On August 29, 2024, Lululemon Athletica Inc (LULU, Financial) released its 8-K filing announcing the financial results for the second quarter of fiscal 2024, which ended on July 28, 2024. Lululemon Athletica designs, distributes, and markets athletic apparel, footwear, and accessories for women, men, and girls. The company offers a wide range of products including pants, shorts, tops, jackets, and fitness accessories, and operates over 700 stores globally.
Performance Overview
Lululemon Athletica Inc (LULU, Financial) reported a 7% increase in net revenue to $2.4 billion, slightly below the analyst estimate of $2.408 billion. The company also reported a diluted earnings per share (EPS) of $3.15, exceeding the estimated EPS of $2.94. This performance highlights the company's robust growth, particularly in its international markets.
Financial Achievements
The company's gross profit increased by 9% to $1.4 billion, with a gross margin expansion of 80 basis points to 59.6%. Income from operations rose by 13% to $540.2 million, and the operating margin improved by 110 basis points to 22.8%. These metrics underscore Lululemon's effective cost management and operational efficiency.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Revenue | $2.4 billion | $2.2 billion |
| Gross Profit | $1.4 billion | $1.3 billion |
| Income from Operations | $540.2 million | $479.3 million |
| Diluted EPS | $3.15 | $2.68 |
Balance Sheet and Cash Flow
As of the end of Q2 2024, Lululemon Athletica Inc (LULU, Financial) held $1.6 billion in cash and cash equivalents. Inventories decreased by 14% to $1.4 billion compared to the same period last year. The company repurchased 1.9 million shares for $583.7 million, reflecting its strong cash flow and commitment to returning value to shareholders.
Outlook and Strategic Initiatives
Looking ahead, Lululemon Athletica Inc (LULU, Financial) expects Q3 2024 net revenue to range between $2.340 billion and $2.365 billion, with diluted EPS projected between $2.68 and $2.73. For the full fiscal year 2024, the company anticipates net revenue between $10.375 billion and $10.475 billion, and diluted EPS between $13.95 and $14.15.
"Earnings per share exceeded our expectations in the second quarter, driven by better-than-expected gross margin expansion and disciplined execution," said Meghan Frank, Chief Financial Officer.
Lululemon's "Power of Three ×2" growth plan aims to double the business from 2021 net revenue of $6.25 billion to $12.5 billion by 2026, focusing on product innovation, guest experience, and market expansion.
For more detailed financial information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Lululemon Athletica Inc for further details.
