Chip Wilson isn’t backing down. The Lululemon founder, who built the yoga-pants empire from a single Vancouver studio in 1998, fired off a blistering letter to shareholders this week. He slammed the board’s choice of Heidi O’Neill, a 30-year Nike veteran, as the next CEO. “Broken governance,” Wilson called it. Shares plunged after the April 22 announcement, dropping as much as 13% to around $141.
O’Neill starts September 8, once her Nike non-compete expires. She’ll replace interim co-CEOs Meghan Frank and André Maestrini, who stepped in after Calvin McDonald departed in January. McDonald had led since 2018, steering growth amid pandemic booms. But lately? North American sales tanked. Americas revenue fell in fiscal 2025, ended February 1, while international markets propped up results. Competition from Alo Yoga and Vuori bites hard. Tariffs loom, projected to cost $380 million this year.
Wilson owns 8.6% of Lululemon. He’s waged war since December, nominating three directors: Marc Maurer, ex-co-CEO of On Holding; Laura Gentile, former ESPN chief marketing officer; Eric Hirshberg, ex-Activision CEO. He demands annual board elections, a full refresh. No CEO hire until then, he insists. The board ignored him. They added Chip Bergh, ex-Levi’s CEO, in March. Then Esi Eggleston Bracey, ex-Unilever growth chief, on April 28. Both stand for election June 25.
Wilson’s Long Simmering Fury
Wilson left the board in 2015 amid diversity controversies. He’s never stopped critiquing. Full-page WSJ ads. LinkedIn rants. Open letters. He accuses the board of killing innovation, letting the brand lose its edge. “The board didn’t understand the apparel company’s brand, which has been leading to its challenges,” he wrote in his latest missive, as reported by The Wall Street Journal. O’Neill’s pick? Proof of disconnect. A month ago, he warned CEO candidates: no single leader fixes this without board change.
The market agrees, sort of. O’Neill helped grow Nike from $9 billion to $45 billion. Lululemon touts her as a “visionary” for product innovation and global strategy, per their press release. She vows to “accelerate product breakthroughs, deepen the brand’s cultural relevance.” But analysts cry foul. “Lululemon needs a turnaround CEO and not a growth CEO,” one said, as shares dived, according to New York Post. BNP Paribas’ Laurent Vasilescu noted her direct-to-consumer role at Nike, now de-emphasized there.
Wilson blames stalled talks. The board demanded he escrow millions for a non-disparagement clause. Self-interest, he says. No deal. Proxy advisors may back him; stock’s down 65% from peaks amid product irrelevance.
Stakes Rise Ahead of June Clash
Lululemon urges votes for its slate: Bergh, Bracey, Teri List (ex-Gap CFO). Wilson’s trio competes. No settlement in sight, despite chats. Wilson advises rivals Alo and Vuori—ironic, given they’re stealing share. Investors watch. Elliott Management lurks, per some chatter. At 6X EBITDA, value destruction screams opportunity.
Board filings paint Wilson erratic, forcing his book on meetings. He fires back: negligence caused the mess. O’Neill inherits chaos. Her start? Rockier than planned. Wilson’s letter: “The market response to the hiring of Heidi O’Neill creates an unnecessarily challenging start for her.” Proxy fight heats. Shareholders decide June 25. Lululemon’s cool factor hangs in balance.
Wilson built this. Now he wants it back—his way. Board digs in. O’Neill waits. Sales slump. Rivals pounce. Brutal timing.
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