Lululemon is entering a difficult leadership transition as weakening legging sales and falling demand across its core markets test new Chief Executive Officer Heidi O'Neill. The company reported second-quarter revenue of $2.42 billion for June through August, down 4% from a year earlier, while net profit fell 11% to $370.9 million. Comparable store sales (sales growth at established locations) plunged 9%, and the stock dropped more than 18% after the results. Legging sales, a central product category, declined 20%, while sales in the Americas, which generate two-thirds of total revenue, fell 8%. International revenue increased 4%, but comparable store sales overseas declined 3% and missed market expectations. Consumer complaints that the leggings' form-fitting design is too revealing have led analysts to call for a review of Lululemon's full product lineup. Wall Street analysts cut their price targets, with JPMorgan lowering its target to $95 from $154, Bank of America reducing it to $122 from $140 and Telsey Advisory Group cutting it to $110 from $122. Telsey said the company needs broader improvement despite its product innovation efforts, while Truist analyst Joseph Civello said the problems would persist longer than initially expected and that uncertainty surrounding the management change was adding pressure. O'Neill takes office on the 9th, according to WWD and other trade publications on the 8th. She spent nearly three decades at Nike across product development, design, marketing and digital commerce and was credited with helping raise its annual revenue from $9 billion to $45 billion, as well as shortening time-to-market. Her departure as Elliott Hill became Nike chief executive has prompted some to characterize the move as a transition from a role she was pushed out of to a company already facing severe difficulties. Morningstar analyst David Swartz said Lululemon was beginning a critical leadership transition while sales were weakening across its major markets and the second half of the year was expected to be even tougher. Analysts also said simultaneous struggles at Nike, Deckers and On Holding could make a turnaround more difficult.