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Lululemon suffers share price slide despite strong annual results

By Jan Schroder


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Lululemon store in Hamburg. Credits: FashionUnited

Canadian sportswear provider Lululemon Athletica Inc. exceeded market expectations in the 2023/24 financial year. However, the outlook for the current year, which the company presented on Thursday evening together with the latest results, was rather cautious. As a result, the share price temporarily slipped by around 12 percent.

Thanks to a surprisingly strong final quarter, turnover in the past financial year, which ended on 28 January, reached 9.62 billion dollars. This exceeded the previous year's level by 19 percent. Adjusted for exchange rate fluctuations, revenue increased by 20 percent.

Management expects a slower pace of growth in the current year

Thanks to a higher gross margin and significantly lower one-off charges, the operating profit grew by 60.5 percent to 2.13 billion dollars, while net profit also increased by 81.4 percent to 1.55 billion dollars. Adjusted for special effects, it reached 1.62 billion dollars, which corresponds to an increase of 25.9 percent compared to the previous year.

For 2024/25, however, the management anticipates a slower pace of growth. An increase in turnover of 11 to 12 percent to 10.7 to 10.8 billion dollars was forecasted. Analysts had expected somewhat more ambitious targets in advance. Diluted earnings per share, which totalled 12.20 dollars last year, are expected to increase to between 14.00 and 14.20 dollars.

This article originally appeared on FashionUnited.DE. Translation and edit by: Rachel Douglass.

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