# Lululemon's new CEO walks into a familiar fire

> Heidi O'Neill left a struggling Nike for a Lululemon whose leggings just fell off a cliff.
- Title: Lululemon's new CEO walks into a familiar fire · Fortune
- Summary: Heidi O'Neill left a struggling Nike for a Lululemon whose leggings just fell off a cliff. Brands that stretch into every category stop meaning anything, and…
- Keywords: retail, lululemon, athleisure, leadership, brand strategy, Lululemon's, CEO, walks, familiar, fire, Fortune
- Source: Fortune — https://fortune.com/2026/09/12/lululemon-new-ceo-heidi-oneill-leggings-sales-decline-nike-mess
- Author: Phil Wahba
- Read time: 2 min
- Topics: retail, lululemon, athleisure, leadership, brand strategy
## A rough welcome
Heidi O'Neill took over as Lululemon CEO on Tuesday. In the five months since her April appointment, the company's slide got worse, not better.

> Incoming CEO O'Neill has a mountain to climb.
## The quarter that scared everyone
Comparable North American sales fell 12%. Lululemon cut its full-year outlook for the second time in three months, after running on interim leadership since late January.
## Leggings fell off a cliff
Leggings sales dropped 20%, stunning analysts. They are roughly a third of revenue and the highest-margin thing Lululemon sells.

> We did a double take when Lulu called out that leggings were down 20%.
## China stopped growing
Sales in China were climbing by double digits as recently as spring. They have now fallen two quarters in a row, closing off the easiest escape route.
## Alo and Vuori are eating in
Lululemon's share of the athleisure market it invented fell 10 points to 43.9% in August, per M Science data. Alo picked up 5.9 points and Vuori 2.2.
## Growth pulled it off course
Revenue rose sixfold from 2013 to 2025, hitting $11 billion. Chasing more, Lululemon pushed into footwear, parkas, and skirts, and landed in fights it was not built for.

> They're able to sell a lot, but not mean a lot.
## The discount bin problem
Analysts call the assortment boring, with too much non-core product and no real technical innovation. Items from a premium brand started showing up marked down.

> A combination of an incredibly boring assortment... have all contributed to a rapid loss of brand heat
## She has seen this movie
O'Neill spent 27 years at Nike, which also lost its innovation edge chasing lifestyle wear. She built Nike's women's business into a multibillion-dollar engine, so skeptics cut both ways.
## The clock is already running
Shares are down 80% from their 2023 peak, which invites activist investors. Founder Chip Wilson panned her hiring, and his non-disparagement deal expires in November 2027.
## Key takeaway

Brands that stretch into every category stop meaning anything, and Lululemon's 20% leggings drop is the bill coming due.