Lululemon flags weak outlook

Lululemon reported fourth-quarter revenue of $3.64 billion and diluted EPS of $5.01, with net income of about $587 million for the period ended Feb. 1, 2026. (cnbc.com) For fiscal 2026 the company guided full-year revenue to a range of $11.35 billion to $11.50 billion and set Q1 sales guidance at $2.40 billion to $2.43 billion, both below consensus estimates. (cnbc.com) Management said tariffs and the end of the U.S. de minimis exemption have materially hit margins, estimating a $240 million gross-profit drag in 2025 and anticipating roughly a $320 million net impact to 2026 operating margin. (supplychaindive.com) Product margin pressure drove a 550-basis-point drop in gross margin in Q4, with tariffs accounting for roughly 520 bps and higher markdowns about 130 bps of the decline. (fool.com) Inventory jumped to about $1.7 billion at quarter-end (an 18% increase), and the company said it will pull back on discounting to shift more sales to full price. (fool.com) (cnbc.com) The board is actively searching for a permanent CEO and on March 17 added former Levi’s CEO Chip Bergh as an independent director as founder Chip Wilson presses a proxy campaign that has nominated three board candidates. (corporate.lululemon.com) (sgieurope.com) Rivals are expanding while Lululemon recalibrates: direct-to-consumer challenger Vuori has accelerated store and e-commerce growth into multiple European and Asian markets, and global heavyweight Adidas continues to push product and channel initiatives worldwide. (retaildive.com) (report.adidas-group.com) The company repurchased about $1.2 billion of stock during the fiscal year and bought 1.4 million shares in the quarter at an average price near $188 as it balances capital returns with the turnaround plan. (fool.com)