“Despite ongoing economic pressures, beauty continues to outperform many other industries, reinforcing its role as a driver of growth across U.S. retail,” said Larissa Jensen, global beauty industry advisor at Circana.Circana
2025 Sales Point to 2026 Strategies
U.S. beauty sales grew in 2025, per Circana, with prestige beauty retail dollar sales up by 4%, year over year, totaling $36 billion. Prestige unit sales increased at a flat rate, while average selling price was up by 1%. Mass beauty dollar sales increased 5%, totaling $72.7 billion, with unit sales up by 2%, compared to 2024.
"Both prestige and mass retail are entering 2026 from a position of strength, something we’re really seeing in sync for the first time, so the door is open for multiple strategies to win," Larissa Jensen, global beauty industry advisor at Circana, told Global Cosmetic Industry and Perfumer & Flavorist+. "There’s clear room for brands focused on value and replenishment, and for those leaning into premium, experience‑led innovation. Consumers are embracing both ends of the spectrum right now, so it’s less about choosing a side and more about showing up authentically in whichever lane you play.
Tiny but Mighty: Fragrance Flexes the Fastest Growth in Beauty
Fragrance is the smallest mass market segment, but it grew at the fastest rate, with both dollar sales and units up about 15%. Prestige fragrance grew 5% in dollars and charted as the second-largest segment in prestige retail. That said, Q4 growth was behind other segments, including makeup, skin care and hair. Circana attributes this to a "normalization" of the market. Per the company, top growing segments included new introductions from luxury brands, high concentrations, including perfume, and ongoing excitement for minis.
Circana's Jensen notes, "As fragrance starts to settle after a few years of huge gains, I don’t think high concentrations, minis, and luxury newness alone have to carry all the weight. What’s really kept the category so strong is the level of consumer engagement and the fact that there’s truly something for every budget and every type of indulgence. Plus, the mass market has stepped up in a big way—shifting from basic, value‑driven scents to more luxe‑feeling, high‑quality options at accessible prices. That mix of inclusivity and elevated experiences is what’s been fueling momentum, and it’s likely what will keep fragrance moving forward in 2026."
Lip Service Pays Off: Makeup Holds the Crown in Prestige Beauty
Makeup was again the largest prestige beauty category in 2025, growing by 4%, with all segments posting dollar growth, though there was unit softness in face and eye makeup. Top performers included makeup sets, lip liner and other lip products, such as oils and balms. Overall, growth was driven by value, social media influence and hybrid formats/skinification. In the mass space, lip products were the fastest-growing segment, including lip liners and lip treatments.
Hair Takes the Crown as Prestige Beauty’s Fastest-Growing Category
Hair was the fastest growing prestige category based on dollar sales in 2025, per Circana, driven by hair treatments and styling and scalp care, the latter of which experienced double-digit growth for the third year in a row. No surprise hatt launches were up more than 20%, particularly in the hair treatment space. Hair is the only prestige beauty category where online sales accounts for the majority of retail results, driven by a desire for convenience and replenishment. In mass, which was relatively soft compared other categories, value was a key driver, typified by the fastest-growing segment: shampoo-conditioner combo packs.
"As we head into 2026, channel strategy in hair will evolve less around big disruptions and more around meeting shoppers where they already are," says Jensen. "In mass, brick‑and‑mortar is still the main way people buy haircare, so being in the right retailers and the right locations really matters. In prestige, salon brands will continue to anchor the category—they’re the trusted names that spark innovation and drive growth. And across both channels, the formats and launches that will resonate most are the ones tied to wellness and hair‑and‑scalp health, since those remain the strongest, most in‑demand areas of the market.
Skin Care Stages a Second-Half Comeback in 2025
Prestige skin care sales in 2025 experienced 3% dollar growth and as the fastest-growing unit gain of any category. The first half of 2025 was soft, but the sector bounced back in the second half of the year to outpace makeup and fragrance during the holidays. Drivers included facial skin care (the largest prestige skin care segment), which saw sales peak in November. Mass skin care, meanwhile, grew 6% year-over-year in 2025, driven by facial cleansers and face moisturizers.
Takeaways for 2026
“Despite ongoing economic pressures, beauty continues to outperform many other industries, reinforcing its role as a driver of growth across U.S. retail,” said Jensen. “Since the pandemic, beauty remains an accessible indulgence, giving consumers a way to invest in themselves and support their mental well‑being—a mindset that has become a meaningful driver behind its performance. However, while consumers continue turning to beauty products for confidence and self-expression, the dynamics shaping their choices are changing. Brands that lean into value, wellness, and innovation—and respond to evolving behaviors with transparency and purpose—will be best positioned to succeed.”
