In a press release, the yoga apparel brand announced that Calvin McDonald, a former top executive at makeup chain Sephora, will take charge of the company from Aug. 20. McDonald, who also previously served as president and CEO of Sears Canada for two years, is set to replace Laurent Potdevin, whose four year stint at Lululemon abruptly came to an end in February after he was charged with improper conduct and accused of being in a relationship with a female subordinate.
“Calvin McDonald has an impressive track record leading organizations through periods of significant growth and innovation," said Glenn Murphy, chair of Lululemon's board. "He is the ideal match for the Lululemon brand and culture given his strong consumer mindset, performance-driven approach, and success developing people. Each member of our board met him during our thorough process. We’re confident Calvin will maintain the momentum in the business and take Lululemon to new heights.”
News of McDonald’s appointment saw Lululemon’s shares climb 1.24% in after-hours trading.
The positive reaction to McDonald’s appointment is unsurprising. Aside from bringing greater stability, following months without a CEO at the helm, investors were also likely impressed with his resume.
McDonald played a key role in helping Sephora become a mobile-first brand and in rolling out the makeup chain’s first beauty subscription program. His arrival at Lululemon comes at a time when the brand is working on modernizing its own sales channels.
Lululemon was one of the first companies to begin the “athleisure” trend, but has since had to contend with rising competition from the likes of Nike Inc. (NKE) and Gap Inc. (GPS). Amid these challenges, the company has been criticized for a lack of innovation and higher prices.
However, financial figures from the firm continue to be encouraging. Over the past two quarters, sales have outstripped expectations, while profit margins continue to widen as more transactions are completed online. Outperformance has seen the company’s shares rise nearly 100 percent from a year ago. (See also: Lululemon Breaks Out to Fresh Highs, but Are Shares Oversold?)
“I’m joining Lululemon at an exciting time, with the brand’s strong business momentum, guest loyalty and passionate employees,” McDonald said in a statement. (See also: Lululemon's Stock Poised for a 16% Pullback.)