Lululemon shares fell on Thursday morning after the company warned it expects sales growth in its yoga-wear stores to slow sharply.

As of 9:30 a.m. Lululemon shares were down 2.9 per cent on the NASDAQ, to $68.59. This despite an overall solid earnings report showing revenue rising by 37 per cent, while profit rose to $57.3 million, from $38.8 million in the same period a year earlier.

The Canadian Press reports:

VANCOUVER -- Lululemon Athletica Inc. (TSX:LLL) said Thursday it earned $57.3 million in its latest quarter as it grew revenue by 37 per cent.

However, the yoga-inspired clothing retailer said it expected its same-store sales growth to slow in the fourth quarter, which began Oct. 29.

In its outlook, the Vancouver-based company projects comparable-store sales growth in the high single digits in the fourth quarter.

That's down from 18 per cent comparable-store sales growth in the third quarter, which ended Oct. 28.

Lululemon said it earned 39 cents per diluted share in the third quarter, up from $38.8 million or 27 cents per diluted share a year ago.

Revenue amounted to $316.5 million for the quarter ended Oct. 28, up from $230.2 million.

"I am very proud of the team for achieving yet another strong quarter coming in ahead of our expectations,'' Lululemon chief executive Christine Day said in a statement.

"Our stellar results were driven by first-rate execution, strong community engagement, beautiful product and continued strength in our e-commerce business.''

For the fourth quarter, which includes the key holiday shopping season, Lululemon said it expects revenue to be in the range of $475 million to $480 million and diluted earnings per share in the range of 71 cents to 73 cents for the quarter.

In its outlook for its full financial year Lululemon said it expects revenue to be in the range of $1.360 billion to $1.365 billion and diluted earnings per share in the range of $1.81 to $1.83.

The outlook compared with earlier expectations for revenue in the range of $1.345 billion to $1.360 billion and diluted earnings per share in the range of $1.76 to $1.81 for the full year.

During the third quarter, Lululemon opened 12 stores to bring its total to 201 locations.

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