Ulta Beauty raised its annual sales and profit forecast on Thursday, betting on strong demand for its makeup and skincare products going into the holiday season.

Shares of the company, which also reported third-quarter results above estimates, were up about 5% in trading after the bell.

The cosmetic retailer enjoyed strong sales at its outlets, helped by its trendy and affordable offerings, along with marketing efforts, which helped attract shoppers, especially younger demographics.

Ulta also benefits from fast-growing demand for fragrances, as well as the popularity of celebrity-owned labels on its shelves, including Rihanna 's Fenty Beauty .

The positive outlook comes at a time when budget-conscious consumers are pulling back on discretionary spending amid macroeconomic uncertai

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