Lululemon shares fell by as much as 21% in pre-market trading on Thursday after the company reported earnings and said it had a “slow start” to the year.
Lululemon’s CEO Laurent Potdevin told analysts on the earnings call Wednesday that the slowness was mostly online. Poor visual merchandising in stores also hurt sales at the athleisure-wear company, he said, according to Bloomberg.
In the earnings release, Lululemon said it expects sales at stores open for at least one year to decline in the first quarter in the “low-single digits” on a constant dollar basis.
The company continues to face strong competition as other brands like Under Armour and Amazon jump on the trend of designing workout clothes that are also suitable for everyday wear.
In the fourth-quarter, adjusted earnings per share (EPS) were $1, one cent short of the consensus forecast according to Bloomberg. Net revenue increased 14% year-on-year to $2.3 billion.
Same-store sales rose by 6%, topping analysts’ forecast for 5.3% growth.
“Although we’ve had a slow start to 2017, our teams are passionately committed to delivering on our robust plans across product innovation, digital, North America and international as we realize our ambitious vision for the future,” said Potdevin in the earnings statement.
Lululemon shares had gained 9% in the year through Wednesday’s market close.