Open this photo in gallery:
Lululemon CEO Calvin McDonald in Vancouver in May, 2023.DARRYL DYCK/The Canadian Press
Lululemon Athletica Inc. LULU-Q chief executive officer Calvin McDonald will step down at the end of January, the athleisure brand announced on Thursday.
Mr. McDonald, who has led the Vancouver-based retailer since 2018, has been struggling to reassure investors as the stock price plunged by 50 per cent since the beginning of the year.
Lululemon has hired an executive search firm and is looking for its next CEO. Mr. McDonald will leave the role on Jan. 31, 2026, and will also step away from the company’s board of directors, but will continue as a senior adviser through March 31.
The company’s chief financial officer Meghan Frank, and chief commercial officer André Maestrini, will serve as co-CEOs on an interim basis until the search process is complete.
Under Mr. McDonald’s leadership, Lululemon’s annual revenues have more than tripled. Sales are estimated to reach US$11-billion this year. He has also brought the brand to new global markets, and expanded the product offerings to include clothing for tennis and golf, as well as casual everyday wear.
But although Lululemon was once dominant in the athleisure space, the brand’s cachet has recently slipped, and competitors such as Alo Yoga and Vuori have been winning away customers with newer designs.
The company’s stock price has fallen by more than 50 per cent so far this year.
Lululemon became synonymous with taking leggings and other stretchy clothing beyond the gym and the yoga studio, with trendy women sporting athleisure throughout the day. The company did particularly well during the pandemic when comfortable leggings and sweatshirts were in high demand.
But in September, Mr. McDonald acknowledged the retailer’s offerings had “become too predictable” and noted some “fatigue” among its most loyal customers as it kept certain styles around too long. That made the brand vulnerable to a being usurped by trendy rivals.
Lululemon’s outspoken founder Chip Wilson – who has not sat on the company’s board since 2015 but remains a major shareholder – took out a full-page ad in The Wall Street Journal last month criticizing the performance, and slamming “finance focused CEOs” who do not understand product.
There were also departures of high-profile executives: Last month, the company announced that Celeste Burgoyne, president of the Americas and Global Guest Innovation, had decided to leave in December for another opportunity. Last year, chief product officer Sun Choe left to join footwear company Vans as global brand president.
Compounding those problems is a choppy economic environment has made premium $100 leggings a tougher sell for some customers who are being more cautious with their purchases.
In a press release on Thursday, Mr. McDonald called his time at Lululemon “the highlight of my career,” and added that he would fully support the transition to new leadership.
The company will look for a new CEO “with a track record of driving companies through periods of growth and transformation,” Lululemon board chair Marti Morfitt wrote in Thursday’s release.
