Coty on Tuesday raised its annual core sales forecast on the back of higher pricing and strong demand from customers who snapped up the CoverGirl parent’s new makeup and fragrance launches.

The company’s shares rose about 3 percent after the bell as it also beat first-quarter revenue expectations.

The beauty market’s post-pandemic growth has thrived as customers prioritize spending on “affordable luxuries” at a time when sticky inflation has impacted consumption patterns and pushed many customers to put off big-ticket purchases in the United States and Europe.

Coty also posted sales growth in the Americas and Europe similar to beauty company L’Oréal, that noted an acceleration in growth in these regions after an initial slowdown.

Coty’s efforts to launch key products such as Burberry Goddess in its high-end “prestige” category and CoverGirl’s Yummy Gloss in the consumer beauty category drove a double-digit increase in these segments.

“We are not seeing any depressed category ... prestige fragrance in US keeps growing very fast,” CFO Laurent Mercier told Reuters, adding that Gen Z was active and driving growth in the consumer beauty segment.

Coty now expects fiscal 2024 core like-for-like sales growth between 9 percent and 11 percent, compared with its previous outlook of an 8 percent to 10 percent rise.

The company’s first-quarter net revenue rose 18 percent to $1.64 billion, beating estimates of $1.58 billion, according to LSEG data.

However, Coty reported a net loss, compared with a profit a year earlier, due to an impact from an equity swap and higher costs.

The company posted a first-quarter net loss attributable to common shareholders of $1.7 million, compared with a profit of $125.3 million a year earlier.

Coty also reaffirmed its full-year adjusted per-share profit forecast between 44 cents and 47 cents.

By Ananya Mariam Rajesh

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Coty Lists on Euronext Paris

Proceeds from the offering will be used to lower debt — a long-term goal for Coty following its purchase of a number of Procter & Gamble beauty brands in 2016.