Shares of apparel company Lululemon Athletica (NASDAQ:LULU) are trading at eight-year lows Friday after the company’s quarterly financial results came in mixed on Thursday and guidance disappointed investors. A market expert shares more reasons why the stock could be down outside of the financials.
Gary Black on LULU Stock
Lululemon management blamed negative commentary on social media as part of the reason for poor traffic and sales in the second quarter.
The negativity included comments in North America and China, with traffic being the biggest driver of weakness for those regions in the quarter.
While social media negativity may have contributed to the quarterly results, Future Fund Managing Partner Gary Black cites other reasons.
“A company should not wait 4 months between announcing a new CEO and when that new CEO takes the reins from a departing CEO,” Black tweeted. “$LULU announced the appointment of Heidi O’Neill on April 22, 2026. She will take over as CEO on Sept. 8, 2026.”
O’Neill previously spent over 25 years with Nike Inc. (NYSE:NKE), including her most recent role as President, Consumer, Product and Brand, which she held from June 2023 to September 2025.
Lululemon is currently led by co-CEOs Meghan Frank and Andre Maestrini, who are the company’s CFO and CCO.
Before O’Neill takes over, it’s unlikely that major decisions will be made, with new CEOs coming into companies and liking to make their own changes. This leaves Lululemon in a situation similar to a “lame duck” presidency in the White House, which refers to a president leaving office in several months after losing an election or choosing not to run again.
Those last few months are often seen as a period of less power and influence.
This isn’t the only reason Black has for Lululemon’s stock performance.
“I had previously warned investors to stay clear of LULU given poor merchandising, product strategy, and leadership.”
In June, Black said those three items “should give investors pause” about Lululemon not being on the right path.
“That implies another two quarters of mediocre results as LULU struggles to build momentum as competitors Vuori, Alo, and Slims continue to take share.”
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Lululemon Q2 Results
Lululemon reported second-quarter revenue of $2.42 billion, which was down 4% year-over-year. The revenue missed a Street consensus estimate of $2.46 billion.
The company’s earnings per share beat analyst estimates in the quarter.
For revenue, the Americas segment revenue was down 8% year-over-year, while international revenue was up 4% year-over-year.
Management said the company was focused on new product offerings, expense management, and increasing marketing initiatives.
Guidance from Lululemon for the third quarter for revenue and earnings per share both came in below analyst estimates.
The company also lowered its full-year revenue and earnings per share outlooks for the full fiscal year, with both estimates now below analyst expectations.
Lululemon Stock Price Action
Lululemon stock is down 18.2% to $99.67 on Friday versus a 52-week trading range of $97.99 to $225.93. Shares hit new 52-week lows earlier in the intraday trading session. Shares are down 52.7% year-to-date and trade at eight-year lows.
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