LULULEMON REPORTS Q2 GROWTH FIGURES; REMAINS ON TRACK TO HIT $4 BILLION IN REVENUE BY 2020
Lululemon (LULU) reported Q2 profits ($.39 compared with $.35) and sales (7% compared with 4%) that beat analysts’ estimates and updated full year forecasts ($2.35-$2.42/share) that topped projections. CEO Laurent Potdevin attributed the continued growth to improved marketing, an effort to drive international sales and an increased focus on their e-commerce business. The company has also been working to increase its appeal to men and add technical innovations to their clothing that set them apart in a crowded athletic-apparel marketplace. Potdevin reiterated that the yogawear brand remains on a trajectory to hit $4 billion in revenue by 2020.
Howie Long-Short: You keep reading about the warning signs of the athleisure trend coming to an end, but I don’t believe that to be the case. FINL and FL are struggling because brands are going DTC, not because the consumer no longer wants to be comfortable outside the gym.
Fan Marino: Part of the reason analysts projected lower Q2 profits/earnings numbers was because of an uptick in online markdowns. That’s great news for fans of the brands! I checked out their “we made too much” section and it has a TON of stuff with at least a 25% discount.