Sally Beauty Holdings, Inc. reported a slight increase in financial performance for the third quarter of fiscal 2026, with consolidated net sales rising by $2.2 million, or 0.2%, to $935.5 million compared to the same period last year. The company attributed this growth to a favorable impact of $4.7 million from foreign currency exchange rates, although comparable sales remained flat. Gross profit for the quarter increased by $9.3 million, or 1.9%, to $490.2 million, resulting in a gross margin improvement of 90 basis points to 52.4%. Operating earnings also saw an increase of $8.2 million, or 10.5%, reaching $86.4 million, while net earnings rose by $8.4 million, or 18.3%, to $54.1 million.
In terms of year-to-date performance, for the nine months ended June 30, 2026, net sales increased by $27.7 million, or 1.0%, totaling $2.78 billion. The growth was driven by a $38.6 million increase in net sales from the Sally segment, primarily due to strong performance in hair color and digital marketplaces, despite challenges in the hair care category and strategic exits from certain European markets. Conversely, the BSG segment experienced a decline in net sales of $10.9 million, attributed to decreased comparable sales and lower transaction volumes.
Operationally, Sally Beauty's total number of stores decreased by 39 to 4,386 as of June 30, 2026, reflecting a strategic focus on optimizing store performance. The company reported a cash balance of $173.1 million and available liquidity of $655.5 million, which includes $482.4 million available under its asset-based lending facility. The company also executed a share repurchase program, buying back 4.9 million shares for $71.4 million during the nine months, compared to 3.3 million shares for $33.0 million in the prior year.
Looking ahead, Sally Beauty anticipates that its existing cash balances, operational cash flow, and available funds under its ABL Facility will be sufficient to meet its working capital and capital expenditure needs over the next twelve months. The company remains focused on its "Fuel for Growth" initiative, which aims to enhance product margins and operational efficiency, despite facing challenges in certain product categories and market conditions. The effective tax rate for the quarter was reported at 25.6%, down from 26.8% in the prior year, reflecting the impact of previous divestitures.
About Sally Beauty Holdings, Inc.
Sally Beauty Holdings, Inc. is a global retailer and distributor of professional beauty supplies, specializing in hair color, care, styling tools, nails, and cosmetics. Operating through retail stores, e-commerce, and wholesale channels, it serves both consumers and salon professionals. The company emphasizes product innovation, owned brands, customer education, and a strong digital presence to differentiate in a competitive, fragmented industry.
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