Q2 net income +84% to $118.0M on $118.0M tariff refunds; sales -2.3% as transformation costs rise

Filed August 26, 2026 · Period ending August 1, 2026 · Compared to 10-Q Aug 28, 2025 · ~1 min read

Key Changes

• high

  Net income rose 84.4% to $118M (diluted EPS +93.3% to $0.58) driven by ~$80M of IEEPA tariff refunds boosting gross margin 440bp to 45.7%, partially offset by a 2.3% sales decline to $1.51B on lower store transactions.

  MD&A: Operating Results verify on EDGAR →
• medium

  Consumer First Formula transformation plan incurred $17M in costs year-to-date, with marketing spend up $18M (to 4.7% of sales) to attract younger consumers through Ulta/Amazon expansion and digital investment.

  MD&A: Business Transformation Activities verify on EDGAR →
• medium

  Company suspended share repurchases (zero in H1 2026 vs. $256M in H1 2025) and repurchased $284M of 2027 Notes plus $250M of 2029 Notes, shifting capital allocation toward debt reduction.

  MD&A: Capital Allocation & Notes: Debt Repurchase verify on EDGAR →