Lululemon Restructures Fabric Team After See-Through Leggings Complaints And Stock Collapse

Lululemon is restructuring its fabric development operations following another round of customer complaints about product quality, eliminating seven positions and shifting some responsibilities closer to overseas suppliers, according to Bloomberg.

The changes, implemented in August, include moving certain raw-material development functions to vendor partners. The company is currently advertising related positions in Taipei and Ho Chi Minh City.

Bloomberg writes that the shakeup follows complaints that leggings from Lululemon’s Get Low collection were too transparent, prompting a temporary suspension of online sales. Similar concerns emerged weeks later over its heart-patterned leggings.

The problems add to a history of quality-control issues. In 2024, Lululemon discontinued its Breezethrough leggings following criticism of their fit, while in 2013, the company recalled nearly 20% of its women’s bottoms over excessive sheerness.

It comes during an already disastrous year for Lululemon shareholders. The stock has plunged roughly 55% in 2026, dramatically underperforming the broader market as investors question whether the once-dominant athleticwear brand can regain its footing.

The company’s financial performance has done little to restore confidence. Second-quarter revenue declined 4% to $2.4 billion, while comparable sales fell 9%, including a 12% decline in the Americas. Management has repeatedly lowered its outlook and now expects full-year revenue to decline between 5% and 7%, a remarkable reversal for a company once celebrated for its consistent growth.

Competition has also intensified, with emerging brands like Alo Yoga and Vuori challenging Lululemon’s dominance in premium athleticwear. Meanwhile, merchandising missteps, declining customer traffic and concerns about product quality have raised questions about whether the company’s once-formidable pricing power and brand loyalty are beginning to erode.

Shares are now trading more than 80% below their late-2023 peak, leaving new CEO Heidi O’Neill with a difficult turnaround ahead.

While the stock’s collapse has made its valuation considerably cheaper, investors appear increasingly unwilling to pay a premium for a company struggling with declining sales, intensifying competition and repeated product failures. For now, the question is whether Lululemon is simply experiencing a temporary rough patch or confronting a more permanent deterioration in its brand.

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