Lululemon's in-line forecast overshadows quarterly profit beat
today Dec 6, 2018
Canadian athletic apparel maker Lululemon Athletica reported a third-quarter profit above analysts’ estimates, driven by a rise in its established store sales but failed to provide an upbeat revenue outlook for the holiday quarter, sending its shares down more than 5 percent on Thursday.
The Vancouver-based company said it expects fourth-quarter revenue of $1.12 billion to $1.13 billion. Analysts were expecting revenue of $1.12 billion, according to IBES data from Refinitiv.
Lululemon, which popularized “athleisure wear” by turning pricey women’s yoga wear into mainstream fashion, has been investing in expanding its online presence and offers more menswear to lure customers in a highly competitive retail industry, dominated by the likes of Under Armour Inc, Nike and Gap Inc.
Total comparable sales, a key indicator for the athleisure company’s business, rose 17 percent, while analysts on average were expecting a rise of 13.7 percent.
The company’s net income rose to $94.4 million, or 71 cents per share, in the quarter ended Oct.28, from $58.9 million, or 43 cents, a year earlier.
Total revenue rose to $747.7 million from $619 million a year ago.
Excluding items, Lululemon earned 75 cents per share.
Analysts on average had expected the company to report a profit of 70 cents per share and revenue of $737.05 million according to IBES data from Refinitiv.
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