Lululemon Lowers Fiscal Year 2026 Outlook Amid Weaker Second-Quarter Performance
Lululemon reported weaker-than-expected second-quarter results, with revenue falling to $2.4 billion—a 4% decline from the prior year—due in part to a significant drop in sales within the Americas and China mainland. The company attributed this downturn partly to negative media commentary that affected customer traffic and muted responses to new product launches. Despite an improved gross margin of 60.5%, driven by $134.5 million in tariff refunds, Lululemon’s net income dropped from $370.9 million a year ago to $329.22 million for the quarter. In response to these challenges and ongoing market headwinds, Lululemon has revised its full-year 2026 financial outlook downward. The company now expects total revenue between $10.35 billion and $10.5 billion—down from a previous forecast of $11 billion to $11.15 billion—and diluted earnings per share (EPS) in the range of $9.48–$9.73, compared to earlier guidance of $10.95–$11.15. The company remains committed to shareholder returns and store expansion despite these setbacks. Lululemon’s interim co-CEO and CFO emphasized confidence in long-term brand strength but acknowledged the need for a prudent approach as it navigates current challenges.
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Topics: Lululemon Outlook Revision Q2 Earnings Sales Decline