Canada's Lululemon exceeds $10 bn revenue in FY24, eyes further growth

For full fiscal 2025 (FY25), the company expects net revenue to be in the range of $11.15 billion to $11.30 billion, representing growth of 5 per cent to 7 per cent YoY. Diluted EPS are expected to be in the range of $14.95 to $15.15 for full fiscal, assuming a tax rate of approximately 30 per cent.

Lululemon’s ‘Power of Three ×2 growth’ strategy aims to double its net revenue from $6.25 billion in 2021 to $12.5 billion by 2026. This ambitious plan is anchored on three core pillars: product innovation, enhancing the guest experience, and expanding into new markets, Lululemon Athletica said in a press release.

The company reported a 10 per cent YoY increase in net revenue in fiscal 2024 (FY24) ended February 2, 2025, reaching $10.6 billion, or 11 per cent on a constant dollar basis. The gross profit of the company rose 12 per cent to $6.3 billion, and gross margin expanded by 90 basis points (bps) to 59.2 per cent. The income from operations increased by 17 per cent to $2.5 billion, with an operating margin of 23.7 per cent.

While Americas net revenue grew by 4 per cent, comparable sales declined 1 per cent in FY24. The international markets performed strongly, with net revenue increasing 34 per cent (36 per cent constant dollar) and comparable sales up 22 per cent (24 per cent constant dollar).

The effective tax rate was 29.6 per cent and diluted EPS reached $14.64. The company ended the year with 767 stores, adding 56 new locations, including 14 through the acquisition of operations in Mexico, added the release.

“We are pleased to deliver another solid year of performance in 2024 and surpass $10 billion in annual revenue for the first time. We look forward to building on our growth in 2025, while remaining agile as we navigate ongoing macro uncertainties. There are significant opportunities ahead for the lululemon brand and we are confident in our ability to continue creating long-term value for all our stakeholders,” said Meghan Frank, chief financial officer (CFO) at Lululemon Athletica.

Meanwhile, in the fourth quarter (Q4) of FY24, Lululemon Athletica reported a 13 per cent YoY increase in net revenue, reaching $3.6 billion, or 14 per cent on a constant dollar basis.

Americas net revenue grew 7 per cent in Q4 FY24 (8 per cent constant dollar), though comparable sales remained flat. International net revenue surged 38 per cent (40 per cent constant dollar), with comparable sales up 20 per cent (22 per cent constant dollar).

The gross profit in the last quarter of FY24 rose 15 per cent to $2.2 billion, with the gross margin improving by 100 basis points to 60.4 per cent. Income from operations increased 14 per cent to $1.0 billion, and operating margin rose to 28.9 per cent. Diluted EPS were $6.14, compared to $5.29 in the same period last year. The company opened 18 net new stores in this quarter.

“Our fourth quarter results exceeded our expectations as we continued to introduce more newness and innovation into our product assortment. Our performance demonstrates the ongoing strength and resilience of lululemon and is a testament to the passion and dedication of our teams around the world. As we begin 2025, we remain focused on executing on our ‘Power of Three ×2 growth’ plan and delivering an exciting pipeline of innovation and brand activations for our guests and communities,” said Calvin McDonald, chief executive officer (CEO) at Lululemon Athletica.

ALCHEMPro News Desk (SG)