Activist investor Elliott reportedly takes $1 billion stake in Lululemon, eyes new CEO

By Mike Murphy

Lululemon's stock has dropped about 45% so far this year.

Activist investor Elliott Management has taken a sizeable stake in Lululemon Athletica and has a potential CEO candidate in hopes of turning around the company's fortunes, according to a new report.

The Wall Street Journal reported Wednesday night, citing sources familiar with the matter, that Elliott has accumulated a stake worth more than $1 billion, which would make it among the company's largest shareholders. Lululemon has a market cap of around $25.3 billion.

The Journal also reported Elliott has been working closely with retail veteran and former Ralph Lauren executive Jane Nielsen, who they see as a possible CEO candidate. In a statement to the Journal, Nielsen said she would "welcome the chance to discuss this opportunity with the Lululemon board."

Neither Lululemon nor Elliott Management immediately responded to requests for comment.

Lululemon shares (LULU) have rallied more than 10% since the athleisure-wear maker last week announced the departure of CEO Calvin McDonald, who had led the company since 2018. The move was praised by analysts, as well as by company founder Chip Wilson, who left the company's board in 2015 and has sharply criticized the direction the company has since taken. Last month, Wilson blamed McDonald for the brand's "loss of cool" and said the company was no longer innovative enough.

Besides internal missteps, Lululemon has faced increased competition from companies like Vuori and Alo Yoga. In its third-quarter earnings report last week, Lululemon said sales were up 7% to $2.6 billion, beating analysts' estimates. Much of that growth, though, was international, with Americas revenue falling 2%.

Lululemon's stock price has plunged by 45% year to date. After peaking above $500 in December 2023, the stock has sunk about 60%, closing Wednesday at $207.87. But shares rallied more than 4% in Wednesday's after-hours trading following the Journal's report.

-Mike Murphy

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12-17-25 2104ET