Lululemon says sees fourth-quarter earnings, gross sales harm because of omicron

Lululemon says sees fourth-quarter earnings, sales hurt due to omicron

Pedestrians sporting protecting masks stroll previous a Lululemon retailer in San Francisco, California, on Monday, March 29, 2021.

David Paul Morris | Bloomberg | Getty Photographs

Lululemon shares fell in premarket buying and selling on Monday after the retailer stated earnings and income for its fiscal fourth quarter will doubtless are available on the low finish of estimates because of staffing shortages and shortened retailer hours as Covid instances as soon as once more surge within the U.S.

The inventory tumbled round 7% after closing Friday down 3.7% at $355.21.

Lululemon stated in a press release it expects fourth-quarter income on the low finish of its vary of $2.125 billion to $2.165 billion. It predicts adjusted earnings per share additionally towards the low finish of its vary of $3.25 to $3.32.

Analysts had been on the lookout for adjusted earnings of $3.34 per share on gross sales of $2.17 billion, based on Refinitiv estimates.

“We began the vacation season in a robust place however have since skilled a number of penalties of the omicron variant, together with elevated capability constraints, extra restricted employees availability, and decreased working hours in sure areas,” stated Lululemon’s Chief Govt Officer Calvin McDonald.

Many retailers are seeing labor issues worsening as employees turn out to be sick or are uncovered to Covid-19, with the presence of the extremely contagious omicron variant.

Division retailer operator Macy’s has reduce retailer hours at areas throughout the nation for the remainder of this month. Whereas big-box retailer Walmart quickly closed nearly 60 areas in December at coronavirus scorching spots.

Learn the complete press launch from Lululemon here.

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