This article was last updated on April 16, 2022
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In its latest set of announcement, the Canadian sportswear giant retailer in spotlight, Lululemon Athletica Inc., has declared to have lessened its already weak outlook for the quarter including the holidays, as it claims to have recorded unexpectedly low traffic and sales since the beginning of January. Consequently, the shares of Lululemon decreased by 7.8% premarket to reach $54.97, whereas till Friday’s close, the stock had dropped 20% in the past three months.
The company has now revealed to have updated its fiscal fourth-quarter earnings forecast of 71 cents to 73 cents a share, which was previously sited at 78 cents to 80 cents a share in December. Consequently, the revenue is expected to range from $513 million to $518 million on a low-to-mid decrease in same-store sales, though the company previously expected $535 million to $540 million on flat same-store sales. At the time of announcement, Chief Financial Officer John Currie mentioned that “we were on track to deliver on our sales and earnings guidance through the month of December.” He added that “however, since the beginning of January, we have seen traffic and sales trends decelerate meaningfully.”
The company has previously kept a loyal customer base that allowed it demand commanding premium prices for its clothing. However, it has suffered a series of self-inflicted wounds since 2013, which mainly include the well-known recall of too-sheer yoga pants in March, the surprise resignation of its chief executive in June and comments in November by its chairman.
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