Ulta Beauty (ULTA) 10-K risk factor changes: FY2022 vs FY2021

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

Any significant interruption in the operations of our distribution [added: and fast fulfillment] 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, labor disagreements, inventory availability, or shipping and transportation problems, could drastically reduce our ability to [added: receive and process orders and provide products and services to our stores and guests, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.]

[removed: receive and process orders and provide products and services to our stores and guests, which] [added: Macroeconomic conditions] could have a material adverse [removed: effect] [added: impact] on our business, financial condition, profitability, and cash [removed: flows.][added: flows.]

Additionally, omnichannel retailing [removed: is] [added: continues to] rapidly [removed: evolving,] [added: evolve,] and we must keep pace with changing guest expectations and new developments by our competitors.

Any event causing a [removed: sudden] disruption of manufacturing or imports from such foreign countries, including the imposition of [removed: additional] import restrictions, [removed: geo-political] [added: geopolitical] events, unanticipated political changes, increased customs duties, and legal or economic restrictions on overseas suppliers’ ability to produce and deliver products, could result in substantial disruptions in our supply chain (including inventory availability) and materially harm our operations.

[removed: Our sourcing operations may also be hurt by health] concerns regarding infectious diseases in countries in which our merchandise is [removed: produced (such as COVID-19),] [added: produced,] adverse weather conditions or natural disasters that may occur overseas, or acts of war or [removed: terrorism in the United States or worldwide,] [added: terrorism,] to the extent these acts affect the production, shipment, or receipt of merchandise.

The capacity of our distribution and order fulfillment infrastructure and the performance of our distribution centers and fast fulfillment centers may not be adequate to support our [removed: expected] future [removed: growth plans,] [added: growth,] 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.

| | ● | hurricanes, tornadoes, wildfires, earthquakes, mudslides, other natural disasters, epidemics or pandemics, and [removed: geo-political] [added: geopolitical] events. |

We rely on our good relationships with brand partners to purchase prestige, mass, and salon beauty products on reasonable [removed: terms.][added: terms, and to offer certain brands or products that are permanently or temporarily exclusive to us.]

If these relationships were to be impaired, or if certain brand partners were to change their distribution [removed: model,] [added: 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.

During fiscal [removed: 2021] [added: 2022] and fiscal [removed: 2020,] [added: 2021,] merchandise supplied to Ulta Beauty by our top ten brand partners accounted for approximately [removed: 54% and] 56% [added: and 54%] of our net sales, respectively.

As laws and regulations [removed: rapidly] evolve to govern the use of these platforms and devices, the failure by us, our employees, or third parties acting at our direction to abide by applicable laws and regulations in the use of these platforms and devices could adversely impact our business, financial condition, profitability, and cash flows.

Furthermore, our ability to manage our retail expansion [removed: will require] [added: requires] us to continue to train, motivate, and manage our associates.

We [removed: will] [added: also] need to attract, motivate, and retain additional qualified executive, managerial, and merchandising personnel and store and distribution center associates.

In addition, fluctuations in the cost of labor, including as a result of inflationary pressures on wages, [removed: could] [added: may] negatively impact our profitability and cash flows.

[removed: Economic, Market] [added: Although we do not have any operations outside the United States, geopolitical events, including the ongoing conflict between Russia] and [removed: Other External RisksThe] [added: Ukraine and the related economic sanctions by Western governments on Russia, has caused greater uncertainty in the global economy and exacerbated the inflation situation.The] health of the economy may affect consumer purchases of discretionary items such as beauty products and salon services, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

We appeal to a wide demographic consumer profile and offer an extensive selection of beauty products sold directly to retail [removed: consumers and premium salon services.]

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

In the event of a prolonged period of inflation, [removed: a prolonged] [added: an] economic downturn or [removed: an acute] [added: a] recession, consumer spending habits could be adversely affected, and we could experience lower than expected net sales.

[removed: The COVID-19] [added: The COVID 19] pandemic has had, and [removed: will] [added: could] continue to have, a negative impact on our business, financial condition, profitability, cash [removed: flows] [added: flows,] and supply chain, [removed: as well as consumer spending.][added: although the full extent is still uncertain and cannot be predicted.]

[removed: In response to government recommendations and for the health and safety of our associates (i.e., employees) and guests, on March 19, 2020 we temporarily closed all stores across the U.S.] 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 being negatively impacted in fiscal 2020.

While we have reopened all stores and resumed [removed: most of] our in-store services, the potential [added: of] temporary [added: restrictions in operating hours, in-store services or] reclosing of certain stores in the future is possible.

[removed: The] [added: For example, the COVID-19] pandemic and its various impacts [removed: have also] changed consumer behavior and consumption of beauty [removed: products] [added: products, at least temporarily,] due to the closures of offices, retail stores and other businesses and the significant decline in social [removed: gatherings.][added: gatherings, and also resulted in inflationary pressures on wages, transportation and shipping costs, and wholesale costs, recessionary concerns and other evolving macroeconomic conditions.]

[removed: The] [added: The] COVID-19 pandemic [removed: has had, and could continue] [added: continues] to [removed: have, a negative impact on] [added: negatively affect] our business, financial condition, profitability, cash flows and supply [removed: chain, although the full extent is still uncertain.][added: chain.]

[removed: Epidemics, pandemics like COVID-19,] [added: Future epidemics, pandemics,] natural disasters, or other catastrophes or crises [removed: that have and] could [removed: 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, have resulted in the temporary closure of our stores and, in the future, could also result in physical damage to our properties, the temporary reclosing of our stores, the temporary closing of our distribution [removed: centers] and fast fulfillment centers, the temporary lack of an adequate work force, 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 [removed: 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.

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

Customer traffic to these shopping areas may be adversely affected by the closing of such destination retailers or anchor stores, or by a reduction in traffic to such stores resulting from a regional or global economic downturn, an outbreak of flu or other [removed: viruses (such as COVID-19),] [added: viruses,] a general downturn in the local area where our store is located, or a decline in the desirability of the shopping environment of a particular power center.

[added: We may respond by increasing markdowns, initiating marketing] promotions, or transferring product to other stores to reduce excess inventory, which would further decrease our gross profits and net income.

Our stock repurchase programs could affect the price of our common stock and [removed: increase volatility and] may be suspended or terminated at any time, which may result in a decrease in the trading price of our common stock.

Repurchases pursuant to any such stock repurchase program could affect our stock price and [removed: increase its volatility.][added: the existence of a stock repurchase program could also cause our stock price to be higher than it would be in the absence of such a program.]

There can be no assurance that any stock repurchases will enhance stockholder value because the market price of our common stock may decline below the levels at which we repurchased shares of common [removed: stock.][added: stock.​]

In addition, concern about climate change and greenhouse gases may result in new or additional legal, legislative, and/or regulatory requirements to reduce or mitigate the effects of climate change on the [removed: environment.]

In the ordinary course of our business, we collect, process, and store sensitive and confidential data, including our proprietary business information and that of our guests, [removed: suppliers] [added: suppliers,] and business partners, and personally identifiable information of our guests and employees, in our data centers and on our networks.

We also [removed: plan to expand] [added: are expanding] and [removed: upgrade] [added: upgrading] our information systems (including replacing our enterprise resource planning platform through Project SOAR) to support historical and expected future growth.

The failure of these projects, the failure of our information systems to perform as [removed: designed] [added: designed,] or breaches of security could have an adverse effect on our business and results of our operations.

As the importance of our website, mobile applications, and e-commerce operations to our business continues to grow, we are increasingly vulnerable to [removed: downtime and other technical failures.]

Complex local, state and national laws and regulations apply to the collection, use, retention, protection, disclosure, [removed: transfer] [added: transfer,] and other processing of personal data.

Complying with these laws and regulations may cause us to incur substantial costs, require changes to our business [removed: practices] [added: practices,] and limit our ability to obtain data used to provide a differentiated guest experience.

Our sourcing operations may also be hurt by health

We also offer products that are permanently exclusive to us and offer a number of brands and products that are exclusive to us for a limited period of time or are offered in advance of our competitors.

If our brand partners ceased granting us permanent or temporary exclusive rights our net sales could be negatively impacted, which could have a material adverse effect on our business, financial condition and profitability.

If we are unable to protect against inventory shrink, our results of operations and financial condition could be adversely affected.

Our business depends on our ability to effectively manage our inventory.

Risk of inventory loss (also called shrink) is inherent in the retail business.

We have historically experienced inventory shrink due to damage, theft (including from organized retail crime), and other causes.

While some level of inventory shrink is unavoidable, we continue to experience elevated levels of inventory shrink relative to historical levels, which have adversely affected, and could continue to adversely affect, our results of operations and financial condition.

To protect against rising inventory shrink, we have taken, and may continue to take, certain operational and strategic actions that could adversely affect our reputation, guest experience, and results of operations.

If our marketing, advertising and promotional programs are unsuccessful, our results of operations and financial condition could be adversely affected.

Customer traffic and demand for our merchandise are influenced by our advertising, marketing and promotional activities.

We use marketing, advertising and promotional programs to attract customers through various media, including social media, websites, mobile applications, email, and print.

Our future growth and profitability will depend in part upon the effectiveness and efficiency of our advertising and marketing programs.

Further, disruption to certain media channels could have a material adverse effect on our results of operations and financial condition.

The credit facility agreement contains usual and customary restrictive covenants that, among other things, limit our ability to incur additional indebtedness, pay cash dividends and repurchase our stock, and merge or consolidate with another entity, and requires us to maintain a fixed charge coverage ratio of not less than 1.0 to 1.0 during such periods when availability under the agreement falls below a specified threshold.

Economic, Market and Other External Risks

Macroeconomic conditions, including inflation, rising interest rates and recessionary concerns, as well as ongoing labor cost pressures, transportation and shipping cost pressures, and the COVID-19 pandemic, have had, and may continue to have, a negative impact on our business, financial condition, profitability, and cash flows.

For instance, we were negatively impacted in fiscal 2022 by persistent cost pressures, including supply chain and labor costs.

We expect inflationary cost pressures to continue in 2023 and we continue to closely monitor macroeconomic conditions, including customer behavior, and the impact of these factors on customer demand.

Continuing or worsening inflation, recessionary concerns and/or supply chain and labor challenges, as well as the current turmoil in the banking industry, may have a material adverse impact on our business, financial condition, profitability, and/or cash flows.

consumers and premium salon services.

​

Since the first quarter of 2020, there has been a worldwide impact from the COVID 19 pandemic.

Government authorities have taken measures to try to contain the virus, such as limiting or closing business activities, transportation and person-to-person interactions, resulting in the temporary closing of all of our stores across the U.S. on March 19, 2020.

Global trade conditions and customer trends that originated during the pandemic continue to persist and may also have a long-lasting adverse impact on us independently of the progress on the pandemic.

​

environment.

​

downtime and other technical failures.

​

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

​

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

Diversion of exclusive salon products, or a decision by manufacturers of exclusive salon products to utilize other distribution channels, could negatively impact our revenue from the sale of such products, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

The retail products that we sell in our salons are meant to be sold exclusively by professional salons and authorized professional retail outlets.

However, incidents of product diversion occur, which involve the selling of salon exclusive haircare products to unauthorized channels such as drug stores, grocery stores, or mass merchandisers.

Diversion could result in adverse publicity that harms the commercial prospects of our products (if diverted products are old, tainted, or damaged), as well as lower product revenues should consumers choose to purchase diverted product from these channels rather than purchasing from one of our salons.

Additionally, the various product manufacturers could, in the future, decide to utilize other distribution channels for such products, therefore widening the availability of these products in other retail channels, which could negatively impact the revenue we earn from the sale of such products.

In 2014, we began a multi-year supply chain project, which focused on, among other things, adding capacity and system improvements to support expanded omnichannel capabilities.

Outstanding borrowings bear interest at either a base rate plus a margin of 0% to 0.125% or the London Interbank Offered Rate plus a margin of 1.125% to 1.25% and the unused line fee is 0.20% per annum.

The credit facility agreement contains usual and customary restrictive covenants relating to our management and the operation of our business.

These covenants, among other things, limit our ability to grant liens on our assets, incur additional indebtedness, pay cash dividends and redeem our stock, enter into transactions with affiliates, and merge or consolidate with another entity.

The COVID-19 pandemic resulted in federal, state, and local governments implementing 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 restrictions, and limitations or shutdowns of business operations.

COVID-19 could also negatively impact our future results of operations by weakening demand for our products and services and/or by disrupting our supply chain.

As the pandemic continues to evolve and new variants continue to emerge, 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 continued duration of the pandemic, government 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 still uncertain and cannot be predicted.

We may respond by increasing markdowns, initiating marketing

Increases in the demand for, or the price of, raw materials used to build and remodel our stores could hurt our profitability.

The raw materials used to build and remodel our stores are subject to availability constraints and price volatility caused by weather, supply conditions, government regulations, general economic conditions, inflationary pressures and other unpredictable factors.

As a retailer engaged in an active building and remodeling program, we are particularly vulnerable to increases in construction and remodeling costs.

As a result, increases in the demand for, or the price of, raw materials could have a material adverse effect on our business, financial condition, profitability, and cash flows.

The timing and actual number of shares repurchased under any such stock repurchase program depends on a variety of factors including the timing of open trading windows, price, corporate and regulatory requirements, and other market conditions.

We may affect repurchases under any stock repurchase program from time to time in the open market, in privately negotiated transactions or otherwise, including accelerated stock repurchase arrangements.

The existence of a stock repurchase program could also cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our stock.

Although our stock repurchase program is intended to enhance stockholder value, short-term stock price fluctuations could reduce the program’s effectiveness.

In addition, our failure to comply with applicable laws and regulations or other obligations to which we may be subject relating to

Our third-party manufacturers of Ulta Beauty products may not maintain adequate controls with respect to product specifications, content, labeling and/or quality and may not continue to produce products that are consistent with applicable regulatory requirements.

However, cosmetic products may become subject to more extensive regulation in the future.

to fail to meet customer expectations, or cause us to be unable to deliver merchandise in sufficient quantities or of sufficient quality to our stores, any of which could result in lost sales, which could have a material adverse effect on our business, financial condition, profitability, and cash flows.

| | ● | prohibiting our stockholders from making certain changes to our certificate of incorporation or bylaws except with a two-thirds majority stockholder approval; and |

We define our target consumer as a beauty enthusiast, a consumer who is passionate about the beauty category, uses beauty for self-expression, [removed: experimentation] [added: experimentation,] and self-investment, and has high expectations for the shopping experience.

We [added: estimate beauty enthusiasts represent approximately 65% of shoppers and 80% of beauty products and services spend in the U.S. We] believe our strategy provides us with the competitive advantages that have contributed to our financial performance.

Today, we are the largest [added: specialty] beauty retailer in the United States and the premier beauty destination for cosmetics, fragrance, skin care products, hair care products, and salon services.

Key aspects of our business include: a differentiated assortment of more than 25,000 beauty products across a variety of categories and price points as well as a variety of beauty services, including salon services, in more than [removed: 1,300] [added: 1,350] stores predominantly located in convenient, high-traffic locations; engaging digital experiences delivered through our website, [removed: ulta.com,] [added: Ulta.com,] and our mobile applications; our best-in-class loyalty program that enables members to earn points for every dollar spent on products and beauty services and provides us with deep, proprietary customer insights; and our ability to cultivate human connection with warm and welcoming guest experiences across all of our channels.

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 priorities: 1) drive breakthrough and disruptive growth through an expanded definition of All Things [removed: Beauty,] [added: Beauty;] 2) evolve the omnichannel experience through connected physical and digital ecosystems, All In Your [removed: World,] [added: World;] 3) expand and deepen our presence across the beauty journey, solidifying Ulta Beauty at the Heart of the Beauty [removed: Community,] [added: Community;] 4) drive operational excellence and [removed: optimization,] [added: optimization;] 5) protect and cultivate our world-class culture and [removed: talent,] [added: talent;] and 6) expand our environmental and social impact.

We believe [removed: that] the attractive and growing U.S. beauty products and salon services industry, the expanding definition of beauty and [added: the] role that omnichannel capabilities play in consumers’ lives, coupled with Ulta Beauty’s competitive strengths, position us to capture additional market share in the industry.

Long-term operating profit is expected to increase as a result of our efforts to optimize our real estate portfolio, expand merchandise [removed: margin] [added: margin,] and leverage our fixed store costs with comparable sales increases and operating efficiencies, partially offset by incremental investments in people, [added: guest experiences,] 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.

[removed: During fiscal 2021, we continued to] [added: We] closely monitor the [added: continuing] impact of COVID-19 on all facets of our [added: business.]

While operations during fiscal [removed: 2021] [added: 2022] did not appear to be [removed: as] negatively impacted, the [removed: continuing] COVID-19 pandemic [added: and the conditions and trends that originated during the pandemic] could have [removed: additional] negative impacts in the future.

The extent of the impact of the pandemic [added: and the conditions and trends that originated during the pandemic] on our [added: future] business and financial results will depend [removed: on future developments, including, but not limited to,] [added: on, among other things,] the potential [removed: temporary reclosing] of [removed: certain stores, the potential] temporary restrictions on [removed: certain store] operating [removed: hours and/or] [added: hours,] in-store [removed: capacity, the duration] [added: services or reclosing] of [removed: potential future quarantines, shelter-in-place and] [added: certain stores or] other [removed: travel restrictions within the U.S.] [added: facilities of ours or our brand partners] and other [removed: affected countries,] [added: suppliers,] supply chain disruptions, increased [removed: freight costs] [added: transportation] and [added: shipping costs,] higher wholesale costs, [removed: the continued duration of the pandemic] [added: increased labor costs,] and [removed: any variants of] the [removed: virus, the] duration, timing and severity of the impact [added: of the foregoing] on consumer [removed: spending, the timing and effectiveness of vaccine distribution, vaccination rates, and how quickly and to what extent normal economic and operating conditions can resume.][added: spending.]

However, the COVID-19 pandemic and its various impacts [removed: have] changed consumer behavior and consumption of beauty [removed: products] [added: products, at least temporarily,] due to the closures of offices, retail [removed: stores] [added: stores,] and other businesses and the significant decline in travel, entertainment and social gatherings.

[removed: Although we do not believe that inflation has had a material] [added: Furthermore, inflationary pressures, as well as other macroeconomic trends, could negatively] impact [removed: on] our [removed: financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on our] ability to maintain current levels of gross margin and selling, general and administrative expenses as a percentage of net sales if the selling prices of our products do not increase with [removed: these increased] [added: higher] costs.

Other revenue [removed: sources include] [added: includes] the private label and co-branded credit card [removed: programs and] [added: programs,] royalties derived from the partnership with [removed: Target, as well as] [added: Target Corporation, and] deferred revenue related to the loyalty program and gift card breakage.

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

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

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

The Company’s fiscal years ended January [added: 28, 2023 (fiscal 2022), January] 29, 2022 (fiscal 2021), [added: and] January 30, 2021 (fiscal [removed: 2020), and February 1, 2020 (fiscal 2019)] [added: 2020)] were all 52-week years.

As of January [removed: 29, 2022,] [added: 28, 2023,] we operated [removed: 1,308] [added: 1,355] stores across 50 states.

| ​ | ​ | January [removed: 29,] [added: 28,] | | ​ | January [removed: 30,] [added: 29,] | | ​ | [removed: February 1,] [added: January 30,] | |

| (Dollars in thousands) | ​ | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | [removed: 2020] [added: 2021] | |

| Net sales | ​ | $ | [removed: 8,630,889] [added: 10,208,580] | ​ | $ | [removed: 6,151,953] [added: 8,630,889] | ​ | $ | [removed: 7,398,068] [added: 6,151,953] |

| Cost of sales | ​ | ​ | [removed: 5,262,335] [added: 6,164,070] | ​ | ​ | [removed: 4,202,794] [added: 5,262,335] | ​ | ​ | [removed: 4,717,004] [added: 4,202,794] |

| Gross profit | ​ | ​ | [removed: 3,368,554] [added: 4,044,510] | ​ | ​ | [removed: 1,949,159] [added: 3,368,554] | ​ | ​ | [removed: 2,681,064] [added: 1,949,159] |

| Selling, general and administrative expenses | ​ | ​ | [removed: 2,061,545] [added: 2,395,299] | ​ | ​ | [removed: 1,583,017] [added: 2,061,545] | ​ | ​ | [removed: 1,760,716] [added: 1,583,017] |

| Impairment, restructuring and other costs | ​ | ​ | — | ​ | ​ | [removed: 114,322] [added: —] | ​ | ​ | [removed: —] [added: 114,322] |

| Pre-opening expenses | ​ | ​ | [removed: 9,517] [added: 10,601] | ​ | ​ | [removed: 15,000] [added: 9,517] | ​ | ​ | [removed: 19,254] [added: 15,000] |

| Operating income | ​ | ​ | [removed: 1,297,492] [added: 1,638,610] | ​ | ​ | [removed: 236,820] [added: 1,297,492] | ​ | ​ | [removed: 901,094] [added: 236,820] |

| Interest [removed: expense (income),] [added: (income) expense,] net | ​ | ​ | [removed: 1,663] [added: (4,934)] | ​ | ​ | [removed: 5,735] [added: 1,663] | ​ | ​ | [removed: (5,056)] [added: 5,735] |

| Income before income taxes | ​ | ​ | [removed: 1,295,829] [added: 1,643,544] | ​ | ​ | [removed: 231,085] [added: 1,295,829] | ​ | ​ | [removed: 906,150] [added: 231,085] |

| Income tax expense | ​ | ​ | [removed: 309,992] [added: 401,136] | ​ | ​ | [removed: 55,250] [added: 309,992] | ​ | ​ | [removed: 200,205] [added: 55,250] |

| Net income | ​ | $ | [removed: 985,837] [added: 1,242,408] | ​ | $ | [removed: 175,835] [added: 985,837] | ​ | $ | [removed: 705,945] [added: 175,835] |

| Number of stores end of year | ​ | ​ | [removed: 1,308] [added: 1,355] | ​ | ​ | [removed: 1,264] [added: 1,308] | ​ | ​ | [removed: 1254] [added: 1,264] |

| Comparable sales | ​ | ​ | [removed: 37.9%] [added: 15.6%] | ​ | ​ | [removed: (17.9)%] [added: 37.9%] | ​ | ​ | [removed: 5.0%] [added: (17.9%)] |

| (Percentage of net sales) | ​ | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | [removed: 2020] [added: 2021] | |

| Cost of sales | ​ | ​ | [removed: 61.0%] [added: 60.4%] | ​ | ​ | [removed: 68.3%] [added: 61.0%] | ​ | ​ | [removed: 63.8%] [added: 68.3%] |

| Gross profit | ​ | ​ | [removed: 39.0%] [added: 39.6%] | ​ | ​ | [removed: 31.7%] [added: 39.0%] | ​ | ​ | [removed: 36.2%] [added: 31.7%] |

| Selling, general and administrative expenses | ​ | ​ | [removed: 23.9%] [added: 23.5%] | ​ | ​ | [removed: 25.7%] [added: 23.9%] | ​ | ​ | [removed: 23.8%] [added: 25.7%] |

| Impairment, restructuring and other costs | ​ | ​ | 0.0% | ​ | ​ | [removed: 1.9%] [added: 0.0%] | ​ | ​ | [removed: 0.0%] [added: 1.9%] |

| Pre-opening expenses | ​ | ​ | 0.1% | ​ | ​ | [removed: 0.2%] [added: 0.1%] | ​ | ​ | [removed: 0.3%] [added: 0.2%] |

| Operating income | ​ | ​ | [removed: 15.0%] [added: 16.1%] | ​ | ​ | [removed: 3.9%] [added: 15.0%] | ​ | ​ | [removed: 12.1%] [added: 3.9%] |

The overall beauty market declined in 2020, stabilized in 2021, and expanded in 2022, as consumers resumed in-person shopping while maintaining some of their online shopping behaviors.

Impact of inflation and other macroeconomic trends

Although we do not believe inflation had a material impact on our sales during fiscal 2022, continued pressure from inflation or other evolving macroeconomic conditions could have an adverse impact on consumer spending and could lead to a recession.

| | ● | the cost of merchandise sold, offset by vendor income that is not a reimbursement of specific, incremental, and identifiable costs; |

| | ● | advertising and marketing costs, offset by vendor income that is a reimbursement of specific, incremental, and identifiable costs; |

Net sales increased $1.6 billion, or 18.3%, to $10.2 billion in fiscal 2022 compared to $8.6 billion in fiscal 2021.

The net sales increase was primarily due to the favorable impact from the continued resilience of the beauty category, retail price increases, the impact of new brands and product innovation, increased social occasions and fewer COVID-19 limitations compared to fiscal 2021, and an increase of $77.3 million in other revenue.

The total comparable sales increase of 15.6% in fiscal 2022, compared to an increase of 37.9% in fiscal 2021, was driven by a 10.8% increase in transactions and a 4.3% increase in average ticket.

Gross profit increased $676.0 million, or 20.1%, to $4.0 billion in fiscal 2022, compared to $3.4 billion in fiscal 2021.

| | ● | 100 basis points of leverage of fixed costs attributed to the impact of higher sales and ongoing occupancy cost optimization efforts; |

| | ● | 60 basis points of leverage in other revenue primarily due to credit card income growth, an increase in royalty income from our partnership with Target, and higher loyalty point redemptions; and |

| | ● | 70 basis points of deleverage in inventory shrink; and |

| | ● | 50 basis points of deleverage in merchandise margins driven by brand mix and lapping benefits from favorable inventory reserve adjustments in fiscal 2021, partially offset by the timing of retail price changes. |

Selling, general and administrative (SG&A) expenses increased $333.8 million, or 16.2%, to $2.4 billion in fiscal 2022 compared to $2.1 billion in fiscal 2021.

| | ● | 80 basis points of leverage due to lower marketing expenses; and |

| | ● | 20 basis points of leverage of incentive compensation due to higher sales; partially offset by |

| | ● | 20 basis points of deleverage of store payroll and benefits due to wage investments. |

Pre-opening expenses increased $1.1 million, or 11.4%, to $10.6 million in fiscal 2022 compared to $9.5 million in fiscal 2021.

Interest income represents interest from cash equivalents and short-term investments with maturities of twelve months or less from the date of purchase.

The higher income tax expense is primarily due

Net income increased $256.6 million to $1.2 billion in fiscal 2022 compared to $985.8 million in fiscal 2021.

As of January 28, 2023 and January 29, 2022, we had cash and cash equivalents of $737.9 million and $431.6 million, respectively.

| Operating lease obligations (1) | ​ | $ | 2,211,981 | ​ | $ | 342,680 | ​ | $ | 719,329 | ​ | $ | 564,184 | ​ | $ | 585,788 |

| Purchase obligations | ​ | ​ | 111,233 | ​ | ​ | 63,419 | ​ | ​ | 46,225 | ​ | ​ | 1,589 | ​ | ​ | — |

| Total (2) | ​ | $ | 2,323,214 | ​ | $ | 406,099 | ​ | $ | 765,554 | ​ | $ | 565,773 | ​ | $ | 585,788 |

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

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

The increase in net cash provided by operating activities in fiscal 2022 is mainly due to the increase in net income, a smaller increase in merchandise inventories in fiscal 2022, and the timing of receivable collections, partially offset by the timing of payables and a smaller increase in deferred revenue compared to fiscal 2021.

The increase in total inventory is primarily due to the following:

| | ● | $54 million increase due to the addition of 47 new stores opened since January 29, 2022; |

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

| | ● | $25 million increase due to new key brand launches; and |

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

| | ● | $25 million increase primarily due to inventory cost increases. |

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

Investment activities for capital expenditures were $312.1 million during fiscal 2022, compared to $172.2 million during fiscal 2021.

The increase in net cash used in investing activities in fiscal 2022 relative to fiscal 2021 was primarily due to more capital expenditures compared to fiscal 2021.

​

| ​ | ​ | 2023 | ​ | 2022 | ​ | 2021 |

The decrease in net cash used in financing activities in fiscal 2022 relative to fiscal 2021 was primarily due to a decrease in share repurchases.

We estimate that female beauty enthusiasts represent approximately 60% of shoppers and 75% of spend in the U.S. beauty category.

As previously discussed, our results of operations for fiscal 2020 were significantly impacted by the effects of the COVID-19 pandemic.

business.

As we navigated the impact of the pandemic, we proactively took steps to optimize our cost structure, while also investing in new capabilities to support future growth.

During fiscal 2021, we experienced an increase in sales driven primarily by the favorable impact from stronger consumer confidence, government stimulus payments, and the easing of COVID-19 restrictions.

The overall beauty market declined in 2020 but stabilized in 2021, as consumers began to recover from the impacts of COVID-19.

Impact of inflation and changing prices

| | ● | the cost of merchandise sold, including substantially all vendor allowances, which are treated as a reduction of merchandise costs; |

| | ● | advertising and marketing costs; |

Impairment, restructuring and other costs

Interest income results from short-term investments.

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

| | ● | 80 basis points of leverage driven by lower promotional activity and cost optimization efforts. |

SG&A expenses decreased $0.2 billion, or 10.1%, to $1.6 billion in fiscal 2020 compared to $1.8 billion in fiscal 2019.

| | ● | 80 basis points of deleverage of store payroll and benefits and variable store expenses due to the impact of lower sales and personal protective equipment and COVID-related expenses; and |

| | ● | 30 basis points of deleverage of marketing expenses attributed to the impact of lower sales volume; partially offset by |

| | ● | 90 basis points of leverage related to the employee retention credits made available under the CARES Act. |

and $15.8 million of severance charges.

All restructuring expenses were recognized in fiscal 2020.

There was no impairment, restructuring and other costs in fiscal 2019.

Pre-opening expenses decreased $4.3 million, or 22.1%, to $15.0 million in fiscal 2020 compared to $19.3 million in fiscal 2019 due to current year real estate activity and stores expected to open in the first quarter of fiscal 2021.

During fiscal 2020, we opened 30 new stores and relocated five stores.

During fiscal 2019, we opened 86 new stores, remodeled 12 stores, and relocated eight stores.

Net income decreased $530.1 million, or 75.1%, to $175.8 million in fiscal 2020 compared to $705.9 million in fiscal 2019.

| Operating lease obligations (1) | ​ | $ | 2,130,097 | ​ | $ | 332,651 | ​ | $ | 681,117 | ​ | $ | 554,022 | ​ | $ | 562,307 |

| Purchase obligations | ​ | ​ | 51,056 | ​ | ​ | 33,615 | ​ | ​ | 15,485 | ​ | ​ | 1,956 | ​ | ​ | — |

| Total (2) | ​ | $ | 2,181,153 | ​ | $ | 366,266 | ​ | $ | 696,602 | ​ | $ | 555,978 | ​ | $ | 562,307 |

The increase in total inventory was primarily driven by the addition of 44 net new stores opened since January 30, 2021, inventory to support new brand launches, and the acceleration of inventory receipts to support expected demand and mitigate anticipated global supply chain disruptions.

The decrease in net cash provided by operating activities in fiscal 2020 relative to fiscal 2019 was primarily due to the decrease in net income, merchandise inventories, and the timing of accounts payable due to the COVID-19 pandemic.

The decrease in net cash used in investing activities in fiscal 2020 relative to fiscal 2019 was primarily due to less capital expenditures due to actions we took to preserve liquidity as we navigated through the COVID-19 pandemic and an increase in proceeds of short-term investments offset by less purchases of short-term investments.

| Merchandising and Refreshed Stores | ​ | ​ | 30 | ​ | ​ | 16 | ​ | ​ | 14 | ​ | ​ | 29 |

The decrease in net cash used in financing activities in fiscal 2020 relative to fiscal 2019 was primarily due to borrowing and repayment under our revolving credit facility and the suspension of the share repurchase program in order to strengthen our liquidity and preserve cash while navigating the COVID-19 pandemic.

The 2019 Share Repurchase Program did not have an expiration date but provided for suspension or discontinuation at any time.

The 2020 Share Repurchase Program authorization revoked the previously authorized but unused amount of $177.8 million from the 2019 Share Repurchase Program.

| (Dollars in millions) | | 2022 | | ​ | 2021 | | ​ | 2020 | |

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

We did not have any outstanding borrowings on our credit facility as of January [added: 28, 2023, January] 29, [removed: 2022,] [added: 2022 or] January 30, [removed: 2021 or February 1, 2020.][added: 2021.]

Ulta Beauty is the largest [added: specialty] beauty retailer in the United States and the premier beauty destination for cosmetics, fragrance, skin care products, hair care products, and salon services.

Store Footprint. We operate more than [removed: 1,300] [added: 1,350] stores predominantly located in convenient, high-traffic locations.

We also offer [added: beauty services in nearly every store, including] a full-service [added: hair] salon [removed: in every store featuring hair, eyebrow] and [removed: other beauty services.][added: a BenefitTM Brow Bar.]

Our digital channels enable always-on shopping and discovery, and our diverse fulfillment options, including buy online pick-up in store, buy online pick-up curbside, ship from store, ship [removed: to home,] [added: from distribution center,] and same-day delivery, provide guests with value and convenience.

With more than 95% of total sales coming from members, we are uniquely positioned with a deep understanding of our customers and their [removed: preferences which enables] [added: preferences, enabling] us to personalize [removed: experiences and target communications] [added: experiences, recommendations,] and promotions through our Customer Relationship Management (CRM) [removed: platform.][added: platform and support our brand partners’ growth.]

We estimate [removed: that female] beauty enthusiasts represent approximately [removed: 60%] [added: 65%] of shoppers and [removed: 75%] [added: account for more than 80%] of [added: beauty products and services] spend in the U.S. [removed: beauty category.]

Our proprietary consumer research confirms engagement with the beauty category remains [removed: strong, but the unprecedented disruption resulting from the COVID-19 pandemic has had sustained effects on the category.][added: strong.]

Reflecting our understanding about how the consumer and beauty category are evolving, [added: in 2021] we [removed: have] refreshed our strategic framework to position Ulta Beauty for continued success.

We are focused on four key areas: maximizing growth in core categories, including makeup, skincare, haircare, and fragrance; driving growth of cross-category strategic platforms, including Conscious Beauty at Ulta Beauty®, Black-owned and Black, Indigenous, and People of Color (BIPOC)-founded Brands, [removed: and] the Wellness [removed: Shop;] [added: Shop, and SPARKED at Ulta Beauty;] differentiating our assortment through exclusive brands and products, including our private label, Ulta Beauty Collection; and increasing profitability through assortment management, inventory productivity, and promotional optimization.

In addition, with more than 95% of total sales coming from [removed: members of] our [added: 40.2 million active] Ultamate Rewards loyalty [removed: program,] [added: program members,] we have unique insights about customer preferences and behavior.

To expand Ulta Beauty’s reach, relevancy, and guest engagement, we intend to amplify our brand purpose; build a creator and content ecosystem to deliver compelling, relevant [removed: beauty-tainment; leverage the power of live streaming and social selling;] [added: beauty entertainment;] drive further innovation in our Ultamate Rewards program; and use our member data to increase [removed: personalization and] [added: personalization,] drive [removed: conversion.][added: conversion, and support our brands.]

Drive operational excellence and optimization. Similar to other retailers, we are experiencing [added: persistent] cost pressures from macroeconomic trends, including rising wage rates and higher transportation and shipping costs.

In addition, we [removed: are managing] [added: anticipate] ongoing headwinds from channel and category mix shifts.

We have an experienced leadership team and [removed: committed,] passionate associates committed to living our values while caring for our guests and for each other.

We empower and inspire guests to make informed and sustainable product choices through our unique Conscious Beauty at Ulta Beauty® [removed: program,] [added: platform,] and we strive to protect the beauty of our natural environment and minimize our impact on the world around us by managing our stores’ energy, water, and waste footprints.

In [removed: 2021,] [added: 2022,] this market represented approximately [removed: $140] [added: $172] billion in sales, according to forecasted Euromonitor International and IBIS World Inc. In [removed: 2021,] [added: 2022,] the beauty products industry totaled approximately [removed: $91] [added: $104] billion and included cosmetics, haircare, fragrance, bath and body, skincare, salon styling tools, and other toiletries.

We estimate that Ulta Beauty had only a 9% share of the [removed: $91] [added: $104] billion beauty product industry.

In [removed: 2021,] [added: 2022,] the salon services industry totaled approximately [removed: $49] [added: $68] billion and included hair, skin, and nail services.

We have full-service hair salons [removed: and skin services] in substantially every store and operate brow bars in most of our stores, as well as makeup services through our salons.

We are committed to meeting guests where and how they want to shop and strive to offer guests a compelling, personalized shopping experience through our stores, [removed: website, mobile applications,] [added: digital platform,] and partnerships.

[removed: Stores.] Our member data suggests our guests prefer to transact in physical stores, where they can discover and interact with products and other beauty enthusiasts.

We offer a full range of beauty services in [removed: all of] our stores, focusing on hair, [removed: skin,] makeup, [added: brow,] and [removed: brow] [added: skin] services.

Our current Ulta Beauty store format includes an open and modern salon [removed: area and a skin treatment room or dedicated skin treatment area] [added: area, with most of our stores offering brow services] on the [removed: sales] [added: salon] floor.

In addition to opening new stores, we also [removed: remodeled, relocated, or refreshed (in-store fixtures] [added: remodeled] and [removed: merchandising upgrades)] [added: relocated] certain stores, as shown in the following table:

| ​ | | January [removed: 29,] [added: 28,] | | January [removed: 30,] [added: 29,] | | [removed: February 1,] [added: January 30,] |

| ​ | ​ | [removed: 2022] [added: 2023] | ​ | [removed: 2021] [added: 2022] | ​ | [removed: 2020] [added: 2021] |

| Total stores beginning of period | ​ | [removed: 1,264] [added: 1,308] | ​ | [removed: 1,254] [added: 1,264] | ​ | [removed: 1,174] [added: 1,254] |

| Stores opened | ​ | [removed: 48] [added: 47] | ​ | [removed: 30] [added: 48] | ​ | [removed: 86] [added: 30] |

| Stores closed | ​ | [removed: (4)] [added: –] | ​ | [removed: (20)] [added: (4)] | ​ | [removed: (6)] [added: (20)] |

| Total stores end of period | ​ | [removed: 1,308] [added: 1,355] | ​ | [removed: 1,264] [added: 1,308] | ​ | [removed: 1,254] [added: 1,264] |

| Total square footage | ​ | [removed: 13,770,438] [added: 14,200,403] | ​ | [removed: 13,291,838] [added: 13,770,438] | ​ | [removed: 13,193,076] [added: 13,291,838] |

| Average square footage per store | ​ | [removed: 10,528] [added: 10,480] | ​ | [removed: 10,516] [added: 10,528] | ​ | [removed: 10,521] [added: 10,516] |

| Stores remodeled | ​ | [removed: 9] [added: 20] | ​ | [removed: –] [added: 9] | ​ | [removed: 12] [added: –] |

| Stores relocated | ​ | [removed: 7] [added: 12] | ​ | [removed: 5] [added: 7] | ​ | [removed: 8] [added: 5] |

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

[removed: In addition, over the long term] [added: Over time,] we expect [added: Ulta Beauty at Target] to [removed: open] [added: be in] up to 800 [added: Target locations, in addition to our freestanding] Ulta Beauty [removed: at Target shops.][added: stores.]

The average investment required to open a new Ulta Beauty store is approximately [removed: $1.4] [added: $1.7] million, which includes capital investments, net of landlord contributions, [removed: pre-][added: pre-opening expenses, and initial inventory, net of payables.]

[removed: Digital platform.] In addition to store expansion, we continue to expand our digital capabilities as more of our guests choose to engage with us across physical and digital platforms.

In fiscal [removed: 2021,] [added: 2022,] 17% of our loyalty members shopped [added: both] in Ulta Beauty stores and through our digital platforms.

We intend to establish ourselves as a leading online beauty resource by providing our guests with a [added: unique,] rich online experience, with information on key trends and products, editorial content, expanded assortments, interactive experiences, including virtual try-on capabilities, and social media content.

In addition to our free-standing locations we have more than 350 Ulta Beauty at Target shop-in-shops which provide guests with a highly-curated, prestige beauty assortment in a unique and elevated presentation in 1,000 square feet of dedicated space within certain Target locations.

Despite the unprecedented disruption and sustaining effects resulting from the COVID-19 pandemic, consumers demonstrated their commitment to beauty as they resumed in-person shopping with enthusiasm, while also maintaining some of their online shopping behaviors, however the operational and competitive landscape remains dynamic, and persistent cost pressures, including supply chain and labor costs, remain a challenge.

In addition, we offer skin services in approximately 150 locations.

Stores

In our fiscal year ended January, 28, 2023 (fiscal 2022), 76% of our loyalty members transacted with us solely in one of our stores.

In addition, stores offering skin services include a skin treatment room or dedicated skin treatment area on the sales floor.

As part of our ongoing efforts to enhance and evolve our in-store experience to best engage our guests, we are introducing a new layout in our new and remodeled stores.

While our traditional layout is organized by price point, with prestige makeup and skincare on one side of the store and mass makeup and skincare on the other, our new layout brings together like categories with intuitive adjacencies to magnify our differentiated assortment.

In the new layout, categories flow from prestige to mass with delineated fixturing showcasing each segment.

In addition, we are adding several features including elevated gondolas to showcase key, iconic, and service brands and new Beauty Bars that offer our brow and makeup services as well as supporting in-store events and highlight beauty-in-action.

We believe this new layout better reflects how our guests shop and will simplify exploration and shopping.

Digital platform

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

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

​

Retail media network

We have a deep understanding of our Ultamate Rewards loyalty members and their preferences.

This unique understanding combined with our ongoing investment in data analytics and CRM capabilities enables us to create personalized experiences and value for our guests and has unlocked new ways for us to support our brand partners and drive additional vendor income.

As we look to elevate our position as the premier beauty retailer, in May 2022 we launched our retail media network, UB Media, to transform the way our brand partners can connect with beauty enthusiasts.

UB Media offers brands a suite of media capabilities that aim to personalize guest engagement and drive the acquisition of new guests.

focus on guest perspectives and reinforce key takeaways.

In fiscal 2022, associates participated in our Inclusion in Action training to reinforce inclusivity and address unconscious bias.

| People of color | ​ | 36% | ​ | 27% | ​ | 53% |

Fragrance (and design).

Consumers are approaching their desire for normalcy with caution, reengaging in retail shopping visits while also holding to some of their new online shopping behaviors.

In addition, the operational and competitive landscape remains dynamic, and many costs are increasing, including supply chain and labor costs.

Due to remaining COVID-19 related restrictions, our services offering was limited in our fiscal year ended January 29, 2022 (fiscal 2021), but we have plans to resume these services as soon as it is safe to do so.

While both the industry and our business was impacted by ongoing COVID-19 restrictions, particularly in salon services, our research indicates that Ulta Beauty continues to increase market share across most prestige beauty categories in the overall U.S. market.

We expect the beauty category will continue its recovery 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.

In fiscal 2021, 75% of our loyalty members only shopped in Ulta Beauty stores.

In addition, most of our stores offer brow services on the sales floor.

Due to ongoing COVID-19 restrictions, we operated at less-than-full capacity for salon and brow services for most of fiscal 2021.

While we lifted capacity constraints for most salon and brow services in fiscal 2021, we were unable to offer makeup services in all stores and skin services in most stores due to remaining COVID-19 related restrictions.

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

During fiscal 2021, 71% of new stores opened in existing shopping centers and 29% opened in new shopping centers.

All new stores were opened in existing markets.

As of January 29, 2022, we operated 1,308 stores across 50 states.

| Stores refreshed | ​ | – | ​ | – | ​ | 240 |

opening expenses, and initial inventory, net of payables.

Over time, we believe Ulta Beauty at Target can be in up to 800 Target locations.

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

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

| (1) | Certain sales departments were reclassified between categories in the prior year to conform to current year presentation. |

| --- | --- |

The 37 million active loyalty program members generated more than 95% of total net sales in fiscal 2021.

support e-commerce orders only.

| ​ | ​ | ​ | ​ | ​ | ​ | January 29, |

| ​ | ​ | ​ | ​ | ​ | ​ | 2022 |

| People of color | ​ | 18% | ​ | 25% | ​ | 49% |

Our executive team reviews associate engagement and satisfaction surveys to monitor associate engagement and satisfaction with their role, their leader, and the Company as a whole.

Products classified as cosmetics (as defined in the Federal Food, Drug and Cosmetic Act) are not subject to pre-market approval by the FDA, but the products must generally be safe and must be properly manufactured and labeled.

Certain products, such as sunscreens and acne treatments, are classified as OTC drugs, and certain ingestible products, such as vitamins and minerals, are classified as dietary supplements.

All statements made in any of our securities

See Note [removed: 9] [added: 10] to our consolidated financial statements, “Commitments and contingencies - General litigation,” for information on legal proceedings.

For the fiscal year ended January [removed: 29, 2022][added: 28, 2023]

See [added: the] definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:

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 July [removed: 30, 2021,] [added: 29, 2022,] as reported on the NASDAQ Global Select Market, was approximately [removed: $13,829,733,000.][added: $16,116,323,000.]

The number of shares of the registrant’s common stock, par value $0.01 per share, outstanding as of March [removed: 21, 2022] [added: 20, 2023] was [removed: 52,327,263] [added: 50,195,089] 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: 2022] [added: 2023] 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 January [removed: 29, 2022.][added: 28, 2023.]

| [Item 6.](#Item6_835160) | ​ | [\[Reserved\]](#Item6_Reserved) | ​ | [removed: 30] [added: 31] |

| [Item 16.](#Item16_10KSummary) | ​ | [Form 10-K Summary](#Item16_10KSummary) | ​ | [removed: 80] [added: 79] |

| [Signatures](#Signatures) | | | ​ | [removed: 81] [added: 80] |

| | ● | changes in the overall level of consumer spending and volatility in the economy, including as a result of [removed: the COVID-19 pandemic] [added: macroeconomic conditions] and [removed: geo-political] [added: geopolitical] events; |

| | ● | [removed: the negative impacts] [added: macroeconomic conditions, including inflation, rising interest rates and recessionary concerns, as well as ongoing labor cost pressures, transportation and shipping cost pressures, and] the COVID-19 [removed: pandemic has] [added: pandemic, have] had, and [removed: will] [added: may] continue to [removed: have] [added: have, a negative impact] on our business, financial condition, profitability, [added: and] cash flows [removed: and supply chain, as well as consumer spending] (including future uncertain impacts); |

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

| | ● | the possibility of material disruptions to our information [removed: systems;] [added: systems, including our Ulta.com website and mobile applications;] |

| | ● | changes in the wholesale cost of our [removed: products;] [added: products and/or interruptions at our brand partners’ or third-party vendors’ operations;] |

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

| | ● | our ability to successfully execute our common stock repurchase program or implement future common stock repurchase programs; [removed: and] |

| | ● | 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 January [removed: 29, 2022,] [added: 28, 2023,] as such may be amended or supplemented in our subsequently filed Quarterly Reports on Form 10-Q. |

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to 240.10D-1(b).

​

| | ● | the possibility of significant interruptions in the operations of our distribution and fast fulfillment centers; |

| | ● | changes in the good relationships we have with our brand partners and/or our ability to continue to offer permanent or temporary exclusive products of our brand partners; |

| | ● | the impact of current inflationary cost pressures on payroll, benefits and supply chain; |

| | ● | the possibility that the capacity of our distribution and order fulfillment infrastructure and the performance of our distribution centers and fast fulfillment centers may not be adequate to support our expected future growth plans; |

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

As of January [removed: 29, 2022,] [added: 28, 2023,] we operated [removed: 1,308] [added: 1,355] retail stores across 50 states, as shown in the table below:

| Arizona | ​ | [removed: 30] [added: 33] | ​ | Nevada | ​ | [removed: 15] [added: 16] |

| California | ​ | [removed: 163] [added: 168] | ​ | New Jersey | ​ | [removed: 43] [added: 44] |

| Connecticut | ​ | [removed: 18] [added: 19] | ​ | New York | ​ | [removed: 52] [added: 55] |

| Delaware | ​ | [removed: 3] [added: 4] | ​ | North Carolina | ​ | [removed: 40] [added: 43] |

| Florida | ​ | [removed: 90] [added: 92] | ​ | North Dakota | ​ | [removed: 3] [added: 4] |

| Georgia | ​ | [removed: 42] [added: 43] | ​ | Ohio | ​ | 45 |

| Hawaii | ​ | 4 | ​ | Oklahoma | ​ | [removed: 21] [added: 22] |

| Idaho | ​ | 9 | ​ | Oregon | ​ | [removed: 16] [added: 18] |

| Indiana | ​ | [removed: 24] [added: 26] | ​ | Rhode Island | ​ | [removed: 3] [added: 4] |

| Iowa | ​ | 11 | ​ | South Carolina | ​ | [removed: 22] [added: 24] |

| Kentucky | ​ | 15 | ​ | Tennessee | ​ | [removed: 28] [added: 29] |

| Louisiana | ​ | 18 | ​ | Texas | ​ | [removed: 119] [added: 126] |

| Maine | ​ | 3 | ​ | Utah | ​ | [removed: 14] [added: 15] |

| Maryland | ​ | [removed: 27] [added: 28] | ​ | Vermont | ​ | 1 |

| Massachusetts | ​ | [removed: 23] [added: 25] | ​ | Virginia | ​ | [removed: 30] [added: 32] |

| Michigan | ​ | 49 | ​ | Washington | ​ | [removed: 36] [added: 37] |

| Mississippi | ​ | [removed: 11] [added: 12] | ​ | Wisconsin | ​ | 20 |

| Missouri | ​ | 25 | ​ | Wyoming | ​ | [removed: 3] [added: 4] |

Distribution [removed: centers and] [added: centers,] fast fulfillment [added: centers, and market fulfillment] centers

Our standard distribution [removed: center and] [added: center,] fast fulfillment [added: center, and market fulfilment] 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 [removed: location,] [added: location and] approximate size, and lease expiration date for each distribution center [removed: (DC) and] [added: (DC),] fast fulfillment center (FFC) [added: and market fulfillment center (MFC)] at January [removed: 29, 2022,] [added: 28, 2023,] are set forth below:

| Dallas, Texas | ​ | DC | ​ | [removed: 671,000] [added: 670,680] | ​ | July 31, 2026 |

| Fresno, California | ​ | DC | ​ | [removed: 671,000] [added: 670,680] | ​ | July 31, 2028 |

| Greenwood, Indiana | ​ | DC | ​ | [removed: 671,000] [added: 670,680] | ​ | July 31, 2025 |

| Romeoville, Illinois | ​ | FFC | ​ | [removed: 291,000] [added: 291,335] | ​ | May 31, [removed: 2023] [added: 2026] |

| ​ | ​ | ​ | ​ | Total | ​ | 1,355 |

| Greer, South Carolina (1) | ​ | MFC | ​ | 303,580 | ​ | May 31, 2033 |

| | (1) | Expected to open in fiscal 2023. |

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

| ​ | ​ | ​ | ​ | Total | ​ | 1,308 |

The names of our executive officers, their ages and their [removed: positions, as of March 1, 2022,] [added: positions] are shown below:

| David C. Kimbell | ​ | [removed: 55] [added: 56] | ​ | Chief Executive Officer and member of the Board of Directors |

| Scott M. Settersten | ​ | [removed: 61] [added: 62] | ​ | Chief Financial Officer, Treasurer and Assistant Secretary |

| Jodi J. Caro | ​ | [removed: 56] [added: 57] | ​ | General Counsel, Chief Risk & Compliance Officer and Corporate Secretary |

| [removed: Jeffrey] [added: Anita] J. [removed: Childs] [added: Ryan] | ​ | [removed: 64] [added: 58] | ​ | Chief Human Resources Officer |

| Kecia L. Steelman | ​ | [removed: 51] [added: 52] | ​ | Chief Operating Officer |

Kimbell._ Mr. Kimbell was named Chief Executive Officer in June 2021 after having previously served as President since December 2019, Chief Merchandising and Marketing Officer since March [removed: 2015] [added: 2015,] and Chief Marketing Officer since February 2014.

Prior to joining Ulta Beauty, he served as Chief Marketing Officer and Executive Vice President at U.S. Cellular, Chief Marketing Officer of Seventh Generation, Vice President of Marketing at PepsiCo, and held a number of brand management roles in the Beauty Division of The Procter and Gamble Company from 1995 to [removed: 2001.]

Ms. Steelman oversees store and services operations, supply chain, Ulta Beauty at [removed: Target] [added: Target,] and enterprise-wide optimization efforts.

2001.

_Anita J.

Ryan._ Ms. Ryan was named Chief Human Resources Officer in April 2022, after having previously served as Senior Vice President of Human Resources since 2018 and Vice President of Human Resources since 2016.

Ms. Ryan oversees all human resources activities, including talent acquisition, total rewards, DEI, associate relations, compliance, and training, as well as oversees all strategic internal communications.

Prior to Ulta Beauty, Ms. Ryan began her career in the grocery industry before transitioning to human resources.

_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.

Mr. Childs is an active member of the Chicago community, serving on the board of directors of Skills for Chicagoland’s Future.

The last reported sale price of our common stock on the NASDAQ Global Select Market on March [removed: 21, 2022] [added: 20, 2023] was [removed: $385.67] [added: $510.23] per share.

As of March [removed: 21, 2022,] [added: 20, 2023,] we had [removed: 31] [added: 27] holders of record of our common stock.

[added: Because many shares of] common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.

The following table sets forth repurchases of our common stock during the fourth quarter of [removed: 2021:][added: 2022:]

| (1) | There were [removed: 1,919,388] [added: 722,457] shares repurchased as part of our publicly announced share repurchase program during the 13 weeks ended January [removed: 29, 2022] [added: 28, 2023,] and there were [removed: 422] [added: 526] 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: 12, 2020, we announced our 2020] [added: 7, 2022, the Board of Directors authorized the 2022] share repurchase program pursuant to which the Company may repurchase up to [removed: $1.6] [added: $2.0] billion of the Company’s common stock. As of January [removed: 29, 2022,] [added: 28, 2023,] the amount remaining available [removed: under the $1.6 billion 2020 share repurchase program] was [removed: nominal. On March 7, 2022, the Board of Directors authorized the 2022 share repurchase program. For additional information on the 2022 share repurchase program see Note 19 to our consolidated financial statements, “Subsequent event.”] [added: $1.1 billion.] |

The following table provides information about Ulta Beauty common stock that may be issued under our equity compensation plans as of January [removed: 29, 2022:][added: 28, 2023:]

| (2) | Includes [removed: 498,156] [added: 324,410] shares issuable pursuant to the exercise of outstanding stock options, [removed: 221,292] [added: 221,045] shares issuable pursuant to restricted stock units, and [removed: 54,160] [added: 75,759] 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 S&P 500 and the S&P 500 Retailing (Industry Group, SP500-2550) for the period covering [removed: January 28, 2017] [added: February 3, 2018] through the end of Ulta Beauty’s fiscal year ended January [removed: 29, 2022.][added: 28, 2023.]

The graph assumes an investment of $100 made at the closing of trading on [removed: January 28, 2017] [added: February 3, 2018] in (i) Ulta Beauty’s common stock, (ii) the stocks comprising the S&P 500 and (iii) the stocks comprising the S&P 500 Retailing (Industry Group, SP500-2550).

[removed: Description automatically generated](https://www.sec.gov/Archives/edgar/data/1403568/000155837022004330/ulta-20220129x10k005.jpg)][added: ]

| ​ | ​ | [removed: January 28, | | ​ |] February 3, | | ​ | February 2, | | ​ | February 1, | | ​ | January 30, | | ​ | January 29, | | [added: ​ | January 28, | |]

| Company / Index | | [removed: 2017 | | |] 2018 | | | 2019 | | | 2020 | | | 2021 | | | 2022 | | [added: | 2023 | |]

| October 30, 2022 to November 26, 2022 | ​ | 164,683 | ​ | $ | 426.90 | ​ | 164,657 | ​ | $ | 1,357,800 |

| November 27, 2022 to December 24, 2022 | ​ | 557,912 | ​ | ​ | 462.24 | ​ | 557,800 | ​ | ​ | 1,099,966 |

| December 25, 2022 to January 28, 2023 | ​ | 388 | ​ | ​ | 484.68 | ​ | — | ​ | ​ | 1,099,966 |

| 13 weeks ended January 28, 2023 | ​ | 722,983 | ​ | ​ | 454.20 | ​ | 722,457 | ​ | ​ | 1,099,966 |

| Equity compensation plans approved by security holders (1) | | 621,214 | ​ | $ | 260.34 | | 2,424,824 |

| Ulta Beauty | ​ | $ | 100.00 | | $ | 131.44 | | $ | 120.63 | | $ | 125.96 | | $ | 161.56 | | $ | 227.68 |

| S&P 500 | ​ | ​ | 100.00 | ​ | ​ | 95.76 | ​ | ​ | 114.23 | ​ | ​ | 131.53 | ​ | ​ | 156.95 | ​ | ​ | 144.15 |

| S&P 500 Retailing | ​ | ​ | 100.00 | ​ | ​ | 107.55 | ​ | ​ | 125.27 | ​ | ​ | 176.00 | ​ | ​ | 185.28 | ​ | ​ | 152.12 |

Because many shares of

| October 31, 2021 to November 27, 2021 | ​ | 55,189 | ​ | $ | 393.85 | ​ | 54,962 | ​ | $ | 738,135 |

| November 28, 2021 to December 25, 2021 | ​ | 1,864,426 | ​ | ​ | 395.89 | ​ | 1,864,426 | ​ | ​ | 25 |

| December 26, 2021 to January 29, 2022 | ​ | 195 | ​ | ​ | 397.10 | ​ | – | ​ | ​ | 25 |

| 13 weeks ended January 29, 2022 | ​ | 1,919,810 | ​ | ​ | 395.83 | ​ | 1,919,388 | ​ | ​ | 25 |

| Equity compensation plans approved by security holders (1) | | 773,608 | ​ | $ | 232.85 | | 2,576,598 |

![Chart, line chart

| Ulta Beauty | ​ | $ | 100.00 | | $ | 81.57 | | $ | 107.21 | | $ | 98.40 | | $ | 102.75 | | $ | 131.79 |

| S&P 500 | ​ | ​ | 100.00 | ​ | ​ | 123.91 | ​ | ​ | 118.66 | ​ | ​ | 141.54 | ​ | ​ | 162.99 | ​ | ​ | 194.48 |

| S&P 500 Retailing | ​ | ​ | 100.00 | ​ | ​ | 143.84 | ​ | ​ | 154.70 | ​ | ​ | 180.19 | ​ | ​ | 253.16 | ​ | ​ | 266.50 |

Based on management’s evaluation as of January [removed: 29, 2022,] [added: 28, 2023,] 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 [added: personnel, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with 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 January [removed: 29, 2022,] [added: 28, 2023,] based on [removed: 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 January [removed: 29, 2022.][added: 28, 2023.]

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 January [removed: 29, 2022] [added: 28, 2023] and has issued the attestation report included in Item 15 of this Annual Report on Form 10-K.

[removed: There] [added: Except as described above, there] were no changes to our internal controls over financial reporting during the 13 weeks ended January [removed: 29, 2022] [added: 28, 2023] that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO).

In the fourth quarter of 2022, we implemented a new payroll system.

This implementation resulted in changes to our internal control over financial reporting by automating and accelerating payment processing, reducing the risk of errors, and simplifying payroll management.

Implementation of the new payroll system was part of the next phase in a multi-year rollout to upgrade our internal systems.

Additional phases of the project will continue to be implemented over the next few years.

We will continue to monitor our internal control over financial reporting, including evaluating the operating effectiveness of related key controls.

personnel, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with U.S generally accepted accounting principles.

The information required by this item with respect to our executive officers is set forth in Part I, Item 4A of this Annual Report on Form 10-K under the caption “Executive 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: 2022] [added: 2023] Annual Meeting of Stockholders (the Proxy Statement) and is hereby incorporated herein by reference.

[removed: The information required by this item is included under the captions “Compensation Discussion and Analysis,” “Corporate Governance – Compensation Committee,” “Corporate Governance – Report] of the [removed: Compensation Committee of the] Board of Directors,” and “Corporate Governance – Non-Executive Director Compensation for Fiscal [removed: 2021”] [added: 2022”] in 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

The information required by this item with respect to compensation plans under which our equity securities are authorized for issuance as of January [removed: 29, 2022] [added: 28, 2023] 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.”

The information required by this item is included under the caption “Corporate Governance – Proposal [removed: Two] [added: Six] – Ratification of Appointment of Independent Registered Public Accounting Firm – Fees to Independent Registered Public Accounting Firm” in the Proxy Statement and is hereby incorporated by reference.

We have audited the accompanying consolidated balance sheets of Ulta Beauty, Inc. (the Company) as of January [removed: 29, 2022,] [added: 28, 2023,] and January [removed: 30, 2021,] [added: 29, 2022,] the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the three years in the period ended January [removed: 29, 2022,] [added: 28, 2023,] 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 January [removed: 29, 2022] [added: 28, 2023] and January [removed: 30, 2021,] [added: 29, 2022,] and the consolidated results of its operations and its cash flows for each of the three years in the period ended January [removed: 29, 2022,] [added: 28, 2023,] 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 January [removed: 29, 2022,] [added: 28, 2023,] 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: 25, 2022] [added: 24, 2023] 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 Note 2 to the consolidated financial statements, revenue from the loyalty program is recognized when [removed: 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. ​ Auditing the Company’s estimate of loyalty deferred revenue was complex as the calculation involved management’s assumptions, such as the standalone selling price and expected redemption rate, which drive the revenue deferral. In particular, the estimate is sensitive to these significant assumptions, which are affected by expectations about future customer behavior. ​ |

| 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 [removed: calculation] [added: 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 test 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. [added: In addition, we tested the value of points redeemed was complete and accurate.] We also considered recent trends in redemption activity 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 January [removed: 29, 2022,] [added: 28, 2023,] 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 January [removed: 29, 2022,] [added: 28, 2023,] 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 January [removed: 29, 2022] [added: 28, 2023] and January [removed: 30, 2021,] [added: 29, 2022,] the related consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended January [removed: 29, 2022,] [added: 28, 2023,] and the related notes and financial statement schedule listed in the Index at Item 15 and our report dated March [removed: 25, 2022] [added: 24, 2023] expressed an unqualified opinion thereon.

| ​ | ​ | January [removed: 29,] [added: 28,] | | ​ | January [removed: 30,] [added: 29,] | |

| (In thousands, except per share data) | [added: ​] | [added: 2023 | | |] 2022 | | | 2021 | |

| Cash and cash equivalents [added: at beginning of year] | ​ | [removed: $] [added: ​] | 431,560 | ​ | [removed: $] [added: ​] | 1,046,051 | [added: ​ | ​ | 392,325 |]

| Receivables, net | ​ | ​ | [removed: 233,682] [added: 199,422] | ​ | ​ | [removed: 193,109] [added: 233,682] |

| Merchandise inventories, net | ​ | ​ | [removed: 1,499,218] [added: 1,603,451] | ​ | ​ | [removed: 1,168,215] [added: 1,499,218] |

| Prepaid expenses and other current assets | ​ | ​ | [removed: 110,814] [added: 130,246] | ​ | ​ | [removed: 107,402] [added: 110,814] |

| Prepaid income taxes | ​ | ​ | [removed: 5,909] [added: 38,308] | ​ | ​ | [removed: —] [added: 5,909] |

| Total current assets | ​ | ​ | [removed: 2,281,183] [added: 2,709,304] | ​ | ​ | [removed: 2,514,777] [added: 2,281,183] |

| Property and equipment, net | ​ | ​ | [removed: 914,476] [added: 1,009,273] | ​ | ​ | [removed: 995,795] [added: 914,476] |

| Operating lease assets | ​ | ​ | [removed: 1,482,256] [added: 1,561,263] | ​ | ​ | [removed: 1,504,614] [added: 1,482,256] |

| Other intangible assets, net | ​ | ​ | [removed: 1,538] [added: 1,312] | ​ | ​ | [removed: 2,465] [added: 1,538] |

| Deferred compensation plan assets | ​ | ​ | [removed: 38,409] [added: 35,382] | ​ | ​ | [removed: 33,223] [added: 38,409] |

| Other long-term assets | ​ | ​ | [removed: 35,647] [added: 43,007] | ​ | ​ | [removed: 28,225] [added: 35,647] |

| Total assets | ​ | $ | [removed: 4,764,379] [added: 5,370,411] | ​ | $ | [removed: 5,089,969] [added: 4,764,379] |

| Accounts payable | ​ | $ | [removed: 552,730] [added: 559,527] | ​ | $ | [removed: 477,052] [added: 552,730] |

| Accrued liabilities | ​ | ​ | [removed: 364,797] [added: 444,278] | ​ | ​ | [removed: 296,334] [added: 364,797] |

| Deferred revenue | ​ | ​ | [removed: 353,579] [added: 394,677] | ​ | ​ | [removed: 274,383] [added: 353,579] |

| Current operating lease liabilities | ​ | ​ | [removed: 274,118] [added: 283,293] | ​ | ​ | [removed: 253,415] [added: 274,118] |

| Accrued income taxes | ​ | ​ | [removed: 12,786] [added: —] | ​ | ​ | [removed: 42,529] [added: 12,786] |

| Total current liabilities | ​ | ​ | [removed: 1,558,010] [added: 1,681,775] | ​ | ​ | [removed: 1,343,713] [added: 1,558,010] |

| Non-current operating lease liabilities | ​ | ​ | [removed: 1,572,638] [added: 1,619,883] | ​ | ​ | [removed: 1,643,386] [added: 1,572,638] |

| Deferred income taxes | ​ | ​ | [removed: 39,693] [added: 55,346] | ​ | ​ | [removed: 65,359] [added: 39,693] |

| Other long-term liabilities | ​ | ​ | [removed: 58,665] [added: 53,596] | ​ | ​ | [removed: 37,962] [added: 58,665] |

| Total liabilities | ​ | ​ | [removed: 3,229,006] [added: 3,410,600] | ​ | ​ | [removed: 3,090,420] [added: 3,229,006] |

| Commitments and contingencies (Note [removed: 9)] [added: 10)] | ​ | ​ | ​ | ​ | ​ | ​ |

| Common stock, $0.01 par value, 400,000 shares authorized; [removed: 53,049] [added: 51,120] and [removed: 56,952] [added: 53,049] shares issued; [removed: 52,311] [added: 50,364] and [removed: 56,260] [added: 52,311] shares outstanding; at January [removed: 29, 2022] [added: 28, 2023] and January [removed: 30, 2021,] [added: 29, 2022,] respectively | ​ | ​ | [removed: 530] [added: 511] | ​ | ​ | [removed: 569] [added: 530] |

| Treasury stock-common, at cost | ​ | ​ | [removed: (53,478)] [added: (60,470)] | ​ | ​ | [removed: (37,801)] [added: (53,478)] |

| Additional paid-in capital | ​ | ​ | [removed: 934,945] [added: 1,023,997] | ​ | ​ | [removed: 847,303] [added: 934,945] |

| Retained earnings | ​ | ​ | [removed: 653,376] [added: 995,773] | ​ | ​ | [removed: 1,189,422] [added: 653,376] |

| Total stockholders’ equity | ​ | ​ | [removed: 1,535,373] [added: 1,959,811] | ​ | ​ | [removed: 1,999,549] [added: 1,535,373] |

| Total liabilities and stockholders’ equity | ​ | $ | [removed: 4,764,379] [added: 5,370,411] | ​ | $ | [removed: 5,089,969] [added: 4,764,379] |

| ​ | ​ | January [removed: 29,] [added: 28,] | | ​ | January [removed: 30,] [added: 29,] | | ​ | [removed: February 1,] [added: January 30,] | |

March 24, 2023

March 24, 2023

| (In thousands, except per share data) | | 2023 | | | 2022 | |

| Cash and cash equivalents | ​ | $ | 737,877 | ​ | $ | 431,560 |

| Net income | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 1,242,408 | ​ | ​ | — | ​ | ​ | 1,242,408 |

| Repurchase of common shares | ​ | (2,193) | ​ | ​ | (22) | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (900,011) | ​ | ​ | — | ​ | ​ | (900,033) |

| Balance – January 28, 2023 | ​ | 51,120 | ​ | $ | 511 | ​ | (756) | ​ | $ | (60,470) | ​ | $ | 1,023,997 | ​ | $ | 995,773 | ​ | $ | — | ​ | $ | 1,959,811 |

Nearly every store features a full-service salon.

| Cash and cash equivalents | ​ | $ | 737,877 | ​ | $ | 431,560 |

| Royalties and other credit card | ​ | ​ | 19,738 | ​ | ​ | 11,898 |

| Other | ​ | ​ | 25,036 | ​ | ​ | 16,855 |

Cloud computing arrangements

The standalone selling price of points earned and the estimated redemption rate is evaluated each reporting period.

Selling, general and administrative (SG&A) expenses includes payroll, bonus, and benefit costs for retail store and corporate employees; advertising and marketing costs, offset by vendor income that is a reimbursement of specific, incremental, and identifiable costs; occupancy costs related to our corporate office facilities; stock-based compensation

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

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

| (In thousands) | ​ | 2023 | | | 2022 | |

5. Prepaid expenses and other assets

Prepaid expenses and other current assets consist of the following:

| (In thousands) | | 2023 | | | 2022 | |

| Prepaid supplies | ​ | $ | 40,454 | ​ | $ | 40,996 |

| Cloud computing costs (1) | ​ | | 34,900 | ​ | | 23,379 |

| Prepaid advertising | ​ | | 9,466 | ​ | | 7,612 |

| Other | ​ | | 45,426 | ​ | | 38,827 |

| Prepaid expenses and other current assets | ​ | $ | 130,246 | ​ | $ | 110,814 |

Other long-term assets consist of the following:

| (In thousands) | | 2023 | | | 2022 | |

| Cloud computing costs (1) | ​ | $ | 28,540 | ​ | $ | 22,596 |

| Other | ​ | | 14,467 | ​ | | 13,051 |

| Other long-term assets | ​ | $ | 43,007 | ​ | $ | 35,647 |

| (In thousands) | | 2023 | | | 2022 | |

| ​ | ​ | | 2,863,179 | ​ | | 2,633,011 |

| (In thousands) | ​ | 2023 | | | 2022 | |

| Ending balance | ​ | $ | 10,870 | ​ | $ | 10,870 |

8.

| 2023 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 874 |

| 2027 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | — |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 1,312 |

​

​​​

March 25, 2022

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

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

| Cash and cash equivalents at beginning of year | ​ | ​ | 1,046,051 | ​ | ​ | 392,325 | ​ | ​ | 409,251 |

| Balance – February 2, 2019 | ​ | 59,232 | ​ | $ | 592 | ​ | (648) | ​ | $ | (24,908) | ​ | $ | 738,671 | ​ | $ | 1,105,863 | ​ | $ | — | ​ | $ | 1,820,218 |

| Net income | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 705,945 | ​ | ​ | — | ​ | ​ | 705,945 |

| Adoption of accounting standards - ASC 842 | ​ | — | ​ | ​ | — | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (2,375) | ​ | ​ | — | ​ | ​ | (2,375) |

| Repurchase of common shares | ​ | (2,321) | ​ | ​ | (23) | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (680,956) | ​ | ​ | — | ​ | ​ | (680,979) |

The stores also feature full-service salons.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

| Other | ​ | ​ | 28,753 | ​ | ​ | 24,181 |

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

Recently adopted accounting pronouncements

_Taxes – Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes._

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes.

The guidance removes certain exceptions for recognizing deferred taxes for equity method investments, performing intraperiod allocation, and calculating income taxes in interim periods.

The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for goodwill and allocating taxes to members of a consolidated group, among others.

This guidance is effective for interim and annual reporting periods beginning after December 15, 2020.

Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued.

The transition requirements are dependent upon each amendment within this update and will be applied either prospectively or retrospectively.

The Company adopted the new guidance as of January 31, 2021, and its adoption had no impact on the Company’s consolidated financial position, results of operations, or cash flows.

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

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

| | (1) | Certain sales departments were reclassified between categories in the prior year to conform to current year presentation. |

| | (2) | As of January 30, 2021, there was $9,476 in accrued liabilities on the consolidated balance sheets for restructuring and was primarily for severance. There was no liability for restructuring as of January 29, 2022. |

5.

| ​ | ​ | | 2,633,011 | ​ | | 2,567,816 |

Internal use software

As of January 29, 2022, capitalized costs related to cloud computing arrangements of $23,379 was classified as prepaid expenses and other current assets and $22,596 was classified as other long-term assets in the consolidated balance sheets.

As of January 30, 2021, capitalized costs related to cloud computing arrangements of $18,773 was classified as prepaid expenses and other current assets and $16,694 was classified as other long-term assets in the consolidated balance sheets.

| Balance at the end of the period | ​ | $ | 10,870 | ​ | $ | 10,870 |

| 2022 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 926 |

| 2023 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | 612 |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | $ | 1,538 |

| | | general and administrative expenses. Operating lease cost from the control date through store opening date is classified within pre-opening expenses. |

| 2022 | ​ | ​ | ​ | $ | 330,260 |

| 2023 | ​ | ​ | ​ | ​ | 349,856 |

| 2024 | ​ | ​ | ​ | ​ | 318,507 |

| 2025 | ​ | ​ | ​ | ​ | 289,025 |

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Bolingbrook, State of Illinois, on March [removed: 25, 2022.][added: 24, 2023.]

| /s/ David C. Kimbell | ​ | Chief Executive Officer and | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Scott M. Settersten | ​ | Chief Financial Officer, Treasurer | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Michelle L. Collins | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ [removed: Mary N. Dillon] [added: Lorna E. Nagler] | ​ | [removed: Executive] [added: Non-Executive] Chair of the Board of Directors | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Kelly E. Garcia | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Catherine Halligan | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Patricia A. Little | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Michael R. MacDonald | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ George Mrkonic | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Gisel Ruiz | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Michael C. Smith | ​ | Director | ​ | March [removed: 25, 2022] [added: 24, 2023] |

| /s/ Heidi G. Petz | ​ | Director | ​ | March 24, 2023 |

| Heidi G. Petz | ​ | ​ | ​ | ​ |

| ​ | ​ | ​ | ​ | ​ |

| /s/ Sally E. Blount | ​ | Director | ​ | March 25, 2022 |

| Sally E. Blount | ​ | ​ | ​ | ​ |

| Mary N. Dillon | ​ | ​ | ​ | ​ |

| /s/ Charles Heilbronn | ​ | Director | ​ | March 25, 2022 |

| Charles Heilbronn | ​ | ​ | ​ | ​ |

| /s/ Lorna E. Nagler | ​ | Lead Independent Director of the Board of Directors | ​ | March 25, 2022 |