Sally Beauty Holdings Reports First Quarter Fiscal 2026 Results
PLANO, Texas--( BUSINESS WIRE)--Sally Beauty Holdings, Inc. (NYSE: SBH) (the “Company”), the leader in professional hair color, today announced financial results for its first quarter ended December 31, 2025. The Company will hold a conference call today at 7:30 a.m. Central Time to discuss these results and its business.
“Our first quarter performance marks a strong start to fiscal 2026,” said Denise Paulonis, president and chief executive officer. “We achieved top line results that met our expectations, maintained healthy gross margins and delivered adjusted EPS growth of 12% - consistent with our long-term financial algorithm. Our robust cash flow from operations enabled us to invest for growth, reduce debt and return value to shareholders. We also made continued progress on our strategic initiatives designed to accelerate growth and increase profitability.”
Fiscal 2026 First Quarter Summary
Balance Sheet and Cash Flow
As of December 31, 2025, the Company had cash and cash equivalents of $157 million and no outstanding borrowings under its asset-based revolving line of credit. At fiscal year-end, inventory was $979 million, down 2.7% versus a year ago.
First quarter cash flow from operations was $93 million and Free Cash Flow totaled $57 million. During the first quarter, the Company utilized its cash flow to repay $20 million of term loan B debt and repurchase 1.4 million shares under its share repurchase program at an aggregate cost of $21 million. The Company ended the first quarter with a net debt leverage ratio of 1.5x.
Fiscal 2026 First Quarter Segment Results
$
531,601
$
525,446
1.2
%
$
411,567
$
412,449
(0.2
)%
0.1
%
1.7
%
(0.2
)%
1.4
%
59.8
%
59.6
%
40.2
%
39.7
%
$
77,897
$
79,874
(2.5
)%
$
53,907
$
50,469
6.8
%
14.7
%
15.2
%
13.1
%
12.2
%
Fiscal Year 2026 Guidance*
$895 million to $905 million (1)
Up 0.5% to 1.5%
$68 million to $71 million
$0.39 to $0.42
*
The Company does not provide a reconciliation for forward-looking non-GAAP financial measures where it is unable to provide a meaningful or accurate calculation or estimation of its reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the occurrence and the financial impact of various items that have not yet occurred, are out of the Company’s control or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.
Conference Call and Where You Can Find Additional Information
The Company will hold a conference call and live webcast at approximately 7:30 a.m. Central Time today, February 9, 2026, to discuss its financial results and its business. During the conference call, the Company may discuss and answer one or more questions concerning business and financial matters and trends affecting the Company. The Company’s responses to these questions, as well as other matters discussed during the conference call, may contain or constitute material information that has not been previously disclosed.
Participants can listen to the live webcast of the conference call by accessing the investor relations section of the Company’s website at sallybeautyholdings.com/investor-relations/events-and-presentations/events-calendar, or through our third-party host at SBH Q1 Earnings Webcast. To join the conference call, participants can pre-register to receive a dial-in number and unique PIN using the following link: Pre-register SBH Q1 Earnings Call. Pre-registration can be completed at any time up to and following the call start time.
A replay will be available on the Company’s investor relations website after 10:00 a.m. Central Time on February 9, 2026, through February 9, 2027.
About Sally Beauty Holdings, Inc.
Sally Beauty Holdings, Inc. (NYSE: SBH), as the leader in professional hair color, sells and distributes professional beauty supplies globally through its Sally Beauty and Beauty Systems Group segments. Sally Beauty stores offer up to 7,000 products for hair color, hair care, nails, and skin care through proprietary brands such as Ion®, Bondbar®, Strawberry Leopard®, Generic Value Products®, Inspired by Nature® and Silk Elements® as well as professional lines such as Wella®, Clairol®, OPI®, L’Oreal®, Wahl® and Babyliss Pro®. Beauty Systems Group stores, branded as Cosmo Prof® or Armstrong McCall® stores, along with its outside sales consultants, sell up to 8,000 professionally branded products including Paul Mitchell®, Wella®, Matrix®, Schwarzkopf®, Kenra®, Goldwell®, Joico®, Amika® and Moroccanoil®, intended for use in salons and for resale by salons to retail consumers. For more information about Sally Beauty Holdings, Inc., please visit sallybeautyholdings.com/investor-relations.
Cautionary Notice Regarding Forward-Looking Statements
Statements in this news release and the schedules hereto that are not purely historical facts or that depend upon future events may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, can be identified by the use of words such as “believes,” “projects,” “expects,” “can,” “may,” “estimates,” “should,” “plans,” “targets,” “intends,” “could,” “will,” “would,” “anticipates,” “potential,” “confident,” “optimistic,” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, guidance, expectations and future plans. Forward-looking statements can also be identified by the fact that these statements do not relate strictly to historical or current matters.
Readers are cautioned not to place undue reliance on forward-looking statements as such statements speak only as of the date they were made. Any forward-looking statements involve risks and uncertainties that could cause actual events or results to differ materially from the events or results described in the forward-looking statements, including the “Risk Factors” described under Item 1A of our Annual Report on Form 10-K for the fiscal year ended September 30, 2025, and other filings with the U.S. Securities and Exchange Commission. Consequently, all forward-looking statements in this release are qualified by the factors, risks and uncertainties contained therein. We assume no obligation to publicly update or revise any forward-looking statements.
Use of Non-GAAP Financial Measures
This news release and the schedules hereto include the following financial measures that have not been calculated in accordance with accounting principles generally accepted in the United States, (“GAAP”), and are therefore referred to as non-GAAP financial measures: (1) Adjusted Gross Margin; (2) Adjusted Selling, General and Administrative Expenses; (3) Adjusted EBITDA and EBITDA Margin; (4) Adjusted Operating Earnings and Operating Margin; (5) Adjusted Net Earnings; (6) Adjusted Diluted Net Earnings Per Share; and (7) Free Cash Flow. We have provided definitions below for these non-GAAP financial measures and have provided tables in the schedules hereto to reconcile these non-GAAP financial measures to the comparable GAAP financial measures.
Adjusted Gross Margin – We define the measure Adjusted Gross Margin as GAAP gross margin excluding the inventory write-off from the Company’s European operations in connection with the fuel for growth initiative for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures.
Adjusted Selling, General and Administrative Expenses – We define the measure Adjusted Selling, General and Administrative Expenses as GAAP selling, general and administrative expenses excluding the costs related to the Company’s fuel for growth initiative and expenses related to the Company’s corporate headquarters relocation for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures.
Adjusted EBITDA and EBITDA Margin – We define the measure Adjusted EBITDA as GAAP net earnings before depreciation and amortization, interest expense, income taxes, share-based compensation, costs related to the Company’s fuel for growth initiative and expenses related to the Company’s corporate headquarters relocation for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures. Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of net sales.
Adjusted Operating Earnings and Operating Margin – Adjusted operating earnings are GAAP operating earnings that exclude the costs related to the Company’s fuel for growth initiative and expenses related to the Company’s corporate headquarters relocation for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures. Adjusted Operating Margin is Adjusted Operating Earnings as a percentage of net sales.
Adjusted Net Earnings – Adjusted net earnings is GAAP net earnings that exclude the tax-effected costs related to the Company’s fuel for growth initiative and tax-effected expenses related to the Company’s corporate headquarters relocation for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures.
Adjusted Diluted Net Earnings Per Share – Adjusted diluted net earnings per share is GAAP diluted earnings per share that exclude the tax-effected costs related to the Company’s fuel for growth initiative and tax-effected expenses related to the Company’s corporate headquarters relocation for the relevant time periods as indicated in the accompanying non-GAAP reconciliations to the comparable GAAP financial measures.
Free Cash Flow – We define the measure Free Cash Flow as GAAP net cash provided by operating activities less payments for capital expenditures (net). We believe Free Cash Flow is an important liquidity measure that provides useful information to investors about the amount of cash generated from operations after taking into account payments for capital expenditures (net).
We believe that these non-GAAP financial measures provide valuable information regarding our earnings and business trends by excluding specific items that we believe are not indicative of the ongoing operating results of our businesses, providing a useful way for investors to make a comparison of our performance over time and against other companies in our industry.
We have provided these non-GAAP financial measures as supplemental information to our GAAP financial measures and believe these non-GAAP measures provide investors with additional meaningful financial information regarding our operating performance and cash flows. Our management and Board of Directors also use these non-GAAP measures as supplemental measures to evaluate our businesses and the performance of management, including the determination of performance-based compensation, to make operating and strategic decisions, and to allocate financial resources. We believe that these non-GAAP measures also provide meaningful information for investors and securities analysts to evaluate our historical and prospective financial performance. These non-GAAP measures should not be considered a substitute for or superior to GAAP results. Furthermore, the non-GAAP measures presented by us may not be comparable to similarly titled measures of other companies.
Supplemental Schedules
Segment Information
1
Non-GAAP Financial Measures Reconciliations
2
Non-GAAP Financial Measures Reconciliations; Adjusted EBITDA and
Free Cash Flow
3
Store Count and Comparable Sales
4
2025
2024
$
943,168
$
937,895
0.6
%
459,909
461,055
(0.2
)%
483,259
476,840
1.3
%
407,324
376,520
8.2
%
75,935
100,320
(24.3
)%
14,620
17,442
(16.2
)%
61,315
82,878
(26.0
)%
15,758
21,865
(27.9
)%
$
45,557
$
61,013
(25.3
)%
$
0.47
$
0.60
(21.7
)%
$
0.45
$
0.58
(22.4
)%
97,804
102,021
100,765
104,974
51.2
%
50.8
%
40
43.2
%
40.1
%
310
8.1
%
10.7
%
(260
)
25.7
%
26.4
%
(70
)
SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
December 31
September 30
2025
2025
$
157,185
$
149,162
104,267
116,562
978,789
987,575
45,444
48,154
1,285,685
1,301,453
280,350
284,284
642,276
646,698
593,929
593,692
48,538
44,969
$
2,850,778
$
2,871,096
$
4,000
$
4,000
208,481
224,507
158,576
184,641
157,102
158,566
14,011
4,260
542,170
575,974
842,531
861,974
537,594
538,426
21,985
21,026
82,933
79,489
2,027,213
2,076,889
823,565
794,207
$
2,850,778
$
2,871,096
2025
2024
Percentage
Change
$
531,601
$
525,446
1.2
%
411,567
412,449
(0.2
)%
$
943,168
$
937,895
0.6
%
$
77,897
$
79,874
(2.5
)%
53,907
50,469
6.8
%
131,804
130,343
1.1
%
55,869
30,023
86.1
%
14,620
17,442
(16.2
)%
$
61,315
$
82,878
(26.0
)%
2025
2024
59.8
%
59.6
%
20
40.2
%
39.7
%
50
14.7
%
15.2
%
(50
)
13.1
%
12.2
%
90
8.1
%
10.7
%
(260
)
$
459,909
$
(907
)
$
—
$
459,002
51.2
%
51.3
%
407,324
(1,180
)
(1,833
)
404,311
43.2
%
42.9
%
75,935
2,087
1,833
79,855
8.1
%
8.5
%
14,620
—
—
14,620
61,315
2,087
1,833
65,235
15,758
529
471
16,758
$
45,557
$
1,558
$
1,362
$
48,477
$
0.47
$
0.02
$
0.01
$
0.50
$
0.45
$
0.02
$
0.01
$
0.48
$
461,055
$
—
$
—
$
461,055
50.8
%
50.8
%
376,520
(4,869
)
26,640
398,291
40.1
%
42.5
%
100,320
4,869
(26,640
)
78,549
10.7
%
8.4
%
17,442
—
—
17,442
82,878
4,869
(26,640
)
61,107
21,865
1,247
(6,851
)
16,261
$
61,013
$
3,622
$
(19,789
)
$
44,846
$
0.60
$
0.04
$
(0.19
)
$
0.44
$
0.58
$
0.03
$
(0.19
)
$
0.43
2025
2024
Percentage
Change
$
45,557
$
61,013
(25.3
)%
23,632
25,565
(7.6
)%
14,620
17,442
(16.2
)%
15,758
21,865
(27.9
)%
99,567
125,885
(20.9
)%
7,555
6,053
24.8
%
2,087
4,869
(57.1
)%
1,833
(26,640
)
106.9
%
$
111,042
$
110,167
0.8
%
11.8
%
11.7
%
10
2025
2024
$
93,239
$
33,459
178.7
%
35,784
20,078
78.2
%
—
43,574
—
$
57,455
$
56,955
0.9
%
2025
2024
3,090
3,123
(33
)
1,194
1,199
(5
)
131
131
—
1,325
1,330
(5
)
4,415
4,453
(38
)
590
639
(49
)
2025
2024
0.1
%
1.7
%
(160
)
(0.2
)%
1.4
%
(160
)
0.0
%
1.6
%
(160
)