Lululemon Athletica Stock Plunges 23% Amid Tariff Pressures and Margin Concerns

Lululemon Athletica (LULU) shares tumbled more than 20% post-earnings, as tariff-related margin pressures overshadowed a quarterly beat. The athletic apparel brand faces mounting challenges from U.S.-China trade policies and softening demand in its Core North American market.

First-quarter operating margins contracted 110 basis points to 18.5%, despite gross margin expansion to 58.3%. Comparable store sales growth stalled at 1%, with a concerning 2% decline in the Americas region. Multiple analysts have downgraded price targets amid deteriorating fundamentals.

The selloff reflects growing investor skepticism about premium apparel valuations in an era of trade wars and consumer spending pullbacks. Lululemon''s guidance cut of $0.37 in full-year EPS suggests the pain may just be beginning.