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Lululemon says sees fourth-quarter earnings, gross sales damage as a result of 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 on Monday after the retailer mentioned earnings and income for its fiscal fourth quarter will doubtless are available in on the low finish of estimates as a result of staffing shortages and shortened retailer hours as Covid instances as soon as once more surge within the U.S.

The inventory tumbled round 4% in early buying and selling after closing Friday down 3.7% at $355.21.

Lululemon mentioned 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 in search of earnings of $3.34 per share on gross sales of $2.17 billion, in keeping with Refinitiv estimates.

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

Many retailers are seeing labor problems worsening as staff become sick or are exposed to Covid-19, with the presence of the extremely contagious omicron variant.

Division retailer operator Macy’s has cut store hours at places throughout the nation for the remainder of this month. Whereas big-box retailer Walmart quickly closed nearly 60 places in December at coronavirus sizzling spots. Different employers, together with Nike, Athleta and Starbucks, have additionally trimmed hours at places the place they do not have sufficient individuals to maintain them open.

Learn the total press launch from Lululemon here.

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