10-Q · May 11, 2026
Sally Beauty Holdings reported Q2 2026 earnings with consolidated net sales of $903 million, slightly exceeding estimates of $901.7 million, and a diluted EPS of $0.43, surpassing expectations of $0.41. The company…
Earnings analysis · 10-Q
SBH earnings analysis
Filed August 3, 2026 · Our reading of the company's report
The latest report
Sally Beauty delivered a modest Q3 sales increase of 0.2% to $935.490 million and a stronger profitability outcome, with diluted EPS up $0.11 year over year to $0.55 and operating margin up 80 bps to 9.2%. Sally segment…
Read full summary
Sally Beauty delivered a modest Q3 sales increase of 0.2% to $935.490 million and a stronger profitability outcome, with diluted EPS up $0.11 year over year to $0.55 and operating margin up 80 bps to 9.2%. Sally segment growth and Fuel for Growth-related product-margin benefits offset a 2.4% BSG sales decline, but flat consolidated comparable sales and a $4.734 million FX tailwind temper the top-line result. Cash generation and liquidity improved, although debt remained $815.0 million and investment spending rose sharply over the first nine months.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.55
What stood out
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EPS and revenue improved sequentially
Q3 net sales increased $2.183 million, or 0.2% year over year, to $935.490 million. This was a sequential improvement from $903 million in fiscal Q2, while diluted EPS rose to $0.55 from $0.44 a year earlier and $0.43 in Q2.
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Margins drove double-digit operating growth
Gross margin expanded 90 bps year over year to 52.4%, lifting operating earnings 10.5% to $86.396 million and operating margin 80 bps to 9.2%. Gross-profit improvement reflected higher product margins associated with Fuel for Growth.
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Sally segment returned to growth
Sally segment sales increased $11.788 million, or 2.2%, to $538.570 million; comparable sales grew 1.6%. Growth in hair color and digital marketplaces, plus a $4.734 million FX benefit, outweighed net store closures.
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Operating cash conversion strengthened
Quarterly operating cash flow increased to $80.9 million from $69.4 million a year ago. For the first nine months, operating cash flow grew to $247.461 million from $153.952 million.
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Liquidity remains ample
Liquidity was $655.5 million at June 30, including $173.1 million of cash and cash equivalents and $482.4 million of available ABL borrowing capacity; the company reported no ABL borrowings during the nine months.
What to watch
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BSG demand remains weak
BSG sales declined $9.605 million, or 2.4%, to $396.920 million, with comparable sales down 2.1%. Management attributes the decline principally to hair-care softness, fewer transactions, and fewer units per transaction.
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Sales growth depended on currency
Reported consolidated sales growth of $2.183 million included a $4.734 million favorable FX impact, while consolidated comparable sales were flat. This indicates underlying top-line momentum remains limited despite margin gains.
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Leverage remains significant
Debt principal outstanding was $815.0 million at June 30, consisting of $600.0 million of 2032 Senior Notes and $215.0 million of Term Loan B, versus $173.1 million in cash and equivalents.
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Capital spending increased materially
Cash used in investing activities increased to $84.257 million for the first nine months from $12.940 million a year ago, driven in part by a $25 million increase in capital expenditures for the new headquarters and Sally Ignited store investments.
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No formal risk-factor update
The filing states there were no material changes to risk factors from the fiscal 2025 10-K. Nonetheless, the store base declined by 39 locations year over year to 4,386, reflecting continued footprint rationalization.
Management's outlook
The 10-Q does not provide quantitative forward revenue or EPS guidance. Management states that existing cash, expected operating cash flow, and ABL availability are anticipated to be sufficient for working-capital and capital-expenditure requirements over the next 12 months.
Earlier filings 4
10-Q · August 5, 2025
Sally Beauty reported quarterly net sales of $933,307,000 (down $9,033,000 vs. $942,340,000 in Q3 FY24) while operating earnings rose to $78,173,000 (from $71,770,000) and diluted EPS increased to $0.44 (from $0.36).…
10-Q · August 8, 2024
Sally Beauty reported three-month net sales of $942,340 (three months ended June 30, 2024), up $11,332 versus the prior year but with operating earnings down to $71,770 from $90,125 year-over-year. Gross profit was…
10-Q · May 9, 2024
Sally Beauty reported quarterly net sales of $908,361,000, down $10,351,000 from $918,712,000 a year earlier, with gross profit of $463,072,000 (≈50.96% margin) and operating earnings of $59,574,000 (6.56% margin).…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.