lululemon athletica inc. (NASDAQ:LULU)

The financial data exhibits several notable trends in key performance metrics over the six-year period analyzed.

Net Operating Profit After Taxes (NOPAT)

The NOPAT figures show a fluctuating but overall upward trajectory. Starting at approximately $712 million in early 2020, NOPAT declined slightly in 2021 to around $680 million. However, a significant increase occurred in 2022, reaching just over $1 billion, followed by a slight decrease in 2023. The period from 2023 to 2025 saw a robust recovery and growth, with NOPAT rising sharply to about $1.63 billion in 2024 and further to nearly $1.93 billion in 2025. This indicates strengthening operational profitability over the medium term despite short-term volatility.

Cost of Capital

The cost of capital remained relatively stable throughout the period, fluctuating narrowly between 16.01% and 16.23%. The slight downward trend toward the end of the timeline suggests marginally improved cost efficiency in capital utilization or a reduction in perceived risk. However, these changes are minimal and suggest consistent capital cost assumptions over time.

Invested Capital

There is a clear upward trend in invested capital, growing from approximately $3.01 billion in early 2020 to about $6.51 billion by 2025. This doubling of invested capital signifies a considerable expansion in the asset base or capital employed in the business, potentially supporting the growth in operating profit observed in the same timeframe.

Economic Profit

Economic profit demonstrates more volatility but overall growth, reflecting the company's value creation beyond the cost of capital. Initially, economic profit was strong at around $227 million in 2020 but declined sharply in 2021 to about $84 million. A recovery took place in 2022 with a significant rebound to over $406 million, followed by another dip in 2023. The years 2024 and 2025 see substantial increases, with economic profit reaching approximately $655 million and then $887 million respectively. This pattern indicates intermittently fluctuating efficiency in generating returns above the cost of capital but culminates in a marked improvement by the end of the period.

In summary, while some short-term fluctuations are evident, the overall financial data suggests that the company has expanded its invested capital base and improved both its net operating profit and economic profit substantially over the six-year span, maintaining a stable cost of capital throughout.

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.

Economic Profit Trends

The economic profit demonstrates significant fluctuations over the observed periods. An initial value of 227,034 thousand US dollars in early 2020 declines sharply to 83,958 thousand by early 2021. Subsequently, a substantial recovery takes place in 2022, reaching 406,530 thousand, before falling again in 2023 to 203,339 thousand. From 2024 onward, the economic profit shows a strong upward trajectory, climbing to 654,870 thousand and further to 886,534 thousand in the latest period.

Invested Capital Development

The invested capital shows a consistent upward trend throughout the timeframe. Starting from 3,008,240 thousand US dollars in early 2020, the invested capital grows steadily each year, reaching 6,507,336 thousand by early 2025. This reflects an overall increase of more than double the initial value, indicating a strong expansion in the company's capital base over the period.

Economic Spread Ratio Analysis

The economic spread ratio exhibits variability but with an overall positive trend. From 7.55% in early 2020, the ratio decreases to 2.29% in early 2021, then rises sharply to 10.4% in early 2022. It dips again to 4.49% in 2023, before increasing significantly to 10.95% and ultimately 13.62% in the most recent period. This pattern suggests fluctuating efficiency in generating returns above the cost of capital, with recent periods showing improved performance.

Summary of Financial Position

The data indicates that while invested capital has consistently grown, economic profit and economic spread ratio experienced volatility. Yet, starting from 2024, there is a marked improvement in both economic profit and spread ratio, implying enhanced profitability and capital efficiency. This suggests a positive shift in financial performance after periods of fluctuation.

The financial data over the six-year period reveals notable fluctuations and an overall upward trajectory in key performance indicators.

Economic Profit

The economic profit demonstrated volatility in the earlier years, dropping significantly from 227,034 thousand US dollars in 2020 to 83,958 thousand in 2021. This was followed by a strong recovery and growth, reaching 406,530 thousand in 2022, although it declined again to 203,339 thousand in 2023. From 2023 onward, a substantial increase occurred, culminating in 654,870 thousand in 2024 and 886,534 thousand in 2025. The trend indicates a capacity for substantial value creation with some interim fluctuations.

Adjusted Net Revenue

Adjusted net revenue consistently increased across all periods, showcasing a strong growth trend. Starting at approximately 4 billion US dollars in 2020, revenue rose steadily each year, reaching over 10.5 billion US dollars by 2025. The growth has been robust, with the most notable jumps occurring between 2021 and 2022, and continuing at a steady pace through 2025.

Economic Profit Margin

The economic profit margin reflected similar volatility to economic profit, with an initial decline from 5.68% in 2020 to 1.89% in 2021. This metric then improved sharply to 6.44% in 2022, followed by a decrease to 2.49% in 2023. From 2023 through 2025, the margin increased markedly, achieving 6.77% and 8.37%, respectively. The upward trend in the latter years suggests enhanced operational efficiency or profitability relative to revenues.

In summary, while economic profit and its margin exhibited cyclical fluctuations in the early years, both indicators have shown strong improvement since 2023. Combined with a steady and consistent increase in adjusted net revenue, these trends point to an improving financial performance and strengthened profitability moving into the most recent periods.