economy
Lululemon reports weak guidance as proxy battle, tariffs weigh on bottom line
Lululemon topped fourth-quarter estimates but gave weaker-than-expected sales and earnings forecasts for 2026.
TL;DR
- Lululemon provided lower-than-expected sales and earnings guidance for fiscal 2026.
- The company exceeded analyst expectations for its fiscal fourth quarter.
- Factors impacting the company include higher tariffs, increased expenses, and a proxy battle with founder Chip Wilson.
- Tariffs are projected to cost the company $380 million on a gross basis in 2026.
- Sales in the Americas are expected to decline between 1% and 3% in 2026, while China sales are projected to grow around 20%.
- Lululemon added Chip Bergh to its board of directors and David Mussafer will not stand for re-election.
- The company is working to return to a full-price business model after relying on promotions.