Lululemon Athletica Inc. (NASDAQ:LULU) experienced a 2% decline in its stock price on Thursday following media reports that the athletic-apparel maker is confronting a new round of criticism over leggings that customers say become see-through during movement.
KeyBanc Capital Markets analysts led by Ashley Owens noted consumers posting on Reddit that the brand's "heart scatter" leggings appear transparent when wearers bend or squat. The analysts also cited similar complaints that have been posted on the company's own website.
This development echoes a recent issue in which Lululemon removed its "Get Low" line from sale after transparency concerns were raised. The company subsequently returned those products to its web store with added disclaimers instructing customers to size up and to wear skin-toned underwear under the garments.
Analysts and investors are watching the recurrence of product-transparency complaints closely because they emerge while the Vancouver-based retailer is operating under difficult conditions. Lululemon's shares have fallen 55% over the past 12 months amid a slowdown in sales growth, and the company is in the market for a new chief executive officer.
The company did not immediately respond to a request for comment on the latest leggings issue.
Context and commercial implications
Repeated product-quality reports have the potential to affect consumer confidence and could influence purchasing decisions, particularly in the women's activewear category where product performance and durability are central to brand value. For Lululemon, which previously enacted product removals and added buyer guidance, the current complaints replicate a pattern that may require further operational responses.
Market reaction
The immediate market response to the latest complaints was a modest share-price decline of 2% on Thursday. That move comes against the backdrop of a much larger 12-month drop in Lululemon's stock value.
Outlook
At present, the available reporting documents consumer complaints and the company's prior actions to adjust product listings and add disclaimers. There is no additional confirmed information about further product changes, operational measures, or management decisions beyond what has been reported. Observers will likely monitor for any official comment or corrective steps from the company.