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Fashion Network
10 hours ago
- Business
- Fashion Network
Lululemon tumbles as slowing demand, tariff woes lead to annual profit cut
This comes at a time when U.S. President Donald Trump 's chaotic tariff implementation on all global trading partners has fanned fears that the economy is headed for tepid growth and stagflation, pushing customers to prioritize essential purchases and not splurge. "We experienced lower store traffic in the Americas, partially reflective of economic uncertainty, inflationary pressures, lower consumer confidence, and changes in discretionary spending," Lululemon said. In March, Lululemon forecast downbeat annual targets that included a 20-basis-point hit from tariffs. Lululemon said that 40% of its products were manufactured in Vietnam in 2024, and 28% of its fabrics were sourced from mainland China. The company now expects annual profit between $14.58 and $14.78 per share, compared with previous expectations of $14.95 to $15.15 each. Lululemon forecast second-quarter revenue between $2.54 billion and $2.56 billion, compared with estimates of $2.56 billion, according to data compiled by LSEG. It expects second-quarter profit between $2.85 and $2.90 per share, compared with estimates of $3.29. "Lululemon also hasn't had a lot of huge hit products recently that are having some effect," said Morningstar analyst David Swartz. Lululemon has introduced new apparel franchises for men and women — including the Glow Up activewear collection and its new lifestyle trousers Daydrift — after setbacks in innovations such as its Breezethrough leggings collection. The company's first-quarter revenue rose 7% to $2.37 billion, topping estimates of $2.36 billion. It maintained its annual revenue forecast of $11.15 billion to $11.30 billion. "Lululemon has a history of beating numbers, so even when Lululemon doesn't raise estimates, that's considered to be kind of a disappointment," Swartz added.
Fashion Network
10 hours ago
- Business
- Fashion Network
Lululemon tumbles as slowing demand, tariff woes lead to annual profit cut
This comes at a time when U.S. President Donald Trump 's chaotic tariff implementation on all global trading partners has fanned fears that the economy is headed for tepid growth and stagflation, pushing customers to prioritize essential purchases and not splurge. "We experienced lower store traffic in the Americas, partially reflective of economic uncertainty, inflationary pressures, lower consumer confidence, and changes in discretionary spending," Lululemon said. In March, Lululemon forecast downbeat annual targets that included a 20-basis-point hit from tariffs. Lululemon said that 40% of its products were manufactured in Vietnam in 2024, and 28% of its fabrics were sourced from mainland China. The company now expects annual profit between $14.58 and $14.78 per share, compared with previous expectations of $14.95 to $15.15 each. Lululemon forecast second-quarter revenue between $2.54 billion and $2.56 billion, compared with estimates of $2.56 billion, according to data compiled by LSEG. It expects second-quarter profit between $2.85 and $2.90 per share, compared with estimates of $3.29. "Lululemon also hasn't had a lot of huge hit products recently that are having some effect," said Morningstar analyst David Swartz. Lululemon has introduced new apparel franchises for men and women — including the Glow Up activewear collection and its new lifestyle trousers Daydrift — after setbacks in innovations such as its Breezethrough leggings collection. The company's first-quarter revenue rose 7% to $2.37 billion, topping estimates of $2.36 billion. It maintained its annual revenue forecast of $11.15 billion to $11.30 billion. "Lululemon has a history of beating numbers, so even when Lululemon doesn't raise estimates, that's considered to be kind of a disappointment," Swartz added.
New York Post
11 hours ago
- Business
- New York Post
Lululemon shares plummet as tariff costs, rivals threaten profit outlook
Lululemon cut its profit forecast for the year, hurt by higher costs to mitigate US tariffs and as tepid demand for its latest products failed to draw away buyers from upstart athleisure rivals such as Vuori. Lululemon Athletica's shares slumped 22% in trading after the bell on Thursday. 'We experienced lower store traffic in the Americas, partially reflective of economic uncertainty, inflationary pressures, lower consumer confidence, and changes in discretionary spending,' Lululemon said in a statement. 3 Although Lululemon has been betting on its new product offerings to boost demand, it is still struggling to drum up sales as competitors, including Alo Yoga and Vuori, gain more traction. Getty Images President Trump's chaotic global tariffs have fanned fears that the economy is headed for stagflation, pushing even wealthier shoppers to prioritize essential purchases. Companies are diversifying sourcing and increasing prices to mitigate any hit from tariffs, which are expected to shrink margins. 'We are planning to take strategic price increases … on a small portion of our assortment, and they will be modest in nature,' Lululemon's finance chief Meghan Frank said. The company will also negotiate with vendors and cut costs, Lululemon said in a filing. In 2024, 40% of Lululemon's products were manufactured in Vietnam, and 28% of its fabrics were sourced from mainland China. 3 In March, Lululemon forecast downbeat annual targets that included a 20-basis-point hit from tariffs. Getty Images 3 'Lululemon also hasn't had a lot of huge hit products recently that are having some effect,' said Morningstar analyst David Swartz. REUTERS The company now expects annual profit between $14.58 and $14.78 per share, compared with previous expectations of $14.95 to $15.15 each. Lululemon also forecast second-quarter profit below an average estimate from LSEG. Its revenue forecast of between $2.54 billion and $2.56 billion was largely in line. 'Lululemon also hasn't had a lot of huge hit products recently that are having some effect,' said Morningstar analyst David Swartz. It introduced new apparel franchises for men and women — including the Glow Up activewear collection and its new lifestyle trousers Daydrift — but those have done little to boost sales. 'Lululemon has a history of beating numbers, so even when Lululemon doesn't raise estimates, that's considered to be kind of a disappointment,' Swartz added.
Fashion Network
12 hours ago
- Business
- Fashion Network
Lululemon tumbles as slowing demand, tariff woes lead to annual profit cut
Lululemon Athletica cut annual profit expectations and forecast second-quarter revenue below estimates on Thursday, as consumer demand waned amid increased competition and a gradual economic slowdown triggered by uncertainty over the Trump administration's trade policy. Shares of the sportswear maker fell 21% in after-market trading. Although Lululemon has been betting on its new product offerings to boost demand, it is still struggling to drum up sales as competitors, including Alo Yoga and Vuori, gain more traction. This comes at a time when U.S. President Donald Trump 's chaotic tariff implementation on all global trading partners has fanned fears that the economy is headed for tepid growth and stagflation, pushing customers to prioritize essential purchases and not splurge. "We experienced lower store traffic in the Americas, partially reflective of economic uncertainty, inflationary pressures, lower consumer confidence, and changes in discretionary spending," Lululemon said. In March, Lululemon forecast downbeat annual targets that included a 20-basis-point hit from tariffs. Lululemon said that 40% of its products were manufactured in Vietnam in 2024, and 28% of its fabrics were sourced from mainland China. The company now expects annual profit between $14.58 and $14.78 per share, compared with previous expectations of $14.95 to $15.15 each. Lululemon forecast second-quarter revenue between $2.54 billion and $2.56 billion, compared with estimates of $2.56 billion, according to data compiled by LSEG. It expects second-quarter profit between $2.85 and $2.90 per share, compared with estimates of $3.29. "Lululemon also hasn't had a lot of huge hit products recently that are having some effect," said Morningstar analyst David Swartz. Lululemon has introduced new apparel franchises for men and women — including the Glow Up activewear collection and its new lifestyle trousers Daydrift — after setbacks in innovations such as its Breezethrough leggings collection. The company's first-quarter revenue rose 7% to $2.37 billion, topping estimates of $2.36 billion. It maintained its annual revenue forecast of $11.15 billion to $11.30 billion. "Lululemon has a history of beating numbers, so even when Lululemon doesn't raise estimates, that's considered to be kind of a disappointment," Swartz added.
Fashion Network
12 hours ago
- Business
- Fashion Network
Lululemon tumbles as slowing demand, tariff woes lead to annual profit cut
This comes at a time when U.S. President Donald Trump 's chaotic tariff implementation on all global trading partners has fanned fears that the economy is headed for tepid growth and stagflation, pushing customers to prioritize essential purchases and not splurge. "We experienced lower store traffic in the Americas, partially reflective of economic uncertainty, inflationary pressures, lower consumer confidence, and changes in discretionary spending," Lululemon said. In March, Lululemon forecast downbeat annual targets that included a 20-basis-point hit from tariffs. Lululemon said that 40% of its products were manufactured in Vietnam in 2024, and 28% of its fabrics were sourced from mainland China. The company now expects annual profit between $14.58 and $14.78 per share, compared with previous expectations of $14.95 to $15.15 each. Lululemon forecast second-quarter revenue between $2.54 billion and $2.56 billion, compared with estimates of $2.56 billion, according to data compiled by LSEG. It expects second-quarter profit between $2.85 and $2.90 per share, compared with estimates of $3.29. "Lululemon also hasn't had a lot of huge hit products recently that are having some effect," said Morningstar analyst David Swartz. Lululemon has introduced new apparel franchises for men and women — including the Glow Up activewear collection and its new lifestyle trousers Daydrift — after setbacks in innovations such as its Breezethrough leggings collection. The company's first-quarter revenue rose 7% to $2.37 billion, topping estimates of $2.36 billion. It maintained its annual revenue forecast of $11.15 billion to $11.30 billion. "Lululemon has a history of beating numbers, so even when Lululemon doesn't raise estimates, that's considered to be kind of a disappointment," Swartz added.
