Lululemon Shares Plunge 22% After Full-Year Earnings Guidance Cut Amid Tariff Concerns

Lululemon Athletica's shares plunged about 22-23% in after-hours trading after the company lowered its full-year earnings guidance despite beating first-quarter expectations on profit and revenue. The company reported a modest 1% same-store sales growth, falling short of analyst expectations, and cited a 'dynamic macroenvironment' marked by cautious consumer spending, economic uncertainty, and inflationary pressures in the U.S. The tariff regime under President Donald Trump was a significant headwind, leading to higher costs and prompting Lululemon to initiate modest price increases and vendor negotiations to protect margins. Lululemon also faces competition from athleisure brands like Vuori, which has impacted demand for its new product lines. While first-quarter EPS was $2.60 and revenue was $2.37 billion, the company now expects full-year EPS between $14.58 and $14.78, down from prior forecasts, with the current quarter's profit guidance also notably below analyst estimates. This earnings downgrade reflects broader challenges in the retail sector amid geopolitical trade tensions and subdued consumer confidence.