THG Beauty “outperforms” Q4 predictions driven by skin care & cosmetics
Key takeaways
- THG’s Q4 marked the Beauty division’s strongest performance since 2021, with H2 growth well ahead of guidance.
- Exiting non-core markets and assets has weighed on reported figures, but is now largely annualized.
- Same-day delivery, AI-led personalization, and renewed investment in own brands such as ESPA and Perricone MD are strengthening customer engagement heading into 2026.
UK-based global e-commerce and digital brands group THG (previously The Hut Group) closed 2025 with “renewed momentum,” according to its latest financial report. The results are bolstered by a standout performance from its Beauty division.
In its fourth-quarter trading update for the period ended December 31, 2025, THG reported its strongest quarterly revenue growth of the year, with group revenue up 7% on a constant currency basis. The performance capped a solid second half, with H2 revenue rising 6.7% year-on-year, around 14% ahead of management’s guidance.
The results also marked the group’s first full year of revenue growth since 2021.
Matthew Moulding, CEO of THG, says: “We finished 2025 on a high with our best quarter of the year, thanks to a strong November and December period. In THG Beauty, our strategy to focus on core categories and territories is delivering clear results, with Lookfantastic UK achieving exceptional growth.
“We continue to accelerate our digital leadership, prioritizing high-margin prestige brands and enhancing personalization by increasing the use of AI and virtual tools.”
Beauty division exceeds expectations
THG Beauty emerged as a clear outperformer, delivering 5.5% revenue growth in H2, well ahead of its previously guided range of 1% to 3%. The fourth quarter of 2025 represented the division’s strongest growth performance since Q4 2021, driven by a combination of category strength, customer growth, and sharper commercial focus.
THG Beauty is one of Europe’s largest online beauty retailers, spanning prestige and mass brands across skin care, cosmetics, hair care, and fragrance.At £370.2 million (US$470.2 million) in Q4 revenue, THG achieved currency growth of 6.4%, despite reported growth being muted by the impact of discontinued activities and asset disposals.
The company’s strategic exits — including the sale of the luxury portfolio and selective withdrawals from Europe and Asia — accounted for the majority of the revenue slump seen across FY 2025 and have now largely annualized, positioning the division more securely for growth in 2026.
Lookfantastic leads UK acceleration
A major contributor to the Q4 uplift was Lookfantastic, which recorded 16.2% growth in the UK and Ireland. The platform delivered substantial gains in new and long-term active customers, helping THG Beauty outperform the broader UK beauty market for a second consecutive quarter.
Growth was broad-based across categories, with cosmetics and skin care delivering the strongest momentum and gaining UK market share. Seasonal demand also played a role, with a record advent calendar contribution reinforcing the brand’s strength in discovery-led and prestige beauty formats.
As part of its digital-first strategy, Lookfantastic expanded its convenience offerings through a partnership with Uber Eats, enabling same-day delivery of curated beauty and fragrance essentials to customers in London. The move reflects THG Beauty’s wider focus on reducing friction across the discovery-to-purchase journey.
Own brands regain traction
Within THG’s own-brand portfolio, signs of recovery were evident in the second half. Perricone MD returned to growth momentum following a challenging H1, supported by increased investment in brand equity, formulation improvements, and expanded B2B distribution.
Meanwhile, luxury spa and skin care brand ESPA strengthened its physical retail presence, launching 60 SKUs across more than 100 Marks & Spencer stores and online. The rollout boosted brand visibility and awareness, supported by access to the retailer’s loyalty scheme, and reflects a continued emphasis on selective, high-quality distribution partnerships.
Confidence heading into 2026
While reported FY 2025 revenue for THG Beauty declined 5.4% due to portfolio changes, underlying constant currency growth was positive, and trading momentum accelerated into the final months of the year. The group highlighted revenue growth of around 8% across November and December, reinforcing confidence in continued progress into Q1 2026.
THG says its Beauty division strategy — centered on core categories, priority territories, and higher-margin prestige brands — is delivering tangible results
Looking ahead, THG says its Beauty division strategy — centered on core categories, priority territories, and higher-margin prestige brands — is delivering tangible results.
With a highly liquid balance sheet and strategic simplification largely complete, THG enters 2026 with renewed focus and optimism — and THG’s Beauty division firmly positioned as a key growth engine in the group’s next phase.
In September, THG was among the three companies to receive approval for the Clean Oil 25 ingredient for use in cosmetic formulations in the UK, US, and Europe. The oil is made from fermented food waste, offering a sustainable alternative to traditional oil and fat ingredients, such as palm oil.
