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Lululemon raises revenue, profit forecast

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Yogawear chain Lululemon Athletica raised its revenue and profit forecast for the fourth quarter, citing strong holiday season sales.

Lululemon shares were up 7 percent in premarket trading. (Get the latest quote here.)

The retailer, which appointed a new chief financial officer last week, estimated total comparable sales to rise 6-7 percent on a constant dollar basis for the quarter ending Feb. 1.

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"Our guests are responding positively to both the women's and men's product assortment," Chief Executive Laurent Potdevin said in a statement on Monday.

Lululemon, which faces strong competition in a market it once dominated, has worked to improve quality and solve supply-chain problems.

The Vancouver-based company, which operated 289 stores until the end of the third quarter, has expanded into the United States as well as outside North America to revive sales.

Lululemon estimated revenue of $595 million to $600 million for the fourth quarter, up from the $570 million to $585 million it forecast earlier. It raised its profit forecast to 71 cents to 73 cents per share from 65 cents to 69 cents.

Analysts on an average were expecting a profit of 69 cents per share on revenue of $584.7 million, according to Thomson Reuters I/B/E/S.

Lululemon's stock, which had risen more than 45 percent in the past three months, closed at $58.63 on Friday.