What happened

Shares of lululemon athletica inc. (NASDAQ:LULU) were up 16.3% as of 11:30 a.m. EDT Friday after the yoga apparel retailer announced strong fiscal first-quarter 2018 results.

More specifically, Lululemon's revenue climbed 25% year over year (or 23% at constant currencies) to $649.7 million, with adjusted net income of $75.2 million, or $0.55 per share, up from $0.32 per share in the same year-ago period. Both the top and bottom lines arrived well above Lululemon's latest guidance, provided in March, which called for revenue between $612 million and $617 million, and adjusted earnings per share between $0.44 and $0.46.

Woman performing a yoga pose in black and white lululemon apparel

Image source: lululemon athletica.

So what

Lululemon's revenue was helped by 20% total comparable-sales growth, including 8% growth from comparable-store sales and a 62% increase in direct-to-consumer revenue.

"Our first quarter results reflect the ongoing strength of our business and our continued focus on product innovation, global growth, digital acceleration, and, most importantly, investing in our people," said Lululemon Chief Operating Officer Stuart Haselden. "Our momentum remains strong and we are optimistic for 2018 and beyond."

Now what

To that end, Lululemon expects fiscal second-quarter revenue to be in the range of $660 million to $665 million, assuming total comparable-sales growth in the high-single-digit percent range at constant currencies. That should translate to earnings per share of $0.46 to $0.48. Here again, both ranges were comfortably ahead of consensus estimates for fiscal Q2 earnings of $0.45 per share on revenue of $646.3 million.

Finally, Lululemon increased its full fiscal-year 2018 guidance for revenue in the range of $3.04 billion to $3.075 billion (up from $2.985 billion to $3.022 billion previously), and for full-year earnings per share of $3.10 to $3.18 (up from $3 to $3.08 before). 

In the end, this was a straightforward beat and raise from Lululemon, and it's no surprise to see the stock soaring in response.