Categories Earnings, Retail

Lululemon Athletica (NASDAQ: LULU) Q3 profit beats estimates, lifts FY19 forecast

Lululemon Athletica (NASDAQ: LULU) reported a 33% jump in earnings for the third quarter of 2019 helped by higher revenue as well as double-digital growth in the comparable sales. The results exceeded analysts’ expectations. Further, the company lifted its revenue and earnings guidance for the full year 2019.

Net income climbed by 33% to $126 million or $0.96 per share. Net revenue grew by 23% to $916.1 million. The analysts had expected EPS of $0.93 on revenue of $899.66 million. Total comparable sales increased by 16%.

The e-commerce revenue totaled $246.7 million, or 26.9% of total revenue, compared to $189.4 million or 25.3% of total revenue, in the previous year quarter.

Looking ahead into the fourth quarter, the company expects revenue in the range of $1.315-1.330 billion and earnings of $2.10-2.13 per share. The market analysts expect EPS of $2.13 on revenue of $1.32 billion for the fourth quarter. The comparable sales growth is anticipated to be in the low double-digits on a constant dollar basis.

For the full year 2019, the company lifted revenue outlook to the range of $3.895-3.910 billion from the prior range of $3.80-3.84 billion. The earnings guidance is raised to the range of $4.75-4.78 per share from $4.63-4.70 per share. The Street analysts predict EPS of $4.75 on revenue of $3.89 billion. The comparable sales growth is now anticipated to be in the mid-teens on a constant dollar basis.

Read: Chewy Q3 earnings review

The comparable store sales increased by 10% for the third quarter and direct-to-consumer net revenue jumped by 29%. Direct-to-consumer net revenue represented 26.9% of total net revenue compared to 25.3% for the third quarter of fiscal 2018. The company ended the quarter with 479 stores.

Lululemon opened 19 net new company-operated stores in Q3 2019 including nine in the US, seven in Asia, and four in Europe. The company had one company-operated store closure in Canada. At the end of Q3 2019, the company had 479 total company-operated stores compared to 426 at the end of Q3 2018.

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