However, the company slashed its full-year revenue and EPS outlook after the second quarter performance.
Lululemon now expects full-year revenue to be between $10.85 billion to $11 billion, down from the previous $11.15 billion to $11.3 billion projection. EPS projections saw a sharper cut to $12.77 – $12.97 from $14.58 to $14.78 earlier.
The full-year guidance now factors in a gross profit hit of $240 million due to the tariffs imposed by the Donald Trump administration, majorly due to the removal of the de minimis exemption, or in simpler words, imposition of tariffs on parcels less than $800 in value.”Actual results could differ materially from these estimates if tariff rates, sourcing savings, consumer demand, or the timing of regulatory changes vary from our current assumptions, or if our mitigation initiatives are less effective than currently expected,” Lululemon said in its statement.
In order to combat the tariff impact, Lululemon has also raised some prices under CEO Calvin McDonald, who is trying to mitigate the tariff costs, while simultaneously maintaining bottomline. Amidst this, younger rivals like Alo Yoga and Vuori are also grabbing market share at the company’s expense.
To further cut down on costs and streamline the cost structure, Lululemon also laid off 150 corporate employees in June at various support centers.
“We’re seeing fatigue with the consumer, particularly our high-value consumer who’s been with us longer,” McDonald said in a call with analysts.
Shares of Lululemon Athletica fell 15.6% afterhours. At the close of regular trading on Thursday, the stock was down 45% in 2025, nearly erasing all the gains made during the hypergrowth pandemic period.
