Lululemon Pauses 'Get Low' Leggings Sales Over Squat-Proof Complaints, Relaunches with Disclaimers
Lululemon halted online sales of its new 'Get Low' legging collection after customers reported the product was not squat proof. The company resumed sales with disclaimers advising buyers to size up and wear skin-toned underwear.
1. Shares Retreat 10% in Early 2026 Despite Strong Guidance
Lululemon stock has fallen more than 10% year to date, trading below levels seen at the start of the fiscal year even after management reiterated full-year guidance. During the January investor call, CFO Meghan Frank confirmed fourth-quarter revenue is expected at the high end of the $2.05 billion to $2.10 billion range, driven in part by disciplined inventory management and targeted promotional activity. Despite that reassurance, investors remain wary as the shares underperform the broader retail index by roughly 800 basis points through January 26, 2026.
2. Divergent Regional Trends: Americas Weakness Versus International Strength
Lululemon’s North America business recorded a 6% decline in same-store revenue in the first quarter, reflecting muted consumer demand and heightened promotional intensity. In contrast, international markets delivered double-digit growth, with the Asia Pacific segment up 18% and EMEA up 12% year over year. Management attributed the overseas outperformance to recent store openings in Japan and South Korea and accelerated e-commerce penetration in Europe, where digital sales now represent 30% of total international revenue.
3. Margin Pressure and Inventory Build Raise Timing Questions
Gross margin contracted by 120 basis points in the quarter due to higher freight costs and increased promotional markdowns in North America. Inventories rose 15% sequentially as management prepared for the spring launch of new apparel lines but faced slower sell-through on legacy styles. Operating margins are forecast to compress further in fiscal 2026 unless Lululemon can curtail freight expenses and rebalance its inventory mix toward full-price product.
4. Product Quality Setback Tests Brand Loyalty
Shortly after debuting its ‘Get Low’ legging collection, Lululemon paused online sales for two days in late January following widespread complaints that the new styles were not ‘squat proof.’ The company reinstated the items on its website with updated product descriptions advising customers to size up and wear skin-tone undergarments. While management characterized the issue as an isolated quality control matter, social media backlash has placed additional scrutiny on Lululemon’s premium pricing strategy.