Shares of athletic-apparel giant Lululemon Athletica fell sharply on Friday, hitting their lowest level since 2018 after the company lowered its full-year financial outlook for the second consecutive quarter.

Weak Sales Pressure Lululemon

Lululemon shares dropped about 20%, making the company one of the biggest decliners in U.S. markets. The retailer reported its first comparable-sales decline since the pandemic, adding to concerns about slowing consumer demand and increasing competition in the athletic-wear market.

The company pointed to weaker performance in the Americas, including declining demand for leggings. Competition from brands such as Alo and Vuori is also putting pressure on Lululemon as consumers have more choices in the premium athletic-apparel market.

New CEO Faces Turnaround Challenge

The results come just before Heidi O'Neill takes over as Lululemon's chief executive, giving the incoming CEO an immediate challenge to improve product innovation, rebuild momentum and strengthen the company's competitive position.

Investors are now watching whether Lululemon can restore sales growth while dealing with changing consumer preferences and a more competitive U.S. retail environment.

The sharp stock-market reaction highlights how closely investors are monitoring consumer spending and retail earnings as U.S. companies navigate changing economic conditions.

Lululemon's next earnings and sales updates could become an important test of whether the retailer can reverse its recent slowdown.