Still in the Doghouse: Lululemon Lowers Q4 Guidance
Free Book Preview: Unstoppable
Pro tip: If your chairman talks negatively about women's bottoms, then your company's bottom line will suffer.
High-end yoga apparel maker Lululemon, whose controversial founder and chairman is set to step down in June, lowered its revenue and profit estimates for its fiscal fourth quarter, which ends on Feb. 2.
The company expects sales in the range of $513 million to $518 million, down from the previously announced range of $535 million to $540 million, on weaker same-store sales. Earnings are expected at $0.71 to $0.73 per share for the quarter, down from previously announced guidance of $0.78 to $0.80 per share.
"We were on track to deliver on our sales and earnings guidance through the month of December; however, since the beginning of January, we have seen traffic and sales trends decelerate meaningfully," said John Currie, the chief financial officer of Lululemon in the statement. He said it would take the company "investment and time to get to best-in-class status."
The Vancouver, Canada-based company's fall from grace began with the embarrassing revelation that some of its pants were see through and the non mea culpa of founder and chairman Chip Wilson, where he claimed in November that "some women's bodies just don't actually work" for the clothing. The comments sparked quite the backlash of offended women. Wilson has since resigned from his post and will leave in June.
In an effort to give its leadership a facelift, Lululemon has brought on Laurent Potdevin, the former president of TOMS Shoes, as chief executive officer.
Related: TOMS Creates E-Commerce Hub for Socially Conscious Shoppers