Thanks, Matt. Feet Added So I would not factor in any marginal impact, and our goals speak for themselves. We currently have approximately 95% of our stores opened globally, we're engaging with guests inside our stores and through our community activations, and our e-commerce business remains strong. February 2, 2020 We're enthusiastic about the opportunities that exist for the business. We've recently announced that we will raise the minimum base pay for our store and guest education center roles in North America, taking our new base pay to $15 to $17 per hour, depending on the location and roll, plus all levels are eligible for a monthly bonus on top of base pay. We will be competitive to attract new members and we will continue to take a measured and responsible approach to the business. There are obviously between bottoms and tops and shorts and outerwear and some of the accessories. Let me now share with you the details of our Q2 performance. lululemon encourages and creates access to voter participation in the 2020 U.S. Election. at the End of Traffic was strong and increased over 150% versus last year. I mean, so much is going on, right, so many puts and takes. People Who Make Our Products Sub Navigation. Foreign For 2022, our first full year as a public company, we delivered net revenue growth of over 20%. For more information about our privacy practices, please refer to our privacy policy available in our stores or on our website at https://www.lululemon.co.uk/en-gb/legal/privacy.html for UK residents or https://www.eu.lululemon.com/en-lu/content/privacy.html for EU resident (Privacy Policy). : The Company ended fiscal 2019 with Quarter. We opened eight stores outside of North America in quarter two and remain on track to open 35-40 stores this year internationally. This includes approximately 35 to 40 stores in our international markets and represents a square footage percentage increase in the low-teens. A new infographic covers how the company achieved global gender pay equity, gender representation statistics, and continued commitments to pay equity. for further information on these adjustments. When I graduated from the Ivey Business School in 2010, I did what all my peers were doing: I got a job at an . Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. "Lululemon hosting a workshop to resist capitalism while selling us $180 yoga pants is peak 2020," wrote Kevin Duffey on Twitter. February 3, 2019, Adjusted Announces First Quarter Fiscal 2022 Earnings Conference Call. This performance not only speaks to the success of our kick-starting, our store's initiatives and the strength of our merchandise assortment but it also speaks to our educators and store teams who bring our brand to life every day for our guests. Climate Change: Source 100% renewable electricity to power our own operations by 2021, and reduce carbon emissions across our global supply chain by 60 percent per unit of value added, meeting our Science-Based Targets by 2030. And we're pleased, I would say, overall with that relative to 2020 performance. Please, go ahead. Equally, we know that the pandemic drove forward, accelerated some of the guest behaviors that play to the strength of our brand. And, Calvin, just a quick follow-up, can you expand a little bit on the plans for membership? That's why we see such balanced growth across markets, channels, and product categories. 1. Howard Tubin Lululemon Athletica Inc. designs, distributes, and markets athletic apparel, footwear, and accessories for women, men, and girls. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. And you've heard me say this before, this brand is early innings across products with activities, where we focus on run train yoga in OTM, categories within those activities, and both our men's and women's business. A reconciliation of GAAP to non-GAAP measures is included in our quarterly report on Form 10-Q and in today's earnings press release. For the year, the anticipated margin expansion now includes 150 to 200 basis points of negative impact from additional airfreight costs but still in excess of Power 3 growth plan, which assumes modest gross margin expansion annually. We're well-positioned within that TAM to address it in a very effective leading way. Hi, thank you. 1931 0 obj <>stream 7. lululemon.org: Establish a lululemon centre of excellence for social impact to support wellbeing by 2021. Tapestry Acceleration Program Infographic. And just as you look forward, could you just talk about if you see any of the current issues leading into spring? I'm sure you remember last year when heading into COVID, our men's business was leading growth over women's. $1.4 billion Thank you, Brooke. Lorraine Hutchinson -- Bank of America Merrill Lynch -- Analyst. Now let me take a moment to share with you a few highlights from several exciting community activations we recently hosted throughout the quarter. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Welcome to our Investors page. Yeah. Executives predict that sales will reach $5.6 . lululemon athletica, 9 Allee Scheffer, Luxembourg L-2520. Howard Tubin -- Vice President, Investor Relations. inc. (NASDAQ:LULU) is a healthy lifestyle inspired athletic apparel company for yoga, running, training, and most other sweaty pursuits, creating transformational products and experiences which enable people to live a life they love. Can you talk about your confidence in sustaining this level beyond the recovery period and what we should think about puts and takes for gross margin just thematically as we look out beyond '21? The deleverage relative to Q2 2019 is the result of the consolidation of MIRROR's results this year, but not in 2019 and deleverage on foreign exchange. Lululemon Subscribe . And how do you think that the overall environment will respond to a situation where everybody is being challenged by supply chain issues in Asia? 2019, Selling, general and administrative expenses, Basic weighted-average shares outstanding, Diluted weighted-average shares outstanding, Goodwill . Beauty Market . Right. And seeing what we saw within the physical and our relationship with the MIRROR team, gave us the confidence to proceed with that. [Operator instructions] The first question comes from Adrienne Yih with Barclays. So maybe, Calvin, as we think about 28% revenue growth relative to 2019 in the second quarter, mid-20s in the first quarter, is there a way to rank the drivers of the outperformance that you're seeing relative to that 19% pre-pandemic? We provide constant dollar changes in net revenue, total comparable sales, comparable store sales, and direct to consumer net revenue because we use these measures to understand the underlying growth rate of net revenue excluding the impact of changes in foreign exchange rates. Company-operated store count and square footage summary excludes retail locations operated by third parties under license and supply arrangements. Our EPS guidance continues to assume modest dilution from MIRROR in the 3% to 5% range, excluding acquisition and integration-related costs. How should we think about this in terms of recovery? 0001172661-23-001474.rtf. Just wondering how you think that impacts the company's ability to continue to reach its goals? lululemon Announces Global Gender Pay Equity Stats and Commitments, lululemon Announces Mental Wellbeing Commitments at the 2020 MAKERS Conference, Sorry, we don't ship to your country/region, lululemon athletica 1818 Cornwall Ave, Vancouver BC V6J 1C7, lululemon Commits to Inclusion, Diversity, Equity, and Action, California Privacy Rights (Last Updated: 1/23/23). During the Those interested . Comparable sales increase 20% After all, the newsletter theyhave run for over a decade, Motley Fool Stock Advisor, has tripled the market.*. I was just curious. Not only were these initiatives the right thing to do for our people, but they kept our workforce whole and have enabled us to reopen stores with a full complement of educators and leadership teams and they are directly contributing to the strong results we've generated over the last several quarters. During the I am incredibly proud of how lululemon navigated the year. Results of this caliber enable us to now develop our next five-year growth plan, and we'll come back to you next year with an updated view of what the future can hold for Lululemon. Press Releases; Events & Presentations; Financial Information. I am grateful to everyone who has dedicated their knowledge and experience to help us define our approach.. We're monitoring how macro factors currently impacting the cost of digital marketing are creating some pressure on customer acquisition costs at MIRROR. 65. Absolutely, Mark, and thanks for the question. Oct 07, 2021. Thanks to our unique innovations across both fabrics and construction, empowered by our proprietary research, we're very excited about our product positioning and we know that bras is a wonderful category to drive loyalty with our guests. Our Service Providers. It's really driven throughout the performance on top-line and leverage on occupancy and depreciation and then we do, at this point in time, we're maintaining our Power 3 growth plan which caused calls for modest expansion in gross margin as you lookout. The legal basis for this processing is the performance of the agreement between you and lululemon related to the Promotion. February 2, 2020 *Average returns of all recommendations since inception. Lululemon boosted its holiday-quarter forecasts on December 11, just hours after it posted Street-beating earnings of $1.16 per share on a 22% gain in revenues to $1.12 billion. Kourtney Gibson will serve on the board effective immediately. Results are great. Announces Second Quarter Fiscal 2022 Results, lululemon athletica inc. These results reflect the ongoing strength across all major areas of the business. Bras remained an important expansion opportunity for us. After submitting your request, you will receive an activation email to the requested email address. The Company repurchased 1.6 thousand shares of its own common stock at an average cost of. Before we begin the call, I'd like to remind our investors to visit our Investor site, where you'll find a summary of our key financial and operating statistics for the second quarter, as well as our quarterly infographic. Investors expected lululemon athletica (LULU 1.66%) to deliver a large increase in revenue over the year-ago weakness, . Direct to consumer net revenue increased 35%. All but one of these locations have since reopened. d. Professional Advisors. As a reminder, all participants are in listen-only mode and the conference is being recorded. 1-415-671-7676, lululemon athletica1818 Cornwall AveVancouver BCV6J 1C7, Working With Our Suppliers to Create Meaningful Change, lululemon athletica inc. 41. But the number of guests that are converting when they see those ads and ultimately convert to buy, once they work their way down through the funnel, are all at or above where we've been trending and very healthy. lululemon reserves the right to change this Privacy Policy from time to time. So it's pretty fluid, Matt, and we're comfortable -- sorry, Jay, very fluid and we're comfortable with sort of how we're positioned today in addressing it, but all and any pricing changes would be in Meghan's guidance and there's nothing of significant plan or that you should expect. Excellent results. Announces Second Quarter Fiscal 2022 Earnings Conference Call, lululemon Expands International Footprint, Launching in Spain, lululemon athletica inc. We share personal data with third parties that perform services for us, including customer support, web hosting, information technology, payment processing, product fulfilment, fraud control, direct mail and email distribution, contest, event, sweepstakes and promotion administration, and analytics services. These include our participation in the Mylo consortium that will allow us to make products using an infinitely renewable material made from the root structure of mushrooms. Fantastic. Events & Presentations: Quarterly Reports: Annual Reports: SEC Filings: End of Day Stock Quote: Unsubscribe . Employee Pay Equity: Expand gender pay equity to full pay equity by 2022. Please go ahead. In our digital channel, revenues increased 66% on a two-year CAGR basis, above our expectations of approximately 55% growth. 3. Capital expenditures were $80 million for the quarter, compared to $53 million in the second quarter last year. We're just ramping up synergies, like the 200 stores that play to our strength in the key leads in each of those locations. Lululemon offers pants, shorts, tops, and jackets for both leisure and athletic activities such as yoga and running. Drivers of the deleverage versus 2019 include consolidation of MIRROR's results this year but not in 2019, increased investments in brand-building for our growth initiatives and higher depreciation due to accelerating investment to support our e-commerce business in 2020 and 2021. How much of a percentage of the assortment can this represent over time? Hi. 8. A right to revoke your consent: When our processing is based on your consent, you have the right to revoke such consent at any time. For more information about our privacy practices in another jurisdiction, please refer to the privacy policy available in our stores, or posted on our website, for that jurisdiction. I wanted to follow up on the international business and the momentum that you're seeing there. HTTPS://AWS.AMAZON.COM/ABOUT-AWS/GLOBAL-INFRASTRUCTURE/). Or maybe said differently, do you believe that TAM coming out of this crisis is larger, broadly multiyear for the Lulu brand or are you taking accelerated market share, or is it a combination of both? Thank you for the detail and best of luck. Learn More. The forward-looking statements made herein speak only as of the date of this press release and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances, except as may be required by law. The next question comes from John Kernan with Cowen. This range now assumes our e-commerce business grows in the mid-teens, relative to the outsized strength we experienced in 2020. In this Privacy Policy, "personal data" means any information about an individual whose identity is apparent or can be ascertained, directly or indirectly. Our Purpose, Vision & Values . 10 stocks we like better thanLululemon AthleticaWhen our award-winning analyst team hasa stock tip, it can pay to listen. We may also disclose your personal data with applicable regulators or other authorities when we believe doing so is reasonably necessary to comply with applicable law or legal process (including requests from authorities), to respond to claims (including inquiries by you in connection with your purchases from lululemon), or to protect the rights, property or personal safety of lululemon, our users, employees or the public. inc. We also transfer personal data to service providers that process personal data for us in the United States, Canada and other locations (as an example, Amazon Web Services process information for us in various data center locations, including those listed at HTTPS://AWS.AMAZON.COM/ABOUT-AWS/GLOBAL-INFRASTRUCTURE/). It's made from a proprietary Ultralu fabric and expands our offering into the high-impact training category. The gross margins in 2Q, they're above what you typically do for the holiday quarter pre-COVID, which is where there's a lot of leverage in the business. We had approximately $1.2 billion in cash and cash equivalents and nearly $400 million of available capacity under our revolving credit facility. I guess, I imagine it was a challenge to get reads on the tests given everything that's been going on in the last 18 months, but I mean do you still see an opportunity to have a loyalty program that exists outside of the MIRROR platform or what form might that take? During the quarter, we opened 11 net new stores. I am proud of our leaders and teams for enabling us to meet and exceed these goals. Sumner, WA. We are monitoring this closely and leaning into the agility of our supply chain, the strength of our planning and allocations team, and the powerful partnerships with our vendors to help mitigate the risks where we can. Good. On a two-year CAGR basis, total revenue increased 28% with North America up 26% and International increasing 43%. Outside of a paid subscription, the opportunity around loyalty absolutely exists and is something that we will share later as we share our plans for the future. , We will provide additional updates as the situation warrants. Stores Opened Investors. If we think about the holiday environment coming, how are you thinking about maybe some opportunities that could be presented around pricing, if we are in an environment where a lot of companies are having trouble sourcing the units they need, or they would want to really fulfill the demand -- the consumer demand that's out there? For example, this Privacy Policy does not apply to consumers located outside the EEA and Switzerland. This is below our expectations for a 25% to 30% increase due to our top-line outperformance coupled with industrywide supply chain disruptions. And we always had visions of being able to bring that to the digital platform. These include the rights to revoke your consent and to object to processing (for example, you have the right to revoke your consent to receive the newsletter at any time by clicking on the unsubscribe link at the bottom of our newsletter emails). We retain personal data only for as long as necessary to achieve the purpose for which such personal data was collected, unless a different retention period is required under applicable law. At the end of Dec. 1994, Nike stock traded at a P/E of 54, not quite as high as Lululemon's current 64 P/E but still frothy. The outbreak of the COVID-19 coronavirus has been declared a pandemic by the But taking profits now could be a very costly mistake. You said you were back in 2019 levels in the second quarter, which was ahead of plan, how are you planning for productivity for open stores in the back half? Due to the 53rd week in fiscal 2018, comparable sales are calculated on a one week shifted basis in fiscal 2019. The new Navigation Stretch Down Collection is technically designed to keep you moving comfortably in winter conditions. Due to the impact that COVID-19 is having across the globe, and the rapid and continuous developments, we are not providing guidance for fiscal 2020 at this time. lululemon athletica The next question comes from Jay Sole with UBS. Thank you. I'm happy to be on the call today to speak to our omni guest experience pillar, and to share some additional details on our second-quarter performance. Strong guests' response to our merchandise offering and improving store trends and continued strength in e-commerce fueled our growth, and contributed to our increased outlook for the year, which I will take you through in a moment. Best Growth Stock to Buy: Nike Stock vs. Lululemon Stock, This Hot Growth Stock Is Still a Buy After Enormous Gains, Buy the Dip in 2023 on These Potentially Explosive Stocks, 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? We continue to expect to open 45 to 55 net new company-operated stores in 2021. This growth rate continues to outpace our three-year CAGR of 19% leading up to the pandemic, and also represents an acceleration from the 25% two-year CAGR we reported in quarter 1 of this year. So China is definitely one of our key markets. When looking at total revenue, our guidance range implies a two-year CAGR of approximately 25%, which is higher than our three-year revenue CAGR of 19% leading up to 2020 and is well ahead of the low-teens CAGR we contemplated in our Power 3 growth plan. e. Compliance with Law. Is it really just products coming out of that country or is it leading into the region? Leverage in the quarter versus Q2 2020 resulted from a sales increase relative to the COVID-impacted quarter last year. , For the fourth quarter ended The specific purposes for which we process your personal data are set out below: To administer your online account and profile (the legal basis for this processing is our legitimate interest in better understanding user needs and expectations and improving our website); To provide products and services to you, which includes processing payments, sending notifications related to your purchases, and processing exchanges and returns (the legal basis for this processing is the performance of the purchase agreement between you and lululemon); To conduct or administer events, contests, prize draws, sweepstakes or other promotions in which you have participated (the legal basis for this processing is the performance of the agreement between you and lululemon related to such contest, prize draw, sweepstakes or other promotion); To respond to any communications from you, including to troubleshoot problems with our websites (the legal basis for this processing is our legitimate interest in providing you with a functional website); To analyse your use of and customise your experience on our websites (the legal basis for this processing is our legitimate interest in better understanding user needs and expectations and improving our websites); To develop and manage lululemon's business and operations (the legal basis for this processing is our legitimate interest in understanding shopping behaviour, improving our selection of products and services, and exploring ways to develop and enhance our business); To measure your social media engagement with our brand (the legal basis for this processing is our legitimate interest in understanding the efficacy of our marketing strategies); To detect, investigate and prevent fraudulent transactions, error, negligence, breach of contract, and other illegal activities and protect against harm to the rights, property or safety of lululemon and our users, customers, employees or the public, including by using video surveillance systems (the legal basis for this processing is our legitimate interest in preventing fraud, error, negligence, contractual breach and other illegal activities and protecting and securing our premises,customers, employees and the public); To comply with our legal obligations, including our tax obligations, those related to the prevention of fraud and money laundering, and those required for you to benefit from rights recognized by law, or any regulatory requirements or provisions (the legal basis for this processing is compliance with our legal obligations under laws in the EEA and Switzerland related to, for instance, taxation, money-laundering and terrorism financing and consumer protection law); To offer you opportunities to purchase products or services that we believe may be of interest to you, by supplementing the information we collect about you with information from third parties (the legal basis for this processing is our legitimate interest in providing information about products and services that may be of interest to you, unless applicable law requires us to obtain your consent, in which case we will do so). We are working with the right partners to help in the manufacturing and the creation, and therefore, the commercialization of these goods. At the end of the second quarter, we had 95% of our stores open. If we receive data about you in this manner, we combine that data with the personal data we collect directly from you. Our Q3 guidance reflects an impact of approximately 200 basis points of pressure from airfreight costs due to port congestion and capacity constraints. We saw strong performance in our nonscrubs business, which increased 59%. As you know, in our Impact agenda that we published, our first one last year on our Be Human, be well, be planet pillars in our Be Planet, our commitment is to make 100% of our products with sustainable materials by 2030, as well as investing into circularity, which is extending the life of our products and providing options and choices for our guests. Combined, these give us a unique strength to keep growing MIRROR. Additionally . On the following pages, you will find key shareholder information and financial reports to help provide perspective on our financial news, performance and events. lululemon athletica UK Ltd, located at Garden House, 57-59 Long Acre, London, WC2E 9JL (lululemon, we or us) are the data controller for the personal data we process about you in connection with the Promotion. Best Growth Stock to Buy: Nike Stock vs. Lululemon Stock, This Hot Growth Stock Is Still a Buy After Enormous Gains, Buy the Dip in 2023 on These Potentially Explosive Stocks, 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? Let me now shift to MIRROR. Our obsession with raw material and our investment in our product is what we do, is what we obsess about, and its really what drives why the guests feel different and continue to sort of be loyal to this product and brand. We retain personal data only for as long as necessary to achieve the purpose for which such personal data was collected, unless a different retention period is required under applicable law. We will also collect personal data, such as your name and e-mail address, when you sign up to receive our email newsletter, in order to offer you opportunities to purchase products or services that we believe may be of interest to you, by supplementing the information we collect about you with information from third parties (the legal basis for this processing is consent). $404.8 million There's a lot in that question, and I'll unpack a bit of it. We prioritized our people and kept our teams intact by offering pay production, sick pay, and other key people investments. One, the membership test, we learned a lot. Please refer to Note 15 to the audited consolidated financial statements included in Item 8 of Part II of our Report on Form 10-K to be filed with the Great results. Comparable February 2, 2020 In Q2, we repurchased 506,000 shares at an average price of $338. Profitability improved as this pipeline of releases more than offset . Adjusted net income for the quarter was $216 million or $1.65 per diluted share, compared to adjusted earnings per diluted share of $0.74 in Q2 of 2020 and $0.96 in Q2 of 2019. --(BUSINESS WIRE)-- And then with the shutting of our stores and other shifts that were happening as a result, we saw that business slow both in the industry as well as with ourselves, even though we are putting on market share. I just wanted to follow up on that last answer. Lululemon is a yoga and exercise apparel company, whose business strategy is based on marketing a lifestyle rather than a product. and continues to spread in World Health Organization We take pricing, obviously, seriously in that we're constantly monitoring and testing. In terms of gross margin, a 150 basis points to 200 basis points, expansion was where we guided for the full year. For all other inquiries, please contact[emailprotected]. And on a two-year CAGR basis, we are pleased to see an acceleration relative to our first quarter. We look forward to sharing more with you on the evolution of our loyalty programs at a later date. ~^C`llhH5vY]-#~0 b Our gross margin increases of 310 basis points relative to 2019 was driven by 290 basis points of leverage on occupancy depreciation and product team costs, and 60 basis points of favorability in foreign exchange, which was partially offset by a 40-basis-point decrease in product margin, driven by a 120-basis-point increase in airfreight related to COVID-19.

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