LULU US S&P 500Russell 1000 Earnings call
Lululemon Athletica (LULU) · Q4 2026 results and valuation
Share price: $107.45 · 2026-11-11
Results Q4 2026 vs Q3 2026 · previous quarter · published 17 Mar 2026 and 11 Dec 2025
Management sounded about as positive as a typical company call, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
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No financial figures for this pair
Outlook given
2 · How management spoke
Typical
Less upbeat than 60% of company calls
Answers to analysts: restrained, in line with the script.
Similar to last call.
3 · What stood out
Guidance
LULU expects revenue to be between $11.35 billion and $11.5 billion, representing growth of 2% to 4% relative to 2025.
Valuation
Is Lululemon Athletica undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2026-02-01), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 11.0% growth a year (3-year revenue growth), the model's fair value is $231.27 a share — the stock trades 54% below it. Today's price assumes −0.1% growth a year.
Current price
$107.45
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
-0.1% for 10 yrs
Fair value / share
$231.27
Buy below
$173.46
Price vs fair value
Undervalued 54%
Price vs buy-below price
Undervalued 38%
Management expects
Revenue +3% · from the Q4 2026 report: “LULU expects revenue to be between $11.35 billion and $11.5 billion, representing growth of 2% to 4% relative to 2025.”
A guidance figure for revenue, usually one year ahead, not a 10-year free-cash-flow rate.
Read between the lines
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Key theme
Most 2026 store openings are international, pushing overall square footage growth into the low double digits.
Source quote
“Our new store openings in 2026 will include approximately 15 stores in North America including 8 in Mexico and 25 to 30 in our international... This will contribute to overall square footage growth in the low double digits. While we are taking a disciplined approach to capital spending, we continue to see good returns from new...”
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Guidance
Expected $380 million tariff cost will be partly offset by $160 million in efficiency initiatives within gross margin.
Source quote
“Looking to 2026, we anticipate gross tariff impact of approximately $380 million with offsets from our enterprise efficiency initiatives of approximately $160 million within gross margin.”
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Figure
I'll just add that in North America, with Lululemon Athletica's new spring merchandise that is already hitting its stores and website...
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Fading
Gross margin fell to 55.6% from 58.5%, driven entirely by a 290 basis point drop in overall product margin.
Source quote
“Gross profit for the third quarter was $1.43 billion or 55.6% of net revenue compared to 58.5% in Q3 2024. The gross profit rate in Q3 decreased 290 basis points and was driven primarily by the following: a 290 basis point decrease in overall product margin driven predominantly by the tariff impact and higher markdowns.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q4 2026. Ring: Q3 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“And by category, men's revenue increased 3% versus last year, women's increased 7%, and accessories and others grew 4%.”
“These investments include market expansion, improving the guest experience by enhancing our omni capabilities and growing brand awareness.”
“We are already seeing better full-price sell-through in Q1 relative to Q4, and we are targeting further improvement as we move through the year, driven by increased product newness, innovation...”
Topics
Most discussed now
- New Lululemon Athletica has a healthy and loyal customer base that remains engaged and looking to it for great product and experiences.
- Lululemon Athletica recognizes there is more work to be done, and it has been course-correcting on a number of fronts, but...
- New guest acquisition, retention, engagement and key brand relevance metrics all remained solid in 2025.
- Within Lululemon Athletica's regions and channels, excluding the 53rd week and in constant currency, results were as follows: North America…
- Square footage increased 11% versus last year driven by the addition of 44 net new lululemon stores since Q4 of...
Faded since Q3 2026
- Fading Looking forward, Lululemon Athletica now expects revenue in China Mainland to be at or better than the high end of its...
- Fading Not only did this help drive traffic to Lululemon Athletica's e-commerce sites, but also fueled a significant number of app downloads...
- Fading For the full year, Lululemon Athletica now expects gross margin to decrease approximately 270 basis points versus 2024.
- Fading Q3 spend relates primarily to investments to support business growth, including Lululemon Athletica's multiyear distribution center…
Latest announcements
Official filings, newest first.
- Director or officer change; Regulation FD disclosure · SEC 8-K
- Director or officer change; Articles or bylaws amended · SEC 8-K
- Results of operations · SEC 8-K
- Other events · SEC 8-K
- Director or officer change; Shareholder vote results · SEC 8-K
- Results of operations · SEC 8-K
- Material agreement; Regulation FD disclosure · SEC 8-K
- Director or officer change; Regulation FD disclosure · SEC 8-K