5 Takeaways From Beauty’s Big M&A Year
In 2025, beauty deals were dramatic and expansive as the industry kept up its momentum despite China’s decline and the uncertainty of US tariffs.
Hailey Bieber’s beauty and skincare brand Rhode was acquired by Elf Beauty for $1 billion in May, and Kering sold Kering Beauté to L’Oréal for €4 billion in October. Among the other significant deals, L’Oréal acquired Color Wow and took a majority stake in Medik8, Ulta snapped up Space NK, Unilever purchased Dr. Squatch, and Rare Beauty Brands acquired Kate Somerville.
“Scale, brand awareness, efficacy and cultural relevance continued to drive attention to the best performing brands from strategic and financial investors alike,” says Marissa Lepor, managing director at investment bank and M&A firm The Sage Group. She notes that key acquisition targets were brands that could show a laser focus on a handful of hero products, and a strong community. “This was a common thread across many of the large transactions in 2025 such as Rhode, Medik8 and Touchland.” (The latter, a buzzy hand sanitizer and body spray brand, was acquired for approximately $880 million by personal care conglomerate Church & Dwight in May.)
This year’s deals were less about acquiring the fastest-growing young brands; instead, power players looked to strengthen their portfolios with more strategic acquisitions. “Beauty’s M&A strategy has undergone a fundamental reset in the post-Covid era, and if 2025 proved anything, it’s that the days of chasing every buzzy newcomer — even those with scale and strong growth and profitability — are over,” says Katie Johnson, Americas consumer and health industry leader at EY-Parthenon. “Scale alone is no longer sufficient. Authenticity, brand equity, IP ownership, clinically proven products and strategic fit have become the key drivers of value creation, as companies focus on opportunities that strengthen their ‘power alleys’.”
Here are five themes that emerged out of 2025’s biggest M&A beauty deals.
Marketing still works
Rhode plunged further into pop culture with its marketing this year, to great effect. The beauty brand’s campaigns hit popular culture by tapping musician Tate McRae and its first-ever male face, actor Harris Dickinson (following the success of his A24 film Babygirl).
Bieber has become synonymous with creating moments that go viral. In the summer, she set up shop at a beach club in Majorca, Spain with a striking lemon-yellow color palette and the release of a limited-edition lemon-flavored lip tint. On TikTok, the brand quickly hopped onto the trend of fans turning Bieber into a man using AI, by posting similar AI-generated images of its founder but wearing Rhode eye patches. In five days since posting, the post has been seen by 4.5 million users, accumulating 792,000 likes.
