Lululemon revises outlook as tariff pressures impact US Q2 performance

In the second quarter of 2025 (Q2) ended 3 August 2025, Lululemon’s total revenue increased 7% to $2.5bn (6% on a constant currency basis) compared to Q2 of 2024 .

Its Americas net revenue was up 1% and its international net revenue climbed 22% (or 20% on a constant currency basis).

Lululemon’s CEO Calvin McDonald explained: “While we continued to see positive momentum overall in our international regions in the second quarter, we are disappointed with our US business results and aspects of our product execution.

“We have closely assessed the drivers of our underperformance and are continuing to take the necessary actions to strengthen our merchandise mix and accelerate our business.”

The company’s comparable sales increased 1% and by region its Americas comparable sales decreased 4% (3% on a constant currency basis) and its international comparable sales increased 15% (13% on a constant currency basis).

Lululemon’s gross profit increased 5% to $1.5bn in Q2 and gross margin decreased 110 basis points to 58.5%. While, income from operations decreased 3% to $523.8m and operating margin decreased 210 basis points to 20.7%.

The company’s net income in Q2 was $370,905 compared to $392,922 in the same period last year.

Lululemon added 14 net new company-operated stores during Q2, ending with 784 stores.

Lululemon’s chief financial officer Meghan Frank stated: “In the second quarter, we exceeded expectations on EPS, but revenue fell short of our guidance driven predominantly by our US business. We are also navigating industry-wide challenges, including higher tariff rates.

“In light of these dynamics, we are revising our full year outlook. As we begin the back half of the year, our brand and balance sheet remain strong, and we will continue to exercise financial discipline and strategically invest in our growth potential.”

For 2025, Lululemon now expects net revenue to be in the range of $10.850bn
$11bn, representing growth of 2% to 4%, or 4% to 6% excluding the 53rd week of 2024. Diluted earnings per share are now expected to be in the range of $12.77 to $12.97 for the year. This assumes a tax rate of approximately 30%.

The guidance for 2025 includes an estimated reduction in gross profit of approximately $240m, net of currently anticipated mitigation efforts, including vendor savings, and pricing actions, reflecting its current assumptions about higher levels of tariffs on imports into the US and the removal of the de minimis exemption.