Lululemon announced on June 4, 2026, that it cut its full-year profit forecast and issued weak guidance for the second quarter, citing persistent sales weakness in the U.S. and other headwinds [1, 2]. The company expects fiscal 2026 sales between $11 billion and $11.15 billion, down from prior guidance of $11.35 billion to $11.50 billion [2]. It projected Q2 earnings per share between $1.76 and $1.81, well below Wall Street estimates of $2.68 [1, 2].
The retailer’s fiscal first-quarter net income fell to $195 million, or $1.69 per share, from $314.6 million, or $2.60 per share, a year earlier despite a 4% rise in overall sales to $2.47 billion [2]. U.S. revenue declined 4% in constant dollars, while sales in China rose 23% [1]. Lululemon faces growing competition from Alo Yoga and Vuori, inflation pressures, tariff costs, and a leadership transition [1].
Interim CEO Meghan Frank said lowered product excitement and slower-than-expected revenue trends were key challenges. She noted the yoga campaign “hasn't had the expected halo effect on other areas of our assortment” and said "Slower-than-expected revenue trends will necessitate additional seasonal clearance" [1]. Frank added, "We have been navigating headwinds that have led us to adjust our outlook for the full year. We have assessed the business and are taking additional actions to reposition where needed and further strengthen our product engine. We remain confident in our path forward" [2].
Lululemon has shortened its product development timeline from 18-24 months to 15-16 months to accelerate new launches [1]. The company’s stock has fallen about 40% so far in 2026 as of early June. Shares dropped between 7% and 11% in extended trading on June 4, according to different reports [1, 2].
Lululemon hired Heidi O'Neill, a longtime Nike veteran, as its next CEO. She is expected to assume the role in September 2026 [1, 2].
