UPDATE: Lululemon Athletica inc. Posts Upbeat Q2 Earnings, Shares Jump

Shares of Lululemon Athletica inc. (NASDAQ: LULU) surged around 6.8 percent in premarket 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 percent 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 percent on a constant dollar basis, while direct to consumer revenue surged 30 percent on a constant dollar basis.

Gross profit rose 6 percent to $197.3 million, while income from operations slipped 14 percent 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-ago 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 percent to $41.00 in premarket trading.