Consumers are replacing jeans and office wear with yoga pants, sweatshirts and shorts as they work from home and spend more free time there.
This is great news for athleisure retailers, casual wear designed for workouts and everyday use. But it’s unclear how long people will continue to pay for items like expensive leggings, shorts, and tank tops.
“We are seeing a change in behavior in terms of working from home, sweating from home and the increased importance of an active and healthy lifestyle. These trends play to our strengths,” CEO Calvin McDonald said in a call. with analysts.
The women’s strong sales were driven by different styles of shorts, the company said. He said his shorter bike shorts “sounded very good”.
However, the company’s stock plunged 9.4% on Wednesday. The higher shipping costs put pressure on profits, said Simeon Siegel, analyst at BMO Capital Markets. Additionally, Lululemon said its declines were higher last quarter.
The company’s net income fell 31% to $ 86.8 million in the quarter from the same period a year earlier.
Lululemon, who did not provide an annual forecast, said the pandemic has made it difficult to predict what autumn and winter will be like. “The environment remains uncertain. COVID is still not contained in many of the markets in which we operate,” McDonald said.
Overall apparel sales fell 34% from March to July from the previous year, including an even more dramatic drop in men’s suits and shirts, but sales of shorts, sweatpants, and sports bras increased during that period , according to market research firm NPD Group.
But there have been other winners.
“There has been a major shift towards sportswear and an active lifestyle [products] with people who spend the most time working and exercising at home, “Dick CEO Ed Stack said in a phone call with analysts last month.
Retail analysts predict that the move to athleisure will continue to grow and companies like Lululemon will benefit.
“We expect the consumer trend towards fitness to accelerate [and] clothing for wellness, “Jefferies analyst Randal Konik said in a research note Tuesday.” Let’s see [Lululemon] emerging even stronger “.