Lululemon Slips as Texas Announces Probe of ‘Forever Chemicals’

Lululemon Athletica Inc. fell in New York trading Monday after the Texas attorney general said his office is investigating for the presence of so-called “forever chemicals,” which have been linked to health problems, in the yogawear brand’s apparel.

“Emerging research and consumer concerns have raised questions about the potential presence of certain synthetic materials and chemical compounds in their apparel,” the office of Texas Attorney General Ken Paxton said in a statement. The probe “will examine whether Lululemon’s athletic apparel contains PFAS or ‘forever chemicals’ that their health-conscious customers would not expect based on the brand’s marketing.”

Lululemon shares declined as much as 4.5% after the announcement. The company didn’t immediately respond to a request for comment.

Paxton’s investigation creates another headache for Lululemon, which has slumped in the stock market as sales growth tapers off, quality issues resurface and the founder advocates for a board overhaul. The company is currently operating without a permanent chief executive officer as its searches for a replacement.

Polyfluoroalkyl chemicals, known as PFAS, are used in hundreds of products that are slippery, non-stick or stain-resistant and have been linked in studies to health problems like cancer and poor immune health. The National Library of Medicine, which tracks published research globally, identifies only two studies that deal with textiles and health issues tied to endocrine disruption.

Paxton has initiated a series of investigations in line with the Make America Healthy Again agenda led by Health and Human Services Secretary Robert F. Kennedy Jr. Last April, Paxton said he was investigating Froot Loops-maker WK Kellogg Co. over its inclusion of artificial food colorings. The company, which is now owned by Ferrero International SA, said in July it would eliminate synthetic dyes by the end of 2027.

Paxton has also been investigating toothpaste companies he has said are encouraging children to use greater amounts of fluoride than is thought to be safe. In December, Procter & Gamble Co. said it would modify the amount of Crest toothpaste in its advertisements in Texas to depict age appropriate usage.

Photo: A Lululemon store in New York, US, on Thursday, Aug. 22, 2024. Lululemon Athletica Inc. is scheduled to release earnings figures on August 29.