Lululemon Athletica Inc. ( LULU ) shares are trading higher on Monday after the company raised its fourth-quarter 2024 guidance.

The athletic apparel retailer now forecasts fourth-quarter revenue of $3.56 billion – $3.58 billion versus the estimate of $3.517 billion. This reflects an 11% to 12% increase over the same period in fiscal 2023. The new guidance surpasses the company’s previous guidance of $3.475 billion – $3.510 billion.

The company’s revised outlook includes an anticipated earnings per share of $5.81 – $5.85 for the fourth quarter, an upward revision from earlier expectations of $5.56 – $5.64, and above the $5.66 consensus.

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Meghan Frank, lululemon’s Chief Financial Officer, said, “During the holiday season, our guests responded well to our product offering, enabling us to increase our fourth quarter guidance.”

Furthermore, the company has updated its forecast for gross margin, now expecting an increase of approximately 30 basis points, a shift from prior guidance, which anticipated a decline of 20 to 30 basis points year-over-year. Additionally, lululemon expects deleverage of selling, general, and administrative expenses, which will now amount to 80 to 90 basis points versus the earlier guidance of 90 to 100 basis points.

In the third-quarter, the retailer reported sales and earnings of $2.40 billion and  $2.87, both above the consensus estimates.

Price Action: LULU shares are trading higher by 1.45% at $401.22 at the last check Monday.

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