Investment Rating - The report assigns a "Hold" rating for lululemon, with a target price adjusted to $400 per share, corresponding to a FY2025 P/E ratio of 26.4 times [1][15]. Core Insights - The North American market has reached a bottom, while significant growth is observed in the Chinese market, indicating that the global expansion strategy is yielding results [1][5]. - In Q3 2024, lululemon's total revenue was $2.4 billion, representing a year-over-year increase of 9%, exceeding the consensus growth expectation of 7% [5][6]. - The adjusted gross margin for Q3 was 58.5%, which is 40 basis points higher than the adjusted gross margin in Q3 2023, outperforming the guidance of a 50-60 basis point decline [5][6]. - Net profit increased by 41.5% year-over-year to $350 million, surpassing the consensus expectation of $340 million [5][6]. - The company plans to launch more colors, prints, and patterns in Q1 2025 to enhance product offerings, which is expected to drive growth [15]. Summary by Sections Performance Overview - In Q3 2024, lululemon's revenue was $2.4 billion, up 9% year-over-year, driven by strong performance in North America and international markets [5][6]. - The adjusted operating margin increased by 70 basis points to 20.5%, benefiting from lower inventory and management costs [5][6]. - The company reported an EPS of $2.87, exceeding the consensus estimate of $2.75 [5][6]. Regional Performance - North American revenue grew by 2% year-over-year, with Canadian revenue increasing by 9% and U.S. revenue remaining flat [5][6]. - International revenue surged by 33% year-over-year, with mainland China showing a 39% increase [5][6]. Future Guidance - For FY2024, lululemon expects net revenue to be between $10.452 billion and $10.487 billion, up from previous guidance of $10.375 billion to $10.487 billion [6][5]. - The company anticipates Q4 2024 net revenue to be between $3.475 billion and $3.510 billion [6][5].

ablokhin While the overall market continues to hit All-time High almost every other day, Lulu (LULU) has been battling the skeptics for much of this year. There is still a long way to go, but with the stock now up almost ...

Advertisement A bright spot on Lululemon's horizon was its robust growth in international markets.Its international sales increased 33% in Q3 of 2024, compared to 2% in the Americas.China, in particular, was a strong market for the brand this quarter.Lululemon's robust growth in its international markets — particularly China — made up for its lackluster performance in the Americas.The Vancouver-based activewear brand, known for selling $100 yoga pants, reported strong third-quarter sales in its stores abro ...

Financial Data and Key Metrics Changes - Total revenue increased by 9% to $2.4 billion, or 8% in constant currency, with adjusted operating margin rising by 70 basis points to 20.5% [13][40][45] - Adjusted earnings per share (EPS) increased by 13% compared to the previous year [14][45] - Inventory increased by 8%, which was lower than the guidance of mid-teens growth [47][72] Performance by Business Line - Men's revenue increased by 9%, while women's and accessories both saw an 8% increase [13][40] - In the Americas, revenue grew by 2%, with a flat performance in the U.S. and a 9% increase in Canada [15][40] - International revenue surged by 33%, or 30% in constant currency, with China Mainland growing by 39% [22][40][101] Market Data and Key Metrics Changes - E-commerce revenue in the U.S. increased by 4%, contributing $945 million, or 39% of total revenue [40][112] - The company ended the quarter with 749 stores globally, having opened 13 net new stores [41] - The membership program now boasts 24 million members, indicating strong guest retention [20][113] Company Strategy and Development Direction - The company aims to return the level of newness in product offerings to historical levels by Q1 2025, focusing on seasonal newness and improved assortments [21][35] - Plans for 2025 include opening new stores in Italy and expanding through franchise models in Denmark, Belgium, Turkey, and the Czech Republic [29][103] - The company remains committed to its Power of Three x2 revenue target of $12.5 billion by 2026, with a current three-year revenue growth CAGR of 19% [35][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the U.S. market's potential for growth, citing strong guest retention and opportunities for increased revenue per guest [66][67] - The company is closely monitoring macroeconomic conditions and planning prudently for the holiday season [38][48] - Management highlighted the importance of brand awareness, which remains low at 36% in the U.S., presenting a significant growth opportunity [21][159] Other Important Information - The company authorized a $1 billion increase in its share repurchase program, with $1.8 billion available for repurchases [14][47] - The purchase of the Mexico franchise was completed, adding 15 stores to the company-operated store count [39] Q&A Session Summary Question: U.S. sales stabilization and future growth - Management indicated that U.S. sales performance met expectations and expressed optimism for improvement in Q4 due to stronger newness [64][66] Question: Inventory growth reasons - Management explained that the mid-teens inventory growth is due to chasing seasonal newness and managing slower-moving core products [70][72] Question: Confidence in negative comp trends inflecting - Management cited strong guest engagement and loyalty, along with a focus on newness, as reasons for confidence in reversing negative comp trends [75][77] Question: Women's business performance - Management reported strong growth in the women's business, particularly in leggings, driven by newness in colors and patterns [82][84] Question: Gross margin drivers and sustainability - Management noted that lower inventory provisions positively impacted gross margin in Q3, but they do not expect significant movement in Q4 [90][92] Question: China market performance - Management expressed satisfaction with the growth in China, expecting continued strong performance in Q4 [100][101] Question: Competitive landscape and promotional intensity - Management acknowledged a promotional environment but emphasized their strategy of maintaining regular price sales rather than relying on markdowns [127][128] Question: Marketing investment and brand awareness - Management indicated that marketing spend is expected to increase slightly, focusing on long-term brand awareness and customer engagement [157][159]

The following table disaggregates the Company's net revenue by channel. In addition to the legal proceedings described below, the Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental agencies and other third parties which are incidental to the conduct of its business. This includes legal matters such as initiation and defense of proceedings to protect intellectual property rights, employment claims, product liability claims, personal injury claims, and ...

Adjusted financial measures 9 10 | --- | --- | --- | --- | --- | |---------------------|---------------------------------------------------------|----------------------------------------------------|-------------------------------------------------|---------------------------------------------------| | | Total Gross Square Feet at the Beginning of the Quarter | Gross Square Feet Added During the (2) Quarter | Gross Square Feet Lost During the (2) Quarter | Total Gross Square Feet at the End of the Quarter | ...

Key TakeawaysLululemon is set to report third-quarter results after the market closes Thursday.The majority of analysts who research Lululemon and are tracked by Visible Alpha have "buy" ratings on the stock, but the consensus price target is below its current level.In August, Chief Executive Officer Calvin McDonald described a “newness” problem for customers seeking, but not finding, more seasonal product updates from Lululemon. Lululemon Athletica (LULU) is slated to report fiscal third-quarter earnings a ...

Wall Street analysts forecast that Lululemon (LULU) will report quarterly earnings of $2.69 per share in its upcoming release, pointing to a year-over-year increase of 6.3%. It is anticipated that revenues will amount to $2.35 billion, exhibiting an increase of 6.8% compared to the year-ago quarter.The current level reflects a downward revision of 0.4% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised thei ...

lululemon athletica inc. (LULU) is likely to witness top and bottom-line growth when it reports third-quarter fiscal 2024 results on Dec. 5, after market close. The Zacks Consensus Estimate for fiscal third-quarter sales is pegged at $2.4 billion, indicating a 6.8% increase from the year-ago quarter's reported figure.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.The consensus estimate for the company's fiscal third-quarter earnings is pegged at $2.69 per share, suggesting a 6.3% r ...

I am a finance enthusiast with a keen interest in value investing. Since 2022, I have been sharing my insights on Seeking Alpha, focusing on easy-to-understand businesses that present opportunities, especially those that are currently out of favour.Wishing everyone the best in their investing journey!Analyst’s Disclosure: I/we have a beneficial long position in the shares of LULU either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I a ...