LOS ANGELES, California: Model Hailey Bieber's skincare and makeup brand, Rhode, is being bought by Elf Beauty for around US$1 billion.

This deal gives Elf access to a celebrity-backed brand that is very popular with Gen Z and millennial customers.

Elf said it would pay $800 million to Rhode's current owners using cash and stock. They may also pay an extra $200 million later, depending on how well Rhode performs.

Last month, news reports said Bieber was considering selling the brand, which could be worth more than $1 billion.

This is a big move for Elf, which usually sells affordable beauty products. The company is now expanding into the high-end beauty market at a time when many people are cutting back on spending due to high inflation.

Sky Canaves, an expert at eMarketer, said, "The Rhode deal is a bold move for e.l.f. Into premium beauty at a time when the prestige side of the industry has lost some of its momentum due to consumers buying less or trading down."

Rhode, launched in 2022, quickly became famous with viral products on TikTok, like the $18 peptide lip treatment. It sells mainly on its website and through pop-up stores, using Hailey Bieber's social media influence to drive interest.

In contrast, Elf (short for eyes, lips, face) sells low-cost makeup at big stores like Walmart, Target, and Ulta Beauty, with some products priced as low as $2.

Hailey Bieber said the deal with Elf is a great way to grow the brand, reach more people, and produce more innovative products. She wants to expand Rhode globally.

"e.l.f. Beauty marks an incredible opportunity to elevate and accelerate our ability to reach more of our community with even more innovative products and widen our distribution globally," Bieber said.

Rhode earned $212 million in sales in the year ending March 31. Starting this fall, it plans to sell in Sephora stores across the U.S. and Canada and later in the UK.

Elf's CEO, Tarang Amin, said, "Rhode helps grow our product line with a brand that brings the best of luxury beauty to more people."

This is Elf's biggest deal ever, following its $355 million purchase of skincare brand Natrium in 2023.

Bieber will stay involved as Rhode's founder and become a strategic advisor after the deal is complete. The purchase is expected to close in the second quarter of fiscal 2026.

Separately, Elf did not give a forecast for 2026 because of uncertainty about import tariffs. The company still beat sales expectations this past quarter. Since it still gets 75 percent of its products from China, it plans to raise prices by $1 to handle higher costs.

Shares of Elf were down about one percent after the bell.