Lululemon Athletica’s second quarter net revenue increased 7 percent to 2.37 billion dollars, or increased 8 percent on a constant dollar basis but missed the Wall Street expectations. According to the CNBC report, based on a survey by LSEG, analysts anticipated sales to reach 2.41 billion dollars.
Lowering its forecasts for 2024, the company now expects net revenue to be in the range of 10.4 billion dollars to 10.5 billion dollars down from a previous range of between 10.7 billion dollars and 10.8 billion dollars, representing growth of 8 percent to 9 percent and diluted earnings per share to be in the range of 13.95 dollars to 14.15 dollars down from previous forecast of 14.27 dollars to 14.47 dollars.
Commenting on the second quarter trading, Calvin McDonald, the company’s chief executive officer, said in a statement: “In the second quarter, Lululemon delivered revenue and earnings growth, with ongoing strength across our international business.”
The company’s Americas net revenue increased 1 percent or 2% on a constant dollar basis and international net revenue increased 29 percent or 31 percent on a constant dollar basis.
Comparable sales increased 2 percent or 3 percent on a constant dollar basis, Americas comparable sales decreased 3 percent or 2 percent on a constant dollar basis and international comparable sales increased 19 percent or 22 percent on a constant dollar basis.
Gross profit for the quarter increased 9 percent to 1.4 billion dollars and gross margin increased 80 basis points to 59.6 percent. Diluted earnings per share rose to 3.15 dollars.
Lululemon opened 10 new company-operated stores during the second quarter, ending with 721 stores.
For the third quarter, the company expects net revenue to be in the range of 2.340 billion dollars to 2.365 billion dollars, representing growth of 6 percent to 7 percent and diluted earnings per share to be in the range of 2.68 dollars to 2.73 dollars.
The company’s Power of Three ×2 growth plan calls for a doubling of the business from 2021 net revenue of 6.25 billion dollars to 12.5 billion dollars by 2026.