Lululemon Athletica seems to be putting the recall of its see-through yoga pants earlier this year behind it. The company reported net revenue of $344.5 million for the second quarter ended Aug. 4, a 22% increase from $282.6 million in the prior-year quarter. Comparable stores sales for the quarter increased by 8%.
But according to reports, the yogawear company's shares fell approximately 8% to $63.50 in premarket trading. CEO Christine Day, who resigned following the company's first quarter results this year, alluded to the sheer yoga pants setback.
"[This year] continues to be the most important and most productive year in Lululemon's history. We have not only worked our way back from the black luon setback, but have also added very talented people in important functions and have taken major steps forward on a number of key fronts including the expansion of our international and men's businesses and many logistical initiatives," said Day. "In addition, our exclusive partnership with Noble announced today and additional sources for luon will help to ensure that Lululemon remains a distinct leader in quality and innovation. We are well on our way to finishing 2013 as a much stronger company than when the year began. I am confident that the leadership currently in place coupled with a new CEO will have tremendous success leveraging the platform for growth."
Despite shares dipping, direct to consumer revenue increased 39% to $49.4 million, or 14.3% of total company revenues, an increase from 12.5% of total company revenues in the second quarter of fiscal 2012.
As part of its effort to avoid another sheer yoga pants situation, the company has expanded its partnership with Noble Biomaterials. The partnership gives Lululemon exclusive rights to use Noble's X-Static antimicrobial technology in its performance apparel. Noble has been a longstanding partner of Lululemon, providing its X-Static technology for its Silverescent fabric since 2005. Made with 99.9% pure metallic silver, X-Static is designed to provide permanent odor protection by naturally inhibiting the growth of bacteria on the surface of fabrics, according to Noble Biomaterials, which adds that the silver fiber is woven directly into the garment and will not wash out over time after numerous washings.
The company ended the quarter with 226 stores in North America and Australia.