Shares of athletic apparel retailer Lululemon Athletica (LULU) slipped modestly early Monday following reports of an unusual founder-led board proxy fight, with Chip Wilson nominating three candidates.
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According to the Wall Street Journal, Wilson — the estranged founder who has been criticizing the leadership of the Vancouver-based company over falling sales — put forward three candidates. They are Marc Maurer, former co-CEO at premium athletic footwear maker On Running (ONON), Laura Gentile, former marketing boss at sports network ESPN (DIS), and Eric Hirshberg, a former chief executive at interactive entertainment giant Activision (MSFT).
Founder Blames Lululemon’s ‘Loss of Cool’ on Board and CEO
Wilson founded Lululemon in 1998 as a retailer of yoga pants and other yoga wear. While the founder has not held any official role at the firm in more than 10 years, he holds a 9% stake in the firm and is the second-largest shareholder after investment firm Vanguard.
There have been rumors of a proxy battle by Wilson in recent times, as Wilson has reportedly met with financial advisers and is in talks with potential investors. The Lululemon founder has been publicly blaming the company’s board and CEO Calvin McDonald for Lululemon’s loss of market share — or “loss of cool,” as he calls it — to U.S.-based private athletic apparel retailers Alo Yoga and Vuori.
Lululemon Battles Falling Sales in U.S. and Canada
Since the start of the year, LULU stock has plummeted over 45%. This comes as the company has been experiencing falling sales, especially in its core market in North America (kindly see the graph below). Wilson blames the development on the company’s marketing strategy.
In its recent Q3 2025 earnings results, Lululemon saw its Americas revenue fall by 2%, with the U.S. down 3% and Canada flat despite a 33% rise in its international revenue. Its gross margin also fell by 290 basis points due to tariff impacts and higher markdowns — that is, permanent price reductions on inventory to clear slow-selling products.
Will Leadership Change Turn Things Around?
McDonald is to step down as CEO at the end of January 2026 and give up his board seat.
Another stakeholder, Elliott Investment Management, is pushing for seasoned retail executive Jane Nielsen as Lululemon’s next CEO — a move J.P. Morgan analyst Matthew Boss thinks could provide a meaningful catalyst despite remaining challenges in the areas of product newness, in-store merchandising, and marketing effectiveness.
Is Lulu a Good Stock to Buy?
Across Wall Street, Lululemon’s shares carry a Hold consensus rating based on one Buy and 22 Holds issued by 23 analysts over the past three months.
In addition, the average LULU price target of $202.88 implies about 3% downside risk from current trading levels.
