New York City cosmetics leader Estee Lauder Companies Inc. (EL) saw its shares jump 4.4% on Wednesday after posting first-quarter earnings results above the Street’s expectations.

As the consumer packaged goods industry suffered a 2.5% decline year over year (YOY) in volumes last quarter, due to changing consumer preferences, brick-and-mortar declines and macro headwinds, the earnings beat from the American beauty company came as a relief. (See also: Consumer Packaged Goods Sank 2.5% in Q1.)

Reasons Behind Q1 Growth

The difference came from Estee Lauder's clinch on a key market that its peers don’t seem to fully understand yet—Millennials. As younger shoppers browse the web for their needs, instead of visiting shopping malls and stores, they are more inclined to pay a premium for products marketed as higher quality. Millennials have also shown a liking for the convenience of ecommerce, where they are,not coincidentally, the most susceptible to new forms of marketing via social channels and so-called influencers with large social media followings.

“The overall increase in makeup resulted from new product offerings, as well as the broadening of the brands' presence in a number of channels to reach new consumers,” said the company. The consumer products company has ramped up its presence on social channels, employing “influencer marketing” as celebrities endorse brands with double-digit growth such as Tom Ford and Smashbox. Estee Lauder’s cosmetics strength can be attributed to acquisitions of premium brands such as Too Faced and BECCA Cosmetics, along with deals with specialty retailers such as ULTA Beauty Inc. (ULTA) and LVMH’s Sephora, often located in off-mall locations.

Makeup as a Workout Essential

The cosmetics leader may have also benefited from a larger trend suggesting that Millennials are starting to spend more on makeup than athleisure clothing.

“Active wear today is no longer exclusive to athletic apparel; recent growth in key makeup categories coincides with the rising popularity of makeup as the latest workout essential,” wrote research firm NDP Group. The research firm said higher-priced “prestige makeup” climbed 11% in 12 months ended Feb. to $7.6 billion.

Moving forward, we can expect Estee Lauder’s rivals in the cosmetics industry, along with leaders across the consumer space, to continue doubling down on their targeting of Millennials. (See also: Revlon Embarks on New Digital Transformation.)