Lululemon stock plunges 20% as outlook cut deepens — SkimNews
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- Lululemon shares plunged 20% in premarket trading Friday after Q2 revenue fell 4% to $2.42 billion and comparable sales dropped 9%
- Meghan Frank, Lululemon's interim CEO, attributed the weak quarter to "negative commentary" on social media and a "greater-than-expected" slowdown in core categories including leggings
- Lululemon cut full-year revenue guidance to $10.35-10.5 billion (a 5-7% decline), down from prior guidance of $11-11.15 billion, and slashed EPS outlook to $9.48-9.73 from $10.95-11.15
- The company beat adjusted EPS expectations ($2.06 vs. $1.79 expected) but missed on revenue ($2.42B vs. $2.46B expected), with gross margin growing 5.6% boosted by a $134.5 million tariff refund
- Q3 guidance projects revenue of $2.29-2.32 billion, a roughly 10-11% year-over-year decline, with EPS of 93-98 cents
- Heidi O'Neill takes over as CEO next week as Lululemon battles ongoing public criticism from founder Chip Wilson
Why it matters: Lululemon shareholders absorbed a roughly 20% premarket hit while the retailer cut full-year guidance for the second straight quarter and projected Q3 revenue down 10-11%. Incoming CEO Heidi O'Neill inherits a brand under simultaneous pressure in both core markets, with interim CEO Frank openly acknowledging "inconsistent" product reception — framing this as an execution and brand-relevance problem, not just tariffs or macro.
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