Sally Beauty Holdings (SBH) Q1 2026 earnings summary

Executive summary

• Q1 net sales increased 0.6% year-over-year to $943.2 million, with adjusted diluted EPS up 12% to $0.48 and GAAP EPS at $0.45; cash flow from operations was $93 million, supporting $20 million in debt repayment and $21 million in share repurchases.

• Strategic exit from lower-margin full-service operations in Europe to focus on core growth areas.

• Continued investment in digital, product innovation, and store refreshes to drive long-term growth.

• Operating earnings declined 24.3% to $75.9 million, and net earnings decreased 25.3% to $45.6 million, with a positive $8.5 million impact from foreign currency exchange rates.

• The company raised the low end of its FY26 EPS guidance.

Financial highlights

• Consolidated comparable sales were flat year-over-year; Sally U.S. and Canada comps up 1.3%, Sally segment net sales up 1.2% to $531.6 million, BSG segment sales down 0.2% to $411.6 million.

• GAAP gross margin expanded 40 basis points to 51.2%; adjusted gross margin up 50 basis points to 51.3%.

• Q1 adjusted SG&A was $404 million, up $6 million year-over-year, with labor and rent increases partially offset by cost savings.

• Global e-commerce sales grew 11% to $111 million, representing 12% of total net sales.

• Ended quarter with $157 million in cash and no borrowings under the revolver; inventory down 3% year-over-year.

Outlook and guidance

• Raised low end of full-year EPS guidance to $2.02–$2.10; net sales expected at $3.71–$3.77 billion.

• Comparable sales expected flat to up 1% for the year; adjusted operating earnings of $328–$342 million.

• Q2 net sales guidance: $895–$905 million; comparable sales up 0.5–1.5%; adjusted EPS $0.39–$0.42.

• Capital expenditures projected at $100–$200 million; free cash flow at $200 million.

• Management expects existing cash, cash flow from operations, and available credit to be sufficient for working capital and capital expenditures over the next twelve months.