From Tariff Burden to Tariff Refunds—and a New Pricing Playbook
E.L.F. Beauty is shifting how it handles trade costs, moving from quietly absorbing tariffs to actively sharing newfound savings with shoppers. After joining other beauty companies in legal challenges to double-digit levies, the company now expects an estimated USD 58.5 million (approx. RM270 million) in one-time tariff refunds. Rather than treating this as pure profit, Chair and CEO Tarang Amin has outlined plans to “reinvest” the windfall into value and unit growth, reinforcing E.L.F.’s long-running promise of everyday affordability. Previously, elevated tariffs—reported at 55% last year and assumed at 35% this year—pushed E.L.F. to raise prices by about USD 1 (approx. RM4.60) per product across much of its range. The incoming refunds create room to unwind some of those increases, giving the brand fresh flexibility to respond to cost-conscious consumers without sacrificing its growth trajectory.
Halo Glow Price Drop: The Test That Changed the Strategy
The turning point in E.L.F.’s new approach came from a single star product: Halo Glow Skin Tint. In a controlled test, E.L.F. trimmed the price from USD 18 (approx. RM83) to USD 14 (approx. RM65). The result was immediate and powerful—a nearly 40% lift in units sold across retailers, including fast-growing channels like TikTok Shop. That surge effectively validated what the brand has long believed: sharp value is a growth engine, not a margin liability. Amin called E.L.F. a “test-and-learn” company, and Halo Glow became the proof-of-concept that price cuts could expand the pie rather than simply shrinking revenue per item. With this data in hand, leadership gained the confidence to extend reductions to additional product families, using tariff refunds as a financial buffer while they push harder on volume and market share.
What’s Getting Cheaper: E.L.F. Cosmetics and Rhode Lead the Rollback
Building on the Halo Glow price drop, E.L.F. is now applying rollbacks more broadly across its portfolio, with a focus on E.L.F. Cosmetics and Hailey Bieber’s Rhode. While the company has not yet disclosed line-by-line cuts, Amin has confirmed that multiple “families” of products are being targeted over the coming weeks to drive unit growth. E.L.F. Cosmetics already spans everything from a USD 3 (approx. RM14) lip liner to a USD 59 (approx. RM272) brush set, and the brand is selectively dialing back earlier USD 1 (approx. RM4.60) tariff-induced increases where the volume upside looks strongest. Rhode, which contributed USD 113 million (approx. RM520 million) in net sales in the latest quarter and USD 500 million (approx. RM2.3 billion) in global retail sales for the year, is also set to benefit from the new value focus. For shoppers, that means more E.L.F. cosmetics savings and budget beauty deals on some of the most in-demand items in mass beauty.
Why Consumers Win Now: Passing Tariff Refunds Straight to Shoppers
E.L.F.’s move marks a strategic pivot in how companies handle tariff-related windfalls. Instead of quietly booking tariff refunds as a one-off profit boost, E.L.F. is explicitly using the money to lower prices and defend its value reputation at a time when customers are stretched by higher gas, grocery, and general living costs. This stands in contrast to the earlier period when the company responded to steep tariffs with across-the-board price hikes. The new tack directly addresses consumer frustration, especially after class action suits asked whether tariff refunds should go back to shoppers. By translating tariff refunds in cosmetics into visible E.L.F. beauty price cuts, the brand is signaling that it sees value not just as marketing language, but as a core competitive lever in a tougher spending climate. The practical takeaway: buyers get more product for their money, without waiting for temporary promotions.
Competitive Stakes in the Budget Beauty Battle
Beyond immediate savings, E.L.F.’s strategy sends a message to the wider beauty industry. The company just posted its 29th consecutive quarter of net sales growth, with quarterly net sales reaching USD 449.3 million (approx. RM2.1 billion), yet it still anticipates slower growth ahead, particularly for E.L.F. Cosmetics. Cutting prices now is a proactive way to retain momentum and consolidate its position as a go-to brand for budget beauty deals. As shoppers become more cautious, any brand that can offer prestige-like formulas at lower prices has an edge. By redirecting an estimated USD 58.5 million (approx. RM270 million) into pricing and unit growth, E.L.F. is doubling down on that edge. Competitors that keep tariffs savings to themselves risk looking out of step with value-conscious buyers, while E.L.F. frames its tariffs journey as a proof point of its everyday great value promise.