Each year extremely popular and reputable financial news website 24/7 Wall St. identifies 10 brands that they believe will disappear by the end of the year. Unfortunately for Lululemon fans, Lulu makes it to number 1 on the list.
According to 24/7 Wall St. it’s actually easy to identify why the fortunes of Lululemon have changed so drastically. Firstly on March 18th 2013, Lululemon started to recall a large portion of yoga pants that were implicated in the sheer scandal (when stretched-something that happen often in yoga, the pants became ultra revealing). This was just the beginning, as an onslaught of problems continued to plague Lululemon. Shortly after the recall, Lululemon’s CEO Christine Day lost her job, and the founder Chip Wilson continually gets himself into trouble with unflattering remarks about women who wear his product.
Lulu’s last quarterly financial statement shows how deep the brand is. Lululemon stock is down 50% and the company’s net income collapsed from $47 Million to $19 Million.