Report: Lululemon to replace hundreds of workers with AI

Daily Mail​

6 hours ago

A major Nike rival will axe 150 workers — and it may replace them with AI. Lululemon, the Canada-based athleisure brand known for its buttery-soft leggings and sweat-wicking men's shirts and pants, confirmed that it is eliminating roles on its support center team. The affected employees handled customer service calls — including questions about online orders, return policies, and sizing options — as well as technical support for brick-and-mortar locations.
'As we continue to deliver on our strategy, we regularly assess our business operations to ensure we are well-positioned for the future,' a company spokesperson told DailyMail.com. 'Following a recent review, we have decided to evolve some aspects of our organizational structure to operate with more agility and further invest in our growth.' Independent retail analysts told CBC they believe the company will turn to AI to fill the gap.
The company did not answer DailyMail.com's questions about its future AI policy. Lululemon's support center roles are exactly the kind of formulaic, repeatable tasks that advanced computers are designed to handle. Independent retail analysts don't believe the job cuts indicate any issues for the brand. Still, under the hood, there are concerns.
'They are now struggling to generate growth in their core North American market,' Neil Saunders, a retail expert at GlobalData, told DailyMail.com. 'With costs rising, including from tariffs, Lululemon is gently pruning roles to keep costs in check.' The layoffs also come as the company reassesses its tariff strategy.
A majority of Lululemon's products are made in Vietnam, Thailand, and Indonesia — countries that could face sweeping reciprocal tariffs if President Donald Trump reinstates them. In June, the company's CFO, Meghan Frank, admitted that the brand would need to raise prices to offset the levies. 'We are planning to take strategic price increases,' Frank said during the company's last earnings call.
'It will be price increases on a small portion of our assortment, and they will be modest in nature.' Price hikes are expected in stores in the fall. Lululemon pulled in $2.4 billion in revenue during its last quarter, but a majority of the company's growth came from international markets. The company currently operates 465 stores in the US and 760 globally.
Jobs jettisoned
Some of America's biggest companies have announced sweeping job cuts this year. In May, Walmart — America's largest employer — announced it was cutting 1,500 jobs from its tech operations and e-commerce teams. Procter & Gamble, the owner of Tide detergent and Gillette shaving products, is also undergoing significant cuts. The company said it would eliminate 7,000 positions.
Job losses have been even more pronounced in the tech sector, as firms increasingly replace human employees with hyper-intelligent machines. The AI-driven job bloodbath marks a major shift for American workers. For years, mass layoffs were concentrated in US manufacturing plants. Now, they're impacting college-educated, high-to-middle-class earners.
Microsoft — one of the leading firms investing in AI — is expected to lay off thousands of employees next month as it shifts resources toward deeper investments. Intel, the flagging tech giant, is also letting go of 10 to 15 percent of its manufacturing staff. Amazon CEO Andy Jassy recently said the quiet part out loud : the technology will uproot thousands of Americans from their jobs.
'​​As we roll out more Generative AI and agents, it should change the way our work is done,' he wrote to his employees in a memo. 'It's hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total corporate workforce.' So far, the cuts haven't had a statistically significant impact on overall job numbers in the US. Last month, employers continued to add jobs. But job creation is starting to slow.