Chip Wilson, the Founder of lululemon athletica inc. and one of the retailers’ largest shareholders, says the company’s board has failed at succession planning and the brand needs to be revitalized.
Wilson made his comments on Friday after the company announced Thursday that Calvin McDonald plans to step down as Chief Executive Officer and member of the company’s Board of Directors, effective January 31, 2026.
“As I have communicated to members of the Company publicly and privately, lululemon needs revitalization and an infusion of new skills to get back to being a product-first company that creates real, long-term shareholder value. After overseeing years of poor decisions erode the brand and destroy shareholder value, it is clear to me that only under my increasing pressure has the lululemon Board of Directors finally started to listen,” said Wilson in a public statement.
“As one of the largest active shareholders of lululemon, I am deeply concerned about what appears to be a tremendous failure by the Board to competently plan for the future and manage an effective succession process. This latest failure in my opinion only amplifies the urgency the Company faces and the obvious need for the CEO search to be led by new, independent directors with real experience. I believe that the Board should seek the advice of individuals with specific and unique expertise, and deep knowledge of the Company, to advise on the CEO selection process.
“The Board’s praise for Calvin McDonald, a CEO who has overseen massive value destruction over the past two years, with a 62.8% drop in LULU’s share price, shows blatant disregard for its shareholders. In my view, the Board has failed to properly hold management accountable to deliver product innovation and instead has led with complacency. The erosion of premium brand value in the Company’s core markets demonstrates that the Board does not understand its target customers anymore or what will drive shareholder value at lululemon over the long term. I strongly believe in the continued strength of the lululemon brand, and I know there are several qualified CEO candidates across the retail and apparel space who can continue to build on its legacy. I hope the Board continues this constructive dialogue with me to find refreshed, experienced directors ahead of completing a CEO search.”
On Thursday, the company said McDonald and the Board are working together to facilitate a smooth transition, and he will serve as a senior advisor to the company through March 31, 2026. It said the Board is conducting a comprehensive search process in partnership with a leading executive search firm to identify the company’s next CEO.
The company also announced that Marti Morfitt, Chair of the Board, will take on the expanded role of Executive Chair, effective immediately, to ensure the continued execution of the company’s near- and long-term growth strategy during the leadership transition. In addition, Meghan Frank, Chief Financial Officer, and André Maestrini, Chief Commercial Officer, will serve as interim co-CEOs following McDonald’s transition. Both interim co-CEOs bring extensive global retail experience and proven track records of driving growth at lululemon, and will support all aspects of the business through the conclusion of the search process, said the company.
Since joining lululemon in 2018, the company said McDonald has guided the it through a period of significant growth and innovation. Under his leadership, lululemon said it has more than tripled its annual revenues, and the company expects to generate $11 billion in annual revenue this fiscal year. It said McDonald also broadened lululemon’s global reach to over 30 geographies and grew the company’s China Mainland business into its second largest market. Additionally, it said he expanded lululemon’s product portfolio, meaningfully growing its athletic and lifestyle categories, and formally expanding into new high-demand activities such as tennis and golf.
“On behalf of the Board and the entire organization, I want to thank Calvin for his visionary leadership building lululemon into one of the strongest brands in retail,” said Morfitt. “During his tenure, Calvin led lululemon through a period of impressive revenue growth, with differentiated products and experiences that resonated with guests around the world. We are grateful for Calvin’s numerous contributions and appreciate his continued support over the coming months to facilitate a seamless transition.
“The Board is confident in our leadership transition plan, the strength of our teams across the company, and our ability to deliver on our strategy. lululemon has a strong foundation in place, and, as we look to the future, the Board is focused on identifying a leader with a track record of driving companies through periods of growth and transformation to guide the company’s next chapter of success. While the search is underway, I look forward to working closely with Meghan, André, and the rest of the Senior Leadership Team to execute on our strategy with a sense of urgency and meaningfully drive the business forward.”
In a LinkedIn post, McDonald said: “After more than seven amazing years, I will step down from my role as CEO of lululemon on January 31.
“This decision was something that I, along with the Board, have been discussing and carefully considered. As we near the end of our five-year strategy, and with our strong senior leadership team in place, we all agree that now is the time for a change.
“I am incredibly proud of everything that our teams have accomplished since I joined the company in 2018. We have quadrupled our international business and tripled our total revenue to more than $10 billion, while increasing our profitability.
“We’ve driven industry leading omnichannel guest experiences, have become the #1 women’s activewear apparel brand in the U.S., and created significant growth in our men’s business. We expanded into new categories and activities, including tennis and golf. And we advanced our sustainability leadership through our Impact Agenda and strengthened our inclusive, people-first culture.
“We have a strong foundation of innovation, creativity, and connection that has transformed the athletic apparel industry and will continue to drive it forward.
“I feel confident the opportunity ahead for lululemon continues to be significant, and I will fully support the transition as an advisor to lululemon through March. And I look forward to sharing more about my next chapter as well.
“I believe we have built an outstanding and ambitious product pipeline. We have created products that don’t just meet the moment, they anticipate where our community is heading. I cannot wait for our guests to experience what’s coming.
“When I joined lululemon, I said this was my dream job. It exceeded every expectation. Thank you to everyone at lululemon who contributed to the growth and accomplishments we’ve shared, and for building something that I believe will deliver incredible value for years to come.”
On Thursday, lululemon announced financial results for the third quarter of fiscal 2025, which ended on November 2, 2025.
For the third quarter of 2025, compared to the third quarter of 2024:
- Net revenue increased 7% to $2.6 billion. Americas net revenue decreased 2%. International net revenue increased 33%;
- Comparable sales increased 1%, or 2% on a constant dollar basis. Americas comparable sales decreased 5%. International comparable sales increased 18%;
- Gross profit increased 2% to $1.4 billion and gross margin decreased 290 basis points to 55.6%;
- Income from operations decreased 11% to $435.9 million and operating margin decreased 350 basis points to 17.0%;
- The effective income tax rate for the third quarter of 2025 was 30.5% compared to 30.2% for the third quarter of 2024;
- Diluted earnings per share were $2.59 compared to $2.87 in the third quarter of 2024;
- The Company opened 12 net new company-operated stores during the third quarter, ending with 796 stores.
Retail analyst Bruce Winder said the change at the top of lululemon was expected.
“Although McDonald took the company to new heights by tripling the retailers’ revenue, expanding internationally and launching new successful categories, shares of the firm were down about 50% this year and investors lost confidence.
“We saw signs of a troubled retailer as several senior leaders left the company over the past year or so.
“Increased competition, tariffs, a softening economy and perceived quality issues all plagued the company and made it tougher to win.
“I listened to their Q2 earnings call in September and the company acknowledged that they had missed the mark on product. Q3 results were posted this week and the US business continued to suffer while international markets fared much better.
“Former founder and majority shareholder Chip Wilson was unhappy with where the company was headed and publicly called for a change.
“McDonald can be proud of a fantastic run at lululemon but as we all know Wall Street has a short memory and sometimes changes need to happen at the top to reset confidence and utilize a new set of eyes. The question now is who will run this Canadian champion and how will they build momentum again in the US market.”
George Minakakis, CEO Inception Retail Group Inc., wondered: Can anyone really predict the future? Can any retailer really predict the future?
“Retailers and their CEOs come and go it is the nature of business. lululemon’s stock price is down over 50% from its February highs this year,” he said, adding with no clear successor this should raise many questions about the board.
“If someone thought this brand’s trajectory was infinite, they don’t understand retail,” he explained. “The competition has grown, and the uniqueness of any brand eventually wears out.
“And apparel is one sector where your fashion decisions are feast or famine. I believe McDonald did well in his tenure, but the role of retail CEO’s need to be shorter and the leaders must come with a fresh perspective because over time everything old looks new.”
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