For the quarter ended May 3, 2026, net revenue increased 4 per cent year-on-year (YoY) to $2.5 billion. International revenue surged 22 per cent, while revenue in the Americas declined 3 per cent.
Lululemon has reported mixed Q1 FY26 results, with net revenue rising 4 per cent to $2.5 billion, driven by 22 per cent international growth, while Americas revenue declined 3 per cent.
Gross margin fell 410 basis points to 54.2 per cent and diluted EPS dropped to $1.69.
The company lowered its FY26 outlook, citing macroeconomic headwinds and softer demand in the Americas market.
“We experienced a solid start to 2026 as our teams executed with speed, agility, and discipline,” said Meghan Frank, interim co-chief executive officer and chief financial officer of Lululemon. “More recently, we have been navigating headwinds that have led us to adjust our outlook for the full year.”
The comparable sales increased 1 per cent overall but declined 2 per cent on a constant dollar basis. In the Americas, comparable sales fell 5 per cent, while international comparable sales rose 13 per cent
Gross margin contracts amid profitability pressure
The gross profit declined 3 per cent to $1.3 billion, with gross margin contracting 410 basis points (bps) to 54.2 per cent. Income from operations fell 37 per cent to $276.9 million, while operating margin dropped 730 bps to 11.2 per cent.
Diluted earnings per share (EPS) decreased to $1.69 compared to $2.60 in the corresponding quarter last year. The company’s effective income tax rate increased to 31.8 per cent from 30.2 per cent a year earlier.
During the quarter, Lululemon opened five net new company-operated stores, taking its global store count to 816.
Andre Maestrini, interim co-chief executive officer, president and chief commercial officer of Lululemon, said the company continued to expand its global community through product launches, store enhancements, and digital improvements, while acknowledging that further work is needed to reignite growth.
Lululemon lowers FY26 growth outlook
Looking ahead, Lululemon expects Q2 FY26 revenue to range between $2.450 billion and $2.475 billion, representing a decline of 3 per cent to 2 per cent. Diluted EPS are projected between $1.76 and $1.81.
For full FY26, the company now expects net revenue between $11 billion and $11.15 billion, representing a decline of 1 per cent to flat growth. Diluted EPS are forecast in the range of $10.95 to $11.15.
Fibre2Fashion News Desk (SG)
