E.l.f. Beauty’s shares tumbled over 20 percent in extended trading on Thursday, after the cosmetics company cut its annual net sales and profit forecasts, citing weak demand in the mass beauty category at the start of the year.

E.l.f. Beauty is known for its vegan lip oils and makeup products at affordable price points, which are also available at drugstores and supermarkets such as Walgreens and Target.

Demand was softer in the mass beauty channel in January, and some of E.l.f.’s newer products were “off to a slower start,” chief executive officer Tarang Amin told Reuters.

“E.l.f.’s core Gen Z demographic has been distracted by natural disasters, political change, and uncertainty over TikTok’s fate, and that’s likely to weigh on the brand through the rest of its fiscal year,” said Sky Canaves, principal analyst at Emarketer.

President Donald Trump’s new 10 percent tariffs on imports from China could also force the company to raise prices, with about 80 percent of its products being manufactured in China, down from 100 percent five years ago.

Consumer uncertainty over inflation and the state of the economy weighed on the mass category in January, executives said on a post-earnings call.

The company now expects annual net sales of $1.30 billion to $1.31 billion, down from a prior target of $1.315 billion to $1.335 billion. It also lowered its annual adjusted profit per share target to $3.27 to $3.32 from $3.47 to $3.53.

E.l.f.’s net sales for the third quarter, ended December 31, grew 31 percent to $355.32 million, beating estimates of $329.67 million, according to data compiled by LSEG.

Beauty giant Estée Lauder said earlier this week that it would cut more jobs and noted it was taking a hit from weakness in travel retail demand for beauty products in Asia.

By Ananya Mariam Rajesh and Arriana McLymore

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