Activewear brand Lululemon Athletica Inc. has reported a revised growth projection for the year as US based sales drop below expectations. The revised projections for the current fiscal year have been ranged between US $ 11.15 billion to US $ 11.3 billion, which is lower than the previous Wall Street analysis. The activewear’s first-quarter revenues also dropped lower than the anticipated mark.
This updated outlook for the US comes as Lululemon struggles with changing consumer preferences, with the consumers opting for looser fits over the brand’s iconic form-fitting clothing. To counter the same, the CEO has diversified the product range and added new categories including sports gears for golf, tennis and running.
On the contrary to the US market, Lululemon’s international outlets performed relatively well. In the fourth quarter, international comparable sales surged by 22 per cent, contrasting sharply with the flat growth observed in the Americas.
Lululemon is also managing possible supply chain interruptions brought on by rising international trade tensions, especially as a sizable amount of its production takes place in Asia, including Vietnam, Cambodia, and Sri Lanka. This element adds even more intricacy to the business’s financial projections.
The CFO, Meghan Frank, attributed the slump to ‘ongoing macro uncertainties’.
