Tariffs are shifting. De minimis rules are under pressure. And new enforcement could change how retailers operate overnight. If you sell across borders—through ecommerce, marketplaces, or direct—these changes don’t just impact compliance. They impact your pricing, margins, and conversion rates.

Register for our Trade and Tariff webinar series for regular updates.

Lululemon reported $2.5B in Q1 revenue, up 4%. The company's own infographic leads with stronger-than-expected revenue growth. Read past the first line, and the picture changes.

Earnings per share came in at $1.69, down 35% from $2.60 a year ago. Net income was $195M. That is not a rounding error. A third of the company's profit disappeared in 12 months, and revenue growth did little to cushion the fall.

Start with where the growth actually came from. China Mainland revenue jumped 30%, to $478M. Rest of World rose 13%. The Americas, which still make up 66% of the business, fell 3%, with comparable sales there down 5%. Strip out currency and it gets worse. Total revenue grew 2% in constant dollars, and global comparable sales declined 2%. The home market is shrinking. China is doing the heavy lifting, and China is roughly a fifth of the business.

Now the margins, which is where this quarter really lives. Gross margin fell 410 basis points to 54.2%. Management blames tariffs, markdowns, and higher inventory provisions. Tariffs are the headline culprit. The de minimis change and broader U.S. customs policy are hitting the P&L directly, and Lululemon has limited room to pass that cost to a guest who is already pulling back at home.

SG&A made it worse. Operating expenses hit 42.9% of revenue, up from 39.8%, a 310-basis-point deleverage. Some of that is employee costs and brand activations. Some of it is the proxy contest, which is a polite way of saying the company spent money fighting with its own shareholders. Operating income dropped from $438M to $277M. The operating margin fell from 18.5% to 11.2%. In one year.

So what is management doing with the balance sheet? Buying back stock. Lululemon repurchased 2.2M shares for $358M in the quarter. That is nearly triple its capital expenditures and almost double its net income. You can argue the stock is cheap. You can also argue that spending $358M on buybacks while the operating margin is in free fall is a confidence signal that the numbers do not support.

A few things are working. Men's apparel grew 7%. Inventory is up only 2% in dollars and down 4% in units, so they are not drowning in product. Cash sits at $1.5B. The international story is real, and 816 stores against 770 a year ago show they are still building.

But the framing matters. "Reignite growth" is the company's own phrase, and it says a lot. You do not reignite something that is already burning. The Americas’ business, the engine that built this brand, is going backward. The margin structure that made Lululemon a Wall Street darling is eroding under tariffs and discounting.

The question for the next two quarters is simple. Can China grow fast enough to matter, and can management defend margin without gutting the brand on markdown? Right now the answer is unproven. A 35% earnings drop is not the quarter that earns the benefit of the doubt.

Lululemon just proved that even a brand with real pricing power can't fully absorb the new tariff regime, eating 330 basis points of product margin in a single quarter. If the strongest name in athleisure takes that hit, everyone below it on the brand ladder is going to take more.

Walk any of these keynotes, and you'll come away thinking Shopify fixes your business. It doesn't. It gives you a better platform to run your existing business. Most operators only learn the difference after the contract's signed, when the problems they blamed on the old stack turn out to be sitting right there on the new one.

That's not a shot at Shopify. It's a shot at magical thinking.

People love debating whether MrBeast counts as a real "enterprise" brand. Have that argument if you want it. Reitmans, LVMH, and Estée Lauder leave no doubt: serious brands at real scale, running on the platform, and none of them got there by accident. With the right team and honest expectations, Shopify holds up. That part is true.

The green bag has become shorthand for the whole pitch: innovation, speed, and a way out of the vendor prison you've been stuck in for a decade. Good story. But the question that actually decides the thing never makes the main stage. Does the promise come with thorns, and when brands hit them, how are they working through it?

That's the conversation I want. Not the highlight reel, but the part where someone tells you what broke and what they'd do differently.

The Big Green Bag of Promise: Enterprise Shopify Webinar Series, sponsored by Avalara, Domaine, and Pattern, is designed to answer those questions rather than duck them.

So if you're weighing a move, stuck mid-migration, or already living with the decision and wondering whether you got the full story going in, register and show up. Bring your skepticism. We'll bring answers, and we won't pretend the thorns aren't there.

Big Green Bag of Promise: Enterprise Shopify Webinar Series is not sponsored by Shopify.

Elara Verret is Chief Digital and Customer Officer at Reitman's — 400 stores across Canada, 3 brands, real omnichannel complexity. She is 3 weeks post-launch.

Max Rolon is CTO at Domaine — one of the agencies doing the hardest technical work in the Shopify enterprise ecosystem. He sees the gap between what brands think they're buying and what they're actually getting.

Unified commerce is one of those phrases that sounds like a goal and functions like a dodge. Everybody wants it. Nobody agrees on what it means. And the vendors — Shopify included — are very happy to let you project whatever you need onto it.

A customer can buy online and return in-store without your system breaking down. Your inventory is visible across every channel before you promise it to anyone. TikTok Shop, Buy With Prime, your own dot-com, and your four hundred physical locations are not running on four separate mental models of what "available to sell" means.

BOPIS works. Not in theory. Not in the roadmap slide. This Tuesday, when a customer drives twenty minutes to pick up an order that your system thinks is there and isn't. That is what unified commerce means. And none of the platforms has fully solved it. Including Shopify.

These webinars are not sponsored by Shopify but contain real talk by operators.

Register for one webinar and be able to join all 3 - if you can’t attend, we will send you a copy to watch on demand.

Date: June 4, 11, and 18, 2026

Time: 12:30 PM ET

Host: Rick Watson