lululemon athletica inc. (NASDAQ:LULU) is approaching its next earnings release at a moment when investor sentiment remains mixed. After a volatile year for the athletic apparel sector, the company’s upcoming fiscal fourth-quarter report will be closely watched for signs of stabilization, margin resilience, and renewed growth. This lululemon earnings preview breaks down what Wall Street expects, how the stock has performed, and what could move shares after the announcement.

Company Overview and Market Position

Founded in Vancouver, Canada, lululemon athletica inc. is a global leader in premium athletic apparel, footwear, and accessories for women and men. The brand is best known for its yoga-inspired roots but has expanded into running, training, casual wear, and lifestyle products. With a market capitalization of roughly $22.3 billion, lululemon competes in a crowded and highly competitive consumer discretionary space where brand strength and pricing power matter.

Despite its strong brand equity, lululemon has not been immune to broader consumer spending pressures. Inflation, shifting discretionary priorities, and increased competition have weighed on growth expectations, setting the stage for a critical earnings report.

Earnings Expectations for the Quarter

For the upcoming fiscal fourth quarter of 2025, analysts expect lululemon to post earnings of $4.74 per share on a diluted basis. That figure would represent a sharp 22.8% decline from the $6.14 per share reported in the same quarter last year. Even so, lululemon has a recent history of outperforming expectations, having beaten Wall Street’s EPS estimates in each of its last four quarterly reports.

Revenue will be another focal point. Investors will be watching closely to see whether demand trends improved during the key holiday season and whether management was able to maintain pricing discipline without sacrificing volume. Any commentary on store traffic, e-commerce performance, and international growth could shape near-term sentiment.

Full-Year Outlook and Growth Trajectory

Looking beyond the quarter, analysts forecast full-year earnings of $13.05 per share, down 10.9% from $14.64 in fiscal 2025. The outlook suggests that lululemon is navigating a period of slower growth rather than a structural decline. For fiscal 2027, EPS is projected to dip slightly again to $12.83, a modest 1.7% year-over-year decrease.

In this lululemon earnings preview, guidance may be even more important than the headline numbers. Management’s tone around inventory levels, cost controls, and expansion plans—particularly in international markets—could influence whether investors regain confidence in the company’s longer-term strategy.

Stock Performance Versus the Broader Market

Over the past 52 weeks, LULU stock has significantly underperformed the broader market. Shares are down approximately 49.2% during that period, while the S&P 500 Index (INDEX:SPX) gained about 13.6%. The stock has also lagged the Consumer Discretionary Select Sector SPDR Fund (NYSEARCA:XLY), which rose 6.6% over the same timeframe.

This underperformance reflects both company-specific concerns and broader pressures facing consumer discretionary names. As a result, expectations heading into earnings are relatively subdued, which could amplify the stock’s reaction to any positive surprises.

Recap of the Most Recent Earnings Beat

lululemon’s most recent quarterly report provides a useful reference point. On Dec. 11, 2025, the company reported third-quarter results that exceeded expectations. Earnings came in at $2.59 per share, well above the consensus estimate of $2.22. Revenue reached $2.6 billion, topping forecasts of $2.5 billion.

Following that release, LULU shares jumped 9.6% in the next trading session. Management also reaffirmed its full-year outlook, guiding for EPS between $12.92 and $13.02 and revenue in the range of $11 billion to $11.1 billion. A similar beat-and-raise scenario in the upcoming report could spark another short-term rally.

Analyst Ratings and Price Targets

Wall Street remains cautious on lululemon stock. The consensus rating is “Hold,” reflecting uncertainty about near-term growth. Of the 31 analysts covering LULU, two rate it a “Strong Buy,” 26 recommend “Hold,” one suggests a “Moderate Sell,” and two assign a “Strong Sell.”

The average analyst price target sits at $212.21, implying roughly 9% upside from current levels. While not a ringing endorsement, this suggests analysts see limited downside risk if the company can execute steadily.

Final Takeaway

This lululemon earnings preview highlights a company at a crossroads. While near-term earnings are expected to decline, lululemon’s brand strength and history of execution leave room for upside surprises. Investors should focus on guidance, margins, and demand trends to gauge whether the stock’s recent slump is nearing an end—or if patience will still be required.