UPDATE: Lululemon Posts Upbeat Q2 Earnings, Shares Jump

Shares of Lululemon Athletica LULU surged around 6.8% in pre-market trading after the company reported better-than-expected second-quarter earnings. The Vancouver, Canada-based company posted a quarterly net profit of $48.7 million, or $0.33 per share, versus a year-ago profit of $56.5 million, or $0.39 per share. Its revenue rose 13% to $390.7 million from $344.5 million. However, analysts were expecting earnings of $0.29 per share on revenue of $376.95 million. Total comparable sales remained flat in the quarter on a constant dollar basis. Comparable store sales fell 5% on a constant dollar basis, while direct to consumer revenue surged 30% on a constant dollar basis. Gross profit rose 6% to $197.3 million, while income from operations slipped 14% to $67.9 million in the quarter. Lululemon ended the quarter with $725.1 million in cash and cash equivalents, versus $610.3 million at the end of the year-ago quarter. Inventory at the end of the quarter was $176.5 million, versus $163.0 million at the end of the year-earlier quarter. Lululemon ended the second quarter with 270 stores. Laurent Potdevin, lululemon's CEO said, "We are pleased to be on track with the implementation of our strategic road map, and are starting to see the results of our work across product, brand and international expansion.” For the fiscal third quarter, Lululemon projects earnings of $0.36 to $0.38 per share on revenue of $420.0 million to $425.0 million. Analysts expected earnings of $0.38 per share on revenue of $421.85 million. The company also expects FY14 adjusted earnings of $1.72 to $1.77 per share on revenue of $1.78 billion to $1.80 billion. Lululemon shares jumped 6.8% to $41.00 in pre-market trading.