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Lululemon slashes full-year outlook as sales decline in Americas and China
Lululemon Athletica Inc. has significantly lowered its full-year financial guidance for the third time this fiscal year, following a disappointing second quarter. The company now expects annual revenue to decline between 5% and 7%, down from previous forecasts of flat growth.
Second-quarter revenue fell 4% to $2.4 billion, with comparable sales dropping 9% globally. The decline was particularly pronounced in the Americas, where revenue fell 8% and comparable sales tumbled 12%. In China, revenue saw a slight decline in constant dollars. A notable 20% drop in sales of the brand's core leggings was cited as a factor in the weakness.
While reported earnings per share of $2.92 beat analyst expectations, the figure was heavily bolstered by a $134.5 million one-time benefit from tariff refunds. Without this windfall, underlying profitability would have appeared much weaker.
The company is currently in a leadership transition, with former Nike executive Heidi O’Neill set to take over as CEO on September 8. O’Neill inherits a business facing intensifying competition from brands like Alo Yoga and Vuori, as well as challenges in product relevance and consumer demand for traditional form-fitting styles.
Entities
Chip Wilson · Heidi O’Neill · Lululemon Athletica Inc. · Meghan Frank · Nike
Claims
What the coverage asserts, and how many sources carry each claim.
- [● 3 SOURCES] Global comparable sales declined by 9% during the second quarter. offthepress.com · www.ibtimes.com.au · newsable.asianetnews.com
- [● 4 SOURCES] Heidi O’Neill is scheduled to begin her role as CEO on September 8. sgbonline.com · offthepress.com · theasset.nl · www.businesstimes.com.sg
- [● 3 SOURCES] The company's reported earnings included a $134.5 million boost from tariff refunds. wwd.com · www.ibtimes.com.au · www.retaildive.com
- [● 6 SOURCES] Second-quarter net revenue fell 4% to approximately $2.4 billion. wwd.com · www.fool.com · offthepress.com · biznis.rs · www.ibtimes.com.au · +1 more
- [● 5 SOURCES] Revenue in the Americas region declined by 8%. wwd.com · offthepress.com · newsable.asianetnews.com · www.dunya.com · www.retaildive.com
- [● 5 SOURCES] Lululemon expects full-year 2026 revenue to decrease between 5% and 7%. offthepress.com · sgbonline.com · www.dunya.com · www.ibtimes.com.au · www.lesaffaires.com
- [● 3 SOURCES] Sales of the company's core leggings category declined by approximately 20%. www.businesstimes.com.sg · www.dunya.com · www.retaildive.com
- [○ 1 SOURCE] The company reduced its planned net new store openings for the year from 40 to 35. www.retaildive.com