Lululemon's North American sales remain flat, and the company provides lackluster forecast for the current quarter.

• Despite beating Wall Street's earnings and revenue estimates, Lululemon issued weak second-quarter guidance due to a slowdown in its largest market, the Americas.
• In the last quarter, the company experienced a decline in sales due to not having the correct sizes and colors available in U.S. stores.
• Lululemon's CEO, Calvin McDonald, highlighted the company's international expansion and indicated that there is still room for improvement in the Americas region.

The retailer's growth in the Americas, its largest market, seems to be slowing down after reporting flat comparable sales in the region and weak guidance for the current quarter.

Lululemon narrowly topped revenue expectations in the first quarter, but easily beat Wall Street's earnings estimates. The athletic apparel retailer's full fiscal year guidance suggests it is optimistic about conditions improving in the second half of the year.

In its first fiscal quarter, Lululemon exceeded Wall Street's expectations, as indicated by a survey of analysts by LSEG.

• Earnings per share: $2.54 vs. $2.38 expected
• Revenue: $2.21 billion vs. $2.19 billion expected

Although Lululemon's growth was lackluster, its stock price increased by 10% in extended trading on Wednesday. Additionally, the company announced a $1 billion expansion of its stock buyback program.

In the three-month period ending April 28, the company's net income was $321 million, or $2.54 per share, which is higher than the $290 million, or $2.28 per share, reported in the same period a year ago.

Sales increased by approximately 10% to $2.21 billion from $2 billion the previous year.

In a news release, CEO Calvin McDonald highlighted the "robust progress" the company is experiencing in its international markets and suggested that it must intensify its efforts in the Americas to achieve growth in the region once more.

"McDonald stated, "We are pleased with our progress in optimizing our U.S. product assortment. Looking ahead, we have a significant runway for growth and are confident in our team's ability to deliver powerful results.""

In the last quarter, McDonald reported that consumer behavior in the Americas was shifting, while Lululemon struggled due to not having the correct sizes and colors in stock, which negatively impacted sales.

Although Lululemon is still expanding in the Americas, its growth rate has slowed down significantly compared to the previous year. In the first quarter of this year, sales in the region increased by only 3%, in contrast to the 17% increase seen in the same period last year. Moreover, comparable sales remained stagnant compared to the previous year.

Lululemon's comparable sales grew 6%, below the 7% increase that analysts had predicted, according to StreetAccount.

Lululemon issued weak guidance for the current quarter as growth in the Americas slows. It expects revenue to be between $2.40 billion and $2.42 billion, just below estimates of $2.45 billion, according to LSEG. It guided earnings per share to be between $2.92 and $2.97, compared to estimates of $3.02, according to LSEG.

Lululemon expects earnings per share to be between $14.27 and $14.47 for the full year, ahead of the $14.11 that analysts had expected. The company anticipates revenue to be between $10.7 billion and $10.8 billion, which is in line with expectations, according to LSEG.

Despite being widely regarded as a top retailer and market leader, Lululemon has recently experienced a decline in its stock value. Its shares have dropped by 40% year to date as of Wednesday's close, causing investors to question its future growth prospects.

Lululemon's longtime chief product officer, Sun Choe, announced his resignation, causing shares to fall. The company could soon face challenges as denim is currently popular among consumers, and investors worry that shoppers may switch from athleisure to jeans, negatively impacting Lululemon's sales.