Lululemon Athletica Inc. reported a net income of US$195 million for the first quarter of fiscal 2026, but the company also lowered its outlook for the full year, citing a challenging retail environment and shifting consumer spending patterns.
Financial Highlights
The Vancouver-based athletic apparel retailer posted revenue of US$2.2 billion for the quarter ended April 30, 2026, up 8% from the same period last year. However, comparable store sales grew only 2%, missing analyst expectations. The company's net income of US$195 million translated to earnings per share of US$1.52, compared to US$1.48 in the prior year.
Outlook Revision
Lululemon now expects full-year 2026 revenue to be in the range of US$9.1 billion to US$9.3 billion, down from its previous forecast of US$9.4 billion to US$9.6 billion. The company also revised its earnings per share guidance to between US$6.80 and US$7.00, below the consensus estimate of US$7.25.
CEO Calvin McDonald said in a statement: "While we delivered solid results in the first quarter, we are seeing more cautious consumer behavior and increased promotional activity in the market. We are taking a prudent approach to the remainder of the year."
Market Reaction
Shares of Lululemon fell 6% in after-hours trading following the announcement. The stock has declined 15% year-to-date, underperforming the broader market.
Strategic Initiatives
Despite the lowered outlook, Lululemon continues to invest in its international expansion and product innovation. The company opened 12 new stores during the quarter, including three in China, and launched a new footwear line in partnership with a leading athletic brand.
Analyst Insights: Industry experts note that Lululemon faces headwinds from rising competition and a slowdown in the athleisure trend. However, the brand's strong loyalty program and digital engagement remain key strengths.
