The bougie athleisure brand that convinced an entire generation $128 for stretchy pants is totally reasonable just proved all the haters wrong. Lululemon announced this morning that they expect Q4 sales to hit somewhere between $3.56B and $3.58B for a 11-12% rise.

And before you @ me about the price tag… have you seen their profit margins? Warren Buffett is somewhere in Omaha right now wondering why he's been wasting time with Coca-Cola when he could've been investing in premium butt-sculpting fabric.

The real mindblower here is that they’ve blown past earlier guidance, which maxed out at $3.51B, while holding their ground on pricing. In a world where most retailers are throwing desperate discounts at consumers, Lululemon is charging full price… and customers can’t stop buying. CFO Meghan Frank even threw a little shade, saying customers "responded well to our product offering." In simpler terms, their customers just keep coming back, no matter the price tag.

The man behind Lululemon’s steady rise, CEO Calvin McDonald (no, not Ronald), has big plans: $12.5B in annual revenue by 2026. How’s he going to get there? By convincing men that $88 workout shorts are worth every penny, expanding internationally (because everyone, everywhere deserves overpriced athleisure, apparently), and doubling down on online sales.

Here’s the magic formula… are you ready for it? Loyal customers + premium pricing + killer branding. It’s a combination that has propelled Lululemon to operating margins of 55–58%, easily rivaling Nike’s 43–45%. That’s no small feat for a company still growing its global footprint. Their marketing is so effective that buying a pair of Align leggings feels less like making a purchase and more like gaining membership to an exclusive club. And once you’re in? There’s no turning back.

Although the stock is down 15% over the last year, the future is starting to look bright for Lululemon. With a strong push into international markets, a growing men’s line, and a focus on inclusivity and comfort, the company is positioning itself as the leader in premium activewear. Add in their seamless e-commerce experience, and they’re miles ahead of competitors still struggling to figure out how to run a website properly. Investors are clearly buying into the long-term vision, as evidenced by multiple analysts raising their price targets for the stock. Morgan Stanley set a price target of $424, UBS upped the ante to $450, and JPMorgan went full send with a $460 prediction.

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Stocks.News has positions in Lululemon, Nike, Coca Cola, and Costco mentioned in the article.