Lululemon’s Q2: China drives growth, but tariff shock looms

What happened Lululemon Athletica posted strong second-quarter results, with China once again proving to be the brand’s growth engine. Revenue rose 7% YoY to $2.53 billion, while net profit reached $371 million, according to the Canadian retailer. Sales in mainland China grew 25% to $393 million, compared with a modest 1% gain in the Americas to $1.76 billion and a 19% rise in other international markets to $374 million. But even with its momentum in East Asia, Lululemon has cut its full-year outlook, now expecting revenue between $10.85 billion and $11.0 billion, for growth of around 2% to 4%, as tariff costs weigh on performance. The Jing Take By rooting itself in China’s sports culture through synchronized swimming, cheerleading, and community events, Lululemon is betting on community and connection. The Canadian athleisure brand has continued to build its local footprint in China, opening five new stores and running its fifth annual “Summer Sweat Challenge.” CFO Meghan Frank has stated that China remains a key focus for expansion, while in the Americas the company plans about 15 new openings this year, with nearly half in Mexico. The brand is also launching cultural offerings to better connect with young consumers. On September 8, it launched its 2025 Tmall Super Brand Day with a short film choreographed by Malik Le Nost, best known for his work with Madonna. The film brought together synchronized swimming world champions Wang Liuyi and Wang Qianyi with the Xihua University cheerleading team, aiming to change perceptions of cheerleading as both athletic and artistic. And later this week, Lululemon will stage an immersive “Scuba Theater” by Hangzhou’s Xianghu Lake, as well as release a podcast episode featuring national cheerleading figures. Meanwhile, global competition is heating up. Nike has just rolled out a new global campaign, dubbed “Why Do It?,” a fresh spin on its famous “Just Do It” line. The film, featuring Zheng Qinwen, LeBron James, Carlos Alcaraz and others, encourages younger audiences to embrace risk and resilience as part of their journeys to success. For Lululemon, the challenge will be sustaining its strong performance in China while navigating slowing demand and higher costs at home. The sportswear giant’s ability to balance expansion with profitability will determine how far it can maintain its leadership in the global market. Additional research by William Zhou. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

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Lululemon’s Q2: China drives growth, but tariff shock looms