E.L.F. Beauty saw shares tumble 26% after issuing a fiscal 2026 forecast below Wall Street estimates, driven by higher U.S. tariff costs on China-based production. The company missed Q2 sales expectations with $343.9 million and anticipates over $50 million in annual tariff costs, contributing to a 165-basis-point drop in gross margin to 69%. While beating quarterly profit estimates with adjusted earnings of 68 cents per share, E.L.F. is focusing on supply chain streamlining and leveraging its Rhode brand acquisition to reignite growth.