e.l.f. Beauty Inc. (NYSE: ELF) saw its stock surge 6.08% in pre-market trading on Thursday following two significant announcements: a $1 billion acquisition deal for Hailey Bieber's Rhode brand and better-than-expected fourth-quarter financial results.

The cosmetics company reported strong Q4 results, with adjusted earnings per share of $0.78, surpassing the analyst consensus of $0.72. Revenue for the quarter came in at $332.6 million, beating estimates of $327.47 million. This marks e.l.f. Beauty's 25th consecutive quarter of net sales growth and market share gains.

In a strategic move to diversify its portfolio and strengthen its position in the prestige beauty market, e.l.f. Beauty announced a definitive agreement to acquire Rhode, a fast-growing multi-category lifestyle beauty brand founded by model and influencer Hailey Bieber, for $1 billion. The deal includes $800 million payable at closing ($600 million in cash and $200 million in stock) and a potential additional $200 million earnout based on Rhode's growth over the next three years.

Despite the positive results and exciting acquisition news, e.l.f. Beauty refrained from providing fiscal 2026 guidance due to uncertainties surrounding import tariffs, which could impact future performance. The company also announced plans to raise prices by $1 starting in August to mitigate the effects of inflation and tariffs, highlighting the challenges faced by the cosmetics industry in the current economic environment.