Home / Business / The pandemic has caused a boom in athleisure. This is good news for these companies

The pandemic has caused a boom in athleisure. This is good news for these companies

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.

Despite the temporary closure of stores due to the pandemic, Lululemon said on Tuesday that sales increased 2% to $ 903 million during the quarter ended August 2, compared with the same period last year. Lululemon (LULU) was able to offset the temporary closures with online sales, which grew 1
57% in the last quarter.

“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.

This discounter is crushing it during the pandemic
These changes have devastated some retail chains, such as Brooks Brothers, Neiman Marcus, J. Crew and Men’s Warehouse parent Tailored Brands. All four filed for bankruptcy during the pandemic.

But there have been other winners.

Athleta, the athleisure label of Gap (GPS), saw sales rise 6% during the last quarter, despite Gap’s decline in sales. PVH (PVH), the parent of Tommy Hilfiger and Calvin Klein, said athleisure apparel was one of his top sellers during the last quarter. IS Dick’s sporting goods (DKS) he said consumers were attracted to athletic clothing.

“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 “.

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