Lululemon Flubbed the Quarter, and the Founder Won't Say a Bad Word

Lululemon reported weak Q1 2026 earnings with only 4% top-line growth driven by international sales, while its crucial Americas business declined 3%. The company's gross profit margin fell 4.1 percentage points and EPS dropped significantly to $1.69 from $2.60 year-over-year. The settlement of founder Chip Wilson's proxy fight, which granted him two board seats and silenced his public criticism, came just before the disappointing earnings announcement. With a new CEO not arriving until September and Q2 guidance projecting further weakness, the company faces an uncertain turnaround path.