(Adds analyst's comment, shares, background)
Jan 9 Canadian yoga and leisure apparel retailer
Lululemon Athletica Inc said on Monday it had narrowed
the range of its profit and revenue forecasts for the fourth
quarter of 2016.
The yogawear maker now expects its fourth-quarter net
revenue to be $775 million-$785 million, from the company's
previous forecast of $765 million-$785 million.
"We had a strong holiday season in both our store and
digital channels", Chief Executive Laurent Potdevin said in a
Lululemon also narrowed its fourth-quarter earnings to
$0.99-$1.01 per share from its previous forecast of $0.96-$1.01,
However, investors shrugged off the news amid reports from
various apparel retailers of weak holiday season sales and lower
spending on apparel.
Lululemon shares fell as much as 1.6 percent to $67.15 in
morning trading, but later reversed course to trade up 0.1
percent. Up to Monday's close, the retailer's shares had risen
24.3 percent in the last 12 months.
"Following a generally disappointing holiday across retail,
investors are skeptical about buying anything in the sector
right now," Instinet analyst Simeon Siegel said.
The retailer, which competes with Nike Inc and
Under Armour Inc in the lucrative athleisure market,
reported better-than-expected third-quarter profit in December
on higher gross margins and sales.
The company began by carving out a niche market of expensive
women's yoga pants before expanding into other areas. It helped
push athleisure wear into mainstream fashion and now competes in
a crowded market.
Lululemon's international success helped turn the
Vancouver-based retailer into an investor favorite, but
struggles with inventory, embarrassing product recalls, and
executive changes in recent years have blemished its
(Reporting by John Benny and Komal Khettry in Bengaluru;
Editing by Shounak Dasgupta)