Lululemon has lost its cool, and is stuck with customers who only follow 'generic athletic brands,' founder says

MW Lululemon has lost its cool, and is stuck with customers who only follow 'generic athletic brands,' founder says

By Bill Peters

The company's choice of Heidi O'Neill as Lululemon's new CEO doesn't represent leadership 'that can instill shareholder confidence in today's world,' Chip Wilson says

Lululemon's stock is down more than 33% year to date.

After a long descent from highs reached in the pandemic and as recently as 2024, even Lululemon's founder is now unhappy with the company.

After a weeklong silence following Lululemon's new CEO pick, Chip Wilson, the struggling yoga-wear's founder-turned-most vocal critic, weighed in on Wednesday - and said recent moves by the company he created suggested it had lost its cool.

In a letter to shareholders that marks the latest drama between the company and its founder, Wilson said Lululemon's choice of Nike veteran Heidi O'Neill reflected the board's commitment to staying the course despite its array of challenges - which include a lack of focus on the workout wear that made it a stock-market darling in the prior decade. He also urged investors to vote for his three nominees for Lululemon's board.

Shares of Lululemon (LULU) finished around 3% lower on Wednesday. Despite some occasional moves higher, shares of Lululemon are still down overall since the company announced O'Neill as its new CEO, as analysts worried about her start time of Sept. 8 and what Nike's $(NKE)$ current struggles might say about Lululemon's path ahead.

"The market reaction to the appointment of Heidi O'Neill reflects shareholder frustration with the board's seemingly stubborn insistence on staying the course despite the challenges in the business," Wilson said in the letter.

"I genuinely hope that Heidi is the right person for Lululemon, but a near 30-year veteran of Nike, Inc. is not the symbol of transformative, creative-first leadership that can instill shareholder confidence in today's world," he continued.

Wilson has been trying to shake up Lululemon's board, which he says does not understand the technical apparel industry. He has nominated executives from On Holding, ESPN and Activision to the board. Lululemon has tried to roll out new products to reignite consumer enthusiasm.

To some degree, Wilson said in the letter, Lululemon's problems were exemplified by a partnership with Disney $(DIS)$ announced in 2024 to launch a line of clothing that put Disney characters and other iconography on Lululemon gear. That, he said, was an example of "brand drift" at Lululemon.

"Lululemon is now left with outlying customers who follow generic athletic brands," he said.

"This ill-advised partnership was a blatant move to grab short-term revenue growth through channel expansion," he continued. "Unfortunately, but predictably, it was at the expense of signaling that Lululemon was no longer the leading, premium, cool brand initially personified by its muse."

Lululemon, in a statement on Wednesday, defended its board, and said that Wilson "has repeatedly attacked the company publicly during our attempts to achieve a constructive outcome."

The company also said Wilson did not allow its board to meet with his director candidates "for months." In a proxy filing on Tuesday, Lululemon said Wilson had told them that rivals Alo and Vuori "had sought and received his advice, while Lululemon had not."

What that "advice" may have been was unclear. A spokesperson for Wilson said he "is not and has never been a paid advisor to either Alo or Vuori. He is also not an investor in either company."

The spokesperson added: "As a recognized leader in the space, he is often approached for advice."

Along with those two competitors, analysts have said Lululemon has lost touch with female customers and spent too much time offering new clothing and other accessories that diluted its reputation as a powerhouse for technical workout gear. Wilson earlier this year also criticized the company for product-quality issues.

BofA analysts also said that the timing of Lululemon's leadership changeover also likely meant no major changes anytime this year.

"The biggest negative, in our mind, was the Sept. 8 start date," they said in a note over the weekend. "That pushes any potential reset into 2027."

-Bill Peters

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April 29, 2026 18:12 ET (22:12 GMT)

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