Lululemon shares fell 18% as the company cut its annual forecast once again

Lululemon Athletica's shares fell about 18% in extended trading after the sportswear maker missed analysts' expectations for second-quarter sales and once again cut its financial forecast for 2026.

The company's second-quarter revenue came in at $2.42 billion, while the market had expected around $2.46 billion. Comparable sales fell 9%, with the decline in the US market reaching 12%.

Sales of the company's flagship product—leggings—proved particularly weak, dropping by about 20%. Lululemon's troubles are compounded by softening consumer interest and intensifying competition from brands such as Alo Yoga and Vuori.

The company cut its 2026 revenue forecast to $10.35–$10.50 billion, a significant downgrade from the previous guidance of $11–$11.15 billion. The earnings-per-share forecast was also reduced, now standing at $9.48–$9.73, compared with the previous $10.95–$11.15.

The company's situation is further complicated by weakening consumer demand in the US, where the brand is losing market share. Lululemon's management cited less appealing new product offerings and recent marketing missteps as among the reasons behind the problems.

A tough start for the new CEO

Lululemon's new head, Heidi O'Neill, is set to take the helm on September 8. The former Nike executive arrives at the top of the company at a time when the brand is grappling with declining sales, lost market share, and waning consumer interest.

Investors will now be watching closely to see whether O'Neill can refresh the product lineup, strengthen marketing, and restore Lululemon's position in the US market. Analysts, however, warn that improving results could take several years.