Lululemon lowers expectations for Q4 results as challenges arise from Omicron
Activewear and lifestyle brand Lululemon Athletica has updated its earnings expectations for the fourth quarter of fiscal 2021, revealing the impact of COVID-19’s Omicron variant on the retailer's sales.
The Vancouver-based company said that its revenue and earnings would be "toward the low end" of its range of $2.125 billion to $2.165 billion for the three months to the end of January.
Lululemon also expects diluted earnings per share and adjusted diluted earnings per share to be toward the low end of its ranges of $3.24 to $3.31 and $3.25 to $3.32, respectively.
Calvin McDonald, Chief Executive Officer of Lululemon, said: "We are closing out a strong 2021 in the coming weeks, and we’re pleased with how Lululemon has delivered over the course of the year.
"We started the holiday season in a strong position but have since experienced several consequences of the Omicron variant, including increased capacity constraints, more limited staff availability, and reduced operating hours in certain locations."
The company also faces a lawsuit from Nike for alleged patent infringement for making and selling its Mirror Home Gym as well as related mobile applications. Lululemon had acquired Mirror, an at-home fitness company with an interactive workout platform featuring live and on-demand classes, for approximately $453 million in July 2020, with the Mirror Home Gyms retailing from $1,195 on its website.