E.l.f. Beauty is acquiring Hailey Bieber’s skincare and makeup brand, Rhode, in a deal valued at approximately $1 billion, marking a major strategic move into the prestige beauty market. The acquisition will give the budget cosmetics company access to a highly sought-after, celebrity-driven brand that has resonated strongly with Gen Z and millennial consumers.
Under the terms announced Wednesday, E.l.f. will pay Rhode shareholders $800 million in a mix of cash and stock, with the potential for an additional $200 million in earnout payments tied to performance milestones.
The deal comes just weeks after reports emerged that Bieber was exploring a sale of the brand, which launched in 2022 and has quickly gained a cult following through TikTok and her social media presence. Rhode is best known for viral products like its $18 peptide lip treatment and operates primarily through direct-to-consumer channels and pop-ups.
The Rhode acquisition represents E.l.f.’s biggest to date and a notable pivot toward premium beauty at a time when mass-market demand is softening due to ongoing inflation. While E.l.f. typically sells products for as little as $2 at retailers like Walmart, Target, and Ulta, Rhode’s higher-end positioning helps diversify the company’s portfolio.
“This is a bold move for E.l.f. into the prestige space,” said Sky Canaves, an eMarketer analyst. “While premium beauty has recently slowed, Rhode has bucked that trend with strong Gen Z appeal and high-profile launches.”
Rhode generated approximately $212 million in sales in the year ended March 31 and plans to expand into Sephora stores in the U.S., Canada, and the UK starting this fall.
“This is an incredible opportunity to elevate and accelerate our ability to reach more of our community with even more innovative products,” said Bieber, who will stay on as founder and serve as a strategic advisor post-acquisition.
The acquisition comes amid broader challenges for E.l.f., which in early 2024 slashed its annual forecast and saw its stock drop 20%. The company cited softer demand and macroeconomic headwinds. On Wednesday, E.l.f. declined to provide fiscal 2026 guidance due to uncertainty around U.S. import tariffs. The company sources about 75% of its products from China and announced it would raise prices by $1 to offset tariff-related costs.
“We can’t wait to bring rhode to more faces, places, and spaces. From day one, my vision for rhode has been to make essential skin care and hybrid makeup you can use every day,” Bieber shared in a statement. “Just three years into this journey, our partnership with e.l.f. Beauty marks an incredible opportunity to elevate and accelerate our ability to reach more of our community with even more innovative products and widen our distribution globally.”
The model said that she looks forward to the brand’s “new exciting chapter” alongside co-founders Michael D. Ratner and Lauren Ratner, “who have helped bring my vision to life from the start.”
E.l.f. chairman and CEO Tarang Amin said that the brand “found a like-minded disruptor in rhode.”
“rhode further diversifies our portfolio with a fast-growing brand that makes the best of prestige accessible,” Amin continued. “We are excited by rhode’s ability to break beauty barriers, fully aligning with e.l.f. Beauty’s vision to create a different kind of company. rhode is a beautiful brand that we believe is ready for rocketship growth.”
E.l.f. shares dipped about 1% in after-hours trading following the Rhode announcement.
CEO Tarang Amin called the Rhode deal a transformative moment: “Rhode further diversifies our portfolio with a fast-growing brand that makes prestige beauty more accessible.”
The transaction is expected to close in the second quarter of fiscal 2026.
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