Lululemon slashes forecasts amid U.S. slowdown, proxy fight fallout
Lululemon Athletica cut its fiscal 2026 revenue and profit forecasts, citing waning U.S. demand, failed product launches, and negative publicity from founder Chip Wilson’s proxy battle and a Texas PFAS investigation. Q1 net income dropped 38%, and shares fell up to 12%. The company now expects flat-to-declining revenue and lowered earnings guidance. Incoming CEO Heidi O’Neill, a Nike veteran, takes over in September to lead a turnaround amid stiff competition from Alo Yoga and Vuori.
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Lululemon Stock Plunges After Company Cuts Annual Guidance, Cites Market Contraction and Tariff Pressures
Lululemon Athletica (LULU) stock tumbled on June 5, 2026, after the company reported better-than-expected Q1 earnings but slashed its full-year fiscal 2026 guidance to $11.07 billion in revenue and $11.05 EPS. Management cited a contracting North American market, increased reliance on discounting eroding the premium brand image, negative media commentary, and failed product launches. Gross margins contracted 410 basis points to 54.2% due to tariff-related pressures. A proxy contest with founder Chip Wilson also weighed on Q1 sales. The stock is down about 45% year-to-date. Analyst Georgy Vashchenko upgraded the stock to 'Hold' but cut his price target from $320 to $139. Barchart rates LULU as '100% SELL,' and the stock trades below major moving averages with an RSI in the late 20s, indicating intense selling pressure.
Yahoo FinanceLululemon shares plunge 12% on weak forecasts, deepening turnaround concerns
Lululemon Athletica shares dropped 12% in premarket trading on June 5, 2026, after the company issued bleak quarterly and annual profit outlooks, intensifying concerns over its turnaround amid slowing U.S. demand, stiff competition from brands like Alo Yoga and Vuori, and rising tariff costs. The stock has lost nearly 63% of its value over the past year, with market value set to decline by over $1.7 billion. Analysts at Barclays and Jefferies highlighted deteriorating fundamentals, a lack of fresh styles, design missteps, and negative brand sentiment in key markets including the U.S. and China, partly due to concerns about material composition and product safety. Interim co-CEO Meghan Frank noted that a recent yoga campaign failed to boost sales. Investors are now focused on incoming CEO Heidi O'Neill, a former Nike executive, who will take over in September and is expected to lead a strategic reset. The company's forward price-to-earnings multiple stands at 10.06, well below competitors Nike (22.85) and Adidas (15.10).
Yahoo FinanceLululemon Q1 Earnings Hit by Bad Buzz and Disappointing Product Launches
Lululemon Athletica reported a 38% drop in Q1 net income to $195 million, missing revenue expectations despite a slight EPS beat. Comparable sales fell 2% in constant currency, and Americas sales declined 4%. The company blamed negative media and social media commentary—stemming from a proxy fight with founder Chip Wilson and a Texas AG investigation into PFAS 'forever chemicals' in its apparel—for hurting traffic and sales. Additionally, several product launches failed to generate expected customer response. As a result, Lululemon lowered its full-year outlook. Shares fell nearly 11% in after-hours trading. The incoming CEO, Nike veteran Heidi O'Neill, faces a challenging turnaround when she takes over in September.
Yahoo FinanceLululemon Stock Plunges on Lowered Guidance Amid Founder Proxy Battle Fallout
Lululemon shares fell 9% on Friday after the company slashed its full-year revenue and earnings guidance, citing headwinds from founder Chip Wilson's proxy fight and weak product reception. For Q2 2026, the company expects revenue of $2.45B-$2.48B, below the $2.6B consensus, and adjusted EPS of $1.76-$1.81 versus the $2.69 forecast. Full-year revenue guidance was cut to $11B-$11.15B from $11.35B-$11.5B, with adjusted EPS lowered to $10.95-$11.15 from $12.10-$12.30. Interim co-CEO Meghan Frank noted that negative media and social commentary from the proxy battle reduced store traffic, and recent product launches failed to generate expected consumer response. The company reached an agreement with Wilson last week, but trends have not yet recovered. Incoming CEO Heidi O'Neill, a former Nike veteran, will take over on September 8 amid rising competition and slowing sales. Morningstar analyst David Swartz described Lululemon as in a transition period but cited reasons for optimism.
Yahoo FinanceLululemon Stock Plunges on Lowered Guidance Amid Founder Drama and Weak Sales
Lululemon's stock fell 9% on June 5, 2026, after the company slashed its full-year revenue outlook and issued weaker-than-expected second-quarter guidance. The activewear retailer now expects Q2 net revenue of $2.45-$2.48 billion, below the $2.6 billion Wall Street forecast, and adjusted earnings of $1.76-$1.81 per share versus the expected $2.69. Full-year revenue guidance was cut to $11-$11.15 billion from $11.35-$11.5 billion. Interim co-CEO Meghan Frank attributed the weakness to product launches that failed to resonate and negative media and social commentary stemming from founder Chip Wilson's proxy fight with the company, which began in December 2025. Although an agreement was reached last week, traffic has not fully recovered. Incoming CEO Heidi O'Neill, a former Nike veteran, is set to start on September 8 and faces a challenging environment of increased competition and slowing sales. Morningstar analyst David Swartz noted the company is in a transition period but sees reasons for optimism.
Yahoo FinanceLululemon cuts annual forecasts amid slowing demand in US
Lululemon Athletica cut its annual revenue and profit forecast on Thursday, citing waning brand appeal in the U.S. amid tough competition. The Vancouver-based apparel maker, known for high-priced leggings and athleisure wear, now expects fiscal 2026 revenue to be flat to down 1%, compared with its prior forecast of a 2% to 4% increase. It also lowered its full-year earnings per share forecast to between $10.95 and $11.15, from $12.10 to $12.30. The news sent shares down about 7% in extended trading. The company is struggling to win back loyal North American shoppers and is looking to incoming CEO Heidi O'Neill, who takes over in September, to revive sales. This development follows the resolution of a months-long proxy fight with founder Chip Wilson in May.
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