Lululemon recently faced a product-quality controversy after customer complaints that new "Get Low" leggings were too sheer. The company paused and then resumed sales with wearing guidance, while founder Chip Wilson publicly criticized the board as he continues a proxy campaign. Concurrently, steep markdowns in a "We Made Too Much" clearance signal inventory pressure and margin risk. These events have contributed to short-term stock volatility while intensifying governance and execution concerns for investors.

Lululemon raised fourth-quarter guidance after strong holiday demand, but aggressive end-of-season discounts and volatile trading have tempered investor enthusiasm. The week's concrete moves — a guidance boost, steep markdowns across key categories, and a sharp intraday stock drop — create a near-term tradeoff between revenue momentum and margin pressure.

A week of decisive events has put Lululemon in the spotlight: founder-led director nominations and activist backing collide with extended heavy markdowns, driving share volatility and raising questions about margin pressure and leadership transition.

Lululemon faces a pivotal governance showdown as founder Chip Wilson launches a proxy fight while CEO Calvin McDonald prepares to step down. An expanded $1 billion buyback and deep post-holiday markdowns add complexity—balancing short-term share support against margin pressure and strategic uncertainty.

Lululemon opened a 9,400 sq ft flagship in Houston while running a heavy clearance push and navigating a CEO transition. These concrete events — a large experiential store, the “We Made Too Much” drop and an end-of-year sale, plus a recent share pullback — signal tactical inventory management and brand investment that investors should watch closely.

Elliott Investment disclosed a >$1 billion stake in Lululemon, accelerating a CEO transition and sparking a notable stock rally. This article explains the governance implications, market reaction, and how broader sector headwinds — including Nike’s margin pressures from tariffs and China weakness — frame Lululemon’s near-term outlook.