E.l.f. Beauty to acquire Hailey Bieber brand Rhode in $1 billion deal

E.l.f. Beauty revealed plans to acquire Hailey Bieber’s beauty brand Rhode in a deal valued at up to $1 billion. The acquisition, E.l.f.’s largest to date, consists of $800 million in cash and stock, with an additional potential $200 million based on Rhode’s performance over the next three years. The deal is set to close in the second quarter of fiscal 2026.

CEO Tarang Amin expressed admiration for Rhode’s rapid growth, going from zero to $212 million in net sales in less than three years with only 10 products. Bieber stated her excitement about partnering with E.l.f. to expand the brand’s reach globally and introduce more innovative products.

Following the acquisition announcement, E.l.f. shares surged 11% as the company exceeded Wall Street’s quarterly estimates. The Goldman Sachs analysts view the deal positively, seeing it as a strategic move to expand E.l.f. into skincare and diversify its customer base.

Launched in 2022, Rhode has experienced significant growth, doubling its customer base and generating $212 million in revenue in the past year. The brand plans to expand into Sephora stores in North America and the U.K. by the end of the year. Bieber will take on the role of Rhode’s chief creative officer and head of innovation.

Under Bieber’s leadership, Rhode became the top skincare brand in earned media value with 367% year-over-year growth. The acquisition aligns with E.l.f.’s focus on skincare and digital marketing strategies.

E.l.f.’s acquisition of Rhode complements its skincare portfolio and targets a higher-income consumer base. Despite challenges such as China tariffs impacting profits, the company remains optimistic about consumer spending on skincare.

E.l.f. reported fiscal fourth quarter results that exceeded analyst expectations. The company’s earnings per share were 78 cents adjusted, higher than the expected 72 cents, while revenue reached $333 million compared to the estimated $328 million.

Despite concerns about slowing growth and tariff impacts, E.l.f. remains focused on innovation and digital marketing strategies to drive sales and engage consumers.