Lululemon reported better than expected, but the stock still fell

Lululemon отчиталась лучше ожиданий, но акции все равно упали

Sportswear seller Lululemon publishes third quarter 2021 financials. The company has lowered its forecast for sales of smart mirrors Mirror, after which the shares fell by 1%, to 412 $.

Compared to the same quarter last year:

  • revenue - $ 1.5 billion (+30%);
  • operating profit - 258 million (+26%);
  • net profit - 188 million (+31%).

But how much sales have grown:

  • in North America - on 28%;
  • in other countries - on 40%;
  • comparable - on 27%.

Revenue and bottom line were better than expected. Separately, Lululemon noted the high demand for men's clothing, sales of which increased by 44%. The company said, which will fulfill the plan to double sales of menswear by the beginning of 2023. Sales of women's clothing - the retailer's main business - grew by 25%.

According to the company, Thanksgiving online sales were the largest ever. Digital sales accounted for 40% all quarterly revenue.

Lululemon predicted, sales in the fourth quarter and at the end of the year will be 2,2 and $ 6.3 billion. Analysts expected about the same.

But the company cut the forecast for annual sales of smart mirrors Mirror by half., from 250 to 125 million dollars. Mirror - smart home fitness device, which looks like a mirror with a built-in display. A year ago, in the midst of quarantine, Lululemon buys Mirror for $ 500 million.

Lululemon changed her outlook for two reasons. The first is high competition in the market.. Second, all consumers have returned to gyms.. Peloton faced the same problem.. A month ago, the company announced a large quarterly loss and cut its annual sales forecast from 5,4 up to $ 4.4 billion. Since the beginning of November, Peloton shares have already dropped by 56%.

And since the beginning of 2021, Lululemon shares have risen in price by 16%. Index S&P 500 for the same period added 26%.

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