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Lululemon Stock Tumbles on Disappointing Outlook
3 Sep
Summary
- Revenue missed estimates, declining 4% year-over-year.
- Full-year revenue outlook slashed to a 5%-7% decline.
- Leadership uncertainty adds to investor anxiety.
Lululemon's stock plummeted 17.3% in after-hours trading on September 3, 2026, after the athletic apparel company reported deeply disappointing Q2 FY2026 financial results. Revenue for the quarter was approximately $2.4 billion, missing analyst estimates of $2.46 billion and marking a 4% year-over-year decline. Comparable sales also dropped by 9%.
The company significantly revised its full-year FY2026 financial outlook, now projecting revenue to decline by 5%-7%, a stark contrast to the previous guidance of flat to down 1%. Earnings per share guidance was also dramatically reduced from $10.95-$11.15 to $9.48-$9.73.
Guidance for the third quarter also fell short of Wall Street expectations, exacerbating investor concerns. This downturn occurs just before Heidi O'Neill officially assumes the role of CEO on September 8, 2026, raising questions about the duration of a potential turnaround.
This significant stock decline pushes LULU toward its 52-week low, deepening a year-to-date drop that already exceeded 40%. Persistent weakness in North American sales and increased promotional activity in the athletic apparel sector are cited as contributing factors.
