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Could Lululemon’s Revenue Beat Analysts’ Expectations?

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Recap of recent performance

Lululemon Athletica’s (LULU) revenue grew 24.1% to $3.3 billion in fiscal 2018 (ended February 3). The company’s top line was boosted by its company-operated-store revenue rising 15.7% to $2.1 billion, its direct-to-consumer (or e-commerce) revenue rising 48.7% to $858.9 million, and its Other revenue growing 29.2% to $303.1 million.

Lululemon’s revenue beat analysts’ expectations in all four quarters of fiscal 2018, growing over 20% in each quarter. In the fourth quarter, the company’s revenue rose 25.7% to $1.17 billion and exceeded analysts’ forecast of $1.15 billion.

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Growth expectations

In fiscal 2019’s first quarter, Lululemon expects its revenue to rise year-over-year to $740 million–$750 million from $649.7 million. It forecasts fiscal 2019 revenue of $3.70 billion–$3.74 billion. Analysts expect Lululemon’s to rise 16.2% to $755.2 million in the first quarter, and 14.7% to $3.77 billion in fiscal 2019.

Lululemon aims to strengthen its women’s and accessories revenue through continued innovation and expansion in the office, bra, and outerwear categories. Lululemon also aims to double its revenue from its men’s and digital businesses by 2023.

Lululemon is geared up to capture international opportunities, especially in Europe and Asia, and plans to quadruple its international revenue by 2023. Lululemon aims to open 40–50 company-operated stores in fiscal 2019, of which 25–30 are to be international.

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