BUSINESS

Lululemon Athletica’s (LULU) shares have come under mounting pressure in recent years, prompting renewed scrutiny from investors about the company’s strategy and leadership.Among the most vocal critics is the brand’s founder, Chip Wilson, who remains one of Lululemon’s largest shareholders, despite stepping away from the company’s board more than a decade ago.The company’s stock has fallen nearly 20% year to date as of March 9, 2026, and is down more than 44% over the past five years, according to market data.Now, Wilson is taking his concerns a step further by launching a public campaign to reshape the company’s leadership.Lululemon founder launches “Creativity First Lulu” campaignWilson recently launched a campaign website called “Creativity First Lulu,” calling for major changes to Lululemon’s board of directors and leadership structure. On the website, Wilson argues that the athletic apparel company “has lost its way” and requires immediate leadership changes to restore creativity and innovation.”Prioritizing short-term goals at the expense of creativity and product innovation has led to the erosion of shareholder value,” wrote Wilson on the website.Wilson claims the company’s current strategy has destroyed 65.9% of shareholder value, and argues the current board lacks the independence and vision needed to address Lululemon’s challenges.He also criticized the board’s handling of CEO succession, saying it cannot be trusted to oversee the process without first undergoing structural changes. One of Wilson’s key proposals is to declassify the board, which would require all directors to stand for election every year rather than serving staggered terms. According to Wilson, the current structure limits accountability and raises concerns about board independence.”Only a refreshed Board with creativity and innovation at the center can affect these changes,” wrote Wilson on the website.To support his campaign, Wilson has nominated three candidates to join the board.Lululemon board candidates proposed by Chip WilsonMarc Maurer: Former co-CEO of On Holding AG (ONON)Laura Gentile: Former CMO at ESPN, Inc. Eric Hirshberg: Former CEO of Activision Publishing, Inc.

Lululemon’s founder, Chip Wilson, launches the “Creativity First Lulu” campaign website.Shutterstock

A decade of criticism from Lululemon’s founderWilson has publicly criticized Lululemon’s leadership for years, despite stepping away from the board in 2015.He previously resigned as chairman in 2013 following backlash over controversial remarks in a Bloomberg interview in which he suggested that “some women’s bodies just actually don’t work” for the company’s yoga pants.Wilson left the board entirely in 2015 to focus on other ventures, including the apparel brand Kit and Ace, which he co-founded in 2014 with his wife and later sold.Despite no longer holding a leadership role at Lululemon, Wilson has continued to criticize the company’s strategy, product quality, and executive leadership.In October 2025, he escalated those criticisms by purchasing a full-page advertisement in The Wall Street Journal titled “Lululemon: in a Nosedive,” according to the SEC filing. Wilson has also repeatedly criticized the company’s leadership on LinkedIn, including posting comments directed at former CEO Calvin McDonald, whom he described as “lacking vision.” McDonald stepped down earlier this year after serving as CEO since 2018, according to a company announcement.Lululemon respondsLululemon has publicly defended its leadership and strategic direction in response to Wilson’s campaign.”Lululemon has a highly engaged and experienced Board that is well-equipped to provide effective guidance on the company’s direction and the execution of our growth strategy,” said Lululemon in a company statement.”Mr. Wilson has not been involved with the company for a decade, and since his departure, Lululemon has continued to adapt to the marketplace and lead the industry,” the company added.Lululemon struggles with slowing U.S. growthLululemon’s financial results show the ongoing challenges it faces in its core market. During the third quarter of fiscal 2025, net revenue increased 7% year over year to $2.6 billion, with comparable sales up 1%, according to the company’s earnings report.While an improvement compared to previous quarters, its Americas business remained weak. Net revenue declined 2%, with comparable sales down 5%. The U.S. saw the steepest fall in revenue, dropping 3%.Lululemon ended the quarter with 796 stores worldwide.Lululemon’s turnaround strategyIn 2022, Lululemon introduced its new Power of Three x2 plan, which aims to double revenue from $6.25 billion in 2021 to $12.5 billion by 2026 through product innovation, international expansion, and digital growth. For fiscal 2025, the company expects total revenue between $10.96 and $11.05 billion, representing growth of 4% to 6%. At that pace, the company could still reach its long-term target by the end of 2026.In its latest earnings call, Lululemon says it is focused on reviving the U.S. business through three key initiatives.Three pillarsProduct innovation: Introducing new designs and expanding product mixMarketing and operational efficiency: Increasing product launches and improving marketing effectivenessEnhanced retail and digital experience: Upgrading both in-store and online shopping experiences”We began this work last year as we saw the U.S. business slow, and we expect to see the most significant benefits of our work streams in 2026,” said CFO Meghan Frank in the earnings call. “We believe this plan will enable us to deliver improved differentiated products to our guests, allow our teams to read and react more quickly based on style performance, elevate our in-store and online experience, and refine our marketing approach to ensure new and existing guests are aware of the products and innovations coming in 2026,” she added.Analysts remain divided on Lululemon’s outlookAnalysts remain divided on Lululemon’s long-term positioning amid intensifying competition in the athleisure market from rivals including Nike, Alo Yoga, Vuori, and Skims.The company’s updated fair value estimate recently increased slightly from $208.08 to $208.35, according to market analysis.However, Bank of America lowered its price target to $200 while maintaining a neutral rating, citing concerns that a major operational reset under the new CEO could pressure margins and earnings, according to Simply Wall Street.The bank also questioned whether the new spring product is enough to support comparable sales or whether a deeper, potentially more costly reset is needed.More Retail Business News:106-year-old retail brand operator selling 170 stores in bankruptcy53-year-old retail chain explores selling entire businessAritzia brings back iconic fashion brand after shutdownSome retail analysts believe Lululemon is losing its product differentiation as competitors innovate faster.”Lululemon doesn’t have that point of difference that it used to have,” said Retail Strategy Group Principal Liza Amlani on Retail Dive. “The last thing you want to be told is that your assortment is boring and that your competitors are ripping you off, right? So I think it’s really important for Lululemon to continue to innovate.”With Lululemon’s leggings typically priced between $98 and $198, per its website, analysts say the company must justify its premium position in a crowded athleisure market.”There is a very crucial point where you do need to have newness because the consumer needs to justify why they’re going to purchase something out of a discretionary category,” said The Consumer Collective Co-founder and Managing Director Jessica Ramírez on Retail Dive. Related: 159-year-old retail giant announces more store closures

Kroger, which operates a vast network of regional supermarkets such as Fred Meyer, Ralphs, and Smith’s, is seeing customers change how they shop in stores. This shift in customer behavior threatens future sales, which is raising concerns. In response, the company’s CEO is promising major changes to keep customers from fleeing.In Kroger’s latest earnings report, it revealed that its identical sales (excluding fuel) rose only 2.4% year over year in the fourth quarter of 2025. For the full year, Kroger generated $1.8 billion in operating profit, which is significantly lower than the $3.8 million it earned in 2024. Also, a recent Placer.ai report found that while foot traffic at Kroger’s stores spiked by 2.3% year over year during the quarter, the average amount of time customers are spending at these locations decreased by about 2% in October, 3.5% in November, and 3% in December. These declines suggest that customers are purchasing less during each visit. “These patterns reflect larger trends seen across the grocery space, where traffic growth has been largely driven by an increase in shorter trips as shoppers split their lists across retailers and make more targeted visits based on price, promotion, or specific product needs,” wrote Shira Petrack, head of content at Placer.ai, in an analysis. Shoppers adjust spending as high prices take a tollDuring an earnings call on March 5, Ronald Sargent, who was Kroger’s interim CEO in 2025, said the company saw sales growth across categories such as pharmacy, e-commerce, and grocery, including fresh food and private-label brands. However, customers continued to spend with caution during the quarter. “Customers remained focused on value in the fourth quarter, which was consistent with the trends that we’ve seen throughout the year,” said Sargent. In recent months, consumer sentiment has dropped as Americans face economic pressures such as inflation, tariffs, and uncertainty in the U.S. housing market. In February this year, consumer sentiment declined 12.5% year over year, according to recent data from the University of Michigan.

Kroger continues to see customers become more price-conscious as they face higher costs of living.Jennifer G. Lang / Shutterstock

“About 46% of consumers spontaneously mentioned high prices eroding their personal finances; readings have exceeded 40% for seven months in a row,” said University of Michigan Surveys of Consumers Director Joanne Hsu in a statement. “Sentiment is about 13% below a year ago and 21% below January 2025.”Last year, to better appeal to frugal shoppers, Kroger began cutting costs across its organization, including layoffs and store closures, to reinvest those savings in lower prices in its stores.It also added expanded store hours, ramped up discounts, and improved checkout speeds, changes Sargent said have “contributed to positive trends in customer satisfaction.”Kroger’s new CEO hopes key changes will retain customersAs consumer sentiment remains challenged, Kroger officially appointed former Walmart U.S. executive Greg Foran as its new CEO on Feb. 9. During the company’s earnings call, Foran emphasized that Kroger needs to double down on providing lower prices, which he plans to focus on as CEO.“We need to grow sales faster, and in my experience, that comes down to giving customers a compelling reason to shop with you by offering great value, great products, and a great experience,” said Foran. “Price is an important part of that equation. Customers need to trust that they’re getting a fair deal every time they walk into our stores.”He said that he plans to keep pushing this initiative by continuing to pull unproductive costs out of the business, modernizing workflow, investing in everyday value, sharpening promotions and making sure customers can see and feel the difference in stores. Related: Kroger CEO has a harsh solution to rising prices in stores“The savings we generate will be reinvested directly into lower prices and better service for our customers,” said Foran. “That’s how we will fund our growth. Customers want convenience and are increasingly shopping online to buy food. We have the assets to meet that demand, and e-commerce is a key focus area for us.”Kroger shoppers should also expect to see a revamped loyalty rewards program and simplified offers following recent criticism.“You know, one of the things consumers tell us is, ‘Hey, it’s just really complicated to figure out, you know, whether I’m getting the best price at Kroger,’ just because of the way some of our offers are structured,” said Kroger Chief Financial Officer David Kennerley during the call.More Retail:Home Depot CEO raises alarm bells on consumer problem in storesKroger quietly reduces a vital store service for customersKroger adds generous offer for customers as grocery prices rise “We’re also doing work to make sure that we structure our offers in a more simple way, so that they get good prices and they can understand them.”In addition to focusing on improving value perception, Kroger is planning to spend about $3.8 billion to $4 billion on several investments, such as new store openings (while testing new in-store formats) and artificial intelligence tools to make it easier for customers to shop.“This year, we’re introducing agentic AI shopping for our customers, which will help them discover items, build baskets, plan meals, and stay within budgets, all in a personalized way,” said Kennerley. “We’re also investing in supply chain modernization with more automation and expanded capacity, and we’ll also continue investing in our remodels to ensure our stores deliver a consistently strong experience.”Kroger makes bold prediction as Americans struggle financiallyAs these changes roll out, Kroger expects its identical sales (without fuel) in fiscal year 2026 to increase by 1% to 2%. Kennerley said that the company expects sales to land “in near the low end of our full year range, driven primarily by continued egg deflation.”Kroger’s increased focus on affordability comes as many Americans struggle to manage spending on groceries and household essentials amid rising prices and economic uncertainty, according to a recent LendingTree survey.How Americans are feeling about their finances: Approximately 60% of Americans said their financial situation at the start of 2026 is the same orworse than it was at the beginning of 2025.In 2025, 87% said they struggled to manage their spending.About 26% said that rising prices and inflation made managing finances most difficult that year. Another 15% cited unexpected expenses, and 11% blamed changes in income or job situation.Across all spending categories, Americans struggled most to afford groceries and household essentials amid higher prices.To improve their financial situation, 48% plan to save more this year, while 35% aim to reduce debt and 34% hope to boost their income.
Source: LendingTree
Groceries are putting the most pressure on households because it’s a category that can’t be fully cut out of the picture, said LendingTree Chief Consumer Finance Analyst Matt Schulz in a statement. “Yes, you can do things to keep your costs down, including couponing, shopping around, leaning on generics or store brands and so on, but you can’t just cut groceries out of your budget,” he said. “When those prices rise, you have to adjust accordingly. With so many people on a tight budget, that’s a major challenge.”Related: Kroger quietly reduces a vital store service for customers