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Lululemon (LULU) stock is taking a pounding in premarket post-earnings, as it should.

The quarter and outlook both stunk. The results are deserved, as people I talk to in retail have been super let down in Lululemon’s product assortments in recent months. It will take time to reverse the lack of must-have items, they say.

Here is the Street vibe on Lululemon this morning:

“Challenges from domestic market pressures and removal of the de minimis exemption are primary drivers of a meaningful cut to FY25 guidance (implying -4.4% lower 2H revenue and -22% lower 2H EPS at the midpoint). Acknowledgment of underperformance within the casual side of the business (40% revenue mix) is a starting point, though reigniting brand momentum in the U.S. is likely to take longer than we had previously anticipated.” — Stifel analyst Peter McGoldrick

“It’s very simple… With sales per foot 4x mall avg and margins near peak, LULU’s fundamentals will get much worse ahead. The US drives the earnings and the US is fading fast here. We believe the guide is not low enough and continue to carry estimates well below the Street/company guide. Rising competition won’t stop either, which means LULU’s EPS is permanently impaired. With lower growth and brand strength fading, a lower multiple is warranted.” — Jefferies analyst Randy Konik