December 19, 2025 — lululemon athletica inc. (NASDAQ: LULU) is back in the spotlight after a fast-moving mix of leadership news, activist-investor pressure, and fresh growth plans pushed the stock sharply higher this week—before a pullback on Friday as traders digested what the turnaround could really look like in 2026.
After closing at $215.11 on Thursday (Dec. 18), LULU traded lower on Friday (Dec. 19), with intraday pricing around the low-$210s in available data, reflecting profit-taking following the week’s rally. [1]
Below is what’s driving lululemon stock right now, what the company itself is forecasting, and how Wall Street is framing the upside—and the risks—heading into a pivotal CEO handoff.
Why lululemon stock is moving on Dec. 19, 2025
The immediate catalysts are clear:
- An activist investor (Elliott Investment Management) has built a stake reportedly worth more than $1 billion and is said to be pushing a high-profile executive as a CEO candidate. [2]
- lululemon’s CEO Calvin McDonald is stepping down on January 31, 2026, kicking off a formal CEO search and creating a new interim leadership structure. [3]
- The company just posted better-than-expected quarterly results but paired them with a cautious outlook that explicitly factors in tariffs and the removal of the “de minimis” exemption, a combination that’s expected to hit operating income. [4]
- lululemon simultaneously announced a record pace of international expansion for 2026, leaning into the part of the business that has been growing faster than North America. [5]
For investors, this is the classic setup for volatility: the “story” is improving (new leadership, activist involvement, global expansion), but the “numbers” still show pressure in the brand’s biggest market and a margin squeeze from policy-driven costs.
Elliott’s stake changes the tone of lululemon’s turnaround conversation
Multiple reports say Elliott Investment Management has amassed a position worth more than $1 billion in lululemon, and that the firm has been working with Jane Nielsen—described as a potential CEO pick with turnaround credentials (including prior leadership roles at Ralph Lauren and Coach). [6]
Why it matters for LULU stock:
- CEO selection becomes a market-moving event. A CEO appointment can reset investor expectations around product cadence, marketing intensity, pricing posture, and cost discipline—especially for a brand where “cool factor” and execution speed are central to demand.
- The board may face pressure to move faster and more decisively. Elliott’s typical playbook centers on operational and governance changes; even without a proxy fight, the presence of a major activist can force clearer timelines and more specific milestones.
- It adds a new layer to an already loud shareholder backdrop. Lululemon founder Chip Wilson has publicly criticized the company’s direction in recent years, and recent coverage has highlighted the possibility of distraction if governance tensions escalate. [7]
Reuters also underscored the valuation context that makes activist involvement more impactful: Lululemon shares have fallen steeply from their peak, and the stock is trading at a forward earnings multiple that some investors view as a “turnaround entry point” if execution improves. [8]
CEO transition: what lululemon has actually announced (and the timeline)
Lululemon’s board has laid out a formal succession process:
- Calvin McDonald plans to step down as CEO and board member effective January 31, 2026, and will remain a senior advisor through March 31, 2026. [9]
- The board is running a “comprehensive search” in partnership with an executive search firm. [10]
- Board Chair Marti Morfitt has been appointed Executive Chair, effective immediately. [11]
- CFO Meghan Frank and Chief Commercial Officer André Maestrini will serve as interim co-CEOs once McDonald transitions out of the role. [12]
For markets, “interim co-CEO” structures can be interpreted two ways: either as a stabilizing bridge (continuity) or as a sign that the board expects a strategic reset that requires outside leadership (change). The presence of Elliott in the background increases the odds investors treat this as a real “reset moment,” not just a routine succession.
Earnings and guidance: the numbers behind the stock’s new narrative
The leadership headlines are grabbing attention, but the latest quarterly report is still the foundation for any LULU stock forecast.
Third-quarter fiscal 2025: strong internationally, soft in the Americas
In its fiscal third quarter (ended November 2, 2025), lululemon reported:
- Net revenue up 7% to $2.6 billion
- Americas net revenue down 2%
- International net revenue up 33%
- Comparable sales up 1% overall, with Americas comps down 5% and International comps up 18%
- Gross margin down 290 basis points to 55.6%
- Diluted EPS of $2.59 (down from $2.87 a year earlier)
- Operating income down 11% to $435.9 million, with operating margin down to 17.0%
- 12 net new stores, ending the quarter with 796 stores [13]
That geographic split is the key: international momentum is real, but North America—still the core profit engine—is the part that has to stabilize for investors to confidently rerate the stock.
Balance sheet and buybacks: support for the share story
Lululemon also highlighted:
- $1.0 billion in cash and cash equivalents
- Inventory up 11% to $2.0 billion (up 4% on a unit basis)
- 1.0 million shares repurchased for $189 million in Q3
- A $1.0 billion increase to the repurchase authorization, leaving roughly $1.6 billion available as of Dec. 11 [14]
For LULU stock, buybacks matter because they can cushion EPS even when margins are under pressure—but only if the company isn’t forced into heavy discounting to clear product.
Outlook: lululemon explicitly prices in tariffs and “de minimis” removal
For fiscal 2025 guidance, lululemon now expects:
- Q4 revenue:$3.500B to $3.585B
- Q4 EPS:$4.66 to $4.76
- FY2025 revenue:$10.962B to $11.047B
- FY2025 EPS:$12.92 to $13.02
Most notably, lululemon said its 2025 guidance includes an estimated $210 million reduction in income from operations, net of mitigation efforts, reflecting assumptions about higher tariffs and the removal of the de minimis exemption. [15]
This is a major reason the stock remains controversial: even if product and brand momentum improve, the company is simultaneously battling a cost shock that can overwhelm incremental demand gains—especially if competitors respond aggressively on price.
International expansion: a fresh growth lever for 2026
On December 18, lululemon announced plans to enter six new markets in 2026, calling it a record number of new market entries in a single year, using a franchise partnership model:
- Greece, Austria, Poland, Hungary, Romania (with Arion Retail Group)
- India (through Tata CLiQ, previously announced)
The company said consumers in the European markets will be able to shop online via eu.lululemon.com, while India will be served through Tata CLiQ Luxury and Tata CLiQ Fashion marketplaces. [16]
This matters for the stock because it reinforces a simple investor takeaway from the latest quarter: international is the growth engine right now. But it also raises questions investors will keep asking in 2026:
- How profitable will the franchise model be versus company-owned expansion?
- Will international growth offset slower U.S. demand, or simply mask it?
- Can supply chain and product development keep pace across more markets without diluting brand identity?
Analyst forecasts and price targets: “Hold” ratings, but rising dispersion
The immediate wave of Lululemon stock analysis has focused on whether the recent rally is “real” or just a headline-driven bounce.
Where price targets stand
As of Dec. 19, widely cited analyst summaries show a wide target range, with a median around the low-$200s and highs reaching above $300. [17]
Recent notable updates reported in analyst-note coverage include:
- Jefferies raised its price target to $200 from $170 and kept a Hold rating (following reporting about Elliott’s stake). [18]
- Wells Fargo raised its target to $175 from $160 while maintaining Equal Weight, citing concerns about U.S. trajectory and margin visibility despite expecting a near-term pop. [19]
- UBS raised its target to $206 from $183 while maintaining a Neutral rating. [20]
In other words: targets are moving up as the stock rebounds, but “neutral” language remains common—because visibility on U.S. demand and margins is still cloudy.
Valuation: cheaper than the past, but not “free”
Reuters noted lululemon was trading around a forward price-to-earnings ratio near 16, and explicitly compared it to select apparel peers’ forward multiples. [21]
That comparison is important: Lululemon historically commanded a premium multiple. The market is no longer paying that premium until it sees proof the brand can regain momentum in North America and defend profitability against tariff-related cost increases.
Other headlines investors are watching today
A few additional items hit the news flow on Dec. 19:
- Retail footprint / brand experience: Lululemon opened a major new store in Houston’s Highland Village, described as an “experiential” location and featuring the first in-store La La Land Kind Cafe—evidence the brand continues to invest in physical presence and community-led retail. [22]
- Insider trading disclosure: A newly filed Form 4 shows an executive sale by Celeste Burgoyne (President, Americas & Global Guest) on Dec. 16, totaling 13,511 shares sold across two transactions at weighted average prices around $203–$204, leaving 5,318 shares directly owned (as reported in the filing). [23]
Insider sales happen for many reasons, but in a high-scrutiny period—CEO search + activist involvement—investors tend to notice every governance signal.
What to watch next for LULU stock
From here, lululemon’s stock price action is likely to revolve around a short list of milestones:
- CEO appointment trajectory: Any signals about timing, candidate profile, or board composition could move the stock quickly. [24]
- Americas demand and product cadence: The hard metric to watch is whether Americas comps improve from the recent decline, and whether the company can accelerate newness without sacrificing margin. [25]
- Tariff/de minimis mitigation: Management has already embedded a significant operating-income impact into guidance; investors will want to see how much can be offset through sourcing, vendor concessions, and pricing actions without slowing demand. [26]
- Next earnings report (timing varies by calendar): Several market calendars currently point to late March 2026 for the next release, though specific dates differ across providers. [27]
- International expansion execution: Investors will look for early detail on store plans, timelines, and how the franchise model affects profitability and brand control. [28]
Bottom line: Lululemon stock is now a “leadership + margins” story
On December 19, 2025, lululemon athletica inc. stock is being repriced around a single question: Can a leadership reset—now potentially influenced by a major activist investor—reignite U.S. demand and restore premium margins, while international growth continues to scale?
The bull case is straightforward: the brand still has strong global demand signals, an aggressive buyback authorization, and a clear plan to expand internationally. [29]
The bear case is just as clear: the core Americas business is slipping, and the company is simultaneously navigating a tariff-driven cost hit that management itself says will materially reduce operating income. [30]
References
1. finance.yahoo.com, 2. www.reuters.com, 3. corporate.lululemon.com, 4. corporate.lululemon.com, 5. corporate.lululemon.com, 6. www.reuters.com, 7. www.ft.com, 8. www.reuters.com, 9. corporate.lululemon.com, 10. corporate.lululemon.com, 11. corporate.lululemon.com, 12. corporate.lululemon.com, 13. corporate.lululemon.com, 14. corporate.lululemon.com, 15. corporate.lululemon.com, 16. corporate.lululemon.com, 17. www.marketwatch.com, 18. www.tipranks.com, 19. www.tipranks.com, 20. uk.investing.com, 21. www.reuters.com, 22. www.houstonchronicle.com, 23. www.sec.gov, 24. corporate.lululemon.com, 25. corporate.lululemon.com, 26. corporate.lululemon.com, 27. www.zacks.com, 28. corporate.lululemon.com, 29. corporate.lululemon.com, 30. corporate.lululemon.com
