This story has been updated from 7:56 a.m. EST to include additional information, stock price update.
NEW YORK (TheStreet) -- Shares of Lululemon Athletica (LULU) were tumbling 15% to $37.61 on Thursday, a level not seen since March 2011, as the yoga and athletic apparel retailer struggles to regain the luster it once had prior to its Luon pant recall last March.
Investors were fleeing from the stock after the Vancouver-based company lowered its outlook for the second quarter and fiscal year on Thursday. Lululemon reported first-quarter net income of $18.98 million, or earnings of 13 cents a share. Earnings included a non-recurring adjustment of $30.9 million, or 21 cents a share, from the repatriation of foreign earnings the company is planning as a way to fund a share repurchase program of $450 million that it also announced on Thursday. Excluding the adjustment, earnings were 34 cents a share compared to $47.3 million, or 32 cents a share in the year-earlier quarter.
Lululemon's net revenue rose 11% to $384.6 million compared to a year earlier, surpassing estimates of $381 million. Comparable sales rose 1% in the quarter, fueled by a 25% increase in direct-to-consumer sales. Comparable store sales actually declined 4% in the quarter. Separately, Lululemon's executive management continues to be in transition. CFO John Currie said in a separate announcement that he would retire from the company at the end of its fiscal year.
Lululemon is still suffering from the after-effects of last year's Luon pant recall, its most popular item, over customer complaints the merchandise was too sheer. The issue was blamed on problems within the growing retailer's supply chain. As well, a lack of both new product mix and having enough of its core product in stores following the recall was hurting sales.
Lululemon said that second-quarter revenue is expected to be in the range of $375 million to $380 million, below the average analysts' expectation of $387 million, and based on comps that "decrease in the low- to mid-single-digits." The company said earnings per share will range between 28 cents and 30 cents a share compared to consensus estimates of 36 cents a share.