e.l.f. Beauty, Inc.

Thank you for joining us to discuss Elf Beauty's second quarter fiscal 2022 results. I'm Melinda Freed, Head of Corporate Communications. With me are Tarang Amin, Chairman and Chief Executive Officer, and Mandy Fields, Senior Vice President and Chief Financial Officer. We encourage you to tune into our webcast presentation for the best viewing experience, which you can access on our website at investor.elfbeauty.com. Since many of our remarks today contain forward-looking statements, please refer to our earnings release and reports filed with the SEC, where you'll find factors that could cause actual results to differ materially from these forward-looking statements. In addition, the company's presentation includes information presented on a non-GAAP basis. Our earnings release contains reconciliations of these differences between the non-GAAP presentation and the most directly comparable GAAP measure. With that, let me turn the webcast over to Turing.

Thank you, Melinda, and good afternoon, everyone. Today, we'll discuss the drivers of our Q2 results as well as our raised outlook for fiscal 2022. I want to start by recognizing our Elf Beauty team. We delivered another terrific quarter. Q2 net sales of $92 million were up 27% versus a year ago, marking our 11th consecutive quarter of net sales growth. We delivered adjusted EBITDA of $18 million, up 29% versus a year ago. With the momentum we're seeing, we're raising our full-year sales guidance, which Mandy will discuss shortly. Our products are resonating in our digitally-led strategy. core value proposition and ability to adapt at ELF speed continue to fuel our performance. In Q2, color cosmetics category trends were slightly below 2019 pre-pandemic levels, with COVID-related volatility offsetting pent-up demand and stepped-up levels of innovation. We're significantly outperforming our competitors in this backdrop, underscoring the strength of the ELF business model. In Q2, ELF was again the only top five color cosmetics brand to post retail sales growth above 2019 levels. ELF continued to gain market share with 5.6% of the category, up 30 basis points year over year, and was the only top five color cosmetics brand to grow share above pre-pandemic levels by a wide margin. Strategic extensions continue to be an important part of our evolution into a differentiated, multi-brand beauty company. We're encouraged by the progress we're making with Well People and Key Soul Care as we build brand awareness. We recently launched Well People's first skincare collection, expanding our product range in the largest category of clean beauty. We also completed our first consumer insight study for Key Soul Care that showed strong consumer response to our product quality, giving us increased confidence in the long-term opportunity as we accelerate trial and awareness for this brand. Our relentless focus on our five strategic imperatives is driving results across our brand portfolio. Let me provide a few highlights from the quarter. Our first strategic imperative is to drive brand demand. We continue to find innovative ways to engage and entertain our community, moving beyond traditional beauty boundaries. We joined forces with recording artist Tara Wack to launch our new Big Mood mascara. Mascara is the largest segment within cosmetics and a significant white space opportunity for e.l.f. With the launch of Big Mood, we're offering big, bold, and beautiful lashes at an incredible price point. Big Mood is priced at just $7 compared to higher priced top five mascaras. We're encouraged by the early results we're seeing with Big Mood. Big Mood is the number one selling eye product on e.l.fcosmetics.com since launch. And it also won the coveted Allure Best of Beauty 2021 Award for Best Mascara Beauty Steel. Also during the quarter, we enjoyed a pop culture moment with our brand debut on the game show Jeopardy.

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