July 6, 2022

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Lululemon (LULU) earnings for the first quarter of 2022 beat estimates

Lululemon (LULU) earnings for the first quarter of 2022 beat estimates

Pedestrians are seen walking past Canadian sports apparel retailer Lululemon in Shanghai.

Alex Ty | SOPA photos | Light Rocket | Getty Images

Lululemon CEO Calvin MacDonald said Thursday that customers are so far not dismissive of price hikes on retail panties and sports bras.

The sportswear maker reported fiscal first-quarter earnings and revenue that beat Wall Street expectations, buoyed by double-digit growth online and in the still-nascent men’s division of the retailer.

It also raised its financial forecast for fiscal year 2022, and expects the momentum to continue in its business despite broader economic headwinds, including severe inflation and a troubled supply chain.

Lululemon, which caters to the more affluent customers, joins a group of retailers including Levi Strauss & Co..And the Nordstrom And the Messi An upscale Bloomingdale department that lures shoppers with enough extra cash to flaunt new clothes and accessories while soaring prices at rates last seen four decades ago. In late March, Lululemon said it would raise prices for some items to help offset higher costs for raw materials, labor and air freight.

Lululemon in particular was seen as a benefactor of the epidemic, as people sought rubber pants and comfortable clothing to wear at home. But now, even as Americans move out of their homes to return to offices and social outings, they are still buying so-called sports items. Lululemon has also recently expanded its range to include footwear and skin care products.

“Our product pipeline remains very robust and is the bedrock of the business,” MacDonald said in a call with analysts.

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Lululemon sees sales in fiscal year 2022 in the range of $7.61 billion to $7.71 billion, up from a previous forecast of $7.49 billion to $7.62 billion. Analysts were looking at $7.54 billion, according to Refinitiv data.

The company expects to earn, on an adjusted basis, between $9.35 and $9.50 per share, up from the previous range of $9.15 to $9.35. Analysts were looking for earnings per share of $9.28.

Lululemon’s shares have changed little during extended trading.

Here’s how to use Lululemon Did in the first quarter of the fiscal year Compared to what Wall Street was expecting, based on Refinitiv data:

  • Earnings per share: $1.48 vs. $1.43 expected
  • he won: $1.61 billion versus $1.53 billion

The retailer reported fiscal first-quarter net income of $190 million, or $1.48 per share, compared with net income of $145 million, or $1.11 per share, a year earlier.

Lululemon’s revenue grew nearly 32% to $1.61 billion from $1.23 billion in the previous year.

Same-store sales, which track revenue online and in Lululemon stores that have been open for at least 12 months, are up 28% from a year earlier. Analysts had been looking for a 20.4% increase, according to StreetAccount estimates.

The company said women’s sales grew 24% on a three-year basis, and men’s sales grew 30% compared to 2019 levels.

For the second quarter, Lululemon expects revenue to be between $1.75 billion and $1.78 billion, beating analysts’ expectations of $1.71 billion.

Excluding gains from the sale of an office building, adjusted earnings per share are expected in the range of $1.82 to $1.87, ahead of analysts’ expectations of $1.77.

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Regarding China, which is still facing Covid-related restrictions in some areas, McDonald said nearly a third of the country’s 71 Lululemon stores closed for a while in the last quarter and second quarter.

However, he said the company will continue to invest in China, considering mitigating demand a short-term challenge. “Our brand momentum remains strong,” said CEO Analysts.

Lululemon shares are down about 23% since the beginning of the year.