Lululemon shares plunge 80% after founder files for divorce

Lululemon shares closed at $100.61 on Friday, a one-day decline of 17.38%, leaving the stock roughly 80% below its December 2023 high of $511.29. The shares reached an eight-year low earlier this month and have not returned to the December level.

Founder Chip Wilson filed for divorce in the Supreme Court of British Columbia in April, and court filings indicate there is no prenuptial agreement. Wilson and related entities hold 9.9 million Lululemon shares, about 8.7% of the company, and roughly 1.1 million of those shares are attributed to his wife, Shannon ‘Summer’ Wilson. At Friday’s close that stake was valued at just under $1 billion.

Lululemon has reduced its sales guidance three times this year, cutting its 2026 revenue outlook from $11.35 billion in March to $10.35 billion. In the second quarter the company reported revenue of $2.4 billion, down 4% year over year, and comparable-store sales fell 9%. Reported earnings per share were $2.92 and included a one-time $134.5 million refund related to import tariffs. The company expects third-quarter sales to decline 10% to 11%.

Corporate governance developments include Chip Wilson ending a campaign to replace directors in May, accepting two board seats and an 18-month truce with the board. Heidi O’Neill begins as chief executive this week and will assume day-to-day responsibility for the business and strategy.

British Columbia family law protects assets owned before marriage while generally dividing the increase in value that occurs during the marriage unless spouses agree otherwise. Lululemon went public in 2007, five years after the Wilsons were married, a detail noted in court filings.