Lululemon cuts 2026 outlook again as stock tumbles before new CEO arrives

Lululemon reported a weak fiscal second quarter, with revenue down 4% year over year to $2.42 billion and comparable sales falling 9% globally and 12% in the Americas, though international revenue rose 4%. Adjusted earnings beat estimates, but results were substantially aided by $134.5 million in tariff refunds and related interest, which contributed 560 basis points to gross-margin expansion. The company cut its full-year revenue forecast to $10.35 billion-$10.5 billion and earnings guidance to $9.48-$9.73 per share, expects third-quarter revenue to decline 10%-11%, and reduced store and pop-up expansion plans. Shares fell roughly 17%-20% after the report to their lowest level in years as analysts warned that North American demand, brand momentum and future earnings could weaken further. Incoming CEO Heidi O’Neill, a former 27-year Nike executive, will take over next week and plans to pursue new product styles, increased marketing and tighter execution amid competition from Alo Yoga and Vuori.