Lululemon stock plunges in historic rout as tariffs eat away at its profit

Lululemon’s stock is on pace for one of its biggest routs in history after the athleisure maker warned that tariffs will dent its profit.

Lululemon’s stock is on pace for one of its biggest routs in history after the athleisure maker warned that tariffs will dent its profit. The company cut its full-year guidance citing a “dynamic macroenvironment” that includes a decline in visits to its US stores, the impact of tariffs and and rising competition from other brands, such as Vuori and Alo. Lululemon (LULU) shares plunged more than 20% in premarket trading, on pace for the stock’s worst day in more than five years and its fourth-worst day ever. “The current tariff paradigm has brought uncertainty into the retail environment,” said CEO Calvin McDonald on a call with analysts Thursday, adding that Lululemon is “definitely not happy where the growth is in the US.” Following the likes of Nike, Roger Federer-backed On and other similiar brands, Lululemon will also implement “strategic price increases” on a “small portion” of its lineup that includes pricey yoga pants, shoes and shorts, Chief Financial Officer Meghan Frank revealed on the call, but said the price hikes “will be modest in nature.” The uncertainty around tariffs and consumer spending in the US forced Lululemon to cut its full-year earnings to be between $14.58 to $14.78 per share – a decrease from its previously forecasted $14.95 to $15.15.