A consumer looks at athletic clothing inside of a Lululemon retailer.
Xaume Olleros | Bloomberg | Getty Pictures
Lululemon aims to double its 2021 profits in the upcoming 5 years, putting it on keep track of to hit $12.5 billion in gross sales by 2026, as the retailer rides a wave of Covid pandemic-fueled need for workout outfits.
Lululemon on Wednesday announced a handful of more time-time period expansion targets, which includes for its men’s business enterprise, in advance of a scheduled analyst working day occasion. It cited 3 essential drivers of momentum in the coming yrs: item innovation, purchaser knowledge and market enlargement.
The athletic apparel retailer is aiming to double its men’s income, double its electronic sales and quadruple intercontinental revenue, all in the following 5 several years. Lululemon teased the official debut of a new membership featuring in the coming months, as perfectly as its foray into Spain and Italy by way of new brick-and-mortar stores.
“We remain early in our growth journey,” reported Lululemon Main Executive Calvin McDonald, in a assertion. “I am enthusiastic about getting our progress methods to the subsequent amount.”
Nonetheless, some investors may possibly have been hoping for even more substantial targets. Lululemon shares shut the working day down practically 5%, at $385.40. The stock has fallen around 1.5% 12 months to date.
The retailer’s product sales grew additional than 40% in 2021 from the prior calendar year, totaling $6.25 billion, fueled by a robust direct-to-consumer business enterprise and overseas momentum for its yoga trousers, leggings and sports bras. That is in comparison with profits of $3.98 billion in 2019.
In April 2019, Lululemon had laid out a selection of monetary targets, including doubling its then-nascent men’s business enterprise by 2023. It ended up reaching the men’s goal two a long time ahead of program and also tripled electronic revenue from 2018 to 2021.
Citing information from The NPD Group, Lululemon explained it obtained far more industry share globally than any brand name in the grownup lively attire marketplace from 2019 to 2021. Its rivals involve giants this kind of as Nike, Adidas and Less than Armour, as nicely as up-and-coming brand names like Vuori for adult men and Sweaty Betty for girls.
A want among shoppers to dress easily when investing more time at dwelling has propelled a lot of of these suppliers through the Covid pandemic.
The firm explained Wednesday that it initiatives earnings for every share expansion to outpace profits development in the next five several years. It expects to increase the sq. footage of its suppliers every year in the small double digits. Its women’s business enterprise and North American division are projected to see minimal, double-digit annual compound growth fees in earnings through 2026.
Lululemon’s main money officer, Meghan Frank, identified as the targets “bold but sensible.”
The enterprise cited the latest initiatives including its initially-at any time footwear collection and a trade-in and resale system that it explained must enable to achieve these new money targets.
Past thirty day period, McDonald instructed analysts for the duration of an earnings phone that the preliminary reaction to the footwear start experienced been “extraordinary.” So significantly, Lululemon has only launched a constrained line of women’s working footwear, with men’s products established to fall future 12 months.
Find the total economical press release from Lululemon listed here.