Lululemon Athletica, the luxury athleisure brand known for its premium yoga leggings and sportswear, will see its CEO Calvin McDonald step down at the end of January next year. McDonald has led the Canadian company for more than seven years, guiding it through periods of remarkable growth as athleisure became a global trend.
The announcement follows a challenging period for Lululemon in its core US market, where sales have slowed and its share price has dropped nearly 50% over the past year. Despite these hurdles, the company recently upgraded its annual revenue forecast thanks to stronger-than-expected sales in recent months.
In a LinkedIn post, McDonald explained that his departure comes after discussions with the board. “As we near the end of our five-year strategy, and with our strong senior leadership team in place, we all agree that now is the time for a change,” he wrote.
Internationally, Lululemon has seen positive momentum, particularly in China, which helped drive net revenues to $2.6 billion by early November. However, in the Americas, growth has been weaker, partly due to rising import tariffs and the end of the US de-minimis exemption, affecting the company’s Asian suppliers. Lululemon estimated these new tariffs could cost the company around $240 million this year.
The brand is also facing stronger competition from lower-priced rivals like Vuori and Alo Yoga. Analysts, such as Dan Coatsworth of AJ Bell, suggest Lululemon needs to revamp its product strategy to make its offerings “must-have” items again.
