Lululemon Athletica Inc. LULU-Q raised its annual sales and profit forecasts on Thursday, betting on strong demand for its activewear from affluent U.S. shoppers and a recovery in China, sending its shares up 11 per cent in extended trading.
The pandemic-era appetite for comfortable clothing and activewear seems to have turned into a habit, helping companies such as Lululemon and Nordstrom Inc. avoid a wider slump in discretionary spending.
Lululemon is also banking on new launches and more full-price selling to drive revenues and offset any impact from promotions taken to clear inventories.
Vancouver-based Lululemon now expects full-year 2023 revenue between US$9.44-billion and US$9.51-billion, compared with its prior estimate of US$9.30-billion to US$9.41-billion. Analysts on average had estimated US$9.37-billion, according to Refinitiv IBES data.
The company projected full-year 2023 profit between US$11.74 and US$11.94, compared with its prior estimate of US$11.50 to US$11.72 per share.