain costs and expenses included in the captions presented on the face of the income statement. The new guidance is effective for the Company’s annual reporting period beginning April 1, 2027, and interim reporting periods beginning April 1, 2028. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively and early adoption is permitted. The Company expects ASU 2024-03 to only impact its disclosures with no impacts to the Company’s results of operations, cash flows, or financial condition.

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In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to modernize the outdated guidance for accounting for software costs by aligning the accounting with how software is developed today. The new guidance is effective for the Company’s annual and interim reporting periods beginning April 1, 2028. Early adoption is permitted. The amendments in this ASU should be applied either prospectively, retrospectively, or utilizing a modified transition approach. The Company is in the process of analyzing the impact of the ASU on its consolidated financial statements and related disclosures.

Note 3—Acquisition

On August 5, 2025 (the “acquisition date”), the Company consummated the acquisition of rhode, the fast-growing, multi-category lifestyle beauty brand founded by Hailey Bieber known for its collection of high-performance, skin-focused products (the “rhode Acquisition”). The rhode Acquisition is built upon both brands' shared focus on disruption, community connection and product innovation, and furthers the Company’s penetration within skin care. The rhode Acquisition was completed pursuant to the Agreement and Plan of Merger, by and among the Company, e.l.f. Cosmetics, Inc., Glaze Merger Sub, LLC (“Merger Sub”), HRBeauty LLC (“rhode”), the sellers identified therein, and David Levin (as the sellers’ representative), dated May 28, 2025 (the “Merger Agreement”). Pursuant to the terms of, and subject to the conditions specified in, the Merger Agreement, Merger Sub merged with and into rhode (the “Merger”), and upon consummation of the Merger, Merger Sub ceased to exist and rhode became a wholly owned subsidiary of e.l.f. Cosmetics, Inc. Upon the consummation of the Merger and the other transactions contemplated by the Merger Agreement, all outstanding limited liability company interests of rhode were cancelled and converted into the right to receive the consideration. The rhode Acquisition was accounted for as a business combination using the acquisition method of accounting, which requires certain assets acquired and liabilities assumed to be recognized at the estimated fair values as of the date of the rhode Acquisition. The total purchase price of $897.5 million consisted of cash, shares of the Company’s common stock, and a potential earnout. The following table summarizes the preliminary allocation of purchase price to the assets acquired and liabilities assumed (in thousands):


Cash consideration			$	590,149
Equity consideration (common stock issued)(1)			300,278
Valuation of potential earnout			7,100
Total consideration			897,527
Net assets acquired, excluding liability assumed for acquisition-related seller expenses	$	431,734
Liability assumed for acquisition-related seller expenses(2)	(47,100)
Less: Net assets acquired			(384,634)
Goodwill			$	512,893

(1) The fair market value of the $300.3 million common stock issued (equivalent to 2,582,371 shares of common stock) was determined on the basis of the opening market price of the Company’s stock of $116.28 per share on the acquisition date.

(2) In connection with the rhode Acquisition, the Company paid rhode’s acquisition-related expenses of $47.1 million recognized as an assumed liability at the acquisition date. The Company determined these amounts represented assumed liabilities of the sellers at the acquisition date, as the Company bore no legal obligation to the related vendors prior to closing.

The Company incurred and expensed acquisition transaction costs of $0.2 million and $3.6 million during the three months ended June 30, 2026 and June 30, 2025, respectively. These costs are included as a component of selling, general and administrative expenses in the condensed consolidated statements of operations.

The purchase price allocation, deferred tax calculations and residual goodwill were finalized during the quarter ended June 30, 2026. rhode’s results of operations have been included in the Company's condensed consolidated financial statements from the acquisition date.

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The following table presents the purchase price allocation recorded in the Company's condensed consolidated balance sheet on the acquisition date and upon finalization during the quarter ended June 30, 2026. The adjustment reflects finalization of purchase accounting for facts and circumstances that existed upon the acquisition date as follows (in thousands):


Cash	$	8,467
Accounts receivable	30,036
Inventory	39,568
Prepaid expenses and other current assets	2,392
Property and equipment	2,098
Intangible assets	380,900
Goodwill(1)	512,893
Total assets acquired	976,354
Accounts payable