Lululemon Athletica (NASDAQ: LULU) shares are trading at eight-year lows following the company's second-quarter financial results, which missed revenue expectations, and ahead of a leadership change. The stock is currently down 18.2% to $99.67 on Friday, marking a new 52-week low and a year-to-date decline of 52.7%.
For the second quarter, Lululemon reported revenue of $2.42 billion, a decrease of 4% year-over-year. This figure fell short of the Street consensus estimate of $2.46 billion. While earnings per share beat analyst estimates, the company’s Americas segment revenue dropped 8% year-over-year, while international revenue increased 4%.
Management attributed the quarterly weakness to negative commentary on social media, specifically noting traffic issues in North America and China. The company stated it is focused on new product offerings, expense management, and increasing marketing initiatives.
Looking ahead, Lululemon lowered its full-year revenue and earnings per share outlooks, with both estimates now below analyst expectations. The company also provided guidance for the third quarter for revenue and earnings per share that came in below analyst estimates.
Market expert Gary Black highlighted the timing of the CEO transition as a potential factor in the stock's decline. Black noted that the company announced the appointment of Heidi O’Neill on April 22, 2026, but she will not take the reins until September 8, 2026. Black argued that a four-month gap between the announcement and the transition creates a period of reduced decision-making power for the outgoing leadership, similar to a "lame duck" presidency.
O’Neill previously spent over 25 years at Nike Inc. (NYSE: NKE), most recently serving as President, Consumer, Product and Brand from June 2023 to September 2025. Until O’Neill's arrival, Lululemon is currently led by co-CEOs Meghan Frank and Andre Maestrini.
Black previously warned investors to avoid the stock due to concerns regarding merchandising, product strategy, and leadership. He suggested that these issues could result in another two quarters of mediocre results as the company struggles against competitors Vuori, Alo, and Slims.
