lululemon athletica inc. (NASDAQ:LULU)

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes experienced fluctuations over the observed periods. Initially, there was a decline from 711,860 thousand US dollars to 680,052 thousand in the second year. This was followed by a significant increase to 1,040,291 thousand US dollars in the subsequent year. A drop occurred again to 933,695 thousand before a strong upward trend emerged, reaching 1,622,788 thousand and then 1,928,398 thousand in the last two years, indicating overall robust growth in operating profitability towards the end of the period.

Cost of Capital

The cost of capital remained relatively stable throughout the periods, with minor fluctuations. It started at 16.4%, showed a slight increase to 16.51% and 16.5% in the following years, then decreased marginally to 16.29% by the final period. The small variations suggest a consistent and steady rate, with no significant changes in the firm's capital cost environment.

Invested Capital

Invested capital demonstrated a continuous upward trajectory across all periods. Starting at 3,008,240 thousand US dollars, it increased consistently each year to reach 6,507,336 thousand by the final period. This steady growth in invested capital implies ongoing investment in business assets and operations, nearly doubling over the analyzed timeframe.

Economic Profit

Economic profit displayed considerable volatility. It kicked off at 218,609 thousand US dollars, then fell sharply to 73,581 thousand in the next period. Subsequently, it recovered significantly to 395,492 thousand before dropping again to 190,635 thousand. From that point, economic profit surged markedly to 638,043 thousand and further increased to 868,483 thousand in the final period. This indicates periods of both constrained and strong value creation, with the latter years showing enhanced efficiency in generating returns above the cost of capital.

Net Income

The net income exhibited a fluctuating yet generally upward trend over the analyzed periods. Starting at 645,596 thousand US dollars in February 2020, it declined to 588,913 thousand US dollars by January 2021. Subsequently, there was a significant increase to 975,322 thousand US dollars in January 2022, followed by a decrease to 854,800 thousand US dollars in January 2023. However, the net income surged notably in the most recent periods, reaching 1,550,190 thousand US dollars in January 2024 and further increasing to 1,814,616 thousand US dollars by February 2025. This overall trend suggests growing profitability with some volatility.

Net Operating Profit After Taxes (NOPAT)

NOPAT followed a pattern similar to net income, indicating consistent operational performance trends. Beginning at 711,860 thousand US dollars in February 2020, it experienced a reduction to 680,052 thousand US dollars in January 2021. This was followed by a sharp increase to 1,040,291 thousand US dollars in January 2022 and a slight decline to 933,695 thousand US dollars in January 2023. The figure then escalated substantially in the subsequent years to 1,622,788 thousand US dollars in January 2024 and 1,928,398 thousand US dollars by February 2025. The increase in NOPAT over time reflects enhanced operating efficiency and profitability after accounting for taxes.

Summary Insights

Both net income and NOPAT demonstrate an overall upward trajectory despite short-term decreases around the early 2021 and 2023 periods. The strong rebound and substantial increases in the latest years highlight improved profitability and operational effectiveness. The parallel trends of net income and NOPAT suggest that the company's core operations are driving earnings growth, with effective cost management and tax impacts potentially influencing fluctuations. The data points to a positive financial health outlook with expanding profit-generating capabilities over the period analyzed.

Income Tax Expense

The income tax expense demonstrates a general increasing trend over the analyzed years. Starting at approximately $252 million in early 2020, it slightly decreased to around $230 million in early 2021. Following this period, a notable upward trajectory is observed, with values rising to approximately $359 million in early 2022, then increasing more pronouncedly to about $478 million in early 2023. This upward trend continues with values reaching approximately $626 million in early 2024 and further escalating to around $761 million by early 2025.

Cash Operating Taxes

Cash operating taxes show a somewhat similar pattern, albeit with more variation. Initially, the amount decreased from roughly $233 million in early 2020 to nearly $202 million in early 2021. Subsequently, there is a significant increase to about $371 million in early 2022 and a further rise to nearly $475 million in early 2023. From early 2023 to early 2024, there is a substantial increase to approximately $664 million, followed by a slight decrease to around $717 million in early 2025.

Comparative Insights

Both income tax expense and cash operating taxes exhibit upward trends over the observed period, with the most significant growth occurring after early 2021. The cash operating taxes display higher volatility with a notable spike followed by a minor decline in the last year, whereas income tax expense consistently increases year over year after an initial dip. The rise in these tax-related expenses may reflect growth in taxable income or changes in tax regulation impacting the financial charges of the company.

Total Reported Debt & Leases

The total reported debt and leases exhibit a consistent upward trend over the examined periods. Starting from approximately 740 million US dollars in early 2020, the debt level increased steadily each year, reaching over 1.57 billion US dollars by early 2025. The most significant incremental growth appears between the years 2023 and 2024, where the debt increased by more than 330 million US dollars, indicating a possible expansion phase or increased financial leverage.

Stockholders' Equity

Stockholders' equity also shows a steady and substantial growth throughout the periods. Beginning at roughly 1.95 billion US dollars in early 2020, equity rose consistently each year, culminating in approximately 4.32 billion US dollars by early 2025. The most pronounced growth in equity occurs between 2023 and 2024, with an increase of nearly 1.1 billion US dollars, suggesting enhanced retained earnings or additional equity financing.

Invested Capital

Invested capital reflects a continuous growth trajectory over the analyzed time frame. From about 3.01 billion US dollars in early 2020, invested capital climbs steadily, reaching approximately 6.51 billion US dollars by early 2025. The largest annual increase is observed between 2023 and 2024, mirroring the substantial growth seen in both debt and equity in the same period. This pattern indicates increased overall capital investment, potentially for business expansion or asset acquisition.

Overall Summary

The financial data collectively suggest that the company is in a phase of expansion, supported by increasing leverage and equity. Both liabilities and shareholders' funds have grown significantly, with invested capital nearly doubling over the five-year span. The pronounced increases between 2023 and 2024 across all key financial measures highlight a potentially strategic deployment of resources. This expansion could be reflective of investments aimed at enhancing the company's market position or operational capacity.

The financial data presents a range of key indicators over a six-year period, revealing several notable trends. The economic profit, invested capital, and economic spread ratio provide insights into the company's financial performance and capital efficiency.

Economic Profit

Economic profit shows significant fluctuations across the periods, starting at 218,609 thousand US dollars in early 2020 and falling to a low of 73,581 thousand in early 2021. It then rises sharply to 395,492 thousand in early 2022 before declining again to 190,635 thousand in early 2023. Thereafter, a pronounced upward trend is evident, with economic profit increasing to 638,043 thousand in early 2024 and reaching 868,483 thousand in early 2025. This pattern suggests variability, with strong recovery and growth in the latter years.

Invested Capital

Invested capital consistently increases throughout the entire period, beginning at 3,008,240 thousand US dollars in early 2020 and reaching 6,507,336 thousand by early 2025. The increase reflects a steady expansion in the resources employed by the company, with particularly notable growth observed from early 2023 onwards, indicating ongoing investment and capital deployment to support operations and growth initiatives.

Economic Spread Ratio

The economic spread ratio exhibits notable volatility but generally trends upward. Starting at 7.27% in early 2020, it falls sharply to 2.00% in early 2021, then recovers to 10.12% in early 2022. This is followed by a decline to 4.21% in early 2023, before again rising significantly to 10.67% in early 2024 and ultimately reaching its highest point of 13.35% in early 2025. The upward trajectory in the latter years suggests improving returns relative to capital costs, highlighting enhanced operational efficiency and profitability.

Overall, the data indicates a company experiencing periods of volatility in economic profit and returns early in the timeline, coupled with sustained growth in invested capital. Recent years show improved profitability and efficiency, as evidenced by rising economic profit and economic spread ratio, alongside continued capital investment. These trends could reflect successful strategic initiatives and greater value creation over time.

The financial data indicates distinct trends in economic profit, adjusted net revenue, and economic profit margin over the observed periods.

Economic Profit

The economic profit exhibits significant fluctuations throughout the years. After a strong figure at the outset, there is a notable decline in the second period. This is followed by a recovery and an increase that peaks in the third period. Subsequently, the value decreases again before experiencing substantial growth in the last two periods, culminating in the highest recorded economic profit in the final period analyzed.

Adjusted Net Revenue

The adjusted net revenue shows a consistent upward trend across all periods. The values increase steadily each year, indicating continuous revenue growth over time. This steady rise suggests successful expansion or enhanced sales performance throughout the years.

Economic Profit Margin

The economic profit margin follows a pattern similar to economic profit but expressed in relative terms. It starts at a moderate level, drops considerably in the second period, then climbs sharply, reaching a peak by the third period. After a subsequent decrease, the margin increases significantly in the last two periods, ultimately achieving the highest margin percentage in the final year, which aligns with the peak values in economic profit.

Overall, the data portrays a company experiencing variability in economic profitability despite a robust and steadily increasing revenue base. The recent trends suggest improved efficiency or profitability management, given the simultaneous growth in both economic profit and its margin alongside rising adjusted net revenue.