Lululemon’s shares dropped 11% Thursday after the athleisure brand picked Heidi O’Neill as its new CEO, an indication the market knows what everyone in the retail business already did.

O’Neill was passed over in 2024 to run Nike (Elliott Hill came out of retirement for the gig) after a quarter century at the sneaker maker. O’Neill masterminded Nike’s pivot away from wholesale, a move that ended badly when retailers started carrying all of Nike’s competitors instead, and oversaw its women’s business, which never matched its men’s line. Hill is walking back both of those strategies at Nike, going deeper into wholesale again and working with Skims to rejuvenate its women’s business.

All of which makes her an odd choice for Lululemon, a women-forward brand in need of a turnaround. Its market cap has dropped from more than $60 billion to $20 billion in less than two years. It’s fighting with its own founder, Chip Wilson, and activist investor Elliott, and bleeding customers who are moving to brands like Alo and Vuori.

Lulu’s board said it conducted an extensive search and picked O’Neill because of “the breadth of her experience, her demonstrated success delivering breakthrough ideas and initiatives at scale, and her ability to be a knowledgeable change and growth agent.”