By Anuja Bharat Mistry and Arriana McLymore
June 2 (Reuters) - Cosmetics retailer Ulta Beauty raised annual profit forecast on Tuesday, betting that leaner inventory-related losses and resilient demand for high-priced products will help counter rising costs tied to store expansion and marketing.
Defying the global luxury slowdown, Ulta Beauty saw strong sales across its stores, driven by affluent and young shoppers splurging on trendy and higher-margin fragrance and skincare brands. Its shares jumped
7% in extended trading.
"From a market-share perspective, we gained share in prestige beauty, and we were roughly flat in mass beauty," CEO Kecia Steelman said on the post-earnings call.
Comparable sales rose 5.3% during the quarter ended May 2, versus a 2.9% increase a year ago. Analysts were expecting sales to increase 4.5%, according to data compiled by LSEG.
Ulta Beauty has also introduced celebrity-owned brands such as Rihanna's Fenty Beauty, Selena Gomez's Rare Beauty and Beyonce's Cecred to further resonate with consumers.
"The company continues to outperform other beauty retailers, such as department stores," said David Swartz, analyst at Morningstar.
Ulta Beauty expects full-year earnings per share to be between $28.36 and $28.80, compared with its prior forecast of $28.05 to $28.55.
It posted first-quarter earnings per share of $7.74, topping analysts' estimate of $6.86.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Shilpi Majumdar)
