Sally Beauty Holdings Reports Second Quarter Fiscal 2026 Results

Sally Beauty Holdings Reports Second 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 second quarter ended March 31, 2026. The Company will hold a conference call today at 7:30 a.m. Central Time to discuss these results and its business.

“Our second quarter results reflect solid execution and the resilience of our operating model amid a dynamic macroeconomic environment,” said Denise Paulonis, president and chief executive officer. “We delivered low-single digit sales growth, gross margin expansion, and strong cash flow from operations, driven by the compounding benefits of our growth initiatives. As we enter the second half of fiscal 2026, we remain confident in our full-year outlook and believe the Company is positioned to deliver consistent, profitable growth and shareholder value over the long-term.”

Fiscal 2026 Second Quarter Summary

Balance Sheet and Cash Flow

As of March 31, 2026, 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 $987 million, down 2% versus a year ago.

Second quarter cash flow from operations was $73 million and Free Cash Flow totaled $44 million. During the quarter, the Company utilized its cash flow to repay $20 million of term loan B debt and repurchase 1.7 million shares under its share repurchase program at an aggregate cost of $25 million. The Company ended the second quarter with a net debt leverage ratio of 1.5x.

Fiscal 2026 Second Quarter Segment Results

521,236

500,575

4.1%

382,146

382,571

(0.1)%

2.5

(0.3

280 bps

(0.3

(2.7

240 bps

61.3

61.2

10 bps

40.9

39.8

110 bps

78,149

77,305

1.1%

47,368

43,934

7.8%

15.0

15.4

(40) bps

12.4

11.5

90 bps

Fiscal Year 2026 Guidance*

Prior FY26 Guidance

Updated FY26 Guidance

$3.71 billion to $3.77 billion

$3.725 billion to $3.750 billion (1)

Flat to up 1%

No change

$328 million to $342 million

No change

$2.02 to $2.10 (2)

No change

Approximately $100 million

No change

Approximately $200 million

No change

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, May 11, 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 Q2 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 Q2 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 May 11, 2026, through May 11, 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 costs related to the Company’s 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, expenses related to the Company’s corporate headquarters relocation, and asset impairment charges 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, expenses related to the Company’s corporate headquarters relocation, and asset impairment charges 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, expenses related to the Company’s corporate headquarters relocation, and asset impairment charges 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, tax-effected expenses related to the Company’s corporate headquarters relocation, and tax-effected asset impairment charges 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, tax-effected expenses related to the Company’s corporate headquarters relocation, and tax-effected asset impairment charges 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

Non-GAAP Financial Measures Reconciliations

2-3

Non-GAAP Financial Measures Reconciliations; Adjusted EBITDA and

Free Cash Flow

Store Count and Comparable Sales

SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(In thousands, except per share data)

(Unaudited)

Three Months Ended March 31,

Six Months Ended March 31,

2026

2025

Percentage Change

2026

2025

Percentage Change

903,382

883,146

2.3

1,846,550

1,821,041

1.4

427,610

424,329

0.8

887,519

885,384

0.2

475,772

458,817

3.7

959,031

935,657

2.5

403,841

389,444

3.7

811,165

765,964

5.9

71,931

69,373

3.7

147,866

169,693

(12.9

14,165

16,289

(13.0

28,785

33,731

(14.7

57,766

53,084

8.8

119,081

135,962

(12.4

15,071

13,874

8.6

30,829

35,739

(13.7

42,695

39,210

8.9

88,252

100,223

(11.9

0.44

0.39

12.8

0.91

0.98

(7.1

0.43

0.38

13.2

0.88

0.96

(8.3

96,727

101,614

97,271

101,820

99,721

104,435

100,265

104,682

52.7

52.0

51.9

51.4

44.7

44.1

43.9

42.1

180

8.0

7.9

8.0

9.3

(130

)

26.1

—

25.9

26.3

(40

)

March 31

September 30

2026

2025

157,401

149,162

101,632

116,562

986,787

987,575

46,940

48,154

1,292,760

1,301,453

285,335

284,284

635,406

646,698

590,436

593,692

49,353

44,969

2,853,290

2,871,096

4,000

222,635

224,507

169,800

184,641

157,050

158,566

—

4,260

553,485

575,974

823,051

861,974

531,987

538,426

21,080

21,026

85,815

79,489

2,015,418

2,076,889

837,872

794,207

2,853,290

2,871,096

Supplemental Schedule 1

SALLY BEAUTY HOLDINGS, INC. AND SUBSIDIARIES

Segment Information

(In thousands)

(Unaudited)

Three Months Ended March 31,

Six Months Ended March 31,

2026

2025

Percentage Change

2026

2025

Percentage Change

521,236

500,575

4.1

1,052,837

1,026,021

2.6

382,146

382,571

(0.1

793,713

795,020

(0.2

903,382

883,146

2.3

1,846,550

1,821,041

1.4

78,149

77,305

1.1

156,046

157,179

(0.7

47,368

43,934

7.8

101,275

94,403

7.3

125,517

121,239

3.5

257,321

251,582

2.3

53,586

51,866

3.3

109,455

81,889

33.7

14,165

16,289

(13.0

28,785

33,731

(14.7

57,766

53,084

8.8

119,081

135,962

(12.4

2026

2025

Basis Point Change

2026

2025

Basis Point Change

61.3

61.2

60.5

60.4

40.9

39.8

110

40.5

39.7

15.0

15.4

(40

)

14.8

15.3

(50

)

12.4

11.5

12.8

11.9

8.0

7.9

8.0

9.3

(130

)

Supplemental Schedule 2

427,610

(811

)

—

426,799

52.7

52.8

403,841

(281

)

(19

)

403,541

44.7

71,931

1,092

73,042

8.0

8.1

57,766

1,092

58,877

15,071

277

15,353

42,695

815

43,524

0.44

0.01

0.00

0.45

0.43

0.01

0.00

0.44

424,329

—

424,329

52.0

389,444

(3,807

)

(207

)

(1,779

)

383,651

44.1

43.4

69,373

3,807

207

1,779

75,166

7.9

8.5

53,084

3,807

207

1,779

58,877

13,874

976

445

15,348

39,210

2,831

154

1,334

43,529

0.39

0.03

0.00

0.01

0.43

0.38

0.03

0.00

0.01

0.42

Supplemental Schedule 3

887,519

(1,718

)

—

885,801

51.9

52.0

811,165

(1,461

)

(1,852

)

807,852

43.9

43.7

147,866

3,179

1,852

152,897

8.0

8.3

119,081

3,179

1,852

124,112

30,829

806

476

32,111

88,252

2,373

1,376

92,001

0.91

0.02

0.01

0.95

0.88

0.02

0.01

0.92

885,384

—

885,384

51.4

765,964

(8,676

)

26,433

(1,779

)

781,942

42.1

42.9

169,693

8,676

(26,433

)

1,779

153,715

9.3

8.4

135,962

8,676

(26,433

)

1,779

119,984

35,739

2,222

(6,797

)

444

31,608

100,223

6,454

(19,636

)

1,335

88,376

0.98

0.06

(0.19

)

0.01

0.87

0.96

0.06

(0.19

)

0.01

0.84

Supplemental Schedule 4

Three Months Ended March 31,

Six Months Ended March 31,

2026

2025

Percentage Change

2026

2025

Percentage Change

42,695

39,210

8.9

88,252

100,223

(11.9

25,280

25,359

(0.3

48,912

50,924

(4.0

14,165

16,289

(13.0

28,785

33,731

(14.7

15,071

13,874

8.6

30,829

35,739

(13.7

97,211

94,732

2.6

196,778

220,617

(10.8

5,969

4,238

40.8

13,524

10,291

31.4

1,092

3,807

(71.3

3,179

8,676

(63.4

207

(90.8

1,852

(26,433

)

107.0

—

1,779

(100.0

—

1,779

(100.0

104,291

104,763

(0.5

215,333

214,930

0.2

11.5

11.9

(40

)

11.7

11.8

(10

)

2026

2025

Percentage Change

2026

2025

Percentage Change

73,280

51,062

43.5

166,519

84,521

97.0

29,162

18,893

54.4

64,946

38,971

66.7

—

43,574

(100.0

44,118

32,169

37.1

101,573

89,124

14.0

As of March 31,

2026

2025

Change

3,079

3,117

(38

)

1,189

1,198

)

131

—

1,320

1,329

)

4,399

4,446

(47

)

560

632

(72

)

Three Months Ended March 31,

Six Months Ended March 31,

2026

2025

Basis Point Change

2026

2025

Basis Point Change

Sally

2.5

(0.3

280

1.3

0.8

BSG

(0.3

(2.7

240

(0.2

(0.6

Consolidated

1.3

(1.3

260

0.6

0.2