Cosmetics maker Elizabeth Arden cut its full-year forecast after reporting lower-than-expected quarterly results due to weak sales at department stores and what it called a "major mass retail account" during the holiday season.

The company's shares fell 20 percent to $36.62 in early trading on the Nasdaq on Thursday.

Arden, which holds fragrance licenses for brands from True Religion Apparel and for hip-hop star Nicki Minaj and Justin Bieber, lowered its full-year earnings forecast to between $2.30 and $2.50 per share from between $2.55 and $2.70 per share. Analysts were looking $2.66 on average, according to Thomson Reuters I/B/E/S.

It now expects sales to grow by 9 to 11 percent during the year, and not by the 13.5 to 15 percent forecast earlier. The projection implies a revenue of $1.35 billion to $1.37 billion, below the $1.42 billion analysts estimated.

The company has been trying to make its namesake brand more upscale by revamping its cosmetics line and adding more celebrity fragrances, and was well positioned going into the holiday season, Suntrust Robinson Humphrey analyst Bill Chappell said in a note.

Nevertheless, he was surprised that the results didn't beat expectations.

"We now wonder whether it is simply too early for the cosmetics restage to make an impact on overall results," Chappell said, maintaining his "neutral" rating on the stock.

The company's net income rose to $48.1 million, or 1.58 per share, from $42.4 million, or $1.42 per share, a year earlier.

Excluding one-time items, Elizabeth Arden reported earnings of $1.58 per share, missing the $1.63 per share analysts expected.

Revenue rose 9 percent to $468 million, well below the average analyst estimate of $492.3 million.