Lululemon shares drop 13% after new CEO announced - BERITAJA

Lululemon Athletica Inc.’s stock value fell much than 13 per cent a time aft the retailer named a caller CEO.

The Vancouver-based company’s shares ended Thursday trading connected the Nasdaq astatine about US$141.

The time before, Lululemon announced erstwhile Nike executive Heidi O’Neill will subordinate the institution arsenic its adjacent CEO and caller committee personnel connected Sept. 8.

Laurent Vasilescu, elder expert pinch BNP Paribas Equity Research, said Thursday’s value driblet is simply a motion that the marketplace is disappointed Lululemon chose O’Neill arsenic its adjacent CEO.

Given that Lululemon’s announcement credited her pinch helping to turn Nike from a $9-billion business into a $45-billion diversion brand, and quoted her arsenic saying Lululemon is “in the early stages of its potential,” Vasilescu thinks she was chosen to beryllium a maturation CEO.

“At this juncture, Lululemon needs a turnaround CEO and not a maturation CEO,” he wrote successful a statement to investors.

While the institution remains 1 of the world’s about salient athleisure brands, it’s mislaid immoderate of its lustre successful caller years. Competitors for illustration Alo and Vuori person stolen distant customers, shoppers person signalled Lululemon’s merchandise lines person a deficiency of newness and markdowns person go much communal astatine the brand.

It’s besides faced accrued disapproval from shareholders, including estranged laminitis Chip Wilson and activistic investor Elliott Management. Since Lululemon CEO Calvin McDonald announced he was stepping down successful December, the shareholders person been lobbying for their ain CEO and committee personnel picks, claiming Lululemon needs to amended reside its little stock value and galore competitors.

Wilson and Elliott Management person yet to remark connected O’Neill’s appointment.

Vasilescu said O’Neill joined Nike successful 1998 and ran the company’s direct-to-consumer business, “which now is being de-emphasized aft it did not unlock margins.”

She stepped down arsenic Nike’s president of consumer, merchandise and marque successful May 2025 but has remained pinch the institution successful an advisory domiciled since September 2025.

While Vasilescu was captious of her appointment, moreover going truthful acold arsenic to title his statement to investors “Uh-Oh’Neill,” others saw her arsenic a logical choice.

Neil Saunders, managing head astatine consulting and analytics patient GlobalData, pointed retired she has acquisition successful activewear and has sat connected the boards of galore customer service-focused companies for illustration Spotify Technology and Hyatt Hotels.

“This will beryllium adjuvant as Lululemon thinks beyond products to the wider belief the marque and its touchpoints person connected customers,” he wrote successful a Wednesday statement to investors.

“The situation will beryllium to inject much power and restore Lululemon as 1 of the leaders successful position of merchandise innovation. This could beryllium accomplished nether O’Neill.”