lululemon(LULU) - 2025 Q4 - Annual Results

Lululemon Fiscal 2024 Earnings Release Financial Highlights Lululemon achieved record annual revenue exceeding $10 billion in fiscal 2024, driven by strong international growth and robust fourth-quarter performance Fiscal 2024 Key Financial Results | Metric | Fourth Quarter 2024 | Full Year 2024 | | :--- | :--- | :--- | | Net Revenue | $3.6 billion (+13% YoY) | $10.6 billion (+10% YoY) | | Diluted EPS | $6.14 | $14.64 | - The company's performance exceeded expectations, driven by new product introductions and innovation[2] Fourth Quarter 2024 Performance Q4 2024 saw net revenue increase 13% to $3.6 billion, driven by strong international growth and improved margins Q4 2024 vs. Q4 2023 Performance | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Net Revenue | $3.6 billion | $3.2 billion | +13% | | Gross Profit | $2.2 billion | $1.9 billion | +15% | | Gross Margin | 60.4% | 59.4% | +100 bps | | Income from Operations | $1.0 billion | $0.9 billion | +14% | | Diluted EPS | $6.14 | $5.29 | +16.1% | - Americas Net Revenue: Increased by 7%[3] - International Net Revenue: Increased by 38%[3] - Comparable Sales: Increased by 3% (excluding the 53rd week)[3] - Share Repurchases: 0.9 million shares for $332.2 million[3] - Store Openings: 18 net new company-operated stores[3] Full Year 2024 Performance Full fiscal year 2024 net revenue grew 10% to $10.6 billion, driven by strong international performance and margin expansion Full Year 2024 vs. 2023 Performance | Metric | Fiscal Year 2024 | Fiscal Year 2023 | Change | | :--- | :--- | :--- | :--- | | Net Revenue | $10.6 billion | $9.6 billion | +10% | | Gross Profit | $6.3 billion | $5.6 billion | +12% | | Gross Margin | 59.2% | 58.3% | +90 bps | | Income from Operations | $2.5 billion | $2.1 billion | +17% | | Diluted EPS | $14.64 | $12.20 | +20.0% | - Americas Net Revenue: Increased by 4%[3][11] - International Net Revenue: Increased by 34%[3][11] - Comparable Sales: Increased by 4% (excluding the 53rd week)[3][11] - Share Repurchases: 5.1 million shares for $1.6 billion[3][11] - Store Additions: 56 net new stores, including 14 from the Mexico acquisition[3][11] Management Commentary and Outlook Management expressed satisfaction with 2024 results, reaffirming the 'Power of Three ×2' plan and providing 2025 growth outlook - The CEO stated that Q4 results exceeded expectations, attributing the success to newness and innovation in the product assortment[2] - The CFO highlighted surpassing $10 billion in annual revenue for the first time and emphasized remaining agile amid macro uncertainties[5] - The company is executing its "Power of Three ×2" growth plan, which targets doubling 2021 net revenue of $6.25 billion to $12.5 billion by 2026[10] Balance Sheet Highlights Lululemon maintained strong liquidity with $2.0 billion cash and $393.9 million available credit, with inventories up 9% Key Balance Sheet Items (End of FY 2024) | Item | Value | | :--- | :--- | | Cash and cash equivalents | $2.0 billion | | Available Credit Facility | $393.9 million | | Inventories | $1.4 billion (+9% YoY) | Fiscal 2025 Outlook The company provided fiscal 2025 guidance, projecting Q1 revenue of $2.335-$2.355 billion and full-year revenue of $11.15-$11.30 billion Q1 Fiscal 2025 Guidance | Metric | Expected Range | | :--- | :--- | | Net Revenue | $2.335 billion - $2.355 billion | | Revenue Growth | 6% - 7% | | Diluted EPS | $2.53 - $2.58 | Full Year Fiscal 2025 Guidance | Metric | Expected Range | | :--- | :--- | | Net Revenue | $11.150 billion - $11.300 billion | | Revenue Growth | 5% - 7% | | Revenue Growth (ex. 53rd week) | 7% - 8% | | Diluted EPS | $14.95 - $15.15 | Consolidated Financial Statements Consolidated financial statements detail Lululemon's performance, showing revenue and net income growth, increased assets, and strong operating cash flow Condensed Consolidated Statements of Operations Fiscal 2024 net revenue increased to $10.59 billion, with gross profit rising to $6.27 billion and diluted EPS reaching $14.64 Fiscal Year Performance (in thousands) | Account | Fiscal Year 2024 | Fiscal Year 2023 | | :--- | :--- | :--- | | Net revenue | $10,588,126 | $9,619,278 | | Gross profit | $6,270,811 | $5,609,405 | | Income from operations | $2,505,697 | $2,132,676 | | Net income | $1,814,616 | $1,550,190 | | Diluted earnings per share | $14.64 | $12.20 | Condensed Consolidated Balance Sheets As of February 2, 2025, total assets reached $7.60 billion, with cash decreasing to $1.98 billion and inventories increasing to $1.44 billion Balance Sheet Summary (in thousands) | Account | Feb 2, 2025 | Jan 28, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,984,336 | $2,243,971 | | Inventories | $1,442,081 | $1,323,602 | | Total assets | $7,603,292 | $7,091,941 | | Total liabilities | $3,279,245 | $2,859,860 | | Total stockholders' equity | $4,324,047 | $4,232,081 | Condensed Consolidated Statements of Cash Flows Fiscal 2024 operating cash flow was $2.27 billion, with significant cash used in financing activities, leading to a net cash decrease of $260 million Cash Flow Summary (in thousands) | Activity | Fiscal Year 2024 | Fiscal Year 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $2,272,713 | $2,296,164 | | Net cash used in investing activities | ($798,174) | ($654,132) | | Net cash used in financing activities | ($1,652,508) | ($548,828) | | Net (decrease) increase in cash | ($259,635) | $1,089,104 | Supplemental Financial Information Supplemental information includes non-GAAP reconciliations, detailing constant dollar revenue, 53rd week impact, and store network expansion Reconciliation of Non-GAAP Financial Measures This section reconciles GAAP to non-GAAP measures, adjusting for currency, 53rd week impact, and lululemon Studio charges for clearer trend analysis FY 2024 Revenue Growth Reconciliation | Metric | Reported Change | Constant Dollar Change | Change ex. 53rd Week (non-GAAP) | | :--- | :--- | :--- | :--- | | Total Revenue | 10% | 11% | 8% | - For fiscal 2023, results were adjusted to exclude charges related to lululemon Studio, which included inventory provisions, asset impairments, and restructuring costs[16][43][44] - This adjustment increased FY2023 diluted EPS from $12.20 (GAAP) to $12.77 (Adjusted)[16][43][44] Store Network Expansion Lululemon expanded its physical retail footprint in fiscal 2024, adding a net of 56 stores to reach 767 company-operated locations Store Count Change in FY 2024 | Quarter | Stores Opened | Stores Closed | Net Change | | :--- | :--- | :--- | :--- | | Q1 2024 | 5 | 5 | 0 | | Q2 2024 | 11 | 1 | +10 | | Q3 2024 | 28 | 0 | +28 | | Q4 2024 | 21 | 3 | +18 | | Total | 65 | 9 | +56 | - The company ended fiscal 2024 with 767 stores, up from 711 at the start of the year[46]