Lululemon reported Q1 revenue of $2.47 billion (+4%), EPS of $1.69 versus $2.60 a year ago, and Americas comparable sales down 5% as gross margin fell 410 bps. It cut fiscal 2026 EPS guidance to $10.95–$11.15 from $12.10–$12.30 and revenue guidance to $11.00–$11.15 billion.
Lululemon reported Q1 net revenue of $2.47 billion, up 4%, while diluted EPS dropped to $1.69 from $2.60 year-over-year. Gross margin contracted 410 basis points to 54.2%, driven by 280 bps from higher tariffs and 40 bps from discounts, as operating income fell 37% and net income declined 38%.
The company cut full-year EPS guidance to $10.95–$11.15 (from $12.10–$12.30) and lowered revenue outlook to $11.00–$11.15 billion (from $11.35–$11.50 billion). Q2 EPS is projected at $1.76–$1.81 with revenue of $2.45–$2.48 billion, while gross margin is expected to fall another 410 bps due to higher tariffs and store investments.
Americas comparable sales declined 5% for a fifth straight quarter, while China Mainland revenue rose 30% and is expected to grow mid- to high teens. Management repurchased 2.2 million shares for $358.3 million during Q1, and permanent CEO Kevin O’Neill will begin in September, delaying a full turnaround strategy until then.
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