I haven’t bought new Lululemon clothing since, I don’t know…2017? (Yes, they’re still going strong.)
But recently, I put on a pair of leggings and noticed my dog Bentley may or may not have chewed a hole or two (let’s just say he’s lucky he’s cute).
Anyways, I decided it was probably time for a long-overdue mini Lululemon shopping spree. Obviously, I’m not in a rush (despite Bentley’s best efforts). Still, I’ve been slowly making a mental list of all the fun new things I want to buy.
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But now? I might need to rethink that plan.
The brand just raised a red flag on its latest earnings call—and while most shoppers haven’t heard about it yet, new cost pressures could soon start affecting what customers pay in stores and online.
In other words: If you’re planning to stock up on your favorite Align leggings, that go-to Define jacket, or even a few pairs of men’s underwear (don’t worry, fellas — I’ve got your back too), you may want to do it sooner rather than later.
Lululemon raised a red flag about tariffs
Image source: Justin Sullivan/Getty Images
Lululemon’s tariffs dilemma leads to margin hit, price hikes
The new tariffs are already taking a bite out of Lululemon’s profits. The company says it expects to make less money on each item it sells this year compared to 2024—and it’s pointing to rising import costs as the reason why.
“That’s all driven by the net impact of tariffs,” CFO Meghan Frank said on the earnings call.
The new U.S. tariffs on apparel sourced from China and other markets are forcing Lululemon ( (LULU) ) to rethink its pricing and sourcing strategy.
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The company is taking a measured approach: it will implement modest price increases on select items in its assortment, while working with vendors to find supply chain efficiencies.
“We’ve looked across the enterprise for how we can offset increased tariff rates,” CEO Calvin McDonald said. “Our work streams include managing expenses, identifying efficiencies within our supply chain, and evaluating our position in the marketplace related to pricing.”
While some mitigation efforts will take effect later this year and into 2026, Lululemon says shoppers should expect to see higher prices on some items in the near future.
Lululemon warns tariffs will likely impact prices
For Lululemon customers, the tariff squeeze means a few things.
First, while the brand’s leadership emphasized that most price increases will be modest and selective, they are coming—and could hit popular categories like leggings, tops, and lifestyle products.
Second, as Lululemon adjusts sourcing and manages costs, it may impact product availability and assortment
During the call, executives highlighted that Lululemon’s strong demand in core categories like Align leggings and new product hits like Daydrift and Glow-Up leggings puts it in a good position to manage pricing and innovation going forward.
Finally, even with $1.3 billion in cash and no debt, Lululemon is proving that no brand is immune when tariffs hit this hard. U.S. shoppers are already showing signs of caution, and further price increases could affect purchase behavior.
“We believe our guests will continue to live an active and healthy lifestyle and turn to us for the technical apparel we are known for,” McDonald said.
But as tariffs keep squeezing Lululemon’s margins, customers should brace themselves—their next shopping trip could come with some unwanted sticker shock.
Guess I better get moving with that trip to Lululemon.
Related: Lululemon analysts reboot stock price target after earnings
