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lululemon athletica’s (LULU) struggles continue, lowers FY26 guidance below street view. (00:13) Peloton (PTON) bets on Pilates growth with acquisition of Skōp. (01:31) Data center developer Switch eyed at $50B+ valuation in massive private funding talks: report. (02:07)
This is an abridged transcript.
Lululemon’s (LULU) first-quarter results revealed continued pressure on the company’s profit and margins.
The company delivered a top- and bottom-line beat, with revenue improving by 4% and comparable store sales up 1% versus estimates for a contraction of 0.23%.
However, LULU issued disappointing guidance for the second quarter and lowered their full-year outlook, reflecting what is now a “more realistic view on what they can actually deliver.”
While sales were higher during the quarter, BTIG analyst Janine Stricter noted that much of these sales were generated by “lower quality traffic” on the company’s website, specifically shoppers looking for bargains on lululemon’s (LULU) “We Made Too Much” page.
For the second quarter, lululemon (LULU) expects revenue to be within the range of $2.45B to $2.475B, representing a decline of 2% to 3% and a $2.46B midpoint that is less than $2.59B estimates. EPS is expected to be between $1.76 and $1.81 versus $2.69 estimates.
LULU is on our biggest movers list this morning. Shares are down more than 11%.
Peloton Interactive (PTON) has acquired Skōp, a startup focused on Pilates.
The acquisition comes as demand for Pilates continues to grow. Peloton said engagement with its existing Pilates content rose 48% year over year in the third quarter, while industry data identified Pilates as the fastest-growing fitness category in the U.S.
The addition of Skōp could help Peloton enhance its Pilates offering with new features, including technology designed to track users’ form and movement during a workout.
Data center developer Switch is said to be in talks to raise billions of dollars at a valuation of at least $50B.
The Information reported on Thursday, citing people with knowledge of the deal that Brookfield Asset Management (BAM), KKR (KKR), and other private equity and institutional investors have been in talks to invest in the fundraising round.
The round could possibly set up Switch for an initial public offering, which could come as early as next year, according to the report.
Switch was founded in 2000 by CEO Rob Roy, and is headquartered in Las Vegas, Nevada. The company counts Nvidia (NVDA) Fedex (FDX), Tesla (TSLA) and Logitech (LOGN) among its clients, per its website.
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Catalyst watch:
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The live-action Masters of the Universe movie from Amazon MGM Studios and Mattel Studios is set to hit U.S. theaters. Mattel (MAT) has a significant merchandising program tied to the film.
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The Summer Game Fest conference will take place. The video game conference could generate buzz that is relevant to Sony’s (SONY) PlayStation, Nintendo (NTDOY), Microsoft’s (MSFT) Xbox, and major third-party publishers like Capcom, Square Enix, Bandai Namco, CD Projekt, and Epic Games.
Stock index futures are in mixed territory.
Crude oil is down 0.3% at $92. Bitcoin is down 1.7% at $62,000. Gold is down 0.2% at $4,464.
The FTSE 100 is up 0.3% and the DAX is down 0.2%.
The biggest movers for the day premarket: Argan (AGX) +13% – Shares jumped after the engineering and construction company delivered a strong FQ1 beat, driven by robust execution on power infrastructure projects.
Economic calendar:
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