Lululemon Athletica Inc. (LULU) has faced significant downward revisions in its earnings outlook, leading to a Zacks Rank of #5 (Strong Sell). The company’s stock has plummeted 50% over the last year, and it reported a 3% decrease in comparable sales in the Americas for fiscal 2025, followed by a 5% decline in Q1 of FY26.
In FY25, Lululemon’s revenue grew by just 5%, marking the lowest year-over-year sales growth since going public. The company is projected to see revenue growth of only 0.5% in FY26, coupled with a 14% decline in adjusted earnings year-over-year for the same fiscal year.
The negative momentum reflects intensified competition in the athleisure market, with emerging rivals impacting Lululemon’s sales. Investors are advised to monitor the company’s performance closely before making any commitments.
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