During the trading session on March 28 Eastern Time, Lululemon (NASDAQ: LULU), a Canadian high-end athletic brand, experienced a sharp drop of nearly 14.2% in its stock price, marking the largest single-day decline since March 22, 2024. According to statistics, the stock has fallen by 23.36% year-to-date, reflecting growing concerns in the capital market about the brand's prospects.

The recent market turbulence stems from a significant deviation between corporate financial expectations and capital market anticipations. Although the brand's financial report for the fourth quarter and the entire fiscal year 2024, disclosed on March 27, showed excellent performance—with quarterly revenue reaching $3.61 billion (a year-on-year increase of 13%), surpassing the market estimate of $3.57 billion; and net profit recorded at $748 million (also an 11.8% year-on-year increase), which was better than expected—the management's outlook for fiscal year 2025 triggered a wave of selling from investors.

According to the company's disclosure, the revenue for the first quarter of fiscal year 2025 is expected to be in the range of $2.34 billion to $2.36 billion, lower than the institutional forecast of $2.39 billion; the full-year revenue guidance of $11.15 billion to $11.3 billion also falls short of the market consensus estimate of $11.31 billion. During the investor meeting that day, CEO Calvin McDonald pointed out: "Market research shows that inflationary pressures continue to impact consumer decision-making, and customer traffic in the U.S. is showing signs of contraction." In addition, the company specifically mentioned the potential impact of Sino-U.S. trade policies on profitability.

Notably, this sports brand, renowned for its thousand-yuan yoga pants (dubbed the luxury benchmark in the yoga apparel industry), is rapidly shifting its strategic focus toward the Eastern market. Data shows that the Greater China region achieved a 46% year-on-year revenue increase in the fourth quarter, with full-year growth reaching 41%, making it the core driver of global business growth. Of the 40 new stores originally planned for the 2024 fiscal year, 30 will be located in the Chinese market.

At the operational strategy level, Lululemon has continued to refine its customer segmentation: initially targeting urban elite women as its core demographic, it has gradually expanded to include middle-aged men and consumer groups in lower-tier markets. According to third-party monitoring data, as of October 2024, the brand's marketing investment on platforms like Douyin and Xiaohongshu increased by 30% year-over-year to 30.45 million yuan. The content matrix primarily features fashion influencers and lifestyle bloggers, with fitness and sports creators playing a supporting role.

However, China's sports consumption market is undergoing a deep adjustment. Industry data shows that during the same period, the sales of sports giant Nike in China decreased by 4% year-on-year to $1.67 billion (a 3% decline at constant exchange rates). Analysts point out that given the more than $1 billion difference in revenue scale between the two companies, direct comparisons have limited reference value, but the impact of changing market conditions on industry participants warrants continued attention.