Canadian athleticwear retailer Lululemon Athletica has reported its third-quarter (Q3) fiscal 2025 results for the period ending 2 November 2025, with net revenue rising 7% year-on-year to $2.6bn.
Regional performance was uneven, with net revenue in the Americas falling 2%, while international markets delivered 33% growth.
Comparable sales increased 1%, or 2% when adjusted for currency, with declines of 5% in the Americas offset by an 18% rise internationally.
Gross profit edged up 2% to $1.4bn, though gross margin contracted by 290 basis points to 55.6%.
Operating income declined 11% to $435.9m, reducing operating margin to 17%, down 350 basis points.
Diluted earnings per share decreased to $2.59 from $2.87 a year earlier.
The retailer finished the quarter with 796 shops after adding 12 net new outlets.
During the period, it repurchased a million shares for $189m.
On 3 December 2025, the board authorised an additional $1bn for the company’s share buyback programme; by 11 December, $1.6bn remained available for repurchases.
Lululemon closed the quarter with $1bn in cash and cash equivalents, supported by $593m of unused capacity on its revolving credit facility.
Inventories increased 11% from the previous year to $2bn, or 4% higher in unit terms.
For Q4, the company expects revenue between $3.50bn and $3.58bn, representing a decline of 3% to 1%, or growth of 2% to 4% when excluding the 53rd week of fiscal 2024.
Diluted earnings per share are forecast to be between $4.66 and $4.76.
Full-year revenue is projected to reach $10.962bn to $11.04bn, indicating 4% growth, or 5% to 6% without the impact of the 53rd week.
Full-year diluted earnings per share (EPS) is projected at between $12.92 and $13.02.
The company's 2025 outlook includes an estimated $210m reduction in operating income, net of mitigation efforts, driven by expected higher US import tariffs and the removal of the de minimis exemption.
Lululemon also announced that Calvin McDonald will step down as CEO and board member on 31 January 2026, subsequently serving as a senior adviser until 31 March 2026.
The board has begun a search for his successor using an external company.
Marti Morfitt, board chair, has been named executive chair, while chief financial officer Meghan Frank and chief commercial officer André Maestrini will act as interim co-CEOs after McDonald’s transition.
