Lululemon Explodes After Reporting Q2 Results

Athletic apparel company Lululemon saw its shares surge over 13% in extended trading on Wednesday this week after reporting second quarter results.

The company revealed a profit and revenue that beat analysts’ expectations.

Lululemon also gave a better-than-expected outlook for the third quarter and for fiscal 2021, expecting momentum to build.

The company is now on track to surpass its 2023 revenue target by the end of this year, two years ahead of schedule.

Chief Executive Officer Calvin McDonald told analysts during an earnings conference call that his company will issue fresh financial targets after the holiday season.

For the second quarter, Lululemon reported earnings per share of $1.65 adjusted. This was far better than the $1.19 that was expected by a Refinitiv survey of analysts.
Revenue at $1.45 billion was higher than the $1.34 billion expected, per Refinitiv.

Net income for the three-month period ended Aug. 30 rose to $208.1 million, or $1.59 per share. This was an increase from $86.8 million, or 66 cents per share, a year earlier. Excluding one-time items, the company earned $1.65 per share, faring much better than the $1.19 that analysts polled by Refinitiv had been looking for.

Sales in North America jumped 63% year over year and were up 49% internationally.

“Our performance in Q2 was driven by a strong response to our product offering, improving productivity in our stores, and sustained strength in e-commerce,” Chief Financial Officer Meghan Frank stated.

For the fiscal third-quarter revenue, the company has projected a range of $1.4 billion to $1.43 billion, with adjusted earnings per share of between $1.33 and $1.38. Analysts had been looking for Lululemon to earn $1.32 per share on revenue of $1.32 billion, according to Refinitiv.

For the fiscal year, the company is looking for revenue to range between $6.19 billion and $6.26 billion. Adjusted earnings per share are expected to be between $7.38 and $7.48. Analysts had been looking for Lululemon to earn $6.91 per share on sales of $5.94 billion.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.