Lululemon Q3 earnings fall on costs; raises concerns for fourth quarter

Vancouver, Canada – Net earnings at Lululemon Athletica Inc. fell 8% to $60.45 million in the third quarter of fiscal 2014 from $66.11 million a year earlier to increases in selling, general and administrative (SG&A) expenses and cost of goods sold.



Net revenue fared better, rising 10% to $419.4 million from $379.9 million. Same-store sales fell 3% but total comparable sales, including direct-to-consumer revenue, climbed 3%.

During the fourth quarter, Lululemon expects a negative impact of $15 million on sales due to the combined impact of West Coast port delays, a lower Canadian dollar, and delayed store openings. The retailer expects same-store sales to grow during the fourth quarter and full fiscal year.



"I am pleased that our third quarter results demonstrated sequential improvements as the quarter progressed, with all key facets of our business - brand, guest experience, and product - contributing to our momentum,” said Laurent Potdevin, CEO. "I am confident that our strong team, coupled with strategic investments into our core business areas, have already made a positive impact and place us on a strong trajectory for further global growth."