Lulemon athletica (NASDAQ:LULU) announced its financial results for the fourth quarter and fiscal year ended February 1, 2026, revealing a tale of two markets.
Total net revenue for the quarter reached $3.6 billion, a modest 1% increase compared to the fourth quarter of 2024.
However, the geographic performance diverged sharply; revenue in the Americas fell by 4% (5% on a constant dollar basis), while International revenue surged by 17%.
When excluding the impact of the 53rd week in the prior year's reporting cycle, total net revenue showed a more robust underlying growth rate of 6%.
Profitability metrics faced significant pressure during the holiday quarter.
Gross profit decreased 8% to $2 billion, with gross margin contracting by 550 basis points to 54.9%.
This decline in margin reflects a more promotional retail environment and shifts in product mix.
Consequently, income from operations fell 22% to $812.3 million, and diluted earnings per share (EPS) came in at $5.01, down from the $6.14 reported in the same period a year ago.
Despite the headwinds in North America, Lululemon’s global expansion remains on track.
International comparable sales jumped 20%, driven by strong brand resonance in China and Europe.
The company continued to invest in its physical footprint, opening 15 net new company-operated stores during the quarter to end the year with 811 locations worldwide.
Management also remained active in returning value to shareholders, repurchasing 1.4 million shares at a cost of $269.1 million during the final three months of the fiscal year.