Ulta Beauty (ULTA) 10-K risk factor changes: FY2020 vs FY2019

[removed: The coronavirus (COVID-19)] [added: Economic, Market and Other External RisksThe COVID-19 pandemic has had, and] will [removed: have] [added: continue to have,] a negative impact on our business, financial condition, profitability, cash flows and supply chain, as well as consumer spending.

Federal, state and local governments have since implemented [removed: various restrictions, including] [added: numerous measures to try to contain the virus, such as] travel restrictions, border closings, restrictions on public gatherings, quarantining of people who may have been exposed to the virus, shelter-in-place [removed: restrictions] [added: restrictions,] and limitations [removed: on] [added: or shutdowns of] business operations.

In response to government recommendations and for the health and safety of our associates (i.e., employees) and guests, [removed: we announced] on March [removed: 17,] [added: 19,] 2020 [removed: our decision to] [added: we] temporarily [removed: close] [added: closed] all stores across the U.S. [removed: While too early to quantify,] [added: As a result of this decision, we experienced a significant reduction in customer traffic and demand which resulted in] our sales and results of operations [removed: will be] [added: being] negatively [removed: impacted by this decision.][added: impacted.]

[removed: Even after our stores are re-opened, the virus] [added: COVID-19] could also negatively impact our [added: future] results of operations by continuing to weaken demand for our products and services and/or by disrupting our supply chain.

Epidemics, pandemics like COVID-19, natural disasters, or other catastrophes or crises [added: that have and] could [added: continue to] have a material adverse effect on our business, financial condition, profitability, and cash flows.

Epidemics, pandemics, or other public health crises, natural disasters, such as hurricanes, tornados, wildfires, earthquakes, and mudslides, as well as acts of violence or terrorism, [added: have resulted in the temporary closure of our stores and, in the future,] could [added: also] result in physical damage to our properties, the temporary [removed: closure] [added: reclosing] of [removed: stores and/or] [added: our stores, the temporary closing of our] distribution [added: centers] and fast fulfillment centers, the temporary lack of an adequate work force, [removed: the temporary or long-term disruption in the supply of products (or a substantial increase in the cost of those products) from domestic or foreign suppliers, the temporary disruption in the delivery of goods both to and from our distribution and fast fulfillment centers (or a substantial increase in the cost of those deliveries), the temporary reduction in the availability of products in our stores and/or the temporary reduction in visits to stores by customers.]

Accordingly, if one or more epidemics, pandemics, natural disasters, and/or acts of violence or terrorism were to [removed: occur,] [added: occur (as] it [added: is with the COVID-19 pandemic), it has and] could [added: continue to] have a material adverse effect on our business, financial condition, profitability, and cash flows or may require us to incur increased costs.

Our results of operations may be materially affected by conditions in the capital markets and the economy [removed: generally, both in the U.S. and internationally.][added: generally.]

Factors that could affect consumers’ willingness to make such discretionary purchases include: general business conditions, levels of employment, interest rates, tax rates, the availability of consumer credit, consumer confidence in future economic conditions, and [removed: risks, or the public perception of risks,] [added: risks] related to epidemics or pandemics like COVID-19.

In addition, a general deterioration in economic conditions could adversely affect our commercial partners including our [removed: vendor] [added: brand] partners as well as the real estate developers and landlords who we rely on to construct and operate centers in which our stores are located.

Additionally, volatility and disruption to the capital and credit markets [removed: in the recent global recession had] [added: may have] a significant, adverse impact on global economic conditions, resulting in recessionary pressures and declines in consumer confidence and economic growth, which, in turn, [removed: led] [added: may lead] to declines in consumer spending.

We may not be able to sustain our growth plans and successfully implement our long-range strategic and financial plans, which could have a material adverse effect on our business, financial condition, profitability, and cash [removed: flows.][added: flows.]

In addition, [removed: we intend to continue to open new stores, which could strain] [added: shipping and transportation costs represent a component of] our [removed: resources] [added: cost structure] and [added: an increase in shipping and transportation costs could] have a material adverse effect on our business, financial condition, profitability, and cash [removed: flows.][added: flows.]

| | ● | anticipate, gauge, and react to changing consumer preferences (including relating to sustainability of product [removed: sources,] [added: sources and packaging,] ingredient transparency, and animal welfare) in a timely manner; |

We believe the principal bases upon which we compete are the breadth of merchandise, our value proposition, the quality of our guests’ shopping experience, and the [added: convenience of our stores as one-stop destinations for beauty products and salon services.]

[removed: As a] consequence of most of our stores being located in such shopping areas, our sales are derived, in part, from the volume of traffic generated by the other destination retailers and the anchor stores in power centers where our stores are located.

Any significant interruption in the operations of our distribution [removed: facilities] [added: centers] could disrupt our ability to deliver merchandise to our stores in a timely manner, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

Any significant interruption in the operation of our supply chain infrastructure, such as disruptions in our information systems, disruptions in operations due to fire, natural disasters, or other catastrophic events (such as [removed: the recent outbreak of COVID-19)] [added: COVID-19),] labor disagreements, or shipping and transportation problems, could drastically reduce our ability to receive and process orders and provide products and services to our [removed: stores,] [added: stores and guests,] which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

For example, if our e-commerce platform successfully grows, it may do so in part by attracting existing guests, rather than new guests, who choose to purchase products from us online or through our [removed: mobile applications rather than from our physical stores, thereby reducing the financial performance of our stores.]

We [removed: have] also [removed: identified the need] [added: plan] to expand and upgrade our information systems to support historical and expected future growth.

The capacity of our distribution and order fulfillment infrastructure and the performance of our distribution [added: centers] and fast fulfillment centers may not be adequate to support our historical growth and expected future growth plans, which could prevent the successful implementation of these plans or cause us to incur excess costs to expand this infrastructure, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

We currently operate four distribution [removed: facilities,] [added: centers,] which house the distribution operations for Ulta Beauty retail stores together with the order fulfillment operations of our e-commerce platform, and [removed: one] [added: two] fast fulfillment [removed: center] [added: centers] (e-commerce [removed: only).]

We rely on our good relationships with [removed: vendor] [added: brand] partners to purchase prestige, mass, and salon beauty products on reasonable terms.

If these relationships were to be impaired, or if certain [removed: vendor] [added: brand] partners were to change their distribution model, or are unable to supply sufficient merchandise to keep pace with our growth plans, we may not be able to obtain a sufficient selection or volume of merchandise on reasonable terms, and we may not be able to respond promptly to changing trends in beauty products, either of which could have a material adverse effect on our competitive position, business, financial condition, profitability, and cash flows.

We have no long-term supply agreements with [removed: vendor] [added: brand] partners and, therefore, our success depends on maintaining good relationships with our [removed: vendor] [added: brand] partners.

Our business depends to a significant extent on the willingness and ability of our [removed: vendor] [added: brand] partners to supply us with a sufficient selection and volume of products to stock our stores.

Some of our prestige [removed: vendor] [added: brand] partners may not have the capacity to supply us with sufficient merchandise to keep pace with our growth plans.

If we fail to maintain strong relationships with our existing [removed: vendor] [added: brand] partners, or if we fail to continue acquiring and strengthening relationships with additional [removed: vendor] [added: brand] partners of beauty products, our ability to obtain a sufficient amount and variety of merchandise on reasonable terms may be limited, which could have a negative impact on our competitive position.

During fiscal [removed: 2019] [added: 2020] and fiscal [removed: 2018,] [added: 2019,] merchandise supplied to Ulta Beauty by our top ten [removed: vendor] [added: brand] partners accounted for approximately [removed: 61%] [added: 56%] and [removed: 62%] [added: 61%] of our net sales, respectively.

The loss of or a reduction in the amount of merchandise made available to us by any one of these key vendors, or by any of our other [removed: vendor] [added: brand] partners, could have a material adverse effect on our business, financial condition, profitability, and cash flows.

[removed: Even if we] were able to obtain a license, the rights may be non-exclusive, which would give our competitors access to the same intellectual property.

In addition, sanctions under various laws may include seizure of products, injunctions against future shipment of products, restitution [added: and disgorgement of profits, operating restrictions, and criminal prosecution.]

| | ● | Our [removed: rapidly expanding workforce, growing in pace with our number of stores,] [added: large workforce] makes us vulnerable to changes in labor and employment laws. In addition, changes in federal and state minimum wage laws and other laws relating to employee benefits could cause us to incur additional wage and benefits costs, which could hurt our profitability and affect our growth strategy. |

| | ● | Our salon [removed: business is] [added: operations are] subject to state board regulations and state licensing requirements for our stylists and our salon procedures. Failure to maintain compliance with these regulatory and licensing requirements could jeopardize the viability of our salons. |

[removed: Concern] [added: In addition, concern] over climate change [added: and greenhouse gases] may result in new or additional legal, legislative, and regulatory requirements to reduce or mitigate the effects of climate change on the environment, which could result in future tax, transportation, and utility increases, which could adversely affect our business.

There is also increased focus, including by investors, guests, and other stakeholders on these and other [added: environmental, social, governance and] sustainability matters, including the use of plastic, energy, waste, and worker safety.

[removed: Our reputation could be damaged if] we do not (or are perceived not to) act responsibly with respect to [removed: sustainability] [added: these] matters, which could adversely affect our business, financial condition, profitability, and cash flows.

[added: Our failure to comply with federal, state, or local requirements when we advertise our products (including prices) or services, or engage in other] promotional activities, in digital (including social media), television, or print may result in enforcement actions and imposition of penalties or otherwise harm the distribution and sale of our [removed: products.][added: products.Our associates or others may engage in misconduct or other improper activities, including noncompliance with our policies and procedures.]

Associate misconduct could also involve improper use of information obtained in the course of the associate’s prior or current employment, which could result in legal or regulatory action and harm to our [removed: reputation.][added: reputation.If we are unable to protect our intellectual property rights, our brand and reputation could be harmed, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.]

All in One Place®,” [removed: and] “21 Days of Beauty®,” [added: and “Conscious Beauty at Ulta BeautyTM,”] copyrights in our website and mobile applications content, rights to our domain name www.ulta.com, and trade secrets and know-how with respect to our Ulta Beauty branded product formulations, product sourcing, sales and marketing and other aspects of our business, and our digital innovations such as try-on applications and artificial intelligence.

Business, Operational and Strategic Risks

mobile applications rather than from our physical stores, thereby reducing the financial performance of our stores.

only).

personnel and store associates.

While we have reopened all stores, the potential temporary reclosing of certain stores in the future is possible.

The COVID-19 pandemic has significantly increased economic and demand uncertainty and has caused an economic slowdown that may continue.

The pandemic has also led to disruption and volatility in the global capital markets, which may adversely affect our and our suppliers’ liquidity.

The COVID-19 pandemic has had, and will continue to have, a negative impact on our business, financial condition, profitability, cash flows and supply chain, although the full extent is still uncertain.

As the pandemic continues to evolve, the extent of the impact on our business, financial condition, profitability, cash flows and supply chain will depend on future developments, including, but not limited to, the potential temporary reclosing of certain of our stores, the potential temporary restrictions on certain of our stores operating hours and/or in store capacity, the duration of potential future quarantines, shelter-in-place and other travel restrictions within U.S. and other affected countries, the duration of the pandemic (including any continuing relapses), the actions to contain the virus and/or treat its impact, the duration, timing and severity of the impact on consumer spending, and how quickly and to what extent normal economic and operating conditions can resume, all of which are highly uncertain and cannot be predicted.

the temporary or long-term disruption in the supply of products (or a substantial increase in the cost of those products) from domestic or foreign suppliers, the temporary disruption in the delivery of goods both to and from our distribution centers and fast fulfillment centers (or a substantial increase in the cost of those deliveries), the temporary reduction in the availability of products in our stores and/or the temporary reduction in visits to stores by customers.

As a

Regulatory, Legal and Cybersecurity Risks

​

Furthermore, we allow certain of our employees to work from home as a result of the COVID-19 pandemic, as certain of our third-party service providers also allow, and this remote working environment may increase cybersecurity related risks.

Even if we

Our reputation could be damaged if

discontinuance of sales of our products or of certain salon services or prevent us from achieving or maintaining market acceptance of the affected products and services.

As events are rapidly changing, we are unable to accurately predict the impact that COVID-19 will have on our business, financial condition, profitability, cash flows and supply chain due to uncertainties including, but not limited to, the duration of the closing of our stores, the duration of quarantines, shelter-in-place and other travel restrictions within U.S. and other affected countries, the severity of the virus, the duration of the outbreak and the public’s response to the outbreak and its eventual aftermath.

We intend to continue to grow our number of stores for the foreseeable future.

Our continued expansion places increased demands on our financial, managerial, operational, supply-chain, and administrative resources.

For example, our planned expansion will require us to increase the number of people we employ, as well as to monitor and upgrade our management information and other systems, and our distribution infrastructure.

These increased demands and operating complexities could cause us to operate our business less efficiently and could have a material adverse effect on our business, financial condition, profitability, and cash flows.

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convenience of our stores as one-stop destinations for beauty products and salon services.

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For more information on our quarterly results of operations, see Note 18 to our consolidated financial statements, “Selected quarterly financial data (unaudited),” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

In addition to infringement claims against us, we may become a party to other patent or trademark litigation and other proceedings, including interference proceedings declared by the United States Patent and Trademark Office (USPTO) proceedings before the USPTO’s Trademark Trial and Appeal Board and opposition proceedings in the European Patent Office, regarding intellectual property rights with respect to our technologies, products purchased from third-party vendors or our Ulta Beauty branded products.

Some of our competitors may be able to bear the costs of such litigation or proceedings better than us because of their substantially greater financial resources.

Uncertainties resulting from the initiation and continuation of intellectual property litigation or other proceedings could impair our ability to compete in the marketplace.

Intellectual property litigation and other proceedings may also absorb significant management time and resources, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

and disgorgement of profits, operating restrictions, and criminal prosecution.

In addition, greenhouse gases may have an adverse effect on global temperatures, weather patterns, and the frequency and severity of extreme weather and natural disasters.

Our failure to comply with federal, state, or local requirements when we advertise our products (including prices) or services, or engage in other

Our associates or others may engage in misconduct or other improper activities, including noncompliance with our policies and procedures.

If we are unable to protect our intellectual property rights, our brand and reputation could be harmed, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

As we grow the number of our stores in new locations, we are subject to local building codes in an increasing number of local jurisdictions.

Our failure to comply with local building codes, and the failure of our landlords to obtain certificates of occupancy in a timely manner, could cause delays in our new store openings, which could increase our store opening costs, cause us to incur lost sales and profits, and damage our public reputation.

Ensuring compliance with local zoning and real estate land use restrictions across numerous jurisdictions is increasingly challenging as we increase the number of our stores in new locations.

Our store leases generally require us to provide a certificate of occupancy with respect to the interior build-out of our stores (landlords generally provide the certificate of occupancy with respect to the shell of the store and the larger shopping area and common areas), and while we strive to remain in compliance with local building codes relating to the interior build out of our stores, the constantly increasing number of local jurisdictions in which we operate makes it increasingly difficult to stay abreast of changes in, and requirements of, local building codes and local building and fire inspectors’ interpretations of such building codes.

Moreover, our landlords have occasionally been unable, due to the requirements of local zoning laws, to obtain in a timely manner a certificate of occupancy with respect to the shell of our stores and/or the larger shopping centers and/or common areas (which certificate of occupancy is required by local building codes for us to open our store), causing us in some instances to delay store openings.

As the number of local building codes and local building and fire inspectors to which we and our landlords are subject to increases, we may be increasingly vulnerable to increased construction costs and delays in store openings caused by our or our landlords’ compliance with local building codes and local building and fire inspectors’ interpretations of such building codes.

Any such increased construction costs and/or delays in store openings could increase our store opening costs, cause us to incur lost sales and profits, and damage our public reputation, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

The market price for our common stock may be volatile.

The market price of our common stock is likely to fluctuate significantly from time to time in response to factors including:

| | ● | differences between our actual financial and operating results and those expected by investors; |

| | ● | fluctuations in quarterly operating results; |

We estimate [removed: the] [added: that] beauty enthusiasts [removed: represents] [added: represent] approximately 57% of shoppers and 77% of spend in the U.S. beauty category.

Key aspects of our business include: our ability to offer our guests a unique combination of more than 25,000 beauty products from across the categories of prestige and mass cosmetics, fragrance, haircare, [added: prestige and mass] skincare, bath and body products, and salon styling tools, as well as a full-service salon in every store featuring hair, skin, and brow services; our focus on delivering a compelling value proposition to our guests across all of our product categories; and convenience, as our stores are predominantly located in convenient, high-traffic locations such as power centers.

The continued growth of our business and any future increases in net sales, net income, and cash flows is dependent on our ability to execute our strategic [removed: imperatives:] [added: priorities:] 1) [removed: drive growth] [added: build omnichannel operations that more deeply connects guests] across [removed: beauty enthusiast consumer groups,] [added: channels,] 2) [added: reimagine how guests experience and discover beauty, 3) drive market share growth through the deployment of winning category strategies, 4)] deepen Ulta Beauty love and loyalty, [removed: 3) deliver a one of a kind, world class beauty assortment, 4) lead the in-store and beauty services experience transformation,] 5) [removed: reinvent beauty digital engagement, 6) deliver operational excellence and] drive [removed: efficiencies,] [added: holistic cost optimization,] and [removed: 7) invest in] [added: 6) develop our] talent [removed: that drives a winning] [added: and strengthen our] culture.

[removed: We believe that the expanding U.S. beauty products and salon services] industry, the shift in distribution channel of prestige beauty products from department stores to specialty retail stores, coupled with Ulta Beauty’s competitive strengths, [removed: positions] [added: position] us to capture additional market share in the industry.

[removed: Operating] [added: Long-term operating] profit is expected to increase as a result of our ability to expand merchandise margin and leverage our fixed store costs with comparable sales increases and operating efficiencies offset by incremental investments in people, systems, and supply chain required to support a 1,500 to 1,700 store chain in the U.S. with successful e-commerce and competitive omnichannel capabilities.

Our research indicates that Ulta Beauty [removed: continues to drive] [added: has captured] meaningful market share across all [removed: categories.][added: categories over the last several years.]

However, our research also suggests that the cosmetics category in the overall U.S. market experienced mid-single digit declines through fiscal [removed: 2019.][added: 2019 and 2020.]

[removed: Despite] [added: We expect] the [removed: overall market decline in] [added: beauty category will return to growth as consumers recover from] the [removed: cosmetics category,] [added: impacts of COVID-19, and] we remain confident that our differentiated and diverse business model, our commitment to strategic investments, and our highly engaged associates will continue to drive market share [removed: gains.][added: gains over the long term.]

[removed: COVID-19][added: COVID-19 response]

The virus has since spread to [removed: almost] every other part of the world, including the U.S., and in March 2020, the World Health Organization declared COVID-19 a global pandemic.

In response to government recommendations and for the health and safety of our associates and guests, [removed: we announced] on March [removed: 17,] [added: 19,] 2020 [removed: our decision to] [added: we] temporarily [removed: close] [added: closed] all stores across the [removed: U.S. While too early] [added: U.S., while continuing] to [removed: quantify,] [added: support] our [removed: sales and results of operations will be negatively impacted by this decision.][added: essential e-commerce operations.]

[removed: As events] [added: Sales] are [removed: rapidly changing,] [added: expected to be challenged as events continue to change, and] we are unable to accurately predict the [added: future] impact that [added: the] COVID-19 [added: pandemic] will have on our results of operations due to uncertainties including, but not limited to, the [removed: duration] [added: potential temporary reclosing] of [removed: the closing] [added: certain] of our stores, the [added: potential temporary restrictions on certain store operating hours and/or in-store capacity, the] duration of [added: potential future] quarantines, shelter-in-place and other travel restrictions within the U.S. and other affected countries, the [removed: severity] [added: duration] of the [added: pandemic and any more dangerous variants of the] virus, the [removed: duration] [added: duration, timing and severity] of the [removed: outbreak, and] [added: impact on consumer spending,] the [removed: public’s response] [added: timing and effectiveness of vaccine distribution, and how quickly and] to [removed: the outbreak] [added: what extent normal economic] and [removed: its eventual aftermath.][added: operating conditions can resume.]

E-commerce [removed: merchandise] sales are recognized [removed: based] upon shipment [added: or guest pickup] of [removed: merchandise to] the [removed: guest] [added: merchandise] based on meeting the transfer of control criteria.

Accordingly, we recognize revenue for our single performance obligation related to online sales at the time control of the merchandise passes to the customer, which is at the time of [removed: shipment.][added: shipment or guest pickup.]

Company coupons and other incentives are recorded as a [removed: reduction of net sales.]

Non-comparable store sales include sales from new stores that have not yet completed their 13th month of operation and stores that were closed for part or all of the period in either [removed: year as a result of remodel activity.][added: year.]

Comparable sales include retail [removed: sales,] [added: sales and] salon [removed: services,] [added: services (including stores temporarily closed due to COVID-19),] and e-commerce.

| | ● | retail stores occupancy costs including rent, depreciation and amortization, real estate taxes, utilities, repairs and maintenance, insurance, [removed: licenses,] and [removed: cleaning expenses;] [added: licenses;] |

Our cost of sales may be negatively impacted as we open [removed: an increasing number of] [added: new] stores.

| | ● | payroll, bonus, and benefit costs for retail [removed: stores] [added: store] and corporate employees; |

Interest [removed: income,] [added: expense (income),] net includes both interest income and expense.

The Company’s fiscal years ended [added: January 30, 2021 (fiscal 2020),] February 1, 2020 (fiscal 2019), [added: and] February 2, 2019 (fiscal [removed: 2018), and February 3, 2018 (fiscal 2017)] [added: 2018)] were [removed: 52, 52, and 53-week years, respectively.][added: all 52-week years.]

As of [removed: February 1, 2020,] [added: January 30, 2021,] we operated [removed: 1,254] [added: 1,264] stores across 50 states.

| ​ | ​ | [removed: ​ |] Fiscal year ended | | | | | | | |

| ​ | ​ | [removed: ​ | February 1,] [added: January 30,] | | ​ | February [removed: 2,] [added: 1,] | | ​ | February [removed: 3,] [added: 2,] | |

| (Dollars in thousands) | ​ | [removed: ​ | 2020] [added: 2021] | | | [removed: 2019] [added: 2020] | | | [removed: 2018] [added: 2019] | |

| Net sales | ​ | [removed: ​ |] $ | [removed: 7,398,068] [added: 6,151,953] | ​ | $ | [removed: 6,716,615] [added: 7,398,068] | ​ | $ | [removed: 5,884,506] [added: 6,716,615] |

| Cost of sales | ​ | ​ | [removed: ​ | 4,717,004] [added: 4,202,794] | ​ | ​ | [removed: 4,307,304] [added: 4,717,004] | ​ | ​ | [removed: 3,787,697] [added: 4,307,304] |

| Gross profit | ​ | ​ | [removed: ​ | 2,681,064] [added: 1,949,159] | ​ | ​ | [removed: 2,409,311] [added: 2,681,064] | ​ | ​ | [removed: 2,096,809] [added: 2,409,311] |

| Selling, general and administrative expenses | ​ | ​ | [removed: ​ | 1,760,716] [added: 1,583,017] | ​ | ​ | [removed: 1,535,464] [added: 1,760,716] | ​ | ​ | [removed: 1,287,232] [added: 1,535,464] |

| Pre-opening expenses | ​ | ​ | [removed: ​ | 19,254] [added: 15,000] | ​ | ​ | [removed: 19,767] [added: 19,254] | ​ | ​ | [removed: 24,286] [added: 19,767] |

| Operating income | ​ | ​ | [removed: ​ | 901,094] [added: 236,820] | ​ | ​ | [removed: 854,080] [added: 901,094] | ​ | ​ | [removed: 785,291] [added: 854,080] |

| Interest [removed: income,] [added: expense (income),] net | ​ | ​ | [removed: ​ | (5,056)] [added: 5,735] | ​ | ​ | [removed: (5,061)] [added: (5,056)] | ​ | ​ | [removed: (1,568)] [added: (5,061)] |

| Income before income taxes | ​ | ​ | [removed: ​ | 906,150] [added: 231,085] | ​ | ​ | [removed: 859,141] [added: 906,150] | ​ | ​ | [removed: 786,859] [added: 859,141] |

| Income tax expense | ​ | ​ | [removed: ​ | 200,205] [added: 55,250] | ​ | ​ | [removed: 200,582] [added: 200,205] | ​ | ​ | [removed: 231,625] [added: 200,582] |

| Net income | ​ | [removed: ​ |] $ | [removed: 705,945] [added: 175,835] | ​ | $ | [removed: 658,559] [added: 705,945] | ​ | $ | [removed: 555,234] [added: 658,559] |

| Other operating data: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | [removed: ​ |]

| Number of stores end of [removed: period | ​] [added: year] | ​ | ​ | [removed: 1,254] [added: 1,264] | ​ | ​ | [removed: 1,174] [added: 1,254] | ​ | ​ | [removed: 1074] [added: 1174] |

| Comparable sales [removed: increase] | ​ | ​ | [removed: ​ | 5.0%] [added: (17.9)%] | ​ | ​ | [removed: 8.1%] [added: 5.0%] | ​ | ​ | [removed: 11.0%] [added: 8.1%] |

| ​ | ​ | [removed: ​ |] Fiscal year ended | | | | | | | |

We believe that the expanding U.S. beauty products and salon services

We have been and continue to closely monitor the impact of the COVID-19 outbreak on all facets of our business.

We have taken decisive actions to protect the safety of our associates and guests and to manage the business throughout the fluid and challenging environment resulting from the COVID-19 pandemic.

Effective April 19, 2020, we temporarily furloughed many of our store and salon associates.

In April 2020, we introduced curbside pickup, and in May 2020, we began reopening stores.

Throughout the second quarter, stores were reopened on a phased timeline, by taking a thoughtful, measured approach based on a variety of criteria, including state and local guidelines and the adoption of our new Shop Safe Standards.

As of July 20, 2020, we completed our phased reopening process.

By October 31, 2020, salon and brow services had resumed in almost all stores.

Due to COVID-19 restrictions, we have not resumed skin and makeup services but we have plans to resume skin and makeup services as soon as it is safe to do so.

Our results of operations for the fiscal year ended January 30, 2021 were significantly impacted by the effects of the COVID-19 pandemic.

Comparable sales decreased 17.9% for the fiscal year ended January 30, 2021 as a result of the COVID-19 pandemic, but the multi-year, strategic investments we have made to enhance our omnichannel and supply chain capabilities, combined with the ongoing commitment of our distribution associates, have enabled us to support increased e-commerce demand and strong guest engagement.

In addition to decreases in net revenue, our overall profitability also decreased as compared to the prior year.

These developments have further required us to recognize certain long-lived asset impairment charges and restructuring charges.

Further, in connection with the Coronavirus Aid,

Relief, and Economic Security (CARES) Act, we recognized payroll subsidies as a reduction of selling, general and administrative expenses in the consolidated statement of operations.

As we navigated these unprecedented circumstances, we continued to focus on our financial flexibility, including drawing down $800.0 million under our $1.0 billion revolving credit facility on March 18, 2020, which was repaid in full on September 2, 2020.

In addition, we took the following steps to preserve financial liquidity:

| | ● | limited new hires and delayed merit increases for all corporate, store, and salon associates; |

| | ● | reduced marketing, travel and controllable expenses; |

| | ● | aligned inventory receipts with current sales trends; |

| | ● | prioritized payment obligations; |

| | ● | reduced new store openings, relocations and remodel projects; and |

| | ● | suspended the stock repurchase program, which resumed in the fourth quarter of fiscal 2020. |

To help support our associates through this crisis, we expanded the criteria for our Associate Relief Program to include those who need assistance due to a personal hardship as a result of the COVID-19 pandemic.

The Ulta Beauty executive team and Board of Directors have each made personal donations to the program.

Industry trends

In addition, the COVID-19 pandemic and its various impacts have changed consumer behavior and consumption of beauty products due to the closures of offices, retail stores and other businesses and the significant decline in social gatherings.

We provide refunds for merchandise returns within 60 days from the original purchase date; however, due to store closures during the first half of fiscal 2020, we extended our return policy to 180 days through November 16, 2020.

reduction of net sales.

Impairment, restructuring and other costs include long-lived asset impairment charges, restructuring costs associated with store closings, costs associated with the suspension of our Canadian expansion, and employee related severance costs.

| Impairment, restructuring and other costs | ​ | ​ | 114,322 | ​ | ​ | — | ​ | ​ | — |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| Impairment, restructuring and other costs | ​ | ​ | 1.9% | ​ | ​ | 0.0% | ​ | ​ | 0.0% |

Net sales decreased $1.2 billion, or 16.8%, to $6.2 billion in fiscal 2020 compared to $7.4 billion in fiscal 2019.

The net sales decrease was driven by the negative impacts of the COVID-19 pandemic, including the temporary closing of our brick-and-mortar retail stores, social distancing and quarantines, reduction of operating hours, and limitations on in-store capacity, and a decrease of $6.6 million in other revenue.

Total comparable sales in fiscal 2020 decreased 17.9% compared to an increase of 5.0% in fiscal 2019.

During fiscal 2020, transactions declined 24.5% and average ticket increased 8.8%.

Gross profit decreased $0.7 billion, or 27.3%, to $1.9 billion in fiscal 2020, compared to $2.7 billion in fiscal 2019.

| | ● | 220 basis points of deleverage due to channel mix shifts; |

| | ● | 220 basis points deleverage of fixed costs and 90 basis points of deleverage in salon services, both attributed to the impact of lower sales; partially offset by |

Current business trends

Even after our stores are re-opened, the virus could also negatively impact our results of operations by continuing to weaken demand for our products and services and/or by disrupting our supply chain.

We provide refunds for merchandise returns within 60 days from the original purchase date.

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We attribute the increase in comparable sales to our successful marketing and merchandising strategies.

Selling, general and administrative (SG&A) expenses increased $225.3 million, or 14.7%, to $1,760.7 million in fiscal 2019 compared to $1,535.5 million in fiscal 2018.

Net sales increased $832.1 million, or 14.1%, to $6,716.6 million in fiscal 2018 compared to $5,884.5 million in fiscal 2017.

The net sales increases are due to the opening of 100 net new stores in fiscal 2018, an 8.1% increase in comparable sales, and other revenue increased $48.9 million.

The sales for the 53rd week of fiscal 2017 were approximately $108.8 million.

The 8.1% comparable sales increase included a 5.3% increase in transactions and a 2.8% increase in average ticket.

Gross profit increased $312.5 million, or 14.9%, to $2,409.3 million in fiscal 2018, compared to $2,096.8 million in fiscal 2017.

The impact of new revenue recognition accounting drove 55 basis points of leverage.

| | ● | 55 basis points deleverage attributed to category and channel mix shifts and investments in our salon services and supply chain operation, partially offset by; |

| | ● | 30 basis points leverage in fixed store costs attributed to the impact of higher sales volume. |

SG&A expenses increased $248.2 million, or 19.3%, to $1,535.5 million in fiscal 2018 compared to $1,287.2 million in fiscal 2017.

The impact of new revenue recognition accounting drove 80 basis points of deleverage.

| | ● | 30 basis points deleverage due to investments in store labor to support growth initiatives, partially offset by; |

Pre-opening expenses decreased $4.5 million, or 18.6%, to $19.8 million in fiscal 2018 compared to $24.3 million in fiscal 2017.

The lower tax rate is primarily due tax reform.

Net income increased $103.3 million, or 18.6%, to $658.6 million in fiscal 2018 compared to $555.2 million in fiscal 2017.

This is also the time of year when we are at maximum investment levels in our new store class and may not have collected all of the landlord allowances due to us as part of our lease agreements.

The increase in net income was due to an increase in gross profit due to sales increases and improvements in merchandise margins, partially offset by increased SG&A expenses due to investments in future growth.

Changes in other assets and liabilities was primarily due to increased participation in our deferred compensation plan.

Merchandise inventories, net were $1,293.7 million at February 1, 2020, compared to $1,214.3 million at February 2, 2019, representing an increase of $79.4 million or 6.5%.

Average inventory per store (defined as merchandise inventory divided by number of stores open) was flat compared to prior year.

The increase in inventory is primarily due to the addition on 80 net new stores opened since February 2, 2019.

Capital expenditures decreased in fiscal 2019 compared to fiscal 2018 primarily from lower merchandising fixtures due to less spend on store refreshes and a decrease in the number of store openings, offset by increases in store maintenance and other due to corporate office renovations.

| ​ | ​ | 2019 | ​ | 2018 | ​ | 2017 |

The average investment required to remodel an Ulta Beauty store was approximately $0.9 million in fiscal 2019.

The average investment required to refresh an Ulta Beauty store was approximately $0.1 million in fiscal 2019.

| ​ | ​ | Fiscal | | ​ | Fiscal | | ​ | Fiscal | |

We may

As a precautionary measure and to enhance financial flexibility in light of the uncertainty arising from the spread of COVID-19, on March 23, 2020, the Company announced that it drew down $800 million under the amended Loan Agreement.

On March 9, 2017, we announced that the Board of Directors authorized a share repurchase program (the 2017 Share Repurchase Program) pursuant to which the Company could repurchase up to $425.0 million of the Company’s common stock.

Our market risk exposure is primarily the result of fluctuations in interest [added: rates and foreign currency exchange] rates.

We are exposed to interest rate risks primarily through [removed: borrowing] [added: borrowings] under our credit facility.

We did not have any outstanding borrowings on our credit facility as of [added: January 30, 2021,] February 1, 2020, [removed: February 2, 2019,] or February [removed: 3, 2018.][added: 2, 2019.]

A hypothetical 1% increase in interest rates on variable rate debt would have increased interest expense for fiscal 2020 by approximately $3.7 million.

Foreign currency exchange rate risk

We are exposed to risks from foreign currency exchange rate fluctuations on the translation of our foreign operations into U.S. dollars and on the purchase of goods by these foreign operations that are not denominated in their local currencies.

Our exposure to foreign currency rate fluctuations is not material to our financial condition or results of operations.

Our stores, website, and mobile applications offer more than 25,000 products from [removed: approximately 500] [added: more than 600] well-established and emerging beauty brands across [removed: all] [added: a variety of] categories and price points, including Ulta Beauty’s own private label, the Ulta Beauty Collection.

We believe we offer the widest selection of beauty categories, including prestige and mass cosmetics, fragrance, haircare, [added: prestige and mass] skincare, bath and body products, professional hair products, and salon styling tools.

We offer a comprehensive loyalty program, Ultamate Rewards, and target [added: communications and] promotions through our Customer Relationship Management (CRM) platform.

[removed: Convenience.] Our stores are predominantly located in convenient, high-traffic locations such as power strip centers.

As of [removed: February 1, 2020,] [added: January 30, 2021,] we operated [removed: 1,254] [added: 1,264] retail stores across 50 states, as well as an e-commerce website and mobile applications.

[removed: Drive growth across beauty enthusiast consumer groups.] We target beauty enthusiasts across multiple demographics and shopping behaviors.

[removed: Deepen Ulta Beauty love and loyalty. We] [added: While recent disruption from the COVID-19 pandemic has impacted recent member growth, we] believe we can expand Ulta Beauty’s reach, relevancy, and engagement with our guests by evolving the value proposition of our Ultamate Rewards program, increasing total membership in the program, building strategic partnerships that create incremental value for our guests, and using our customer data to deliver personalized member experiences.

[added: Deepen Ulta Beauty love and loyalty.] We have [removed: more than 34] [added: 30.7] million active Ulta Beauty [removed: guests] [added: members] enrolled in our Ultamate Rewards loyalty program.

Loyalty member transactions represent more than [removed: 95%] [added: 94%] of our annual total net sales, and our data demonstrates that loyalty members shop with higher frequency and spend more per visit as compared to non-members.

[removed: Deliver a one] [added: Drive market share growth through the deployment] of [removed: a kind, world class beauty assortment.] [added: winning category strategies.] Assortment is [removed: at] the center of our value proposition and represents a core differentiator within the market.

Guests can find everything they need in one shopping trip with our [removed: approximately 500 brands offered,] [added: offering of more than 600 brands,] eliminating the need to go to multiple departments stores, specialty stores, salons, drug stores, mass merchandisers, and pure play e-commerce companies that may sell the same or similar products.

We continue to [removed: evolve] [added: change] our assortment to [added: reflect evolving beauty trends and innovation and to] meet our guests’ desire for new [removed: and exclusive] products.

[removed: Lead the in-store and beauty services experience transformation.] The Ulta Beauty guest experience [removed: today] is differentiated by our broad array of categories, brands, and price points, [added: immersive digital tools, multiple shopping options,] high quality services, and friendly, well-trained associates.

Through our cost optimization program, Efficiencies For Growth, we [removed: plan to achieve] [added: are targeting and delivering] cost savings in four work streams: category performance improvement, indirect procurement, end-to-end operations, and real estate.

[removed: Invest in] [added: Develop our] talent [removed: that drives a winning] [added: and strengthen our] culture. Leadership, culture, and engagement of our associates are key drivers of our performance.

[removed: We strive] [added: Our vision is] to provide an environment where every associate feels they can fully contribute and [removed: every guest is optimally served, regardless of differences.][added: realize their full potential.]

We operate within the large [removed: and growing] U.S. beauty products and salon services industry.

[removed: This] [added: In 2020, this] market [removed: represents] [added: represented] approximately $150 billion in sales, according to [added: forecasted] Euromonitor International and IBIS World Inc. [removed: The approximately $89 billion] [added: In 2020, the] beauty products industry [removed: includes] [added: totaled approximately $92 billion and included] cosmetics, haircare, fragrance, bath and body, skincare, salon styling tools, and other toiletries.

We estimate that Ulta Beauty [removed: has] [added: had] only [removed: an 8%] [added: a 7%] share of the [removed: $89] [added: $92] billion beauty product industry.

[removed: The approximately $61 billion] [added: In 2020, the] salon services industry [removed: consists of] [added: totaled approximately $58 billion and included] hair, skin, and nail services.

We estimate that Ulta Beauty [removed: has] [added: had] less than 1% share of this industry.

[removed: Beauty] [added: In addition, beauty] cycles are impacted by demographics, trends, and product innovation.

Despite the overall [added: beauty] market decline in [added: 2020 due to COVID-19 impacts, we expect] the [removed: cosmetics category,] [added: beauty category will return to growth as consumers recover from the impacts of COVID-19, and] we remain confident that our differentiated and diverse business model, our commitment to strategic investments, and our highly engaged associates will continue to drive market share gains for Ulta Beauty.

[added: Stores.] Our retail stores are predominantly located in convenient, high-traffic locations such as power strip centers.

Our retail store concept, including physical layout, displays, lighting, and quality of finishes, has evolved over time to [removed: match] [added: reflect] the rising expectations of our guests and to keep pace with our merchandising and operating strategies.

In addition, [removed: the majority] [added: most] of our stores offer brow services on the sales floor.

During our fiscal year ended [removed: February 1, 2020] [added: January 30, 2021] (fiscal [removed: 2019),] [added: 2020),] 74% of new stores opened in existing shopping centers and 26% opened in new shopping centers.

As of [removed: February 1, 2020,] [added: January 30, 2021,] we operated [removed: 1,254] [added: 1,264] stores across 50 states.

| ​ | | [removed: February 1,] [added: January 30,] | | February [removed: 2,] [added: 1,] | | February [removed: 3,] [added: 2,] |

| ​ | ​ | [removed: 2020] [added: 2021] | ​ | [removed: 2019] [added: 2020] | ​ | [removed: 2018] [added: 2019] |

| Total stores beginning of period | ​ | [removed: 1,174] [added: 1,254] | ​ | [removed: 1,074] [added: 1,174] | ​ | [removed: 974] [added: 1,074] |

| Stores opened | ​ | [removed: 86] [added: 30] | ​ | [removed: 107] [added: 86] | ​ | [removed: 102] [added: 107] |

| Stores closed | ​ | [removed: (6)] [added: (20)] | ​ | [removed: (7)] [added: (6)] | ​ | [removed: (2)] [added: (7)] |

| Total stores end of period | ​ | [removed: 1,254] [added: 1,264] | ​ | [removed: 1,174] [added: 1,254] | ​ | [removed: 1,074] [added: 1,174] |

| Total square footage | ​ | [removed: 13,193,076] [added: 13,291,838] | ​ | [removed: 12,337,145] [added: 13,193,076] | ​ | [removed: 11,300,920] [added: 12,337,145] |

| Average square footage per store | ​ | [removed: 10,521] [added: 10,516] | ​ | [removed: 10,509] [added: 10,521] | ​ | [removed: 10,522] [added: 10,509] |

| Stores remodeled | ​ | [removed: 12] [added: –] | ​ | [removed: 13] [added: 12] | ​ | [removed: 11] [added: 13] |

| Stores relocated | ​ | [removed: 8] [added: 5] | ​ | [removed: 2] [added: 8] | ​ | [removed: 7] [added: 2] |

| Stores refreshed | ​ | [removed: 240] [added: –] | ​ | [removed: 109] [added: 240] | ​ | [removed: 190] [added: 109] |

Our real estate vision is to make Ulta Beauty accessible and convenient to more consumers across a variety of markets, a key [removed: part] [added: driver] of how we plan to expand our market share over time.

Convenience. Today, we offer guests a variety of ways to shop for beauty, including in our stores, through our mobile applications, and on ulta.com.

We also provide convenient fulfillment options including buy online pick-up in store, buy online pickup curbside, ship from store, and ship to home.

Beauty enthusiasts have a deep emotional connection with beauty, and historically, this connection has not diminished in softer economic environments.

Our proprietary consumer research confirms engagement with the beauty category remains strong, but the unprecedented challenges faced as a result of the COVID-19 pandemic will likely have sustained effects on the category.

Health and safety concerns are elevated, consumers have quickly adopted new shopping behaviors, operating costs are increasing, and many retailers have faced financial challenges, resulting in increased store closures.

Recognizing the impact these changes will have on the beauty category, we intend to leverage the strengths of our operating model and investments to position Ulta Beauty for continued success post-COVID.

Specifically, we are focused on accelerating efforts in the following key areas to expand our long-term market share gains and extend our competitive advantages.

Build omnichannel operations that more deeply connects guests across channels. Our guest insights and loyalty program member data confirm that our guests prefer to transact in physical stores, where they can discover and interact with products and other beauty enthusiasts.

In addition, our guests are increasingly engaging online to research, discover new products, and purchase.

To drive increased guest engagement across all channels, we are leveraging a multifaceted approach to communicate, engage, and transact, and we are expanding our fulfillment capabilities, including buy online and pickup in-store and curbside pickup.

Our vision is to offer industry-leading omnichannel experiences that engage our guests and unlock the combined potential of our physical and digital channels.

Reimagine how guests experience and discover Beauty. Beauty enthusiasts value the human connection and the physical experience of beauty.

The COVID-19 pandemic has increased focus on personal safety and impacted how guests test products and experience beauty.

As a result, we are reimagining the guest experience and product discovery process and exploring ways technology, services, and the role of our associates can evolve to deliver fun, interactive, easy, and functional experiences for our guests.

Our vision is to become the most loved destination for beauty enthusiasts by reimagining the end-to-end guest experience, facilitating inspiration, discovery, and experimentation, and serving as a trusted guide, regardless of channel.

Our vision is to engage and delight beauty enthusiasts with a curated beauty assortment focused on exclusivity and leading trends.

Our vision is to continue to innovate and integrate the Ultamate Rewards program in meaningful ways and personalize the guest experience across all touchpoints to create stronger member connection, engagement, and loyalty.

Drive holistic cost optimization. Similar to other retailers, we are experiencing cost pressures from macroeconomic trends, including rising wage rates and higher transportation and shipping costs.

In addition, we are managing ongoing headwinds from channel and category mix shifts.

As we look forward, we are moving beyond process optimization to develop a cost structure that will enable us to weather future economic challenges while also supporting investments for future growth.

Our vision is to deliver profitable growth and competitive advantage by optimizing our cost structure to

enable scale and growth, developing agile operating processes that support rapid testing, learning and implementation, and building new capabilities tailored to win in a rapidly evolving omnichannel world.

We have developed and sustained a world-class, guest-centric, values-based, high performance culture.

Due to COVID-19 related restrictions, we were unable to offer skin and makeup services for most of fiscal 2020.

We have plans to resume services as soon as it is safe to do so.

Although our business was impacted by temporary store closures due to COVID-19, our research indicates that Ulta Beauty continues to increase market share across most prestige beauty categories in the overall U.S. market.

COVID-19 and its various impacts have changed consumer behavior and consumption of beauty products due to the closures of offices, retail stores and other businesses and the significant decline in social gatherings.

Our retail channels

We are committed to meeting guests where and how they want to shop and strive to offer guests a compelling shopping experience through our stores, website, and mobile applications.

Due to COVID-19 restrictions, we operated at approximately 50% capacity for salon and brow services and were unable to offer skin and makeup services for most of fiscal 2020.

We have plans to resume skin and makeup services as soon as it is safe to do so.

During the first half of fiscal 2020, new store activity was temporarily paused due to COVID-19.

New store openings resumed in the third quarter of fiscal 2020.

Digital platform. In addition to store expansion, we continue to expand our digital capabilities.

new products and brands, and omnichannel integration points.

To support our e-commerce operations, during 2020 we opened the Jacksonville fast fulfillment center, expanded e-commerce operations in the Chambersburg, Greenwood and Dallas distribution centers, and expanded the ship-from-store program to 115 stores.

These investments have increased our e-commerce shipping capacity and improved delivery speed to guests.

In response to COVID-related constraints, in fiscal 2020 our digital and store teams launched a new curbside pickup option for guests.

We also expanded our store locator functionality to include greater visibility to store specific service offerings, in-store and curbside hours, and to communicate the opening status of local stores.

In the Ulta app, we now provide store-specific occupancy levels for greater transparency and guest safety.

We are committed to executing our strategic imperatives to drive long-term growth and sustainable competitive advantages.

With the unique needs and perspectives of our beauty enthusiast consumer groups, we have evolved how we connect with each group.

We believe we can drive guest acquisition across beauty enthusiast consumer groups by evolving our brand purpose and marketing mix, expanding our efforts to target specific consumer groups, and driving our leadership as a diversity-forward brand.

As we sharpen our brand positioning, we are increasing awareness of the Ulta Beauty brand by communicating our brand differentiation through broad scale advertising.

We leverage a wide range of marketing tactics including digital, television, direct mail, social media, and public relations to drive brand engagement, deepen the guest connection to Ulta Beauty, and strengthen our authority in the beauty category.

We also plan to continue to drive brand awareness and traffic by making human connections in more innovative and meaningful ways by continuing to transform our marketing mix towards channels of the future.

We intend to continue to innovate this program to keep it relevant, exciting, engaging, and growing.

Our vision is to personalize messaging, communication, and experiences across every touch point: in-store, online, and through digital (including mobile) and print channels.

We also continue to upgrade and enhance the Ulta Beauty Collection, our private label, which offers products in key categories such as cosmetics, skincare, and bath.

​

Our strategic vision is to transcend our competition by creating an immersive store experience that brings beauty to life in ways others cannot, by weaving together the best of products and services, focusing on human connection, and delivering a meaningful guest experience.

Ulta Beauty is a leading salon authority that provides high quality and consistent services from our licensed stylists and estheticians, with a focus on hair, skin, makeup, and brows.

Our service offering is an important platform because it creates a means to connect more closely with our guests and to elevate their experience in our stores.

Our strategy is to drive awareness and trial of our services with new guests as well as accelerate the frequency of existing guests’ visits.

We believe focusing on guest satisfaction, increasing effectiveness of promotions, and optimizing staffing, scheduling, and training will make our services business an even stronger differentiator in our stores.

Reinvent beauty digital engagement. Our strategic vision is to build industry leading digital experiences that engage our guests through our differentiated assortment, personalization, convenience, and interactive experiences.

To increase this engagement, we have a multifaceted approach to communicate, engage, and transact across all channels and touch points.

By creating digital experiences that are visual and immersive, and seamlessly merging content and commerce, we aim to be the unmatched source of personalized beauty information and make the beauty shopping experience fun, interactive, easy, and functional.

​

Deliver operational excellence and drive efficiencies. Our strategic vision is to manage end-to-end speed, quality, and efficiency to deliver exceptional guest experiences, while leveraging efficiencies of scale to drive profit improvement.

These operating efficiencies will help us fund investments required for future growth.

Our well-trained, non-commissioned store associates are highly engaged and deliver a differentiated guest experience.

We continue to expand the depth of our team at all levels and in all functional areas to support our growth.

Our research indicates that Ulta Beauty continues to increase market share across all categories.

However, our research also indicates that the cosmetics category in the overall U.S. market experienced declines in 2019.

Our stores

While we have opportunity to expand our footprint within the U.S., in fiscal 2019 we announced our decision to expand internationally and establish Ulta Beauty as a global brand, with our first market entry in Canada.

Omnichannel strategy

In addition to store expansion, we expect to significantly grow our omnichannel capabilities.

emerging beauty brands across all categories and price points, including Ulta Beauty’s own private label, the Ulta Beauty Collection.

During 2019, we launched “Sparked at Ulta Beauty,” which is a platform designed to feature a curated, ever-evolving selection of emerging brands, across all categories, in select stores and on ulta.com.

| ​ | ​ | 2020 | ​ | 2019 | ​ | 2018 |

We have developed a corporate culture that enables individual store managers to make store-level operating decisions, and we consistently reward high performance.

We train and educate our new store managers, prestige beauty advisors, and sales associates on our beauty products and services, our policies and procedures, opening and closing routines, guest service expectations, loss prevention practices, and our culture.

Our learning management system and our digital workplace system allows us to provide ongoing training to all associates to continually enhance their product knowledge, technical skills, and guest service expertise.

In contrast to the sales teams at traditional department stores, our retail sales teams are not commissioned.

Our prestige beauty advisors are trained to work across all prestige lines and within our prestige boutiques (sets of custom-designed fixtures configured to prominently display certain prestige brands within our stores), where guests can receive makeup demonstrations, skin analysis, and assistance in selecting the products and services that suit them best.

Distribution

Store replenishment order selection is performed using pick-to-light processing technologies.

certain product defects.

See Note [removed: 9] [added: 11] to our consolidated financial statements, “Commitments and contingencies - General litigation,” for information on legal proceedings.

For the fiscal year ended [removed: February 1, 2020][added: January 30, 2021]

The aggregate market value of the voting stock held by non-affiliates of the registrant, based upon the closing sale price of the common stock on [removed: August 2, 2019,] [added: July 31, 2020,] as reported on the NASDAQ Global Select Market, was approximately [removed: $14,367,080,000.][added: $8,127,797,000.]

The number of shares of the registrant’s common stock, par value $0.01 per share, outstanding as of March [removed: 23, 2020] [added: 22, 2021] was [removed: 56,309,476] [added: 56,205,592] shares.

Information required in response to Part III of Form 10-K is hereby incorporated by reference from portions of the registrant’s Proxy Statement for the [removed: 2020] [added: 2021] Annual Meeting of Stockholders.

Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended [removed: February 1, 2020.][added: January 30, 2021.]

| [Forward Looking Statements](#Forward_looking_statements) | | | [removed: ​] | 1 |

| [Part I](#PartI_472203) | [removed: ​] | ​ | ​ | ​ |

| [Item 1A.](#Item1ARiskFactors_628368) | ​ | [Risk Factors](#Item1ARiskFactors_628368) | ​ | [removed: 11] [added: 13] |

| [Item 1B.](#Item1BUnresolvedStaffComments_655706) | ​ | [Unresolved Staff Comments](#Item1BUnresolvedStaffComments_655706) | ​ | [removed: 22] [added: 23] |

| [Item 2.](#Item2Properties_676325) | ​ | [Properties](#Item2Properties_676325) | ​ | [removed: 23] [added: 24] |

| [Item 3.](#Item3LegalProceedings_817269) | ​ | [Legal Proceedings](#Item3LegalProceedings_817269) | ​ | [removed: 24] [added: 25] |

| [Item 4.](#Item4MineSafetyDisclosures_491985) | ​ | [Mine Safety Disclosures](#Item4MineSafetyDisclosures_491985) | ​ | [removed: 24] [added: 25] |

| [Item 5.](#Item5MarketforRegistrantsCommonEquityRel) | ​ | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#Item5MarketforRegistrantsCommonEquityRel) | ​ | [removed: 25] [added: 26] |

| [Item 6.](#Item6_835160) | ​ | [Selected Financial Data](#Item6_835160) | ​ | [removed: 28] [added: 29] |

| [Item 7.](#Item7_651497) | ​ | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#Item7_651497) | ​ | [removed: 29] [added: 30] |

| [Item 7A.](#Item7AQuantitativeandQualitativeDisclosu) | ​ | [Quantitative and Qualitative Disclosures about Market Risk](#Item7AQuantitativeandQualitativeDisclosu) | ​ | [removed: 41] [added: 43] |

| [Item 8.](#Item8FinancialStatementsandSupplementary) | ​ | [Financial Statements and Supplementary Data](#Item8FinancialStatementsandSupplementary) | ​ | [removed: 41] [added: 44] |

| [Item 9.](#Item9ChangesinandDisagreementswithAccoun) | ​ | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#Item9ChangesinandDisagreementswithAccoun) | ​ | [removed: 41] [added: 44] |

| [Item 9A.](#Item9AControlsandProcedures_91034) | ​ | [Controls and Procedures](#Item9AControlsandProcedures_91034) | ​ | [removed: 41] [added: 44] |

| [Item 9B.](#Item9BOtherInformation_494278) | ​ | [Other Information](#Item9BOtherInformation_494278) | ​ | [removed: 42] [added: 44] |

| [Item 10.](#Item10DirectorsExecutiveOfficersandCorpo) | ​ | [Directors, Executive Officers and Corporate Governance](#Item10DirectorsExecutiveOfficersandCorpo) | ​ | [removed: 42] [added: 45] |

| [Item 11.](#Item11ExecutiveCompensation_650349) | ​ | [Executive Compensation](#Item11ExecutiveCompensation_650349) | ​ | [removed: 42] [added: 45] |

| [Item 12.](#Item12SecurityOwnershipofCertainBenefici) | ​ | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#Item12SecurityOwnershipofCertainBenefici) | ​ | [removed: 42] [added: 45] |

| [Item 13.](#Item13CertainRelationshipsandRelatedTran) | ​ | [Certain Relationships and Related Transactions, and Director Independence](#Item13CertainRelationshipsandRelatedTran) | ​ | [removed: 42] [added: 45] |

| [Item 14.](#Item14PrincipalAccountantFeesandServices) | ​ | [Principal Accountant Fees and Services](#Item14PrincipalAccountantFeesandServices) | ​ | [removed: 43] [added: 45] |

| [Item 15.](#Item15ExhibitsandFinancialStatementSched) | ​ | [Exhibits and Financial Statement Schedules](#Item15ExhibitsandFinancialStatementSched) | ​ | [removed: 43] [added: 46] |

| [Item 16.](#Item16_10KSummary) | ​ | [Form 10-K Summary](#Item16_10KSummary) | ​ | [removed: 76] [added: 83] |

| [Signatures](#Signatures) | [removed: ​] | [removed: ​] | ​ | [removed: 77] [added: 84] |

| | ● | The [removed: uncertain] negative impacts the [removed: coronavirus (COVID-19)] [added: COVID-19 pandemic has had, and] will [added: continue to] have on our business, financial condition, profitability, cash flows and supply chain, as well as consumer [removed: spending;] [added: spending (including future uncertain impacts);] |

| | ● | epidemics, pandemics like COVID-19 or natural disasters that [added: have and] could [added: continue to] negatively impact sales; |

| | ● | changes in the overall level of consumer spending and volatility in the [removed: economy;] [added: economy, including as a result of the COVID-19 pandemic and/or government aid programs;] |

| | ● | the possibility that the capacity of our distribution and order fulfillment infrastructure and the performance of our [removed: newly opened and to be opened] distribution centers [added: and fast fulfillment centers] may not be adequate to support our [removed: recent growth and] expected future growth plans; |

| | ● | other risk factors detailed in our public filings with the Securities and Exchange Commission (the SEC), including risk factors contained in Item 1A, “Risk Factors” of this Annual Report on Form 10-K for the year ended [removed: February 1, 2020,] [added: January 30, 2021,] as such may be amended or supplemented in our subsequently filed Quarterly Reports on Form 10-Q. |

| ​ ​ | ​ |

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

⌧

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| [Item 4A.](#Item4A) | ​ | [Executive Officers](#Item4A) | ​ | 25 |

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| | ● | a decline in operating results that has and may continue to lead to asset impairment and store closure charges; |

| --- | --- | --- |

| ​ incorporation or organization) ​ | ​ Identification No.) ​ |

| ​ | | | ​ | ​ |

All of our retail stores, distribution centers, [added: fast fulfillment centers,] and corporate offices are leased or subleased.

As of [removed: February 1, 2020,] [added: January 30, 2021,] we operated [removed: 1,254] [added: 1,264] retail stores across 50 states, as shown in the table below:

| California | ​ | [removed: 159] [added: 156] | ​ | New Jersey | ​ | [removed: 38] [added: 42] |

| Connecticut | ​ | [removed: 16] [added: 17] | ​ | New York | ​ | [removed: 50] [added: 49] |

| Florida | ​ | [removed: 84] [added: 86] | ​ | North Dakota | ​ | 3 |

| Idaho | ​ | 9 | ​ | Oregon | ​ | [removed: 14] [added: 17] |

| Illinois | ​ | 55 | ​ | Pennsylvania | ​ | [removed: 45] [added: 44] |

| Kentucky | ​ | 15 | ​ | Tennessee | ​ | [removed: 26] [added: 27] |

| Louisiana | ​ | [removed: 19] [added: 18] | ​ | Texas | ​ | [removed: 115] [added: 117] |

| Maryland | ​ | [removed: 25] [added: 27] | ​ | Vermont | ​ | 1 |

| Massachusetts | ​ | 21 | ​ | Virginia | ​ | [removed: 29] [added: 30] |

| Michigan | ​ | [removed: 49] [added: 48] | ​ | Washington | ​ | [removed: 36] [added: 34] |

| Minnesota | ​ | [removed: 18] [added: 19] | ​ | West Virginia | ​ | 7 |

| Missouri | ​ | [removed: 24] [added: 25] | ​ | Wyoming | ​ | [removed: 2] [added: 3] |

Our standard distribution [added: center] and fast fulfillment center lease provides for a fixed minimum annual rent and generally has a 10 or 15-year initial term with three or four renewal options with terms of five years each.

The general location, approximate size, and lease expiration [removed: dates of our] [added: date for each] distribution [removed: centers] [added: center] (DC) and fast fulfillment [removed: centers] [added: center] (FFC) at [removed: February 1, 2020,] [added: January 30, 2021,] are set forth below:

| Jacksonville, Florida [removed: (1)] | ​ | FFC | ​ | 203,463 | ​ | September 30, 2029 |

| Romeoville, Illinois [removed: (2)] | ​ | FFC | ​ | 291,000 | ​ | May 31, 2023 |

The corporate office is approximately [removed: 411,000] [added: 341,000] square feet with lease terms expiring [removed: from 2020 to] [added: in] 2028.

| ​ | ​ | ​ | ​ | Total | ​ | 1,264 |

| Chambersburg, Pennsylvania | ​ | DC | ​ | 503,605 | ​ | June 30, 2027 |

​

| Chambersburg, Pennsylvania | ​ | DC | ​ | 373,000 | ​ | March 31, 2027 |

| (1) | The Jacksonville, Florida fast fulfillment center is expected to open in fiscal 2021. |

| --- | --- |

| (2) | The Romeoville, Illinois distribution center was converted to a fast fulfillment center in fiscal 2019. |

| --- | --- |

EXECUTIVE OFFICERS OF THE REGISTRANT

The names of our executive officers, their ages and their positions are shown below:

| ​ | ​ | ​ | ​ | ​ |

| --- | --- | --- | --- | --- |

| Name | | Age | | Position |

| Mary N. Dillon | ​ | 58 | ​ | Chief Executive Officer and member of the Board of Directors |

| David C. Kimbell | ​ | 53 | ​ | President |

| Scott M. Settersten | ​ | 59 | ​ | Chief Financial Officer, Treasurer and Assistant Secretary |

| Jodi J. Caro | ​ | 54 | ​ | General Counsel, Chief Compliance Officer and Corporate Secretary |

| Jeffrey J. Childs | ​ | 62 | ​ | Chief Human Resources Officer |

| ​ | ​ | ​ |

| --- | --- | --- |

There is no family relationship between any of the directors or executive officers and any other director or executive officer of Ulta Beauty.

_Mary N.

Dillon._ Ms. Dillon was named Chief Executive Officer effective July 2013.

Prior to joining Ulta Beauty, she was President and Chief Executive Officer and a Director of U.S. Cellular from June 2010 to July 2013.

From 2005 to 2010, Ms. Dillon served as Global Chief Marketing Officer and Executive Vice President for McDonald’s Corporation.

Prior to joining McDonald’s Corporation, she held various positions at PepsiCo, including President of the Quaker Foods

division.

Ms. Dillon serves as a member of the Board of Directors for Starbucks Corporation and KKR & Co. Inc. and previously served on the board of Target Corporation from 2007 to 2013.

_David C.

Kimbell._ Mr. Kimbell was named President in December 2019 after having previously served as Chief Merchandising and Marketing Officer since March 2015 and Chief Marketing Officer since February 2014.

Prior to joining Ulta Beauty, he was Chief Marketing Officer and Executive Vice President at U.S. Cellular since February 2011.

From 2008 to 2011, Mr. Kimbell served as Chief Marketing Officer and Senior Vice President of Seventh Generation, a producer of environmentally friendly household and baby care products.

Prior to that from 2001 to 2008, Mr. Kimbell held various positions at PepsiCo, Quaker Food Division, including Vice President of Marketing.

Mr. Kimbell held a number of marketing roles for several brands at The Procter and Gamble Company from 1995 to 2001.

_Scott M.

Settersten._ Mr. Settersten was named Chief Financial Officer, Treasurer and Assistant Secretary in March 2013 after having previously served as Acting Chief Financial Officer and Assistant Secretary since October 2012.

Prior to this role, Mr. Settersten served as Vice President of Accounting since 2010 and was responsible for accounting, tax, external reporting and investor relations.

He joined Ulta Beauty in January 2005 as a Director of Financial Reporting.

Prior to joining Ulta Beauty, Mr. Settersten spent 15 years with PricewaterhouseCoopers LLP as a certified public accountant serving in various senior manager roles in the assurance and risk management practices.

_Jodi J.

Caro._ Ms. Caro was named General Counsel, Chief Compliance Officer and Corporate Secretary in August 2015.

Prior to joining Ulta Beauty, she was Vice President, General Counsel and Secretary for Integrys Energy Group, in addition to holding the role of Integrys’ Chief Compliance and Ethics Officer.

Prior to joining Integrys in 2008, Ms. Caro owned and operated her own law practice, which provided general counsel and corporate services to clients ranging from established multi-million-dollar companies to medium and small early-stage enterprises.

Prior to opening her law practice in 2006, she was co-founder and General Counsel of Looking Glass Networks, a privately held, facilities-based telecommunications company, and served as an in-house attorney with MCI/WORLDCOM.

_Jeffrey J.

Childs_.

Mr. Childs was named Chief Human Resource Officer in October 2013.

Prior to joining Ulta Beauty, he was Executive Vice President and Chief Human Resource Officer at U.S. Cellular after joining as Senior Vice President of Human Resources in 2004.

The names of our executive officers, their ages and their positions, as of March 1, 2021, are shown below:

| ​ | ​ | ​ | ​ | ​ |

| --- | --- | --- | --- | --- |

| Name | | Age | | Position |

| Mary N. Dillon | ​ | 59 | ​ | Chief Executive Officer and member of the Board of Directors |

| David C. Kimbell | ​ | 54 | ​ | President |

| Scott M. Settersten | ​ | 60 | ​ | Chief Financial Officer, Treasurer and Assistant Secretary |

| Jodi J. Caro | ​ | 55 | ​ | General Counsel, Chief Compliance Officer and Corporate Secretary |

| Jeffrey J. Childs | ​ | 63 | ​ | Chief Human Resources Officer |

There is no family relationship between any of the directors or executive officers and any other director or executive officer of Ulta Beauty.

_Mary N.

Dillon._ Ms. Dillon was named Chief Executive Officer effective July 2013.

Prior to joining Ulta Beauty, she was President and Chief Executive Officer and a Director of U.S. Cellular from June 2010 to July 2013.

From 2005 to 2010, Ms. Dillon served as Global Chief Marketing Officer and Executive Vice President for McDonald’s Corporation.

Prior to joining McDonald’s, she held various positions at PepsiCo, including President of the Quaker Foods division.

Ms. Dillon serves as a member of the Board of Directors for Starbucks Corporation and KKR & Co. Inc. and previously served on the board of Target Corporation from 2007 to 2013.

_David C.

Kimbell._ Mr. Kimbell was named President in December 2019 after having previously served as Chief Merchandising and Marketing Officer since March 2015 and Chief Marketing Officer since February 2014.

Prior to joining Ulta Beauty, he was Chief Marketing Officer and Executive Vice President at U.S. Cellular since February 2011.

From 2008 to 2010, Mr. Kimbell served as Chief Marketing Officer and Senior Vice President of Seventh Generation, a producer of environmentally friendly household and baby care products.

Prior to that from 2001 to 2008, Mr. Kimbell held various positions at PepsiCo, Quaker Food Division, including Vice President of Marketing.

Mr. Kimbell held a number of brand management roles in the Beauty Division of The Procter and Gamble Company from 1995 to 2001.

_Scott M.

Settersten._ Mr. Settersten was named Chief Financial Officer, Treasurer and Assistant Secretary in March 2013 after having previously served as Acting Chief Financial Officer and Assistant Secretary since October 2012.

Prior to this role, Mr. Settersten served as Vice President of Accounting since 2010 and was responsible for accounting, tax, external reporting and investor relations.

He joined Ulta Beauty in January 2005 as a Director of Financial Reporting.

Prior to joining Ulta Beauty, Mr. Settersten spent 15 years with PricewaterhouseCoopers LLP as a certified public accountant serving in various senior manager roles in the assurance and risk management practices.

_Jodi J.

Caro._ Ms. Caro was named General Counsel, Chief Compliance Officer and Corporate Secretary in August 2015.

Prior to joining Ulta Beauty, she was Vice President, General Counsel and Secretary for Integrys Energy Group, in addition to holding the role of Integrys’ Chief Compliance and Ethics Officer.

Prior to joining Integrys in 2008, Ms. Caro owned and operated her own law practice, which provided general counsel and corporate services to clients ranging from established multi-million-dollar companies to medium and small early-stage enterprises.

Prior to opening her law practice in 2006, she was co-founder and General Counsel of Looking Glass Networks, a privately held, facilities-based telecommunications company, and served as an in-house attorney with MCI/WORLDCOM.

_Jeffrey J.

Childs_.

Mr. Childs was named Chief Human Resource Officer in October 2013.

Prior to joining Ulta Beauty, he was Executive Vice President and Chief Human Resource Officer at U.S. Cellular after joining as Senior Vice President of Human Resources in 2004.

From 2001 to 2004, he was President and Owner of Childs Consulting Services.

Previously, he served from 1979 to 2001 in a variety of human resources, marketing, sales and operations roles at AT&T, including Vice President, Human Resources and Corporate Services.

Part II

The last reported sale price of our common stock on the NASDAQ Global Select Market on March [removed: 23, 2020] [added: 22, 2021] was [removed: $143.24] [added: $315.09] per share.

As of March [removed: 23, 2020,] [added: 22, 2021,] we had [removed: 32] [added: 34] holders of record of our common stock.

The following table sets forth repurchases of our common stock during the fourth quarter of [removed: 2019:][added: fiscal 2020:]

| (1) | There were [removed: 681,458] [added: 147,824] shares repurchased as part of our publicly announced share repurchase program during the 13 weeks ended [removed: February 1, 2020,] [added: January 30, 2021] and there were [removed: 700] [added: 413] shares transferred from employees in satisfaction of minimum statutory tax withholding obligations upon the vesting of restricted stock during the period. |

| (2) | On March [removed: 14, 2019,] [added: 12, 2020,] we announced our [removed: 2019] [added: 2020] share repurchase program pursuant to which the Company may repurchase up to [removed: $875.0 million] [added: $1.6 billion] of the Company’s common stock. [removed: The 2019] [added: As of January 30, 2021, $1.5 billion remained available under the $1.6 billion 2020] share repurchase [removed: program did] [added: program, which does] not have an expiration date but [removed: provided for suspension] [added: which may be suspended] or [removed: discontinuation] [added: discontinued] at any time. [removed: As of February 1, 2020, $214.6 million remained available under the $875.0 million 2019 share repurchase program. On March 12, 2020, we announced the 2020 share repurchase program. For additional information on the 2020 share repurchase program see Note 20 to our consolidated financial statements, “Subsequent event.”] |

The following table provides information about Ulta Beauty common stock that may be issued under our equity compensation plans as of [removed: February 1, 2020:][added: January 30, 2021:]

| (2) | Includes [removed: 539,155] [added: 671,344] shares issuable pursuant to the exercise of outstanding stock options, [removed: 159,363] [added: 252,713] shares issuable pursuant to restricted stock units, and [removed: 62,402] [added: 37,356] shares issuable pursuant to performance-based units. |

Set forth below is a graph comparing the cumulative total stockholder return on Ulta Beauty’s common stock with the NASDAQ Global Select Market Composite Index [removed: (NQGS)] [added: (NQGS), the S&P 500,] and the S&P [removed: Retail Index (RLX)] [added: 500 Retailing/RLX (Industry Group, SP500-2550)] for the period covering January [removed: 31, 2015] [added: 30, 2016] through the end of Ulta Beauty’s fiscal year ended [removed: February 1, 2020.][added: January 30, 2021.]

The graph assumes an investment of $100 made at the closing of trading on January [removed: 31, 2015] [added: 30, 2016] in (i) Ulta Beauty’s common stock, (ii) the stocks comprising the [removed: NQGS and] [added: NQGS,] (iii) [added: the] stocks comprising the [removed: RLX.][added: S&P 500 and (iv) the stocks comprising the S&P 500 Retailing/RLX (Industry Group, SP500-2550).]

[removed: ][added: ]

| ​ | ​ | January [removed: 31, | | ​ | January] 30, | | ​ | January 28, | | ​ | February 3, | | ​ | February 2, | | ​ | February 1, | | [added: ​ | January 30, | |]

| Company / Index | | [removed: 2015 | | |] 2016 | | | 2017 | | | 2018 | | | 2019 | | | 2020 | | [added: | 2021 | |]

| November 1, 2020 to November 28, 2020 | ​ | 311 | ​ | $ | 215.02 | ​ | – | ​ | $ | 1,563,863 |

| November 29, 2020 to December 26, 2020 | ​ | 43,218 | ​ | ​ | 266.41 | ​ | 43,218 | ​ | ​ | 1,552,349 |

| December 27, 2020 to January 30, 2021 | ​ | 104,708 | ​ | ​ | 290.62 | ​ | 104,606 | ​ | ​ | 1,521,949 |

| 13 weeks ended January 30, 2021 | ​ | 148,237 | ​ | ​ | 283.40 | ​ | 147,824 | ​ | ​ | 1,521,949 |

| Equity compensation plans approved by security holders (1) | | 961,413 | ​ | $ | 208.47 | | 2,791,165 |

As Ulta Beauty is a part of the S&P 500, pursuant to the rules of the SEC, the S&P 500 is included in the graph below.

| Ulta Beauty | ​ | $ | 100.00 | | $ | 150.29 | | $ | 122.59 | | $ | 161.13 | | $ | 147.88 | | $ | 154.42 |

| NQGS | ​ | ​ | 100.00 | ​ | ​ | 121.62 | ​ | ​ | 160.75 | ​ | ​ | 157.85 | ​ | ​ | 199.43 | ​ | ​ | 282.53 |

| S&P 500 | ​ | ​ | 100.00 | ​ | ​ | 117.45 | ​ | ​ | 145.54 | ​ | ​ | 139.37 | ​ | ​ | 166.24 | ​ | ​ | 191.43 |

| S&P 500 Retailing (RLX) | ​ | ​ | 100.00 | ​ | ​ | 116.83 | ​ | ​ | 168.04 | ​ | ​ | 180.73 | ​ | ​ | 210.51 | ​ | ​ | 234.02 |

| November 3, 2019 to November 30, 2019 | ​ | 138,567 | ​ | $ | 238.46 | ​ | 138,167 | ​ | $ | 355,817 |

| December 1, 2019 to December 28, 2019 | ​ | 215,290 | ​ | ​ | 250.41 | ​ | 215,290 | ​ | ​ | 301,906 |

| December 29, 2019 to February 1, 2020 | ​ | 328,301 | ​ | ​ | 266.02 | ​ | 328,001 | ​ | ​ | 214,650 |

| 13 weeks ended February 1, 2020 | ​ | 682,158 | ​ | ​ | 255.50 | ​ | 681,458 | ​ | ​ | 214,650 |

| Equity compensation plans approved by security holders (1) | | 760,920 | ​ | $ | 212.58 | | 3,194,142 |

| Ulta Beauty | ​ | $ | 100.00 | | $ | 137.31 | | $ | 206.37 | | $ | 168.33 | | $ | 221.25 | | $ | 203.05 |

| NQGS | ​ | ​ | 100.00 | ​ | ​ | 100.13 | ​ | ​ | 121.78 | ​ | ​ | 160.96 | ​ | ​ | 158.06 | ​ | ​ | 199.69 |

| RLX | ​ | ​ | 100.00 | ​ | ​ | 115.56 | ​ | ​ | 135.00 | ​ | ​ | 194.19 | ​ | ​ | 208.85 | ​ | ​ | 243.26 |

| ​ | ​ | [added: January 30, | | ​ |] February 1, | | ​ | February 2, | | ​ | February 3, | | ​ | January 28, | | [removed: ​ | January 30, | |]

| ​ | ​ | [added: 2021 | | |] 2020 | | | 2019 (2) | | | 2018 (3) | | | 2017 | | [removed: | 2016 | |]

| ​ | ​ | (In thousands, except per share and per square foot [removed: data)] [added: data and number of stores)] | | | | | | | | | | | | | |

| Net sales | ​ | $ | [removed: 7,398,068] [added: 6,151,953] | ​ | $ | [removed: 6,716,615] [added: 7,398,068] | ​ | $ | [removed: 5,884,506] [added: 6,716,615] | ​ | $ | [removed: 4,854,737] [added: 5,884,506] | ​ | $ | [removed: 3,924,116] [added: 4,854,737] |

| Cost of sales | ​ | ​ | [removed: 4,717,004] [added: 4,202,794] | ​ | ​ | [removed: 4,307,304] [added: 4,717,004] | ​ | ​ | [removed: 3,787,697] [added: 4,307,304] | ​ | ​ | [removed: 3,107,508] [added: 3,787,697] | ​ | ​ | [removed: 2,539,783] [added: 3,107,508] |

| Gross profit | ​ | ​ | [removed: 2,681,064] [added: 1,949,159] | ​ | ​ | [removed: 2,409,311] [added: 2,681,064] | ​ | ​ | [removed: 2,096,809] [added: 2,409,311] | ​ | ​ | [removed: 1,747,229] [added: 2,096,809] | ​ | ​ | [removed: 1,384,333] [added: 1,747,229] |

| Selling, general and administrative expenses | ​ | ​ | [removed: 1,760,716] [added: 1,583,017] | ​ | ​ | [removed: 1,535,464] [added: 1,760,716] | ​ | ​ | [removed: 1,287,232] [added: 1,535,464] | ​ | ​ | [removed: 1,073,834] [added: 1,287,232] | ​ | ​ | [removed: 863,354] [added: 1,073,834] |

| Pre-opening expenses | ​ | ​ | [removed: 19,254] [added: 15,000] | ​ | ​ | [removed: 19,767] [added: 19,254] | ​ | ​ | [removed: 24,286] [added: 19,767] | ​ | ​ | [removed: 18,571] [added: 24,286] | ​ | ​ | [removed: 14,682] [added: 18,571] |

| Operating income | ​ | ​ | [removed: 901,094] [added: 236,820] | ​ | ​ | [removed: 854,080] [added: 901,094] | ​ | ​ | [removed: 785,291] [added: 854,080] | ​ | ​ | [removed: 654,824] [added: 785,291] | ​ | ​ | [removed: 506,297] [added: 654,824] |

| Interest [removed: income,] [added: expense (income),] net | ​ | ​ | [removed: (5,056)] [added: 5,735] | ​ | ​ | [removed: (5,061)] [added: (5,056)] | ​ | ​ | [removed: (1,568)] [added: (5,061)] | ​ | ​ | [removed: (890)] [added: (1,568)] | ​ | ​ | [removed: (1,143)] [added: (890)] |

| Income before income taxes | ​ | ​ | [removed: 906,150] [added: 231,085] | ​ | ​ | [removed: 859,141] [added: 906,150] | ​ | ​ | [removed: 786,859] [added: 859,141] | ​ | ​ | [removed: 655,714] [added: 786,859] | ​ | ​ | [removed: 507,440] [added: 655,714] |

| Income tax expense (4) | ​ | ​ | [removed: 200,205] [added: 55,250] | ​ | ​ | [removed: 200,582] [added: 200,205] | ​ | ​ | [removed: 231,625] [added: 200,582] | ​ | ​ | [removed: 245,954] [added: 231,625] | ​ | ​ | [removed: 187,432] [added: 245,954] |

| Net income | ​ | $ | [removed: 705,945] [added: 175,835] | ​ | $ | [removed: 658,559] [added: 705,945] | ​ | $ | [removed: 555,234] [added: 658,559] | ​ | $ | [removed: 409,760] [added: 555,234] | ​ | $ | [removed: 320,008] [added: 409,760] |

| Basic | ​ | $ | [removed: 12.21] [added: 3.12] | ​ | $ | [removed: 11.00] [added: 12.21] | ​ | $ | [removed: 9.02] [added: 11.00] | ​ | $ | [removed: 6.55] [added: 9.02] | ​ | $ | [removed: 5.00] [added: 6.55] |

| Diluted | ​ | $ | [removed: 12.15] [added: 3.11] | ​ | $ | [removed: 10.94] [added: 12.15] | ​ | $ | [removed: 8.96] [added: 10.94] | ​ | $ | [removed: 6.52] [added: 8.96] | ​ | $ | [removed: 4.98] [added: 6.52] |

| Basic | ​ | ​ | [removed: 57,840] [added: 56,351] | ​ | ​ | [removed: 59,864] [added: 57,840] | ​ | ​ | [removed: 61,556] [added: 59,864] | ​ | ​ | [removed: 62,519] [added: 61,556] | [added: ​] | ​ | [removed: 63,949] [added: 62,519] |

| Diluted | ​ | ​ | [removed: 58,105] [added: 56,558] | ​ | ​ | [removed: 60,181] [added: 58,105] | ​ | ​ | [removed: 61,975] [added: 60,181] | ​ | ​ | [removed: 62,851] [added: 61,975] | ​ | ​ | [removed: 64,275] [added: 62,851] |

| Comparable sales [removed: increase] (5) | ​ | ​ | [removed: 5.0%] [added: (17.9)%] | ​ | ​ | [removed: 8.1%] [added: 5.0%] | ​ | ​ | [removed: 11.0%] [added: 8.1%] | ​ | ​ | [removed: 15.8%] [added: 11.0%] | ​ | ​ | [removed: 11.8%] [added: 15.8%] |

| Number of stores end of year | ​ | ​ | [removed: 1,254] [added: 1,264] | ​ | ​ | [removed: 1,174] [added: 1,254] | ​ | ​ | [removed: 1,074] [added: 1,174] | ​ | ​ | [removed: 974] [added: 1,074] | ​ | ​ | [removed: 874] [added: 974] |

| Total square footage end of year | ​ | ​ | [removed: 13,193,076] [added: 13,291,838] | ​ | ​ | [removed: 12,337,145] [added: 13,193,076] | ​ | ​ | [removed: 11,300,920] [added: 12,337,145] | ​ | ​ | [removed: 10,271,184] [added: 11,300,920] | ​ | ​ | [removed: 9,225,957] [added: 10,271,184] |

| Total square footage per store (6) | ​ | ​ | [removed: 10,521] [added: 10,516] | ​ | ​ | [removed: 10,509] [added: 10,521] | ​ | ​ | [removed: 10,522] [added: 10,509] | ​ | ​ | [removed: 10,545] [added: 10,522] | ​ | ​ | [removed: 10,556] [added: 10,545] |

| Average total square footage (7) | ​ | ​ | [removed: 12,804,988] [added: 13,260,705] | ​ | ​ | [removed: 11,893,413] [added: 12,804,988] | ​ | ​ | [removed: 10,742,874] [added: 11,893,413] | ​ | ​ | [removed: 9,641,367] [added: 10,742,874] | ​ | ​ | [removed: 8,724,581] [added: 9,641,367] |

| Capital expenditures | ​ | [added: $ | 151,866 |] ​ | [added: $ |] 298,534 | ​ | [removed: ​] [added: $] | 319,400 | ​ | [removed: ​] [added: $] | 440,714 | ​ | [removed: ​] [added: $] | 373,747 | [removed: ​ | ​ | 299,167 |]

| Depreciation and amortization | ​ | ​ | [removed: 295,599] [added: 297,772] | ​ | ​ | [removed: 279,472] [added: 295,599] | ​ | ​ | [removed: 252,713] [added: 279,472] | ​ | ​ | [removed: 210,295] [added: 252,713] | ​ | ​ | [removed: 165,049] [added: 210,295] |

| Repurchase of common shares | ​ | ​ | [removed: 680,979] [added: 114,895] | ​ | ​ | [removed: 616,194] [added: 680,979] | ​ | ​ | [removed: 367,581] [added: 616,194] | ​ | ​ | [removed: 344,275] [added: 367,581] | ​ | ​ | [removed: 167,396] [added: 344,275] |

| Cash and cash equivalents | ​ | $ | [removed: 392,325] [added: 1,046,051] | ​ | $ | [removed: 409,251] [added: 392,325] | ​ | $ | [removed: 277,445] [added: 409,251] | ​ | $ | [removed: 385,010] [added: 277,445] | ​ | $ | [removed: 345,840] [added: 385,010] |

| Short-term investments | ​ | ​ | [removed: 110,000] [added: —] | ​ | ​ | [removed: —] [added: 110,000] | ​ | ​ | [removed: 120,000] [added: —] | ​ | ​ | [removed: 30,000] [added: 120,000] | ​ | ​ | [removed: 130,000] [added: 30,000] |

| Working capital | ​ | ​ | [removed: 918,056] [added: 1,171,064] | ​ | ​ | [removed: 1,091,125] [added: 918,056] | ​ | ​ | [removed: 1,051,577] [added: 1,091,125] | ​ | ​ | [removed: 1,006,894] [added: 1,051,577] | ​ | ​ | [removed: 978,946] [added: 1,006,894] |

| Property and equipment, net | ​ | ​ | [removed: 1,205,524] [added: 995,795] | ​ | ​ | [removed: 1,226,029] [added: 1,205,524] | ​ | ​ | [removed: 1,189,453] [added: 1,226,029] | ​ | ​ | [removed: 1,004,358] [added: 1,189,453] | ​ | ​ | [removed: 847,600] [added: 1,004,358] |

| Total assets (8) | ​ | ​ | [removed: 4,863,872] [added: 5,089,969] | ​ | ​ | [removed: 3,191,172] [added: 4,863,872] | ​ | ​ | [removed: 2,908,687] [added: 3,191,172] | ​ | ​ | [removed: 2,551,878] [added: 2,908,687] | ​ | ​ | [removed: 2,230,918] [added: 2,551,878] |

| Operating lease liabilities (8) | ​ | ​ | [removed: 1,938,347] [added: 1,896,801] | ​ | ​ | [removed: —] [added: 1,938,347] | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — |

| Total stockholders' equity | ​ | ​ | [removed: 1,902,094] [added: 1,999,549] | ​ | ​ | [removed: 1,820,218] [added: 1,902,094] | ​ | ​ | [removed: 1,774,217] [added: 1,820,218] | ​ | ​ | [removed: 1,550,218] [added: 1,774,217] | ​ | ​ | [removed: 1,442,886] [added: 1,550,218] |

| (5) | Comparable sales [removed: increase] reflects sales for stores beginning on the first day of the 14th month of operation. Remodeled stores are included in comparable sales unless the store was closed for a portion of the current or comparable prior year. |

| | | | | | | | | | | | | | | | |

| Statement of operations: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| Impairment, restructuring and other costs | ​ | ​ | 114,322 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — |

| Income statement: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

Based on management’s evaluation as of [removed: February 1, 2020,] [added: January 30, 2021,] our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) are effective to ensure that the information required to be disclosed by us in our reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Internal control over financial reporting is a process designed by, or under the supervision of, the principal executive officer and principal financial officer and effected by the Board of Directors, management, and other personnel, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with [removed: GAAP.][added: U.S generally accepted accounting principles.]

Under the supervision and with the participation of our principal executive officer and our principal financial officer, management evaluated the effectiveness of our internal control over financial reporting as of [removed: February 1, 2020,] [added: January 30, 2021,] based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO).

Based on this evaluation, our principal executive officer and principal financial officer concluded that our internal controls over financial reporting were effective as of [removed: February 1, 2020.][added: January 30, 2021.]

Ernst & Young LLP, the independent registered public accounting firm that audited our financial statements included in this Annual Report on Form 10-K, has audited the effectiveness of our internal control over financial reporting as of [removed: February 1, 2020] [added: January 30, 2021] and has issued the attestation report included in Item 15 of this Annual Report on Form 10-K.

There were no changes to our internal controls over financial reporting during the 13 weeks ended [removed: February 1, 2020] [added: January 30, 2021] that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

The information required by this item with respect to our executive officers is set forth [removed: after] [added: in] Part I, Item [removed: 4] [added: 4A] of this Annual Report on Form 10-K under the caption “Executive [removed: Officers of the Registrant.”] [added: Officers.”] The additional information required by this item is included under the captions “Corporate Governance – Code of Business Conduct,” “Corporate Governance – Nomination Process – Qualifications,” “Corporate Governance – Proposal One – Election of Directors,” “Corporate Governance – Information About Our Director Nominees,” “Corporate Governance – Information About Our Directors Continuing in Office” and “Corporate Governance – Audit Committee” in our definitive Proxy Statement for our [removed: 2020] [added: 2021] Annual Meeting of Stockholders (the Proxy Statement) and is hereby incorporated herein by reference.

The information required by this item is included under the captions “Compensation Discussion and Analysis,” “Corporate Governance – Compensation Committee,” “Corporate Governance – Report of the Compensation Committee of the Board of Directors,” and “Corporate Governance – Non-Executive Director Compensation for Fiscal [removed: 2019”] [added: 2020”] in the Proxy Statement and is hereby incorporated herein by reference.

The information required by this item with respect to compensation plans under which our equity securities are authorized for issuance as of [removed: February 1, 2020] [added: January 30, 2021] is set forth in Item 5 of this Annual Report on Form 10-K under the caption “Securities authorized for issuance under equity compensation plans.”

| [Reports of Independent Registered Public Accounting Firm](#ReportofIndependentRegisteredPublicAccou) | [removed: 44] [added: 47] |

| [Consolidated Balance Sheets](#Consol_Balance_Sheets) | [removed: 49] [added: 52] |

| [Consolidated Statements of [removed: Income](#Consol_Stmnts_Income)] [added: Operations](#Consol_Stmnts_Income)] | [removed: 50] [added: 53] |

| [Consolidated Statements of Cash Flows](#Consol_Stmnts_Cash_Flows) | [removed: 51] [added: 55] |

| [Consolidated Statements of Stockholders’ Equity](#Consol_Stmnts_Stockhldrs_Equity) | [removed: 52] [added: 56] |

| [Notes to Consolidated Financial Statements](#Notes_to_Consol_Fin_Statements) | [removed: 53] [added: 57] |

| [Schedule II – Valuation and Qualifying Accounts](#Schedule_II) | [removed: 73] [added: 80] |

We have audited the accompanying consolidated balance sheets of Ulta Beauty, Inc. (the Company) as of [added: January 30, 2021, and] February 1, 2020, [removed: and February 2, 2019,] the related consolidated statements of [added: operations, comprehensive] income, stockholders’ equity, and cash flows for each of the three years in the period ended [removed: February 1, 2020,] [added: January 30, 2021,] and the related notes and financial statement schedule listed in the Index at Item 15 (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at [removed: February 1, 2020] [added: January 30, 2021] and February [removed: 2, 2019,] [added: 1, 2020,] and the consolidated results of its operations and its cash flows for each of the three years in the period ended [removed: February 1, 2020,] [added: January 30, 2021,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of [removed: February 1, 2020,] [added: January 30, 2021,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March [removed: 27, 2020] [added: 26, 2021] expressed an unqualified opinion thereon.

| Description of the matter | The Company maintains a loyalty program, Ultamate Rewards, which offers members the ability to earn and redeem points on purchases of products and services. As described in Notes 2 and [removed: 4] [added: 5] to the consolidated financial statements, revenue from the loyalty program is recognized when the members redeem points or points expire. The Company estimates the amount of revenue to defer using the standalone selling price of the points earned and the expected redemption percentage. The Company evaluates its estimated standalone selling price quarterly based on the value of products or services purchased using points. The expected redemption percentage is based on historical redemption patterns in conjunction with current information and trends. [removed: The Company evaluates the estimated redemption rate based on observed customer behaviors and trends.] ​ Auditing the Company’s estimate of loyalty deferred revenue was complex because the calculation involves subjective management assumptions for the standalone selling price and expected redemption rate. In particular, the estimate is sensitive to these significant assumptions, which are affected by expectations about future customer behavior. [added: ​] |

| How we addressed the matter in our audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s estimation process and controls supporting the measurement and recognition of the amount of loyalty revenue deferred. This included testing controls over management’s review of the assumptions and other inputs used in the estimation, the completeness and accuracy of issuance and redemption data used in the calculation and controls over the assignment of membership levels based on customer spending patterns. ​ Our audit procedures included, among others, evaluating the methodology used, analyzing the significant assumptions discussed above, and testing the accuracy and completeness of the underlying data used in management’s calculation. To audit the standalone selling price per point, we validated that the price per point for each membership level was appropriate based on products or services purchased by loyalty members. To audit the redemption rate, we tested redemption activity and compared the results of that testing to the redemption rate used by management in its estimate. We also considered recent trends in redemption activity [removed: as well as loyalty customer behavior] and [removed: spending by membership level and] the impact on the redemption rate. In addition, we performed sensitivity analyses of significant assumptions to evaluate the change in the deferral amounts. |

We have audited Ulta Beauty, Inc.’s internal control over financial reporting as of [removed: February 1, 2020,] [added: January 30, 2021,] based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Ulta Beauty, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of [removed: February 1, 2020,] [added: January 30, 2021,] based on COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of [removed: February 1, 2020] [added: January 30, 2021] and February [removed: 2, 2019,] [added: 1, 2020,] the related consolidated statements of [added: operations, comprehensive] income, stockholders’ equity and cash flows for each of the three years in the period ended [removed: February 1, 2020,] [added: January 30, 2021,] and the related notes and financial statement schedule listed in the Index at Item 15 and our report dated March [removed: 27, 2020] [added: 26, 2021] expressed an unqualified opinion thereon.

| ​ | ​ | [removed: February 1,] [added: January 30,] | | ​ | February [removed: 2,] [added: 1,] | |

| (In thousands, except per share data) | [added: ​] | [added: 2021 | | |] 2020 | | | 2019 | |

| Cash and cash equivalents [added: at beginning of year] | ​ | [removed: $] [added: ​] | 392,325 | ​ | [removed: $] [added: ​] | 409,251 | [added: ​ | ​ | 277,445 |]

| Short-term investments | ​ | ​ | [removed: 110,000] [added: —] | ​ | ​ | [removed: —] [added: 110,000] |

| Receivables, net | ​ | ​ | [removed: 139,337] [added: 193,109] | ​ | ​ | [removed: 136,168] [added: 139,337] |

| Merchandise inventories, net | ​ | ​ | [removed: 1,293,701] [added: 1,168,215] | ​ | ​ | [removed: 1,214,329] [added: 1,293,701] |

| Prepaid expenses and other current assets | ​ | ​ | [removed: 103,567] [added: 107,402] | ​ | ​ | [removed: 138,116] [added: 103,567] |

| Prepaid income taxes | ​ | ​ | [removed: 16,387] [added: —] | ​ | ​ | [removed: 16,997] [added: 16,387] |

| Total current assets | ​ | ​ | [removed: 2,055,317] [added: 2,514,777] | ​ | ​ | [removed: 1,914,861] [added: 2,055,317] |

| Property and equipment, net | ​ | ​ | [removed: 1,205,524] [added: 995,795] | ​ | ​ | [removed: 1,226,029] [added: 1,205,524] |

| Operating lease assets | ​ | ​ | [removed: 1,537,565] [added: 1,504,614] | ​ | ​ | [removed: —] [added: 1,537,565] |

| Other intangible assets, net | ​ | ​ | [removed: 3,391] [added: 2,465] | ​ | ​ | [removed: 4,317] [added: 3,391] |

| Deferred compensation plan assets | ​ | ​ | [removed: 27,849] [added: 33,223] | ​ | ​ | [removed: 20,511] [added: 27,849] |

| Other long-term assets | ​ | ​ | [removed: 23,356] [added: 28,225] | ​ | ​ | [removed: 14,584] [added: 23,356] |

| Total assets | ​ | $ | [removed: 4,863,872] [added: 5,089,969] | ​ | $ | [removed: 3,191,172] [added: 4,863,872] |

| Accounts payable | ​ | $ | [removed: 414,009] [added: 477,052] | ​ | $ | [removed: 404,016] [added: 414,009] |

| Accrued liabilities | ​ | ​ | [removed: 246,088] [added: 296,334] | ​ | ​ | [removed: 220,666] [added: 246,088] |

| Deferred revenue | ​ | ​ | [removed: 237,535] [added: 274,383] | ​ | ​ | [removed: 199,054] [added: 237,535] |

| Current operating lease liabilities | ​ | ​ | [removed: 239,629] [added: 253,415] | ​ | ​ | [removed: —] [added: 239,629] |

| Total current liabilities | ​ | ​ | [removed: 1,137,261] [added: 1,343,713] | ​ | ​ | [removed: 823,736] [added: 1,137,261] |

| Non-current operating lease liabilities | ​ | ​ | [removed: 1,698,718] [added: 1,643,386] | ​ | ​ | [removed: —] [added: 1,698,718] |

| Deferred rent | ​ | ​ | — | ​ | ​ | [removed: 434,980] [added: —] | [added: ​ | ​ | 27,064 |]

| Deferred income taxes | ​ | ​ | [removed: 89,367] [added: 65,359] | ​ | ​ | [removed: 83,864] [added: 89,367] |

| Other long-term liabilities | ​ | ​ | [removed: 36,432] [added: 37,962] | ​ | ​ | [removed: 28,374] [added: 36,432] |

| Total liabilities | ​ | ​ | [removed: 2,961,778] [added: 3,090,420] | ​ | ​ | [removed: 1,370,954] [added: 2,961,778] |

| ​ ​ ​ | ​ |

| ​ | Impairment of Long-Lived Tangible and Right of Use Assets |

| Description of the matter | As described in Notes 2 and 6 to the consolidated financial statements, the Company evaluates if there are indicators of impairment for long-lived tangible and right of use assets in accordance with ASC 360, Property, Plant, and Equipment. The Company’s first step is to determine whether indicators of impairment exist in its long-lived assets (property and equipment and leasehold improvements and operating lease right-of-use assets) at the individual retail store level, which is the lowest level at which cash flows can be identified. If indicators of impairment are identified for any retail stores, the Company evaluates if the projected undiscounted cash flows derived from continued retail operations by those stores are less than their carrying amounts. When this is the case, the Company compares the calculated fair value of the respective retail store to its carrying value. If fair value is less than the carrying value, an impairment loss is recorded. For the year ended January 30, 2021, the Company recorded impairment charges of $41,948 thousand and $19,569 thousand related to operating retail stores and closed stores, respectively, as the Company experienced lower than projected revenues for certain stores due to the COVID-19 pandemic. Significant assumptions used in the Company’s projected undiscounted cash flow analyses included estimates of future revenue growth rates and operating expenses. Additionally, significant assumptions utilized in the fair value analyses included the aforementioned assumptions, as well as market-based assumptions such as a discount rate and market rents. This led to a high degree of auditor judgment and subjectivity in performing procedures and in assessing the assumptions utilized to project the undiscounted cash flows generated by retail stores with indicators of impairment, for purposes of determining if such cash flows were less than the carrying amount as well as in evaluating the assumptions utilized to estimate the fair value of those retail stores to calculate the impairment all of which can be affected by expectations about future market or economic conditions including outcomes resulting from the COVID-19 pandemic. |

| How we addressed the matter in our audit | We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s processes over the identification of indicators of impairment, the assessment of the projected undiscounted cash flows to be generated by retail stores with indicators of impairment, the determination of the fair value of the retail stores and the measurement of any resulting impairment. These controls include, among others, management’s evaluation of indicators of impairment, management’s review of the assumptions utilized to develop the projected undiscounted cash flows and the related fair value estimates, and management’s testing of the completeness and accuracy of the underlying data utilized to project future operating results for the retail stores. Our testing of the Company’s impairment analyses included, among other procedures, testing the completeness of retail stores evaluated for impairments, management’s process for developing the undiscounted cash flows, evaluating the models used and evaluating significant assumptions discussed above used to project the undiscounted cash flows and the incremental assumptions discussed above used to estimate fair value. For example, we compared the significant assumptions used by management to historical results and current industry and economic trends. We performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the individual retail stores that would result from changes in the |

| | underlying assumptions. We involved our valuation specialists to assist in our evaluation of the fair value estimate specific to evaluating the discount rate and market rents. ​ |

March 26, 2021

March 26, 2021

| Accrued income taxes | ​ | ​ | 42,529 | ​ | ​ | — |

| Accumulated other comprehensive income | ​ | ​ | 56 | ​ | ​ | — |

Consolidated Statements of Operations

| Impairment, restructuring and other costs | ​ | ​ | 114,322 | ​ | ​ | — | ​ | ​ | — |

*​*

*​*

*​*

Consolidated Statements of Comprehensive Income

| Other comprehensive income: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| Foreign currency translation adjustments | ​ | ​ | 56 | ​ | ​ | — | ​ | ​ | — |

| Comprehensive income | ​ | $ | 175,891 | ​ | $ | 705,945 | ​ | $ | 658,559 |

| Long-lived asset impairment charge | ​ | ​ | 72,533 | ​ | ​ | — | ​ | ​ | — |

| Proceeds from long-term debt | ​ | ​ | 800,000 | ​ | ​ | — | ​ | ​ | — |

| Payments on long-term debt | ​ | ​ | (800,000) | ​ | ​ | — | ​ | ​ | — |

| Effect of exchange rate changes on cash and cash equivalents | ​ | ​ | 56 | ​ | ​ | — | ​ | ​ | — |

| Cash paid for interest | ​ | $ | 6,987 | ​ | $ | — | ​ | $ | — |

Ulta Beauty, Inc.

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Net income | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 175,835 | ​ | ​ | — | ​ | ​ | 175,835 |

| Stock-based compensation | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | 27,583 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 27,583 |

| Foreign currency translation adjustments | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 56 | ​ | ​ | 56 |

| Repurchase of common shares | ​ | (475) | ​ | ​ | (5) | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (114,890) | ​ | ​ | — | ​ | ​ | (114,895) |

| Balance – January 30, 2021 | ​ | 56,952 | ​ | $ | 569 | ​ | (692) | ​ | $ | (37,801) | ​ | $ | 847,303 | ​ | $ | 1,189,422 | ​ | $ | 56 | ​ | $ | 1,999,549 |

_See accompanying notes to consolidated financial statements._

The Company considers its accounting policies relating to inventory valuations, vendor allowances, impairment of long-lived tangible and operating lease assets, loyalty program and income taxes to be the most significant accounting policies that involve management estimates and judgments.

The COVID-19 pandemic has created and may continue to create significant uncertainty in macroeconomic conditions, which may cause further business disruptions and adversely impact the Company’s results of operations.

While the full impact of the COVID-19 pandemic is unknown and cannot be reasonably estimated, the Company has made accounting estimates based on the facts and circumstances available as of the reporting date.

Actual amounts could differ from these estimates, and such differences could be material.

| Cash and cash equivalents | ​ | $ | 1,046,051 | ​ | $ | 392,325 |

Receivables consist principally of amounts due from vendors and amounts related to the employee retention credit (see Note 3, “Impact of the COVID-19 pandemic”).

The receivable for the employee retention credit was $52,405 as of January 30, 2021.

There was no receivable for the employee retention credit as of February 1, 2020.

| --- | --- |

| --- | --- |

See below for discussion of our related critical audit matter.