Lululemon CEO ‘Cautiously Optimistic’ as Online Sales Boom

Lululemon CEO ‘Cautiously Optimistic’ as Online Sales Boom

(Bloomberg) — Lululemon Athletica Inc. reported a surge in its e-commerce business as quarantined consumers flocked to comfy apparel like yoga pants. Chief Executive Officer Calvin McDonald said he is “cautiously optimistic” about the second half of the year.



a group of people standing in a room: Sports apparel is displayed for sale at a Lululemon Athletica Inc. store in the Lincoln Park neighborhood of Chicago.


© Photographer: Taylor Glascock/Bloomberg
Sports apparel is displayed for sale at a Lululemon Athletica Inc. store in the Lincoln Park neighborhood of Chicago.


In an echo of retailers including Gap Inc. and Nike Inc., Lululemon’s comparable online sales excluding currency impacts rose 157% in the second quarter, the Vancouver-based company said Tuesday. The company has bolstered its online offerings with free online workouts and one-on-one video chats with sales associates.

Key Insights

The company still isn’t offering a formal forecast for 2020, given ongoing pandemic-related uncertainty and consumer upheaval. McDonald said the company is “pleased with our overall business results” in the period ended Aug. 2, while citing an “uncertain environment.”After missing analysts’ forecasts for sales and profit the previous quarter, the latest results suggest the company is now capitalizing on the embrace of comfy clothes by consumers who are working from home. While it’s mostly known for its yoga pants and exercise outfits, Lululemon has been expanding into casual clothes fit for travel and work.Lululemon’s shares have risen steadily in recent years, fueled by the company’s online boom and push into new categories like men’s wear. But with a valuation well above rivals, analysts have begun to question its ability to continue growing, with Citigroup cutting its rating on Lululemon’s stock last week.

Market Reaction

The shares alternated between gains and losses in late trading, falling 2.7% as of 4:41 p.m. The stock gained 51% this year through Tuesday’s close.

Get More

For more financial details, click here.For the company statement, click here.

(Adds CEO comments in first bullet)

For more articles like this, please visit us at bloomberg.com

©2020 Bloomberg L.P.

Continue Reading

Source Article