Pedestrians wearing protective masks walk past a Lululemon store in San Francisco, California, Monday, March 29, 2021.
David Paul Morris | Bloomberg | Getty Images
Lululemon shares tumbled in pre-market trading on Monday after the retailer said fiscal fourth quarter earnings and revenues were likely to bottom out due to staff shortages and cut store opening hours as Covid cases flare up in the US again.
The stock fell about 7% after closing on Friday by 3.7% to $ 355.21.
Lululemon said in Press release he expects fourth-quarter revenues to be at the low end of the $ 2.125 billion to $ 2.165 billion range. He predicts adjusted earnings per share also closer to the lower end of its $ 3.25 to $ 3.32 range.
Refinitiv estimated that analysts were expecting adjusted earnings of $ 3.34 per share on sales of $ 2.17 billion.
“We started the holiday season in a strong position but have since faced a number of implications of the omicron option, including increased throughput, more limited staff availability and reduced opening hours in some locations,” said Lululemon CEO Calvin McDonald.
Many retailers are seeing an exacerbation of labor problems as staff become ill or exposed to Covid-19 with the highly contagious omicron variant.
Department store operator Macy’s has slashed store opening hours across the country until the end of this month. While major retailer Walmart temporarily closed nearly 60 outlets in coronavirus hotspots in December.
Read the full press release from Lululemon here…