Activewear maker Fabletics is launching its first denim collection, the company announced Tuesday, signaling that the once-hot athleisure category is starting to slow.
The collection, which will launch online and in select stores on Thursday, will include 11 styles and seven washes for both women and men. Items will be priced between $79.95 and $174.95, depending on whether buyers are members of the Fabletics subscription program.
“Over a million of our customers have told us that if Fabletics offered denim, they would be very interested in it, and that's really what prompted us to begin our expansion journey into the denim category,” Fabletics co-founder and CEO Adam Goldenberg told CNBC in an interview. “We think denim is booming. We've seen it, you know, we started [looking into denim] “It's been over two years, so it's the right time.”
Denim of fables.
Courtesy: Fabletics
Fabletics, which made more than $1 billion in revenue last year, is expanding into denim as consumer preferences change. The type of “soft” clothing that became popular during the pandemic, with comfortable joggers, sports bras and hoodies, has fallen out of favor with some shoppers.
Instead, as hybrid work begins to fade, many consumers are opting to get back to dressing up, opting for denim over leggings as a casual staple that works both on the weekends and in the office.
While the athleisure market is still expanding, that growth rate has faltered in North America, data from market intelligence firm Euromonitor International shows.
The sportswear market is projected to grow 2.3% in North America in 2026 compared to 2025, up from 3.1% between 2023 and 2024. Meanwhile, the denim market is expected to grow 2.1% this year, up from 0.7% between 2023 and 2024.
Globally, the sports market grew 2% last year, while the denim market grew 4%, according to independent figures from GlobalData.
Denim of fables.
Courtesy: Fabletics
“What we found coming out of the pandemic is that conveniences become king,” Goldenberg said. “So even now, as consumers, I would say, dress more, they still want to do so in a way that feels good and is more comfortable, right? And we heard that very clearly from our customers when we were developing denim.”
America has fallen in and out of love with denim for decades, which has plagued fashion and led to major apparel companies like Levi Strauss, american eagle and Gap structure their businesses so that they are not as exposed to changing styles. Each company is a market leader in denim, but also has its own athleisure brands, which protects them from changes in fashion.
Changing trends have proven more difficult for niche players like Lululemon, which boomed during the pandemic and is now falling behind as denim reigns again.
lululemon has worked for several years to expand outside of its core range of yoga pants into more lifestyle categories, including outerwear, T-shirts and pants made for work, as fashion preferences changed. The move has allowed Lululemon to increase its total addressable market, but some critics have said it has alienated Lululemon's core customers and contributed to a slowdown in growth in the retailer's main American market.
NikeThe former CEO of John Donahoe grew the retailer into a roughly $50 billion brand by focusing on lifestyle styles and streetwear. While the strategy briefly led to growth, it ultimately contributed to a decline in market share because it distracted the company from its core range of performance. Now, Nike's new CEO, Elliott Hill, is working to reorient the brand toward sports to win back that core consumer, the athlete.
Goldenberg disagreed that Lululemon's challenges stemmed from expanding into new categories and instead said Fabletics, along with emerging athleisure private brands Alo Yoga and Vuori, are taking market share from incumbents. He also said that Fabletics' expansion also does not come at the expense of innovation in its core sports products.
“All these category expansions should be 'and' and not 'and or', right?” Goldenberg said. “So we need to double and triple down on our innovation and activewear while making sure we launch denim in a way that is truly the best product out there.”
He added that Fabletics has already proven it can successfully scale into new categories, helping the company stay ahead of schedule two years into its five-year plan to double revenue and quadruple profits. In 2020, it launched a men's category, which is now a more than $300 million business, and its line of medical gowns, which has grown to $75 million in just over two years.
Goldenberg said activewear remains Fabletics' top priority, but expanding the category will be critical to gaining more sales from its current customers and acquiring new buyers.
“I'll give you medical gowns as an example,” Goldenberg said. “We are now adding thousands of new customers every month to the Fabletics family through them. First they buy medical gowns, but within 90 days, more than 50% of them also buy sportswear.”
