Lululemon reported second quarter fiscal 2026 revenue of $2.42 billion, a 4% decline that missed analyst expectations, while diluted EPS of $2.92 was bolstered by a one-time tariff refund. The company lowered its full-year 2026 revenue outlook to a decline of 5% to 7%, reflecting persistent execution challenges in the North American market.
Key Highlights
- Americas comparable sales fell 12%, underperforming the low-double-digit decline analysts had anticipated.
- Gross margin reached 60.5%, an increase of 200 basis points, though this included a 560 basis point benefit from $134.5 million in one-time tariff refunds.
- Inventory levels improved slightly, ending the quarter at $1.7 billion, a 1% decrease in value and a 7% decrease in units compared to the prior year.
- Management lowered full-year 2026 revenue guidance to a range of $10.35 billion to $10.50 billion, down significantly from prior expectations.