Lululemon Reports Strong Sales and Profit Growth in Q2

One sentence summary – Lululemon has reported an 18% increase in sales and profit for its fiscal second quarter, leading to an upward revision in its full-year guidance, with strong sales growth internationally, particularly in China, and plans to open the majority of its new stores internationally in China.

At a glance

  • Lululemon reports an 18% increase in sales and profit for Q2
  • Full-year sales guidance revised to $9.51 billion to $9.57 billion
  • Forecasting earnings per share of $12.02 to $12.17 for the year
  • Strong sales growth internationally, with a 52% increase in international sales
  • China experiences a 61% increase in sales, plans to open majority of new stores there

The details

Lululemon, the athletic apparel retailer, has reported an 18% increase in sales and profit for its fiscal second quarter.

This strong performance has led to an upward revision in the company’s full-year guidance.

Lululemon now expects its sales for the fiscal year to be between $9.51 billion and $9.57 billion.

In terms of profitability, the company is forecasting earnings per share of $12.02 to $12.17 for the year.

For the current quarter, Lululemon anticipates earnings per share of $2.23 to $2.28.

The company also expects sales of $2.17 billion to $2.19 billion for the current quarter.

During the second quarter, Lululemon’s net income reached $341.6 million, or $2.68 per share.

This is compared to $289.5 million, or $2.26 per share, in the same period last year.

Sales also rose to $2.21 billion, up approximately 18% from $1.87 billion in the previous year.

Lululemon experienced strong sales growth internationally, particularly in markets outside of North America.

These international markets saw a 52% increase in sales.

China, in particular, witnessed a 61% increase in sales.

The company’s finance chief described the growth in China as “strong” and “healthy.”

CEO Calvin McDonald expressed satisfaction with the performance of both e-commerce and in-store sales in China.

As a result, Lululemon plans to open the majority of its 35 new stores internationally in China.

Sales in North America, Lululemon’s largest market, increased by 11%.

However, the company’s comparable sales fell slightly short of expectations, with an increase of 11% in the quarter compared to an estimated 12.1%.

The men’s category performed well with a 15% sales increase during the quarter.

Lululemon’s expansion continued with the opening of 10 new stores, including its first store in Thailand.

Inventories also saw growth, rising by 14% to reach $1.7 billion compared to the same period last year.

Direct-to-consumer sales represented 40% of Lululemon’s overall sales, slightly lower than the 42% reported in the year-ago period.

The company’s gross margin for the second quarter was 58.8%, in line with expectations.

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cnbc.com
– Lululemon raised its full-year guidance after reporting an 18% increase in sales and profit for its fiscal second quarter.
The company now expects sales to be between $9.51 billion and $9.57 billion for the fiscal year.
– Lululemon is expecting profits to be between $12.02 to $12.17 per share for the year.
For the current quarter, the retailer is forecasting earnings per share of $2.23 to $2.28 and sales of $2.17 billion to $2.19 billion.
– Lululemon’s net income for the second quarter was $341.6 million, or $2.68 per share, compared to $289.5 million, or $2.26 per share, a year earlier.
– Sales rose to $2.21 billion, up about 18% from $1.87 billion a year earlier.
– Sales growth was strong internationally, with a 52% increase in markets outside of North America and a 61% increase in China.
– Lululemon’s finance chief described the sales growth in China as “strong” and “healthy.

– CEO Calvin McDonald said both e-commerce and in-store sales are performing well in China.
– Lululemon plans to open the majority of its 35 new stores internationally in China.
– Sales in North America were up 11%.
– Comparable sales fell short of expectations, with an increase of 11% in the quarter compared to an estimate of 12.1%.
– Sales in the men’s category were up 15% during the quarter.
– Lululemon opened 10 new stores during the quarter, including its first in Thailand.
– Inventories were up 14% to $1.7 billion compared to the year-ago quarter.
– Direct-to-consumer sales represented 40% of Lululemon’s overall sales, compared to 42% in the year-ago period.
– Lululemon’s gross margin was 58.8%, in line with expectations.

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