Lululemon Slashes Full-Year Outlook a Second Time as Q2 Revenue Falls 4%, Stock Hits 8-Year Low

Lululemon Athletica cut its full-year revenue forecast for the second time in 2026, sending shares down as much as 20% on Friday to an eight-year low, after second-quarter results revealed deepening weakness across every major geography. Q2 revenue came in at $2.4 billion, a 4% decline year-over-year and below the $2.46 billion analyst estimate, with comparable sales falling 9%. The company revised its full-year revenue outlook to a range of $10.35 billion to $10.50 billion, marking what analysts noted would be the first full-year revenue decline since the company went public.

The Americas business deteriorated sharply, with revenue down 8% and comparable sales dropping 12%, while international growth, long viewed as a key offset, also stalled. China revenue fell 2%, adding strain to a region that had been expected to cushion North American softness. A Q2 earnings-per-share beat masked the underlying deterioration: analysts at Seeking Alpha noted the outperformance was driven by $134.5 million in tariff refunds rather than operational improvement, with margin and profitability otherwise declining. Jefferies described the quarter as a "triple whammy," and a Jefferies analyst said the former CEO had "basically ruined the company."

The selloff sent LULU to a 52-week intraday low of $98.02 and left the stock trading around $100, levels not seen in roughly eight years. Multiple Wall Street firms cut their price targets: UBS lowered its target to $106, Wells Fargo reduced its figure citing worsening demand, and Stifel, Bernstein, Morgan Stanley, and Freedom Broker, which set a target of $115, all trimmed their estimates. Guggenheim reiterated its existing rating without a cut. Needham also lowered estimates following the weak quarter.

The results land just before incoming CEO Heidi O'Neill formally takes the helm, and analysts described the guidance cut as a direct signal of the challenges she inherits. Investor Michael Burry publicly declared Lululemon his largest stock position and said he plans to aggressively buy shares below $100, calling the setup a "fat pitch." On the same day, Lululemon founder Chip Wilson and his wife Shannon Wilson, one of the company's earliest employees and his business partner for more than 20 years, announced they are divorcing.