• by Sarah Mahoney  @mahoney_sarah, March 13, 2017

With other retailers staggering and stumbling, Ulta Beauty is continuing its red-hot roll, announcing a 17% jump in same-store sales, more store openings and the addition of M.A.C. Cosmetics. 

The inclusion of the M.A.C. line adds to the mostly suburban retailer’s successful “high-low” strategy, which has helped it stay ahead of not only the rapidly growing Sephora, but online retailers, as well. 

For the fiscal fourth quarter, Ulta says total sales jumped 25% to $1.58 billion, up from $1.27 billion. Sales from e-commerce rose 63.4% to $154.9 million. Net income climbed 28% to $409.8 million.

While mass chains, department stores and specialty retailers have been struggling, Ulta’s “All Things Beauty, All in One Place” positioning keeps winning it new fans. Stores include salons, where business grew 15.2% to $241.1 million in the quarter, as well as in-store facials and brow services.

“Not only has the company posted yet another record-breaking set of results but, across most metrics, it has managed to notch up sequential improvements from an already high benchmark,” writes Carter Harrison, an analyst who follows the company for GlobalData Retail, in reaction to Ulta’s strong quarter. “Our consumer data shows that beauty is, essentially, a local business. Shoppers do not want to travel long distances, and Ulta offers a range of in-store beauty services and a level of customer service that cannot be replicated online.”

With close to 1,000 stores in 48 states, Ulta is larger than Sephora, which has only about 430 stores throughout in the Americas. (Worldwide, it operates 2,300 stores in 33 countries.) But parent LVMH says its growth is also strong, with double-digit gains in both sales and profits in the last fiscal year.

Both stores are succeeding “due to their ability to curate a unique product assortment,” writes L2, the digital think tank, in a recent report on the category, and introduce women to new brands — many of them small independents. 

But that will only work for so long, says L2. “It would be a mistake to think Sephora and Ulta’s upper hand on Amazon is permanent … once fans discover and convert to a product they can seek it on alternate retailers. Ulta and Sephora must continuously provide incentives for users to repeatedly purchase from them, and think of new ways to Amazon-proof their shops.”

In the coming year, Ulta says it expects to open 100 new stores, and for same-store results to climb 8%, with e-commerce sales rising 40%.