Key TakeawaysLululemon Athletica shares moved higher in premarket trading Friday after the activewear retailer reported higher-than-expected profit and outlined efforts to accelerate the introduction of new products, offsetting weak sales and a cut to its full-year outlook.The stock's premarket move sets the stage for a potential retest of the top trendline of a descending channel and the 50-day moving average.Investors should monitor post-earnings price levels on the Lululemon chart at $272, $293, $335. an ...

jetcityimage/iStock Editorial via Getty Images It is far from common for a stock to be up 4% after missing the revenue guide for the quarter and slashing the full-year revenue guide. That's exactly what happened with Lululemon (NASDAQ:LULU) yesterday, which should tell you the kind of sentiment going into the earnings! Here are my highlights from tonight's call. Sales Growth by Region The crux of the bear thesis on Lulu usually circles around their US business. After growing sales +2% YoY in 1Q'24, it was f ...

Financial Data and Key Metrics - Total revenue increased 7% or 8% in constant currency, with earnings per share rising 18% driven by strong gross margin, contributing to a 110 basis point increase in operating margin [10] - Gross profit for Q2 was $1.4 billion or 59.6% of net revenue, up 80 basis points from Q2 2023, driven by a 130 basis point increase in product margin [30] - Operating income for Q2 was $540 million or 22.8% of net revenue, compared to 21.7% in Q2 2023 [32] - Net income for Q2 was $393 million or $3.15 per diluted share, up from $2.68 in Q2 2023 [32] - The company repurchased $584 million of stock in Q2, bringing the year-to-date total to $1.2 billion [10] Business Line Performance - Women's revenue increased 6%, men's grew 11%, and accessories increased 7% [10] - Men's business remained robust, with strength across the assortment, including Zeroed In, Pace Breaker, and Show Zero Polo [20] - Women's business experienced a slowdown due to reduced newness in product offerings, particularly in bottoms and the online channel [14][15] - Accessories business grew 7%, driven by new styles in the Everywhere franchise and other innovative products [21][22] Regional Performance - International revenue increased 29% or 31% in constant currency, with China mainland up 34% or 37% and Rest of World up 24% or 27% [10][11] - Americas revenue increased 1% or 2% in constant currency, with Canada growing 8% or 11% and the U.S. flat [13] - Store channel sales increased 11%, with 721 stores globally and 49 net new stores added since Q2 2023 [29] - Digital channel revenue increased 2%, contributing $900 million or 38% of total revenue [29] Company Strategy and Industry Competition - The company aims to quadruple international revenue from 2021 levels by the end of 2026 [10] - A new product organization structure was implemented to improve the balance between design and merchandising, with a focus on increasing newness in the women's assortment [16][17] - The company is leveraging its membership program, which now has over 20 million essential members, to drive loyalty and long-term value [19] - The company is focused on increasing brand awareness and consideration through global campaigns and activations, such as the Summer Sweat Game Series in China and partnerships with the Canadian Olympic and Paralympic teams [23][24] Management Commentary on Operating Environment and Future Outlook - The company expects revenue growth of 6% to 7% for Q3 and the full year, excluding the 53rd week, with uncertainties around the shorter holiday shopping season and the U.S. election in Q4 [26][35] - The company plans to improve the penetration of newness in the women's assortment in the second half of 2024, with a return to historical levels of newness by Spring 2025 [17][26] - The company remains committed to its Power of Three Times Two target of doubling revenue from $6.25 billion in 2021 to $12.5 billion in 2026 [27] Other Important Information - The company paused sales of the Breathe Through product due to guest feedback, with plans to reintroduce the fabric in the future [22] - The company expects inventory to increase in the mid-teens in Q3 and slightly higher in Q4, with markdowns expected to be flat for the full year [36][47] Q&A Session Summary Question: Revenue growth algorithm in North America and guardrails for consistency [42] - The company remains committed to low double-digit growth in North America, with a focus on improving brand awareness and product newness [43] - The new product organization structure is expected to lead to more creative conversations and better decision-making, with a focus on the ratio of newness in product plans [44] Question: Inventory and markdowns [45] - Inventory declined 14% in Q2, in line with expectations, with mid-teens growth expected in Q3 and Q4 [46] - Markdowns were flat year-over-year in Q2, with Q3 markdowns expected to be in line with last year and Q4 slightly below [47] Question: Revised full-year guidance and revenue shortfall [49][51] - The revised guidance reflects a softer Q4 due to a shorter holiday shopping season and macroeconomic uncertainty, with no change in the relationship between Q3 and Q4 [50] - The revenue shortfall in Q2 was attributed to product decisions within the company's control, particularly the lack of newness in the women's assortment [52] Question: Regional performance and inventory [55] - Q2 performance was softer in June and July, with no significant regional breakdown provided [56] - The Breathe Through pause had a negligible financial impact, with no material markdowns or inventory resets [56][74] Question: P&L mechanics and product organization changes [58] - The company is managing the P&L by investing in international growth and brand awareness while seeking efficiency opportunities [59] - The new product organization structure aims to improve the balance between design and merchandising, leading to more creative outcomes and better product mix [61][62] Question: Product innovation and back-to-school campaign [65][76] - The Breathe Through fabric will be reintroduced in the future, with no specific timeline for 2024 or 2025 [66] - The company is focusing on increasing newness in the women's assortment, with seasonal updates and new performance fabrics [67][68] - The back-to-school campaign is targeting younger guests, particularly men, with a focus on loungewear and the Cityverse sneaker [25] Question: China growth and comp trends [81] - China revenue grew 37% in constant currency in Q2, with strong performance across both store and digital channels [82] - The company remains optimistic about growth in China, with a localized approach to brand building and product positioning [84] Question: Core product performance and accessories outlook [86] - The slowdown in women's was due to a lack of newness in core styles, with improvements expected in Q3 and Q4 [87] - Accessories grew 7% in Q2, with new styles and innovations driving continued momentum [88] Question: Gross margin and SG&A concerns [91] - The company expects gross margin to be relatively in line with 2023, with flat SG&A and strong operating margin [92] - The company remains committed to modest operating margin expansion over the long term [92] Question: Core customer changes in women's [93] - The company continues to acquire new guests across all age demographics, with improvements in sizing mix expected in Q3 [94]

Lululemon management lowered its full-year guidance of revenue and earnings.Athletic apparel specialist Lululemon Athletica (LULU 0.07%) reported mixed second-quarter results on Thursday. Earnings per share (EPS) surpassed analyst consensus expectations but revenue slightly missed. This reflects steady growth but highlights areas for potential improvement in revenue generation.The quarter was marked by robust international growth and improved margins, but the growth in the Americas lagged. Overall, the quar ...

For the quarter ended July 2024, Lululemon (LULU) reported revenue of $2.37 billion, up 7.3% over the same period last year. EPS came in at $3.15, compared to $2.68 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $2.4 billion, representing a surprise of -1.37%. The company delivered an EPS surprise of +7.88%, with the consensus EPS estimate being $2.92.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they com ...

SAN DIEGO, Aug. 29, 2024 (GLOBE NEWSWIRE) -- Robbins LLP reminds investors that a shareholder filed a class action on behalf of all persons and entities that purchased or otherwise acquired Lululemon Athletica Inc. (NASDAQ: LULU) securities between December 7, 2023 and July 24, 2024. Lululemon is principally a designer, distributor, and retailer of technical athletic apparel, footwear, and accessories. For more information, submit a form, email attorney Aaron Dumas, Jr., or give us a call at (800) 350-6003. ...

Lululemon (LULU) came out with quarterly earnings of $3.15 per share, beating the Zacks Consensus Estimate of $2.92 per share. This compares to earnings of $2.68 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 7.88%. A quarter ago, it was expected that this athletic apparel maker would post earnings of $2.38 per share when it actually produced earnings of $2.54, delivering a surprise of 6.72%.Over the last four quarters, the c ...

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

Revenue Growth - Net revenue increased 7% to $2.4 billion in Q2 2024, with an 8% increase on a constant dollar basis[90] - Net revenue increased by $370.0 million (9%) to $4.6 billion in the first two quarters of 2024 compared to $4.2 billion in 2023, driven by growth in China Mainland and Rest of World regions[115] - Total net revenue increased by 8% on a constant dollar basis, with China Mainland leading at 39% growth[139] - Revenue was $43.9 million lower in the first two quarters of 2024 compared to the same period in 2023 due to foreign currency exchange fluctuations[156] Comparable Sales Performance - Comparable sales increased 2% overall, with China Mainland showing a 21% increase and Rest of World a 17% increase[90] - Americas comparable sales decreased 3%, primarily due to lower conversion rates, despite increased traffic[98] - Comparable sales increased by 4% on a constant dollar basis, with China Mainland contributing 24% growth[139] Gross Profit and Margin - Gross profit increased 9% to $1.4 billion, with gross margin rising 80 basis points to 59.6%[90] - Gross profit increased by $237.9 million (9.7%) to $2.69 billion, with gross margin improving by 50 basis points to 58.7%[120] - China Mainland gross profit increased by $118.9 million, driven by higher net revenue and gross margin, partially offset by unfavorable foreign currency exchange rates[128] - Rest of World gross profit increased by $79.6 million, primarily due to higher net revenue and gross margin, partially offset by unfavorable foreign currency exchange rates[129] Operating Income and Margin - Income from operations increased 13% to $540.2 million, with operating margin up 110 basis points to 22.8%[90][92] - Income from operations increased by $92.2 million (10.5%) to $972.9 million, with operating margin improving by 30 basis points to 21.2%[127] Net Income and Earnings Per Share - Diluted earnings per share rose to $3.15 in Q2 2024, compared to $2.68 in Q2 2023[92] - Net income increased by $51.3 million (15.0%) to $392.9 million in Q2 2024, driven by higher gross profit and other income[113] - Net income increased by $82.3 million (13.0%) year-over-year, driven by a $237.9 million increase in gross profit and a $25.9 million increase in other income[132] Regional Performance - China Mainland net revenue increased by $79.7 million, driven by a 21% rise in comparable sales and new store openings[99] - Rest of World net revenue increased by $60.5 million, with comparable sales up 17% due to higher traffic and transaction values[100] - China Mainland net revenue increased by $173.5 million (39%) to $618.0 million, with comparable sales growth of 24% (28% on a constant dollar basis)[118] - Rest of World net revenue increased by $120.4 million (25%) to $598.3 million, with comparable sales growth of 20% (23% on a constant dollar basis)[119] - Americas net revenue increased by $76.2 million (2%) to $3.36 billion, driven by new store openings, despite a 1% decline in comparable sales[117] Expenses - Selling, general, and administrative expenses increased 6.7% to $871.9 million, primarily due to higher head office and operating channel costs[102][103] - Selling, general and administrative expenses increased by $149.5 million (9.6%) to $1.71 billion, primarily due to higher marketing and technology costs[123] - Income tax expense increased by $35.8 million (13.5%), with the effective tax rate rising by 10 basis points to 29.6%[131] Store Expansion and Operations - The company opened 15 net new stores in the Americas, 25 in China Mainland, and 9 in Rest of World since Q2 2023[117][118][119] - Company-operated stores in China Mainland increased from 127 to 132, while total Americas stores grew from 438 to 441[153] - Total company-operated stores decreased from 711 to 721 as of July 28, 2024 compared to January 28, 2024[154] - Total retail locations operated by third parties increased from 39 to 45 as of July 28, 2024 compared to January 28, 2024[154] Cash Flow and Financial Position - Cash provided by operating activities increased by $48.5 million, primarily due to higher net income[143] - Cash used in financing activities increased by $610.9 million, driven by higher stock repurchases of 2.6 million shares at a cost of $888.9 million[145] - The company held cash and cash equivalents of $1.6 billion as of July 28, 2024[162] - The company has a committed revolving credit facility of up to $400.0 million, with no borrowings outstanding as of July 28, 2024 except for $6.3 million in letters of credit[161] Inventory and Derivatives - Inventory balance decreased by 14% to $1.4 billion as of July 28, 2024[149] - The net fair value of outstanding derivatives as of July 28, 2024 was $0.1 million, with a hypothetical 10% depreciation in the U.S. dollar potentially causing a $21.5 million depreciation in derivative value[159] Foreign Currency and Inflation Risks - Foreign currency fluctuations reduced net revenue growth by $43.9 million in the first two quarters of 2024 compared to 2023[94] - The impact of translation on Canadian subsidiaries resulted in an increased loss of $42.5 million, including net investment hedge gains[157] - The company is exposed to inflationary risks, including potential increases in transportation costs, wages, and raw material costs, which could adversely affect operating margins[166] - The company may enter into further derivative financial instruments to hedge additional currency pairs in the future to reduce foreign currency exchange risks[159] - The company does not engage in interest rate hedging activities currently but may consider it in the future if there is a meaningful outstanding balance under the revolving credit facility[161] Other Income and Expenses - Other income (expense), net increased by $10.6 million (144.4%) to $18.0 million in Q2 2024, primarily due to higher interest income[108]

LULULEMON ATHLETICA INC. ANNOUNCES SECOND QUARTER FISCAL 2024 RESULTS Revenue increased 7% to $2.4 billion Comparable sales increased 2%, or 3% on a constant dollar basis Diluted EPS of $3.15 Vancouver, British Columbia – August 29, 2024 – lululemon athletica inc. (NASDAQ:LULU) today announced financial results for the second quarter of fiscal 2024, which ended on July 28, 2024. Calvin McDonald, Chief Executive Officer, stated: "In the second quarter, lululemon delivered revenue and earnings growth, with on ...