Lululemon reported a 25% increase in first-quarter sales
In its first-quarter results reported on May 31, Lululemon Athletica’s (LULU) top line increased 25% YoY (year-over-year) to $650 million. Analysts surveyed by Thomson Reuters had projected an 18.7% rise in sales to $618 million. The results also exceeded the upper end of management’s guidance of $612 million–$617 million. That was the company’s seventh consecutive top-line beat.
The current earnings season has been a fairly good one for sportswear companies. Columbia Sportswear (COLM) and Under Armour (UAA), which both reported results in early May, came in ahead of Wall Street’s top-line expectations. Columbia Sportswear’s total sales increased 11.7% YoY to $607 million, while Under Armour reported a 6.2% YoY increase in sales to $1.2 billion.
LULU delivered strong in-store and e-commerce comps
Lululemon’s comparable sales growth was the high point of its results. Sales comps surged a significant 20% during the quarter, driven by a robust 60% increase in e-commerce sales.
What is even more impressive is that online sales are not cannibalizing LULU’s in-store sales, and the company is successfully attracting customers to its stores. That’s evident from the 8% growth it achieved in its brick-and-mortar comps. And even better, the increase in traffic for those comps has been in the mid-single-digit range.
Its North American store comps improved 6% during the quarter. Europe recorded double-digit growth in sales comps, and Asia continued to lead the growth story with combined comps growth of more than 50%.
ETF investors seeking to add exposure to LULU can consider the First Trust Consumer Discretionary AlphaDEX ETF (FXD), which invests 1.8% of its portfolio in LULU.
In the next part of this series, we’ll look at LULU’s bottom-line performance for the first quarter.