LULU stock's dip reflects soft North America demand, heavier markdowns and tariff-driven margin pressure, even as brand strength and global growth remain intact.
Shares of Lululemon Athletica Inc (NASDAQ:LULU) fell nearly 12% on Thursday after the athletic apparel maker named former Nike executive Heidi O'Neill as its new CEO, as the company looks to revive its US business amid weakening sales and rising investor pressure. O'Neill previously served as Nike's president of consumer, product & brand.
“Lululemon needs a turnaround CEO and not a growth CEO,” retail analyst Laurent Vasilescu.
Yoga-wear maker Lululemon on Wednesday said its board had approved Nike veteran Heidi O'Neill as its new CEO. But analysts said it was too early to tell if that was the right call, and said questions about Nike's current struggles could spill over into her new job.
Lululemon's stock price has tumbled 38% in the last 12 months.
Lululemon announced on Wednesday that it has chosen former Nike executive Heidi O'Neill as its new CEO, effective in September.
Lululemon Athletica picked a former top Nike executive as its next chief executive as the athletic apparel retailer known for its stretchy yoga pants faces pressure from its founder and a large activist investor to revive its struggling business, the company said on Wednesday.
Athletic apparel maker Lululemon named Heidi O'Neill as CEO on Wednesday, tasking the former Nike executive with arresting sagging sales, refreshing its designs and navigating ongoing tensions between its founder and the board.
Heidi O'Neill is expected to begin in the role in September.
LULU bets on men's wear and footwear to fuel growth beyond yoga roots, using innovation and new styles to capture untapped demand.
I maintain my “buy” rating on lululemon, as the risk-reward remains attractive, despite recent underperformance of its stock relative to the S&P 500. Americas business shows early signs of stabilization, while international segments, especially China, continue robust growth and expand their share of revenue contribution. Margins should fully bottom in the coming quarter or two, with management focused on full-price sales, inventory discipline, and leveraging automation and AI for operating efficiency.
Lululemon (LULU) closed at $167.28 in the latest trading session, marking a +2.68% move from the prior day.