Lululemon's comparable sales fell 10% in the quarter, and its full-year sales guidance has moved from up 3% to 4% at the start of the year, to flat last quarter, to down 5% to 7% now.
Most of this week's Canadian earnings were quiet. This episode had a brand in free fall, a snowmobile maker absorbing a $200 million tariff bill it cannot plan around, and a US president posting that Bombardier should not be allowed to sell planes in America unless it builds them there.
"And just those revisions, it also shows that management is not really sure where things are going."
The Canadian Investor is the Canadian Investor Podcast Network's news-and-earnings show, and its two hosts work from the releases and the conference calls themselves — one of them owns BRP and says so on air before valuing it.
I listened to the full episode so you can skip it. 49 minutes of audio, 16 minutes of reading.
Here are the 10 numbers that matter.
🎙️ Hosts: Simon and Dan Kent, the two co-hosts of The Canadian Investor, the Canadian Investor Podcast Network's show on individual stocks and portfolio construction
📰 Published: 10 September 2026, on the show's own podcast feed
🟣 Apple Podcasts | 🔗 Episode page | ⏱️ 49 min | ✅ Time saved: 33 min
Key Takeaways
Lululemon's comparable sales fell 10%, and its full-year guidance has been cut twice in two quarters — from up 3-4% to flat to down 5-7%
The hosts read the serial revisions as management not knowing where the business is going
International comps went from up 8% last quarter to down 6% this one, removing the last bright spot
Strip out a 560-basis-point one-off and Lululemon's operating margin was around 12%, against a mid-teens-to-high-20s history
Tariffs did roughly 80% of the damage to BRP's gross margin, and the company will not move production until the rules stop changing
It also handed $75 million to an unnamed parts supplier in financial distress, which it called an exceptional circumstance
BRP raised full-year guidance and guided to a 50% profit decline next quarter at the same time
The tariff bill was always coming; management just did not know which quarter it would land in
Bombardier has 56% of its sales in the US and 6% of its property, plant and equipment there — which is probably what the Trump post was reading
Section 546 of the Bank Act bars foreign banks from taking deposits under $150,000, which is how Canada protects its banks without banning anyone
The hosts' verdict: Trump is wrong that US banks cannot operate in Canada, and right that they cannot compete in retail
Couche-Tard's revenue rose 25% but merchandise sales rose only 3.3%, and fuel carried the beat
Energy drinks now sell at twice the volume of carbonated drinks and drive 70% of beverage growth
GameStop's net income was up 65% on the headline and down 66% once derivative and eBay paper gains come out
Collectibles are now 45% of sales, up from 23%, and grew 57% year over year
1. Lululemon's Tire Fire
The hosts opened on what one of them called a tire fire, and the numbers are the reason.
Revenue fell 5% and comparable sales fell 10% — the figure they kept returning to. "But comparable sales declining by 10% is wild."
The Americas were worse than the overall number, and the decline accelerated sharply: the previous quarter's Americas comp was down 6%
International comparable sales fell 6%, against an 8% increase the previous quarter. International, led by China, had been the one part of the business still growing while the Americas went flat, and that is over
Operating margin came in close to 19%, which sounds survivable until you take out the one-off. The company told the call that margins got a 560-basis-point bump from a tariff-related item; without it, the hosts put the margin near 12%, against a history they describe as mid-teens to high-20s
The guidance was worse than the quarter. Q3 sales are guided down 10% to 11%, with management flagging a slow start to August — a month they were already part-way through when they gave the number
The full-year number has been cut twice: up 3% to 4% at the start of 2026, essentially flat last quarter, and now down 5% to 7%
"And just those revisions, it also shows that management is not really sure where things are going."
On what has gone wrong, they listed the company's own admissions and one outside read: products are not resonating, said on several calls now; the store experience is less vibrant than competitors and the assortment is too wide, which a retail analyst made on Bloomberg TV; the production cycle from design to shelf runs about two years, which management is trying to shorten; and there were see-through complaints on a leggings product again this year
Leggings, the category the brand was built on, underperformed again. The chief product officer left about two years ago and the company acknowledged the assortment problem then. "At this point, you should have had some new products and revamped your offering."
Brand sentiment is a stated problem in China specifically, which was the growth vector. New chief executive Heidi O'Neill started on 8 September, days after the call, and the hosts' view is that nothing else works until the product is right
2. The Growth Paradox
The second half of the Lululemon discussion was a general argument about fashion retail rather than about this quarter.
The pattern they describe is a trap rather than a mistake: demand looks strong, the company goes into full expansion mode, and stores take time to plan and open
"And then once those stores start opening and they have a massive store footprint, that's when the brand actually oftentimes like starts slowing down." The company is then carrying a larger cost base into a slowdown, has to discount, and the discounting compounds
One of them called it a growth paradox: the company has to grow while it is popular, and that growth is what damages the results later
On this quarter specifically, one host questioned the number of new stores Lululemon is still opening
Their wider claim, from research they did for a separate episode on fashion companies, is that formerly thriving brands routinely went bankrupt while the brands themselves survived — bought back out of bankruptcy, with the public shareholders wiped out. They found dozens of examples and used three
3. BRP Is Not Bombardier
Before the earnings, a correction, because the two names had been conflated in the news cycle all day.
"BRP has nothing to do with Bombardier." BRP spun out of Bombardier about 25 years ago and is a completely separate company
One host said he had seen fabricated posts attributed to Trump about banning snowmobile sales in the US. "It never actually happened."
The practical point for a listener is that the Trump post concerned Bombardier's aircraft business, not the recreational-products company that shares part of the name
4. BRP's $200M Tariff Bill
They called the quarter solid and the disclosure confusing, and both halves are about tariffs.
Revenue was well ahead of estimates and grew double digits, and the hosts noted BRP has not posted a bad quarter in a while
Gross margins fell nearly 10%, and the company attributed close to 80% of that drop to tariffs — around 7.5 percentage points of margin, possibly more. Management said the underlying business improvements would have lifted gross margins without them
The remaining piece of the margin decline is a payment nobody expected: BRP gave $75 million to a parts supplier in financial distress. The company refused, repeatedly, to say who it was, and called it an exceptional circumstance that has never happened before
The hosts could not tell whether it was structured as a loan, and reasoned that if it was not a loan the supplier must be critical. One of them asked why the company would not simply buy the supplier instead
BRP put the tariff impact at $200 million this year and $225 million in fiscal 2028 — it is in fiscal 2027 now — and the hosts described that as ripping the bandaid off
The company has already moved manufacturing and parts sourcing to mitigate tariffs, and the bill still went up. "So they did mention that relocating production is not going to happen until they get a predictable environment." The hosts called that wise, and doubted the predictable environment will arrive
Their view on why it will not arrive is structural, not political. They noted the Biden administration kept most of the China tariffs, so a change of party would change tone more than substance: "I think we're just seeing a structural shift in terms of how the world is working, going from globalization to de-globalization." One host said he would have expected a return to normal a year ago and no longer does
5. Trump's Bombardier Post
The hosts treated the post as a fact-check exercise rather than as news, and went to Bombardier's own filings.
About 56% of Bombardier's sales are in the US, though that figure covers maintenance and other services as well as aircraft. The planes involved are mostly smaller aircraft and private jets
Only about 6% of Bombardier's property, plant and equipment sits in the US, against roughly 89% in Canada — which is, on the hosts' reading, the number the post was built on
Their counter-argument is that a plant location is not the whole supply chain. A jet assembled in Canada can still be full of US-supplied parts and still support US jobs, and the hosts argued that context is missing from the claim
The same post also named banks and Gulfstream, which is a Bombardier competitor
On Gulfstream the hosts say the complaint is out of date. Trump said in January that Canada was refusing to certify a number of Gulfstream models; Canada certified most of them in February, so the recent version of the claim no longer holds
"So I'm not trying to defend it or anything. I just wanted to make sure kind of fact check what he was saying."
6. Bank Act Section 546
The banking half of the post got the most careful treatment in the episode, and the answer is that both sides of it are partly right.
US banks do operate in Canada. The hosts pulled up J.P. Morgan's Canadian presence: commercial banking, global corporate banking and investment banking — institutional and high-net-worth work rather than retail
"But one of the things that the Bank Act says, so Section 546, and I looked that up, foreign banks cannot take deposit less than 150,000."
"Then you're essentially saying they can't compete on the retail side." The hosts extended it to small business as well, since many small businesses hold less than $150,000 on deposit
So the verdict splits: Trump is wrong that US banks cannot be in Canada, and right that regulation protects the Canadian banks from them
They named the other protected industries the post was aimed at: airlines, which carry heavy ownership and operating rules, dairy, and banking
7. Why He Is Escalating
The hosts' read on the motive is the opposite of the common one, and they were explicit that it is interpretation.
Their claim is that the aggression signals need, not strength. "And the only way that he thinks he can do a trade deal and force Canada to do so is just ramp up the screws on Canadian companies on Canadian trade."
The timing pressure is the midterms, and specifically mail voting. They put mailed ballots at 30% of the vote in the last US election, and said the earliest states begin mailing in about a week — so the deadline for a visible win is well before election day, not on it
The backdrop they named makes a win harder: escalation in the Middle East, US diesel prices they believe are at a record, and pump prices well above $4 a gallon
Their summary of the post itself was that it threw a lot of things at the wall, and that the industries named are ones Canada genuinely does protect
8. Couche-Tard's Fuel Beat
Alimentation Couche-Tard beat, and the hosts spent the segment explaining why the market did not reward it.
Revenue rose 25%, earnings 15.4% and gross profit 8.7% — but 15% of the growth came from fuel, while merchandise rose only 3.3%
"So you're talking about fuel running the most of it and merchandise kind of trending in line with inflation for the most part." Given where food costs have gone, they do not count that as growth
The US numbers are the problem, because the US is the majority of the business. Fuel volumes fell about 1.6%, same-store sales came in at 1.7%, and merchandise margins fell 0.5%, which management attributed to heavy promotional activity including World Cup campaigns
Canadian merchandise same-store sales were flat and Europe was up 1.2%, with fuel volumes falling in both the US and Europe and rising slightly in Canada
The trade-down explanation is the one they favor, and they tied it to what Walmart, Target and Dollar Tree have all reported: consumers moving to value, and grocery doing well only where the offer is cheap
Their worked example: nobody pays seven or eight dollars for chips at a convenience store when the store brand at a grocer costs a quarter of that. "now it's really the price does not match the convenience so you go elsewhere, which is kind of why they're getting hit pretty hard"
One host raised the absence of a discount house brand as a structural disadvantage, noting 7-Eleven has its own line
Two categories are working, and both are habit purchases. Energy drinks now sell at twice the volume of carbonated drinks and drive about 70% of beverage growth — no longer just Red Bull, Rockstar and Monster but Alani Nu, Celsius and a long tail. Nicotine pouches are taking shelf space from cigarettes and driving traffic
The Canadian regulatory angle is a real cost: pouches were banned from Canadian gas stations, so buyers must go to a pharmacy. One host said that if he ran Couche-Tard he would fight to get them back, because that traffic buys chips and pop on the same visit
Management said GLP-1 drugs are hitting snack and candy sales, which the hosts found plausible and hard to measure. One recounted a family party in Syracuse where seven or eight of roughly 25 to 30 parents were on them
Leverage has come down but goes back up after the Żabka acquisition, and buybacks stayed slow this quarter — which they had earlier read as the company saving for a purchase. At about 18 times expected earnings they call it cheap, and neither could construct a thesis for how merchandise growth recovers
9. GameStop's Two Numbers
The last earnings item is a lesson in reading a release, and the hosts said so before giving any figures.
"It's always a bit weird though when you started reading an income statement and the company highlights a specific segment or line in the income statement that's either not sales or income." They treat it as a red flag that sales, net income or free cash flow are not presentable
"And they said that they made a point to highlight operating income that was the highest in history for the second quarter." The hosts noted the precision of that qualifier
Revenue fell 19%, which the company attributed to the Nintendo Switch 2 launch in the base period, ongoing store closures and the divestiture of its French operations
GameStop has had two quarters of positive sales growth since October 2021
The headline net income was 65% higher; strip out gains on derivative assets and unrealized gains on its eBay stake and it was down 66% — paper gains and one-offs, which is why the hosts think the company pointed at operating income instead. One of them gave it credit for not leading with the flattering number
The eBay position is now worth $4.9 billion. First-half free cash flow was just shy of $400 million, a 34% increase on the same period last year, and the operating margin reached 20%
Collectibles are now 45% of sales against 23% a year ago, and collectible sales grew 57% — the result of a strategic decision taken in 2022 that has accelerated over the past year. The company will now report three segments: collectibles, video games, and pre-owned and refurbished
On Ryan Cohen the hosts landed on credit rather than vindication: "Sure, sales are declining, but the fact that the company is still alive, it's generating free cash flow too." Their point is that a games retailer facing all-digital distribution would plausibly be bankrupt without the pivot. "So I think you have to give credit where credit is due." Neither would buy the stock
10. The Collectibles Boom
The collectibles line turned into the episode's longest tangent, and it is the part with the most transferable information in it.
"It's absolutely wild the surge in these collectibles, especially cards." The hosts connect it directly to eBay's performance
GameStop now offers card grading, including trading and sports cards, which is what makes collectibles a service business rather than just shelf space
The grading bottleneck is the story. PSA's backlog is large enough that it has stopped accepting anything but premium cards, and there is now a minimum card value below which grading is not worth the fee and the wait
Ungraded cards get low-balled, because a buyer has to assume the worst — a PSA 5 rather than an 8 or a 9, on a scale to 10, and a 10 is rare. So grading is what lets a card hold its value
One host's anecdote: a friend's father held rookie cards of Gordie Howe, Maurice Richard, several Wayne Gretzkys and Patrick Roy, and sold the lot in bulk for a couple of thousand dollars
Their read on why demand is there is partly financial, with some buyers treating cards and art as an inflation hedge or an investment rather than as a hobby
One host's unanswered question: why GameStop does not run a secondary marketplace for cards and charge a fee, given that its own customers would plausibly use it over eBay
Bonus Insights
The hosts deferred a Canadian energy merger involving Tamarack to the following week, on the grounds that the result matters more than the announcement
Apple's product launch was that day, the first under new chief executive John Ternus, and one host said he owns Apple products and may be buying a new phone
They expect the following week to be even slower on earnings, with Dollarama among the few large Canadian companies reporting
On the Trump posting spree, one host mentioned a South Park gag in which the town's welcome sign was changed to South America, and both agreed the show's willingness to attack every side, itself included, is what they like about it
The hosts noted that a company can be well managed and still be un-investable: one of them owns BRP, does not plan to sell, and said he would have been far more inclined to buy it in 2018 or 2019 than now, because too much sits outside management's control
The episode's bottom line is that almost none of this quarter's damage was operational: Lululemon's is a brand problem two years in the making, BRP's and Bombardier's are tariff and policy problems their managements cannot plan around, and Couche-Tard's is a consumer trading down at the till.
Products, Companies & Tools Mentioned
Lululemon (Comparable sales down 10%, full-year guidance cut to down 5-7%, and an operating margin near 12% once a 560-basis-point one-off is removed)
Vuori (The privately held competitor the hosts and a retail analyst both named as taking share, with more vibrant stores and a tighter assortment)
BRP (Beat on revenue, lost nearly 10 points of gross margin with about 80% of it tariffs, and paid $75 million to an unnamed distressed parts supplier)
Bombardier and Gulfstream (56% of Bombardier's sales and 6% of its plant sit in the US; the Gulfstream certification complaint in the Trump post was settled in February, per the hosts)
Alimentation Couche-Tard and Circle K (Revenue up 25% on fuel, merchandise up only 3.3%, US merchandise margins down 0.5%, and no discount house brand as consumers trade down)
Żabka (The Polish acquisition that will push Couche-Tard's leverage back up after the company brought it down)
GameStop (Revenue down 19%, net income down 66% excluding paper gains, collectibles now 45% of sales, and a $4.9 billion eBay stake)
eBay (GameStop's $4.9 billion position, and the venue the hosts credit the collectibles surge for lifting)
PSA (The card-grading company whose backlog is large enough that it now takes only premium cards — the bottleneck in the collectibles trade)
J.P. Morgan (The worked example of a US bank that does operate in Canada, in corporate and investment banking rather than retail)
Red Bull, Monster, Rockstar, Celsius and Alani Nu (The energy-drink category now selling at twice the volume of carbonated drinks in Couche-Tard's stores and driving 70% of beverage growth)
Walmart, Target and Dollar Tree (The comparison set for the trade-down thesis; Walmart has said it can see consumer behavior change when US gas passes $4 a gallon)
Nintendo Switch 2 (Launched in the base period, which is part of why GameStop's revenue fell 19%)
Dollarama (One of the few large Canadian companies reporting the following week, and the next test of the trade-down read)
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