MW Lululemon admits far more work is needed for a turnaround, and its stock sinks

By Bill Peters

The yoga-wear maker must further reposition its business, interim co-CEO says

Some analysts have criticized Lululemon for straying from its core technical workout-wear business.

Problems continue to add up for Lululemon, as the yoga-wear maker on Thursday trimmed its full-year forecast to account for a potential dip in sales this year, sinking its shares in after-hours trading.

Meghan Frank, Lululemon's interim co-CEO and chief financial officer, said in a statement that the company had been "navigating headwinds" recently that have made it more cautious on its full-year expectations.

"We have assessed the business and are taking additional actions to reposition where needed and further strengthen our product engine," she said, without elaborating.

Lululemon shares (LULU) sank 9.5% after hours Thursday, continuing the stock's slide as the company navigates uncertainty around its leadership, the composition of its board and competition. The stock is down nearly 40% so far this year.

Lululemon said it now expects full-year sales of $11 billion to $11.15 billion, representing a range of flat to down 1%. In March, the company said it expected revenue of $11.35 billion to $11.5 billion, which would have amounted to modest sales growth.

The company also cut its per-share profit outlook to $10.95 to $11.15, whereas it previously expected $12.10 to $12.30.

For the first quarter, Lululemon said same-store sales rose 1%, beating Wall Street analysts' estimates for a decline of 0.2%. The company earned $1.69 a share, topping expectations by a penny. Revenue rose 4% to $2.47 billion, above forecasts for $2.43 billion.

Lululemon reported the results after it resolved a board dispute with founder Chip Wilson and announced the appointment of a new CEO, Nike $(NKE)$ veteran Heidi O'Neill, who takes over the job in September.

The company last month agreed to appoint two of Wilson's preferred candidates to the board after its annual shareholder meeting. Lululemon also agreed to bring aboard another director with expertise in apparel by Oct. 1.

Wilson, who owns around 8.7% of Lululemon's outstanding shares, had been trying to shake up the board in the face of steep competition against brands like Vuori and lower-priced dupes.

Analysts have had questions about the appointment of O'Neill, given Nike's ongoing struggles. Some analysts also believe Lululemon has strayed from the technical workout wear that made it popular, instead offering things like rugby shirts. In January, the company also faced backlash over see-through issues in its Get Low line of workout gear.

-Bill Peters

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June 04, 2026 17:05 ET (21:05 GMT)

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