Lululemon shares dropped as much as 22% in premarket trading after the company cut its earnings per share (EPS) forecast for the full year, despite posting a strong first quarter. The weak outlook for the second quarter and full year raised concerns about tariffs, macroeconomic uncertainty, and slowing sales in China. Analysts highlighted that the lower EPS guidance overshadowed solid Q1 results, marking the first time the company reduced its annual EPS forecast since fiscal year 2014.
Key Financial Data:
- 2026 Full-year EPS guidance cut to $14.58–$14.78 (previously $14.95–$15.15; consensus estimate $14.91)
- Second-quarter EPS guidance: $2.85–$2.90 (consensus estimate $3.31)
- First-quarter EPS 2025: $2.60 (in line with estimate $2.60)
- First-quarter net revenue 2025: $2.37 billion (vs estimate $2.36 billion)
- China net revenue: $368.1 million (vs estimate $378.7 million)
The company's pre-market trading price on the NASDAQ stands at $263.55, representing a decline of approximately 70 points from the $331.64 level, breaking a two-month upward trend. The stock is now trading just 40 points above its 2020 low of $226.23.
Source: xStation
Lululemon's financial results, under pressure from reduced margins, have returned to levels seen prior to the third quarter of FY24/25. In the first quarter of FY25/26, the company reported a profit of $314.6 million, compared to the previous quarter, in which it earned $748.4 million.
Source: XTB Research, Bloomberg Finance L.P.
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