Shares of e.l.f. Beauty (NYSE: ELF) surged more than 33% intraday to $120.81 following the announcement of its acquisition of rhode, a fast-growing lifestyle beauty brand founded by Hailey Bieber. The deal, valued at $1 billion, marks a significant move by e.l.f. Beauty to deepen its presence in the prestige skincare market and broaden its retail partnerships.
The transaction includes $800 million in consideration payable at closing, split between $600 million in cash and $200 million in newly issued e.l.f. Beauty stock, subject to customary adjustments. An additional earnout of up to $200 million is contingent on rhode’s growth over the next three years. The purchase price at closing represents roughly 3.8 times rhode’s last twelve months net sales of $212 million, which ended March 31, 2025.
Founded on Bieber’s skincare philosophy of “one of everything really good,” rhode has quickly made a name for itself with multitasking, high-performance products designed to deliver visible results. The brand’s direct-to-consumer business has more than doubled its consumer base in the past year, reflecting strong demand for its innovative formulations and marketing approach. rhode’s products are currently sold online, with plans to debut in Sephora stores across North America and the U.K. later this year.
e.l.f. Beauty’s CEO, Tarang Amin, highlighted the alignment between the two brands’ focus on disruption and innovation. He described rhode as a “like-minded disruptor” that complements e.l.f.’s mission to democratize beauty by making prestige products more accessible. This acquisition expands e.l.f.’s footprint in the prestige channel, following its earlier skin care brand launches and the 2023 acquisition of Naturium.
Hailey Bieber will continue as rhode’s Founder and take on expanded roles as Chief Creative Officer and Head of Innovation, overseeing creative direction, product development, and marketing. She will also serve as a Strategic Advisor to the combined company. Bieber’s influence as a cultural tastemaker and beauty influencer has been instrumental in rhode’s rapid rise, with the brand achieving the top spot in Earned Media Value in 2024, growing 367% year over year.
Co-Founders Michael D. Ratner and Lauren Ratner, along with CEO Nick Vlahos, will remain at the helm of rhode, operating from its Los Angeles headquarters. Their continued leadership aims to preserve the brand’s entrepreneurial spirit and growth momentum.
The acquisition is backed by fully committed debt financing of $600 million. Some shares issued to founders and key employees will be subject to a one-year lock-up period. The deal has received approval from e.l.f. Beauty’s board and is expected to close in the second quarter of fiscal 2026, pending regulatory approvals.
This move further diversifies e.l.f. Beauty’s portfolio beyond its core cosmetics brand, which holds the No. 1 position in units sold across U.S. cosmetics and ranks second in dollar share. The company’s skin care segment has been growing steadily, and rhode’s addition accelerates its entry into prestige retail, particularly through Sephora, a global leader in beauty retail.
The market responded enthusiastically to the news, with e.l.f. Beauty’s stock reaching an intraday high of $120.81 before settling back. This reflects investor confidence in the company’s strategy to leverage innovative brands and expand its global reach.
e.l.f. Beauty continues to emphasize its commitment to inclusivity, accessibility, and sustainability. Its product lines are clean, vegan, cruelty-free, and Fair Trade Certified™, reinforcing its mission to make quality beauty products available to a broad audience.
As the beauty industry evolves, e.l.f. Beauty’s acquisition of rhode positions it to capitalize on the growing demand for prestige skincare products that combine performance with a strong cultural and community connection. The partnership with Bieber and the rhode team is expected to drive significant growth and innovation in the years ahead.
