Fueled by a 30% increase in traffic, a 79% jump in sequential Greater China quarterly sales, and a 430-basis-point improvement in product margin as air freight costs abated, Lululemon reported strong Q1 results that exceeded its sales and profit expectations. With the strong showing, LULU shares surged more than 13.0% in after-market trading. Net income came in nearly 53% higher year-over-year at $290,405,000 versus $189,998,000. Gross margin improved 360 basis points to 57.5% despite a 30-basis-point increase in product and supply costs and a 50-basis-point impact from currency headwinds.

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