### Lululemon Shares Plummet Following Disappointing Profit Forecasts

Lululemon Athletica's shares experienced a significant drop on Friday morning after the company's profit outlook for the second quarter fell short of expectations. Entering the day, the shares were already down by 14% for the year, and the premarket trading saw a further 20% decline.

The apparel giant's forecast for second-quarter revenue stands between $2.54 billion and $2.56 billion, with earnings per share (EPS) anticipated to be in the range of $2.85 to $2.90. These figures failed to meet the consensus estimates of $2.57 billion in revenue and $3.28 EPS, compiled by Visible Alpha.

For the full year, Lululemon has revised its profit projections downward. Although the company still expects full-year sales to be between $11.15 billion and $11.30 billion, it lowered its EPS forecast to a range of $14.58 to $14.78 from the previous range of $14.95 to $15.15.

In light of these adjustments, analysts from JPMorgan and UBS have lowered their price targets for Lululemon stock to $303 and $290, respectively—down from $389 and $330.

Company executives cited various reasons for the downgraded forecasts. CEO Calvin McDonald noted that while customers have responded positively to new product innovations, they are currently cautious and deliberate with their purchasing decisions. CFO Meghan Frank mentioned that the company plans to implement strategic price increases on select products to offset tariff impacts. She also indicated that adjustments to the supply chain would aim to have a more significant effect in the latter half of the year.

First-quarter results matched analyst expectations in terms of sales at $2.37 billion and an EPS of $2.60. However, comparable sales growth was only 1%, falling short of the projected 4.56%.

These developments come as Lululemon navigates a challenging retail environment, with both consumers and analysts closely watching how the company will perform in the coming quarters.