Ulta Beauty Expands Globally in U.K., Mexico, and Middle East

After 35 years in business in the U.S., Ulta Beauty is going global, marking a new chapter for the retailer.

Through an unexpected acquisition, a joint venture and a franchise, Bolingbrook, Ill.-based Ulta will this year enter the U.K., Mexico and the Middle East. More countries and regions will no doubt be announced soon as the retailer talks to potential partners across a number of markets.

“Finding the right partner to move in a marginally creative way that doesn’t put a ton of risk to our core business and organization in the United States, that’s always going to be our top priority,” said Kecia Steelman, CEO and president of Ulta Beauty.

The company is using the Middle East and Mexico to test and learn. “[Consumers] were asking for us to come to Mexico. We were hearing that they wanted us to grow in the Middle East,” said Steelman, noting that Mexico is a partnership, while the Middle East venture will be operated as a franchise. “We’re going to continue to have those conversations with even more partners.”

When searching for additional partners, her team is looking at it country by country.

“You’ve got a good list of targets that are out there, and we want to be where the market is asking for us and where it will make sense for us to continue to grow,” said Steelman. “I couldn’t be more excited than to have Mexico and the Middle East be the first ones. We’re going to learn a lot along the way, and we’ll continue to get even better as we launch more countries in the future.”

Beginning with Mexico, Ulta has forged a joint venture with Axo, a global brands operator.

“We have been searching for a great partner in the beauty segment for a long time,” said Andrés Gómez, cofounder, chairman and CEO of Axo. “We admire what Ulta has done in the U.S., the model that they have. It is a model that resonates very well with the Mexican consumer. Why? Because, as well as prestige, you have mass. For me, that’s the secret sauce,” he said.

Gómez noted that the retail scene in Mexico is currently dominated by department stores. “The younger consumer in Mexico is going to be very happy to have this option, because it is a very democratic option,” he said. “We have more than 30 million young people in Mexico. They love the beauty trends and it’s a very steady growth.”

According to data from Euromonitor, Mexico’s beauty and personal care market was worth $16 billion in 2024. In 2018, it stood at around $10 billion.

Youth culture is a big driver. Data from the World Bank showed that in 2022, 25 percent of the 132 million-plus population was age 14 and below, compared to 18 percent in the U.S. and 12 percent in Japan.

The first Ulta Beauty store is expected to open in Mexico City in September. While Gómez did not want to put a number on it, he said that he plans to open numerous doors.

Currently, Axo and Ulta are in curation mode. “We’re going to bring a good percentage of brands that are not in Mexico today for this young consumer,” he said.

In the Middle East, the plan is to open around a dozen Ulta stores across the region by the end of next year via a licensing agreement with Alshaya Group, which also brought the likes of H&M and Cheesecake Factory to the region. 

According to Rebecca Jobo, president of wellness at Alshaya, awareness of the Ulta brand is already high in the region. “Ulta is a very well-known brand in the Middle East,” she said. “It seemed like a natural synergy with our customer base, who absolutely love beauty. You only need to see social media and the response to Ulta opening in the region to really appreciate the excitement about the brand coming to the Middle East.”

The first store will open in Kuwait City, where Alshaya Group is based, in the fourth quarter, closely followed by Dubai.

John Hadden, chief executive of Alshaya Group, said: “We’re a Kuwait business and we also operate the largest shopping mall in Kuwait. We found the best location possible, so we just felt it was the right place to go and start.”

Euromonitor’s data showed that the UAE’s beauty market totaled 11.1 million Emirati dirham in 2024, while Kuwait’s was worth 355.1 million Kuwaiti dinar.

Future locations will likely be in Bahrain, Qatar, Saudi Arabia and the UAE. “We’re looking for real estate at the moment,” continued Hadden. “We’ll sign a number of new locations over the next three to four months, and you’ll see rapid expansion across the GCC (Gulf Cooperation Council) next year.”

Jobo added that Alshaya’s vision is to “replicate the best of Ulta in the Middle East, so that we bring the best to our consumers, both in brands and in service and in presentation.”

At the same time, however, it will tailor the stores to consumers in the region. “Everything from tweaking the brands just slightly, but also bringing the best of what Ulta has to offer. And then, of course, the color ranges within to speak to our customer base.”

In particular, the consumer in the region is very into fragrance and makeup, but demand for skin care is also on the rise, according to Jobo, citing K Beauty and indie American brands as being of particular interest. “They have a very wide palette and appreciation for brands.”

The beauty retail landscape in the region is extremely competitive, but Alshaya is confident it can rise to the top with Ulta, Hadden said. “It is always a race, and it’s a very serious race to be number one in most everything that we do. We’re excited about it. We can’t wait to launch, and our customers are excited about it. We know because of that, we will absolutely be looking to achieve a number-one status here.”

Of the moves into Mexico and the Middle East, Ashley Helgans, an analyst at Jefferies, said they “reflect Ulta’s strategy to scale globally by partnering with established regional players, leveraging their local expertise to bring Ulta’s brand and customer experience to new markets.”

Nevertheless, Ulta approached entering the U.K. completely differently, acquiring Space NK in early July for an undisclosed sum.

As part of the deal, Space NK, which has 83 stores in the U.K. and Ireland and turnover of 196.5 million pounds in 2024, will operate as a stand-alone subsidiary of Ulta and will continue to be led by its existing management team, including CEO Andy Lightfoot.  

While Lightfoot said it’s still very early days in terms of what it means for scaling Space NK, the plan is to continue to grow space as a stand-alone business. 

“Our vision is to continue the 10 stores plus growth that we’ve got, but we’ll start to talk about what that looks like over an extended period, what that looks like in terms of acceleration, any ambitions to go beyond U.K. and Ireland where we currently operate,” said Lightfoot, noting that its online site already sells into several EU countries.  

It’s also too premature to tell what this could mean for the U.S. “It certainly opens the possibility, but strategically, we haven’t got any plans to re-enter the U.S.,” said Lightfoot. “It is too early to say.”

The U.S. wholesale division of Space NK, which entails roughly 600 points of distribution across Bloomingdale’s, Nordstrom, Nordstrom Rack, Hudson’s Bay and the company’s shop-in-shop collaboration with Walmart and Beauty SpaceNK, was acquired by PCA Companies in June 2024 and is now called BeautySpace.

On whether the Ulta banner could appear at Space NK stores, Lightfoot responded that for the time being the answer is no.

“The existing plan and intentions are to keep Space NK as it is and run them as two businesses within the same group, rather than merge and blur the lines,” he said. “Like everything else that is going to evolve over time, and we might see elements of Ulta appear in Space NK, and you might see elements of Space NK appearing also. But those are all decisions that we’ll make in the future, ensuring that they make sense both for our brand partners and for our customers. But in the short term, things shouldn’t really change in terms of the look and feel of the stores.”

The acquisition was met with approval by analysts. “This acquisition is an attractive way for Ulta to quickly ramp its international expansion, and demonstrates management’s commitment to delivering faster growth,” said Raymond James analyst Olivia Tong.

Neil Saunders, managing director of GlobalData, added: “The acquisition of Space NK by Ulta gives the beauty chain a ready-made international business that it can use to drive future growth. It also provides Ulta with a brand in a different tier of the market that complements its mainstream beauty operation in the U.S. Both things are important as, while Ulta is very successful, its headroom for organic expansion in the U.S. is much slimmer than it once was. Space NK basically unlocks more potential and provides a compelling growth story for investors. It also fast-tracks Ulta’s international ambitions.”

Lightfoot, for one, is eager to learn from the much larger Ulta.

“Ulta is only three years older than Space NK. It’s now a $21 billion market cap organization. We have aspirations to achieve our first 1 billion pounds of sales in the next three years. For us, that’s a huge growth that we have to achieve. Ulta’s been there and done that, so to guide us through that path and to help us to achieve our ambitions, there isn’t anyone better out there.”