Lululemon stock legs higher on earnings beat, strong sales forecast
Robert Way/iStock Editorial via Getty Images

Lululemon athletica (NASDAQ:LULU) stock jumped over 8% in Tuesdayâs extended session after topping earnings expectations and offering an upbeat guide for 2023.
For its fiscal fourth quarter, the Canadian athleisure company reported $4.40 in adjusted earnings per share for the quarter, beating the analyst consensus by $0.14. Meanwhile, a 30% jump in revenue to $2.8B exceeded expectations by $100M. Direct to consumer revenue rose 39% on a constant currency basis.
Gross margins decreased 300 basis points to 55.1%, coming in below the 57.1% consensus estimate, as inventories ballooned 50% year over year. However, comparable sales crushed expectations at 30% against a 22.7% consensus.
âOur ability to exceed our annual revenue target in a dynamic operating environment is a testament to the enduring strength of the lululemon brand,â CFO Meghan Frank commented. âLooking ahead, we remain optimistic regarding our ability to deliver sustained growth and long-term value for all our stakeholders."
For the first quarter of fiscal 2023, management expects net revenue to be in the range of $1.89B to $1.93B, above the $1.85B consensus. Diluted earnings per share are expected to be in the range of $1.93 to $2.00, also well above the $1.64 consensus for the quarter. 
For the full-year ahead, the company is projecting between $9.3B and $9.41B in revenue, easily above the $9.14B consensus. Meanwhile, a diluted earnings per share guide of between $11.50 and $11.72 was comfortably above the $11.30 Street consensus.
Shares of Lululemon (LULU) leapt 8.02% following the earnings announcement.