The athletic apparel company said it now expects revenue between $513 million and $518 million and net income in the range of 71 cents to 73 cents a share. Management had previously estimated revenue between $535 million and $540 million and earnings of 78 cents to 80 cents a share.
The updated guidance falls significantly short of consensus. Analysts polled by Thomson Reuters had expected net income of 79 cents a share on $539.87 million in revenue.
The Vancouver-based business said it expects comparable-store sales to fall in the low-to-mid single digits, compared to previous estimates of flat comparable-store sales.
"We were on track to deliver on our sales and earnings guidance through the month of December; however, since the beginning of January, we have seen traffic and sales trends decelerate meaningfully," said CFO John Currie in a statement.
Shortly after market open, shares had plummeted 16% to $50.06.
TheStreet Ratings team reiterates LULULEMON ATHLETICA INC as a Buy with a ratings score of B. The team has this to say about their recommendation:
"We rate LULULEMON ATHLETICA INC (LULU) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, expanding profit margins and compelling growth in net income. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."