Lululemon raises annual outlook on strong demand in Q2

Lululemon has today announced financial results for the second quarter of fiscal 2022, revealing a 29% increase in revenue to £1.6 billion, compared to the same period in 2021.

For the second quarter of 2022, compared to the second quarter of 2021:

• Net revenue increased 28% in North America, and increased 35% internationally.
• Total comparable sales increased 23%, or 25% on a constant dollar basis.
• Comparable store sales increased 16%, or 18% on a constant dollar basis.
• DTC net revenue increased 30%, or 32% on a constant dollar basis.
• DTC net revenue represented 42% of total net revenue compared to 41% for Q2 2021.
• Gross profit increased 25% to £952 million ($1.1 billion).
• 21 new company-operated stores opened during the quarter, ending with 600 stores.

For the second quarter of 2022, compared to the second quarter of 2019:

• Net revenue increased by £865 million ($1.0 billion), or 112%, representing a three-year compound annual growth rate of 28%.
• Gross margin increased 150 basis points.
• Operating margin increased 250 basis points. Adjusted operating margin increased 190 basis points.

Lululemon expects net revenue for the third quarter of 2022 to be in the range of £1.4 billion to £1.5 billion. For 2022, the company expects net revenue to be in the range of £6.7 billion to $6.8 billion.

Calvin McDonald, Chief Executive Officer, stated: "The momentum in our business continued in the second quarter, fuelled by strong guest response to our product innovations, community activations, and omni experience. As we look ahead, we're excited about our ability to successfully deliver against our Power of Three ×2 growth plan and create ongoing value for all our stakeholders."

Meghan Frank, Chief Financial Officer, added: "Despite the challenges around us in the macro-environment, guest traffic in our stores and on our e-commerce sites remains robust, which speaks to the strength of our multi-dimensional operating model. I am pleased with our start to the third quarter and believe we are well positioned for the fall and holiday seasons."