Lululemon earnings, sales top estimates on strong demand for workout gear

Lululemon Athletica retailer exterior, Ponce City Market.

John Greim | LightRocket | Getty Images

Lululemon on Thursday reported sales of $1.1 billion, up 22% from a 12 months in the past and beating analysts’ estimates, as customers frequented the retailer’s shops and web site to purchase workout attire throughout the interval.

In North America, internet income grew 19%, boosted by its e-commerce enterprise. Overall direct to shopper income elevated 94%, the corporate stated, representing 42.8% of whole income in contrast with 26.9% a 12 months in the past. This represents the sales that Lululemon makes straight to customers, utilizing its shops and web site, with none middlemen.

Due to the uncertainty across the Covid-19 pandemic, which has compelled it to close a handful of its shops quickly once more, Lululemon will not be providing a full outlook for 2020. Like others in retail, Lululemon faces the specter of further retailer closures, with coronavirus circumstances nonetheless surging within the U.S. and in different elements of the world.

However, CFO Meghan Frank famous the corporate has deliberate for the vacation quarter “based on multiple performance scenarios,” and believes it to be “well positioned” for the vacation season. During the week of Thanksgiving and Black Friday, the corporate stated its on-line enterprise drove report sales, offsetting declines in retailer visitors.

Lululemon shares pared preliminary features, falling round 1% in after-hours buying and selling simply earlier than 5 p.m. As of Thursday’s market shut, Lululemon shares had run up greater than 59% 12 months to this point, bringing the corporate’s market cap to $48.1 billion.

Here’s how the retailer did throughout its fiscal third quarter, in contrast with what analysts had been anticipating, primarily based on Refinitiv knowledge:

  • Earnings per share: $1.16, adjusted, vs 88 cents, anticipated
  • Revenue: $1.12 billion vs. $1.02 billion, anticipated

For the quarter ended Nov. 1, Lululemon earned $143.6 million, or $1.10 per share, in contrast with $126 million, or 96 cents per share, a 12 months in the past. Excluding one-time expenses, it earned $1.16 per share, higher than the 88 cents anticipated by analysts.

Net income rose 22% to $1.12 billion, beating analysts’ estimates of $1.02 billion.

Same-store sales, which observe sales made on-line and at shops open for no less than 12 months, had been up 19%.

The firm stated its ladies’s income grew 22% 12 months over 12 months, whereas males’s was up 14%.

While the attire class as a complete has struggled this 12 months, Lululemon is one retailer that has reaped the advantages of extra customers focusing on at-home exercises throughout the pandemic, and opting for comfy athleisure put on over attire and fits.

“While a V-shaped recovery may not be materializing for most of apparel retail, Lululemon has bounced back from the weak start to its year with a stunning set of third-quarter numbers,” GlobalData Retail Managing Director Neil Saunders stated.

“Our data also show that Lululemon has picked up plenty of new shoppers, especially in womenswear,” he added.

Earlier this 12 months, Lululemon additionally acquired the at-home train gear maker Mirror for $500 million, in a bid to compete with the likes of cycle maker Peloton. During the quarter, Lululemon stated it began promoting the start-ups $1,500 mirror-like gadgets in 18 shops and on its web site.

You can discover the total earnings press launch right here.

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Written by Business Boy


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