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LULUActive

Will LULU report Q2 FY2026 gross margin above 55%?

Resolves September 15, 2026(47d)

IG: 0.64

Current Prediction

40%

Likely No

Model Agreement94%

Predictions9 runs

Last UpdatedMarch 26, 2026

Why This Question Matters

Gross margin is the clearest quantitative measure of whether tariff mitigation and full-price selling are working. Q4 FY2025 saw 550bps compression to 54.9%. If margins recover above 55% by Q2, it signals tariff offsets are taking hold. If margins continue compressing, the premium brand margin thesis weakens.

UNIT_ECONOMICSREGULATORY_EXPOSURE

Prediction Distribution

0%25%50%75%100%

opus

sonnet

haiku

Range: 35% – 45%Aggregate: 40%

Individual Predictions(9 runs)

opusRun 1

38%

Q4 gross margin 54.9% with 520bps tariff compression. FY2026 projects $380M tariffs. Q2 typically benefits from summer. But tariff impact accelerating.

Q4 below threshold$380M tariffsQ2 seasonal benefit

opusRun 2

42%

Q2 historically strong margin quarter. If mitigation ramps ($40M/quarter), Q2 sees less drag. But markdowns +130bps may not reverse.

Q2 historically strongMitigation rampingMarkdowns may persist

opusRun 3

35%

Atomic Auditor: unit economics PRESSURED. 22%+ operating margins permanently gone. Gross margin likely 53-56% range. 55% near middle. Tariff mitigation is swing factor.

Unit economics PRESSURED55% near middle of rangeMitigation is swing factor

sonnetRun 1

45%

Q2 seasonal advantage. Management targeting mitigation ramp. $160M target implies front-loading H1. New product launches may improve mix. Tight but achievable.

Q2 seasonal advantageFront-loaded mitigationNew product mix

sonnetRun 2

40%

Tariff costs rising not stable. De minimis adds cost. Pricing risks demand. Committee: margins structurally 100-200bps below pre-tariff.

Tariff costs risingPricing risks demandStructurally lower margins

sonnetRun 3

43%

Q2 vs Q4 trajectory matters. If mitigation progressing, Q2 better than Q4. Prior year Q2 may be harder comp. Slight lean YES on seasonality.

Q2 vs Q4 trajectorySeasonal factorsPrior year comp uncertain

haikuRun 1

37%

Q4 was 54.9%. Q2 historically better. FY2026 tariffs rising. 55% is tight. Slight lean NO.

Q4 below thresholdQ2 better seasonallyTight threshold

haikuRun 2

40%

Mitigation ramping. Pricing taking effect. Q2 mix favorable. But $380M is significant. Near coin-flip.

Mitigation rampingPricing effect$380M headwind

haikuRun 3

35%

FY2025 mitigation underperformed. Execution risk high. Markdowns elevated. Below coin-flip.

Mitigation underperformedExecution riskMarkdowns elevated

Resolution Criteria

Resolves YES if LULU reports Q2 FY2026 adjusted gross margin at or above 55.0%. Resolves NO if gross margin falls below 55.0%.

Resolution Source

LULU Q2 FY2026 earnings release (10-Q or press release)

Source Trigger

Gross margin stabilization above 55%

atomic-auditorUNIT_ECONOMICSHIGH

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