Global performance apparel company Lululemon Athletica Inc reported modest global growth for the fourth quarter and fiscal 2025, as strength in international markets — particularly China — helped offset slower momentum in North America.

Fourth quarter net revenue rose 1 percent to $3.6 billion, the company said, with a 17 percent increase in international sales cushioning softer demand in its core market. For the full year, revenue climbed 5 percent to $11.1 billion, while international revenue advanced 22 percent, underscoring the growing weight of overseas operations in the company's expansion strategy.

China stood out as a key driver.

Revenue in the Chinese market rose 24 percent in the fourth quarter and 29 percent for the full year, making it one of the fastest-growing regions for Lululemon. Its contribution to global revenue rose from 13 percent to 16 percent.

The performance highlights a broader shift in the company's growth mix, as it leans increasingly on international markets to sustain momentum amid a more promotional and competitive environment in North America.

Executives attributed the strong performance in the Chinese market to a combination of product strength and localized brand engagement. Outerwear was a standout category in the fourth quarter, led by the company's Wunder Puff collection, which resonated with consumers during the winter season.

Moreover, the company also stepped up efforts to align product storytelling with local cultural moments. During the Chinese New Year holiday, Lululemon launched a spring-themed campaign alongside a limited-edition collection. The move is part of a crucial push to deepen connections with local consumers.

The approach reflects a wider trend among global athletic brands, which are increasingly tailoring product development and marketing strategies to regional preferences as competition intensifies, according to industry experts.

Cheng Weixiong, a fashion analyst and founder of Shanghai Liangqi Brand Management Co Ltd, said:"The adaptability of Lululemon is key to standing out in the Chinese market.

"Lululemon's strategy of expanding from professional athletic wear to casual lifestyle scenarios precisely meets local consumers' demand for 'sport + daily' attire." This approach retains the quality core of professional sports while satisfying the fashion aspirations of everyday wear, Cheng added.

The brand is actively advancing its localization strategy. From leveraging hair ties to collaborating on traditional canvas shoes, Lululemon uses marketing and product innovation rooted in local culture to strengthen community resonance.

"The success of Lululemon's business in China not only validates the massive potential of the domestic premium activewear market, but also confirms the continued penetration of the yoga lifestyle throughout the country," Cheng added.

According to Euromonitor International, the retail value of the sports-inspired apparel market in China had grown from 75.34 billion yuan ($10.92 billion) in 2023 to 77.57 billion yuan in 2025. The number is forecast to rise to 79.83 billion yuan in 2028.

Lululemon's management said that insights from high-growth regions are being incorporated into the company's global playbook, with the aim of replicating successful products and marketing strategies across markets.

For fiscal 2026, the company expects revenue in the Chinese market to grow about 20 percent, maintaining a pace well above the global average. Early indicators suggest continued strength, with first quarter revenue in the market projected to rise between 25 percent and 30 percent year-on-year.

The outlook reinforces China's dual role as both a growth engine and a testing ground for innovation, where new products and campaigns can be refined before being scaled up globally.

Retail expansion remains a central pillar of the company's strategy. Lululemon plans to open 40 to 45 new company-operated stores globally in fiscal 2026, while optimizing around 35 existing locations, resulting in low double-digit growth in total retail space.

Of the planned openings, about 15 stores will be located in the Americas — roughly half in Mexico — while 25 to 30 stores will be added in international markets. The majority of those are expected to be in the Chinese market. The company ended fiscal 2025 with more than 170 stores in the Chinese market.

At the same time, competition in China's premium athleisure market is heating up. California-based athletic lifestyle brand Vuori has been accelerating its expansion in the country, recently opening a store at Hangzhou MixC — its fifth location in China.

After initially entering the market in Shanghai with three stores, Vuori expanded into Beijing shortly after the National Day holiday in October, followed by its move into Hangzhou within three months. The pace of expansion signals an aggressive push to establish a foothold in the market.

Meanwhile, athleisure retailer Alo Yoga is also making inroads. The brand has begun preparations for its debut in Hong Kong.