lululemon(US:LULU) Changjiang Securities·2026-03-30 08:41Investment Rating - The investment rating for the industry is "Positive" and is maintained [9] Core Insights - In FY2025Q4, Lululemon achieved revenue of $3.64 billion, a year-on-year increase of 1%, and performance exceeded market and company expectations [2][6] - Gross margin decreased by 5.5 percentage points to 54.9%, primarily due to rising tariffs and increased discounts [2][6] - Operating profit fell by 22% to $810 million, with an operating margin decline of 6.6 percentage points to 22.3%, mainly impacted by the drop in gross margin and increased expense ratios [2][6] - Net profit also decreased by 22% to $590 million, with a net margin decline of 4.6 percentage points to 16.1% [2][6] Revenue Breakdown - By region, revenue for FY2025Q4 was as follows: North America - $2.17 billion (down 6% YoY), outside North America - $960 million (up 17% YoY), Greater China - $590 million (up 23% YoY) [8] - By channel, offline revenue was $1.44 billion (down 5% YoY) and e-commerce revenue was $1.90 billion (up 5% YoY) for FY2025Q4 [8] - By product category, women's apparel revenue was $2.27 billion (up 2% YoY), men's apparel revenue was $900 million (down 2% YoY), and other products remained flat at $470 million for FY2025Q4 [8] Inventory Situation - At the end of FY2025Q4, Lululemon's inventory amounted to $1.7 billion, an 18% increase YoY, with inventory quantity up 6% [12] Performance Guidance - For FY2026, Lululemon expects revenue to be between $11.35 billion and $11.5 billion, representing a 2% to 4% growth YoY [12] - The company anticipates a gross margin decline of 1.2 percentage points for FY2026, with diluted EPS projected between $12.1 and $12.3 [12]