Lululemon Athletica Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Matthew Boss - JPMorgan Chase & Co - Analyst : So in the US, could you speak to the cadence of demand that you saw in the third quarter, elaborate on trends quarter to date, maybe notably the slowing trend that you cited post Black Friday? And just larger picture, the timeline that you see is reasonable for the product assortment to be fully optimized as we look to next year?

Question: Matthew Boss - JPMorgan Chase & Co - Analyst : Great. And then, Meghan, just taking all that into account on the product assortment changes, are there any puts and takes for us to consider as we model operating margins relative to this year? Any reinvestments for us to think about maybe as it relates to your comments on experience and activating newness as you outlined as we think about next year?

Question: Dana Telsey - Telsey Advisory Group LLC - Analyst : As you think about the segment, how did the segment perform this quarter versus how you performed? And then as you think about the newness that's flowing in, which segments should we be seeing first? What are you thinking about bottoms, about tops, about men's and women's? Any more clarification on that? And what are you looking for in the new CEO? What are you looking for in the new leader as you move forward?

Question: Adrienne Yih - Barclays Services Corp - Analyst : Yes. Calvin, thank you for all the hard work over the years and all the successful strategies in place going forward. I guess, let me start with kind of the new products pipeline and the things that you'll be doing, how much of that new product has been sort of informed from primary research and from the customer directly? And then Meghan, can you talk about kind of price increases, what you've done season to date and any additional price increases for spring. And you had mentioned kind of maintaining operating margins or supporting them at current levels next year. Can you give us a little bit more color on what that entails? Best of luck, Calvin.

Question: Brooke Roach - Goldman Sachs Group Inc - Analyst : Calvin, Meghan, I was hoping you could speak to the performance of your largest franchises, both in the performance category and in Lounge and Social. Are these businesses large enough that you think that they warrant a reset in order to let the new product innovation shine and the new design language pop out to the consumer in a bigger way in '26 and beyond? And what proof points in the new design language are you currently seeing that gives you confidence that the new styles launching in '26 will change the trend rate that you're seeing in the US today?

Question: Lorraine Hutchinson - Bofa Merrill Lynch Asset Holdings Inc - Analyst : I was hoping to hear more about the [NFL] partnership. Can you quantify the impact to sales and margins? And then talk about, if it attracted a new or reengaged guest in line with your expectations? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 11, 2025 / 9:30PM, LULU.OQ - Q3 2025 Lululemon Athletica Inc Earnings Call

Question: Paul Lejuez - Citi Infrastructure Investments LLC - Analyst : Curious if you could talk a little bit more about the kind of business, what you saw in e-comm performance versus stores? And also curious how you would characterize the athletic apparel market in China in general? And if there are any big differences by city peers?

Question: Brian Nagel - Oppenheimer & Co Inc - Analyst : First off, Calvin, best of luck. It's been a pleasure working with you.

Question: Brian Nagel - Oppenheimer & Co Inc - Analyst : So with the leadership change, and we've been talking for a while now about our product refreshes and particularly a lot of new products set to hit in early '26. So I guess a two-part question. I mean does the leadership change the timing or any aspects of those product launches? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 11, 2025 / 9:30PM, LULU.OQ - Q3 2025 Lululemon Athletica Inc Earnings Call And then I guess the follow-up, and I think this may be a bit of a follow-up. But I mean, what are you seeing now as far as consumer reception to the new products you have introduced are you -- is there a marked difference in how the consumers reacted to those products versus some of your legacy items?

Question: Jay Sole - UBS AG - Analyst : My question is on the co-CEO structure that exists now. Calvin, given your transition in select transition, who is design reporting to who is merchandise reporting to, who's ultimately going to make the fund decision on what happens in terms of product and what gets made and what goes into the stores?

Question: Mark Altschwager - Robert W. Baird & Co Inc - Analyst : And Calvin, best wishes for your next chapter. My question is for Meghan. I just was hoping we could zoom in specifically on the tariff de minimis piece. Last quarter, you gave us some dollar figures for gross and net this year, next year. It sounds like you're making some progress. I guess where are you seeing the progress? And would you be willing to share some updated figures and how you're thinking about the gross net impact both this year and next year? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 11, 2025 / 9:30PM, LULU.OQ - Q3 2025 Lululemon Athletica Inc Earnings Call