Lululemon raises profit guidance after Q2 revenue smashes £700m

Lululemon Q2 Calvin McDonald profit guidance trading update
Lululemon aims to expand outside of North America, where it does 90% of its business
// Lululemon expects to achieve revenue of between £3.07 billion to £3.11 billion in fiscal 2019
// Net revenue rose 22% year-on-year to £713.72 million in its 2nd quarter ended August 4
// Total comparable sales rose 15% from a year ago in the period

Lululemon has raised its profit guidance after reporting successful second-quarter results that topped its own forecasts and pushed shares to a record high.

The athleisure retailer reported a 22 per cent year-on-year rise in net revenue to $883.4 million (£713.72 million) in its second quarter ended August 4.

Total comparable sales rose 15 per cent from a year ago, with comparable store sales rising 10 per cent and direct to consumer net revenue up 30 per cent.

Lululemon now expects to achieve earnings of between $4.63 (£3.74) to $4.70 (£3.80) a diluted share on revenue in the range of $3.8 billion (£3.07 billion) to $3.84 billion (£3.11 billion) in fiscal 2019.

That compares with its forecast three months ago for earnings of $4.51 (£3.65) to $4.58 (£3.70) a diluted share on revenue in the range of $3.73 billion (£3.02 billion) to $3.77 billion (£3.05 billion).

“We are pleased with the ongoing strength across our business,” Lululemon chief executive Calvin McDonald said in a statement.

He added that the retailer continued to make progress in achieving three “growth pillars” which were product innovation, market expansion and user experience across its retail and online channels.

Lululemon aims to expand its presence outside of North America, where it does about 90 per cent of its business.

It announced plans earlier this year to step up its international expansion.

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