Lululemon Q1 earnings: What to watch for

Lululemon Athletica (LULU) reports its first quarter results after the market close on Wednesday.

Yahoo Finance's Brad Smith and Madison Mills take a closer look at what Wall Street will be looking for in the report.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Stephanie Mikulich.

Transcription de la vidéo

Wall Street is Abuzz with the talk of Lulu Lemon ahead of the retailers Q one results after the bell today.

And let me tell you, stakes are high stock is down right now.

Around 40% so far.

This year.

In 2024 the company struggling in light of increasing competition from brands like Alo Alo.

I always say A I know we gotta investigate this workshop and Fiori, there's no confusion there.

Analysts are forecasting stain store sales growth of less than half of what we saw in Q one last year and there you're taking a look at some of the estimates.

One of the huge things that I'm keeping a close tab on here going into the earnings where we're essentially looking at.

And according to data from options A I A potential move to the upside or downside of about 10% post earnings here, the trade down that we've seen from some consumers, especially when it comes to the business of stretchy fabrics and that leisure apparel and footwear.

And so that particularly could be one of the things where we hear more about what the mindset of the consumer is that is continuing to engage with Lule.

It could be one of two things.

It could be that a trade down to perhaps an Athleta impacts them.

Um or it could be that those who are on the higher end of the income spectrum continue to spend into what they might deem as a luxury type of uh ath leisure purchase as well.

So uh one of two sides there could prevail here.

Yeah, it's interesting.

This is another look at the consumer.

We love to get this at the end of earning season.

We start to get a really good look at some of these consumer driven names, but with a name like Lululemon, it's not just about trade down, right?

We're seeing that these consumers aren't going to an old navy, they're going to alo alo whatever it is.

I have their leggings to be told to be truthful.

So we hear all ok, we hear all.

Ok. That's what I've been calling it.

So it is really important with Lululemon that is it an issue with their price mix, their product mix?

Right?

Is it something that they're doing with their marketing?

Because these consumers are not bucking under the weight of inflation, they're going to competitors and that is never what you want to hear as an executive