lululemon athletica (LULU) 10-K risk factor changes: FY2020 vs FY2019

*In addition to the other information contained in this Form 10-K, the following risk [added: factors, as well as additional] factors [added: not presently known to us or that we currently deem to be immaterial,] should be considered [removed: carefully] in evaluating our business.

Our business, financial condition, or results of operations could be materially adversely affected [removed: by] [added: as a result of] any of these [removed: risks.][added: risks.*]

The lululemon name is integral to our business as well as to the implementation of our [removed: strategies for expanding our business.][added: expansion strategies.]

Additionally, while we devote considerable [removed: efforts] [added: effort] and resources to protecting our intellectual property, if these efforts are not successful the value of our brand may be harmed.

Additionally, if the unacceptability of our products is not discovered until after such products are [removed: purchased by our guests,] [added: sold,] our guests could lose confidence in our products or we could face a product recall and our results of operations could suffer and our business, reputation, and brand could be harmed.

The [removed: recent] [added: current] COVID-19 coronavirus [removed: outbreak] [added: pandemic] and related government, private sector, and individual consumer responsive actions [removed: may] [added: have and will continue to] adversely affect our business operations, store traffic, employee availability, financial condition, liquidity, and cash flow.

The outbreak of [removed: the] COVID-19 [removed: coronavirus disease] has [removed: been declared a pandemic by the World Health Organization continues to] spread [removed: in] [added: across] the United States, Canada, and [removed: in many] [added: most] other countries globally.

The spread of COVID-19 has caused [removed: public] health officials to [added: impose restrictions and] recommend precautions to mitigate the spread of the virus, especially when congregating in heavily populated areas, such as malls and lifestyle centers.

There is [removed: significant] uncertainty [removed: around] [added: over] the [removed: breadth and duration of our store closures and other business disruptions related to COVID-19, as well as its] impact [added: of COVID-19] on the U.S., Canadian, and global economies, consumer willingness to visit stores, malls, and lifestyle centers, and employee willingness to staff our stores [removed: once they re-open.][added: as the pandemic continues and if there are future resurgences.]

The [added: COVID-19 situation is changing rapidly and the] extent to which COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and [added: its variants and] the actions taken to contain it or treat its [removed: impact.][added: impact, including vaccinations.]

Our reliance on suppliers to provide fabrics for and to produce our products could cause problems [removed: in our] [added: if we experience a] supply [removed: chain.][added: chain disruption and we are unable to secure additional suppliers of fabrics or other raw materials, or manufacturers of our end products.]

Many of the specialty fabrics used in our products are technically advanced textile products developed and manufactured by third parties and may be available, in the short-term, from only one or a [removed: very] limited number of sources.

We work with a group of approximately [removed: 39] [added: 40] vendors that manufacture our products, five of which produced [removed: approximately 56%] [added: 59%] of our products in [removed: fiscal 2019.][added: 2020.]

During [removed: fiscal 2019,] [added: 2020,] the largest single manufacturer produced approximately 17% of our products.

During [removed: fiscal 2019,] [added: 2020,] approximately 33% of our products were manufactured in Vietnam, [removed: 16%] [added: 20%] in Cambodia, [removed: 15%] [added: 12%] in Sri Lanka, and [removed: 11%] [added: 9%] in the PRC, including 2% in [removed: Taiwan, PRC.][added: Taiwan.]

We work with a group of approximately [removed: 76] [added: 65] suppliers to provide the fabrics for our products.

In [removed: fiscal 2019, approximately 59%] [added: 2020, 65%] of our fabrics were produced by our top five fabric suppliers, and the largest single manufacturer produced approximately [removed: 32%] [added: 29%] of fabric used.

During [removed: fiscal 2019,] [added: 2020,] approximately [removed: 46%] [added: 45%] of our fabrics originated from Taiwan, [removed: PRC, 14%] [added: 18%] from [removed: the rest of the PRC, 19%] [added: Mainland China, 16%] from Sri Lanka, and the remainder from other regions.

We have experienced, and may in the future experience, a significant disruption in the supply of fabrics or raw materials [removed: from current sources] and [removed: we] may be unable to locate alternative [removed: materials] suppliers of comparable quality at an acceptable price, or at all.

[added: experience significant increased demand, or if we need to replace an existing supplier or] manufacturer, we may be unable to locate additional supplies of fabrics or raw materials or additional manufacturing capacity on terms that are acceptable to us, or at all, or we may be unable to locate any supplier or manufacturer with sufficient capacity to meet our requirements or [removed: to] fill our orders in a timely manner.

Our supply of fabric or manufacture of our products could be disrupted or delayed by the impact of [removed: global] health pandemics, including the current COVID-19 [removed: coronavirus] pandemic, and the related government and private sector responsive actions such as border closures, restrictions on product shipments, and travel restrictions.

The operations of many of our suppliers are subject to additional risks that are beyond our [removed: control and that could harm our business, financial condition, and results of operations.][added: control.]

[removed: | • |] [added: -] the impact of health conditions, including [removed: the current COVID-19 coronavirus pandemic,] [added: COVID-19,] and related government and private sector responsive actions, and other changes in local economic conditions in countries where our [removed: manufacturers, suppliers,] [added: suppliers] or [removed: guests] [added: manufacturers] are located; [removed: |]

[removed: | • |] [added: -] political unrest, terrorism, labor disputes, and economic instability resulting in the disruption of trade from foreign countries in which our products are manufactured; [removed: |]

[removed: | • |] [added: -] the imposition of new laws and regulations, including those relating to labor conditions, quality and safety standards, imports, duties, taxes and other charges on imports, as well as trade restrictions and restrictions on currency exchange or the transfer of funds; [removed: |]

[removed: | • |] [added: -] reduced protection for intellectual property rights, including trademark protection, in some countries, particularly in the PRC; and [removed: |]

[removed: | • |] [added: -] disruptions or delays in shipments whether due to port congestion, labor disputes, product regulations and/or inspections or other factors, natural disasters or health pandemics, or other transportation disruptions. [removed: |]

An economic [added: recession, depression,] downturn or economic uncertainty in our key markets may adversely affect consumer discretionary spending and demand for our products.

Some of the factors that may influence consumer spending on discretionary items include general economic conditions (particularly those in North America), high levels of unemployment, health pandemics (such as the impact of the current COVID-19 coronavirus pandemic, including reduced store traffic and widespread temporary [removed: store closures),] [added: closures of retail locations),] higher consumer debt levels, reductions in net worth based on market declines and uncertainty, home foreclosures and reductions in home values, fluctuating interest and foreign currency rates and credit availability, government austerity measures, fluctuating fuel and other energy costs, fluctuating commodity prices, tax rates and general uncertainty regarding the overall future economic environment.

[added: Unfavorable economic conditions may] lead consumers to delay or reduce purchases of our products.

If we are unable to anticipate consumer preferences and successfully develop and introduce new, innovative, and [removed: updated] [added: differentiated] products, we may not be able to maintain or increase our sales and profitability.

[removed: Our inability] [added: We may be unable] to safeguard against security breaches or [removed: our failure to] comply with data privacy laws [added: which] could damage our customer relationships and result in significant legal and financial exposure.

Advances in computer capabilities, new technological discoveries or other developments may [added: result in the technology used by us to protect transaction or other data being breached or compromised.]

[removed: Any material disruption] [added: Disruption] of our information technology systems or unexpected network interruption could disrupt our [removed: business and reduce our sales.][added: business.]

The failure of our information technology systems to operate properly or effectively, problems with transitioning to upgraded or replacement systems, or difficulty in integrating new systems, could adversely [removed: affect our business.]

[removed: If the] [added: Our] technology-based systems that give our customers the ability to shop with us online [removed: do] [added: may] not function [removed: effectively, our operating results, as well as our ability to grow our e-commerce business globally, could be materially adversely affected.][added: effectively.]

Changes in consumer shopping [removed: preferences] [added: preferences,] and shifts in distribution channels could materially impact our results of operations.

We sell our products through a variety of [removed: trade] channels, with a significant portion through traditional brick-and-mortar retail channels.

The diversion of sales from our company-operated stores could adversely impact our return on investment and could lead to [removed: store closures and] impairment [removed: charges.][added: charges and store closures, including lease exit costs.]

[added: We could have difficulty in] recreating the in-store experience through direct channels.

Risks related to our business and industry

Our reputation could also be impacted by adverse publicity, whether or not valid, regarding allegations that we, or persons associated with us or formerly associated with us, have violated applicable laws or regulations, including but not limited to those related to safety, employment, discrimination, harassment, whistle-blowing, privacy, corporate citizenship, improper business practices, or cybersecurity.

Related government and private sector responsive actions have significantly affected our business operations and will likely continue to do so for the foreseeable future.

Our stores have experienced temporary closures, and we have implemented precautionary measures in line with guidance from local authorities in the stores that are open.

These measures include restrictions such as limitations on the number of guests allowed in our stores at any single time, minimum physical distancing requirements, and limited operating hours.

We do not know how the measures recommended by local authorities or implemented by us may change over time or what the duration of these restrictions will be.

Further resurgences in COVID-19 cases, including from variants, could cause additional restrictions, including temporarily closing all or some of our stores again.

An outbreak at one of our locations, even if we follow appropriate precautionary measures, could negatively impact our employees, guests, and brand.

There is also uncertainty regarding potential long-term changes to consumer shopping behavior and preferences and whether consumer demand will recover when restrictions are lifted.

We may be impacted by other business disruptions related to COVID-19, including disruptions to our sourcing and manufacturing or to our distribution facilities.

Both of our distribution centers in the United States have experienced temporary closures due to COVID-19.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

The temporary closure of the majority of our retail locations during the first two quarters of 2020, subsequent temporary re-closures of certain retail locations, as well as other impacts of COVID-19, have negatively impacted our cash flows from operations and our liquidity.

The length and severity of the pandemic, as well as the pace of recovery, could negatively impact our future cash flows.

The COVID-19 pandemic has shifted guest shopping preferences away from brick-and-mortar and towards digital platforms.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

In addition, we may, from time to time, evaluate and pursue other strategic investments or acquisitions.

These involve various inherent risks and the benefits sought may not be realized.

The acquisition of MIRROR or other strategic investments or acquisitions may not create value and may harm our brand and adversely affect our business, financial condition, and results of operations.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

We may not realize the potential benefits and synergies sought with the acquisition of MIRROR.

During 2020, we acquired MIRROR as part of our growth plan, which includes driving business through omni-guest experiences.

The potential benefits of enhancing our digital and interactive capabilities and deepening our roots in the sweatlife might not be realized fully, if at all.

Further, the expected synergies between lululemon and MIRROR, such as those related to our connections with our guests and communities as well as our store and direct to consumer infrastructure, may not materialize.

A significant portion of the purchase price was allocated to goodwill and if our acquisition does not yield expected returns, we may be required to record impairment charges, which would adversely affect our results of operations.

Our management team has limited experience in addressing the challenges of integrating management teams, strategies, cultures, and organizations of two companies.

This integration may divert the attention of management and cause additional expenses.

Management also has limited experience outside of the retail industry, including with the specialized hardware and software sold and licensed by MIRROR.

If MIRROR has inadequate or ineffective controls and procedures, our internal control over financial reporting could be adversely impacted.

The acquisition may not be well received by the customers or employees of either company, and this could hurt our brand and result in the loss of key employees.

If we are unable to successfully integrate MIRROR, including its people and technologies, we may not be able to manage operations efficiently, which could adversely affect our results of operations.

The acquisition of MIRROR may also divert management time and other resources away from our existing business.

We may not be able to grow the MIRROR business and have it achieve profitability.

We may be unable to attract and retain subscribers to MIRROR.

If we do not provide the delivery and installation service that our guests expect, offer engaging and innovative classes, and support and continue to improve the technology used, we may not be able to maintain and grow the number of subscribers.

This could adversely impact our results of operations.

We are dependent on information technology systems to provide live and recorded classes to our customers with MIRROR subscriptions, to maintain its software, and to manage subscriptions.

If we experience issues such as cybersecurity threats or actions, or interruptions or delays in our information technology systems, the data privacy and overall experience of subscribers could be negatively impacted and could therefore damage our brand and adversely affect our results of operations.

Competition, including from other in-home fitness providers as well as in-person fitness studios, and trends of consumer preferences, could also impact the level of subscriptions and therefore our results of operations.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

Please note that additional risks not presently known to us or that we currently deem immaterial could also impair our business and operations.*

Our success depends on the value and reputation of the lululemon brand.

Related government and private sector responsive actions may adversely affect our business operations.

It is impossible to predict the effect and ultimate impact of the COVID-19 pandemic as the situation is rapidly evolving.

In February 2020, we temporarily

closed all of our retail locations in Mainland China.

All but one of these locations have since reopened.

In March 2020, we temporarily closed all of our retail locations in North America, Europe, Malaysia, New Zealand, and we temporarily closed our distribution center in Sumner, WA.

These locations currently remain closed.

In addition, if we experience significant increased demand, or if we need to replace an existing supplier or

| | |

| --- | --- |

Unfavorable economic conditions may

result in the technology used by us to protect transaction or other data being breached or compromised.

We could have difficulty in

We could also be exposed to liability for online content.

On January 31, 2020, the United Kingdom ("UK") withdrew from the European Union ("EU"), commonly referred to as "Brexit".

There is significant uncertainty related to how the UK's trade, duties, and customs arrangements with the EU will be impacted by Brexit after the transition period, as well as the impact on the movement of goods, people, and capital between the UK and the EU.

We do not maintain a key person life insurance policy on any of the members of our senior management team.

As a result, we would have no way to cover the financial loss if we were to lose the services of members of our senior management team.

This seasonality may adversely affect our business and cause our results of operations to fluctuate, and, as a result, we believe that comparisons of our operating results between different quarters within a single fiscal year are not necessarily meaningful and that results of operations in any period should not be considered indicative of the results to be expected for any future period.

We have, and may continue to, enter into forward currency contracts, or other derivative instruments, in an effort to mitigate the foreign exchange risks which we are exposed to.

This may include entering into forward currency contracts to hedge against the foreign exchange gains and losses which arise on translation of our foreign subsidiaries' balance sheets into U.S. dollars, or entering into forward currency contracts in an effort to reduce our exposure to foreign exchange revaluation gains and losses that arise on monetary assets and liabilities held by our subsidiaries in a currency other than their functional currency.

Our fiscal year ends on the Sunday closest to January 31 of the following year, typically resulting in a [removed: 52 week] [added: 52-week] year, but occasionally giving rise to an additional week, resulting in a [removed: 53 week] [added: 53-week] year.

[removed: The following] [added: Management's] discussion and analysis [added: of financial condition and results of operations is provided as a supplement to, and] should be read in conjunction [removed: with] [added: with,] our consolidated financial statements and the related notes included elsewhere in this Annual Report on Form 10-K.

This discussion and analysis contains forward-looking statements based on current expectations that involve risks, uncertainties and assumptions, such as our plans, objectives, expectations, and intentions included in the "Special Note Regarding Forward-Looking Statements." Our actual results and the timing of events may differ materially from those anticipated in these [removed: forward looking] [added: forward-looking] statements as a result of various factors, including those described in the "Item 1A.

[removed: The] [added: In addition to the growth targets, the three] strategic pillars of [removed: this] [added: the] plan [removed: are] [added: also remain unchanged and include:] product innovation, omni-guest experience, and market expansion.

[removed: In fiscal 2019 we] [added: We] continued to [removed: host unique events] [added: expand our presence both] in North America and in our international markets.

During the year, we opened [removed: 51] [added: 30] net new company-operated stores, including [removed: 19 in North America, 24] [added: 18 stores] in Asia Pacific, [added: nine stores in North America,] and [removed: eight] [added: three stores] in Europe.

We also expanded our seasonal store strategy in [removed: fiscal 2019] [added: 2020] with [removed: approximately 80] [added: over 100] seasonal stores in operation for some period of time during the year.

These stores allowed us to better cater to our guests in select markets, [removed: particularly during the holidays,] while also helping introduce new guests to our brand.

For [removed: fiscal 2019,] [added: 2020,] our business in North America [removed: grew 20%,] [added: increased 8%,] while total growth in our international markets was [removed: 32%.][added: 31%.]

In February [removed: 2020,] [added: and March,] we temporarily closed all of our retail locations in Mainland [removed: China.][added: China, North America, Europe, and certain countries in Asia Pacific.]

[removed: There is] [added: The COVID-19 pandemic had a material adverse impact on our results of operations for 2020 and there remains] significant uncertainty regarding the extent and duration of the impact that the COVID-19 [removed: coronavirus] pandemic will have on [removed: the demand for] our [removed: products and our supply chain.][added: operations.]

We remain confident in the long-term growth opportunities and our Power of Three growth plan and believe that we have sufficient cash and cash equivalents, and available capacity under our [added: committed] revolving credit [removed: facilities,] [added: facility,] to meet our liquidity needs.

As of [removed: February 2, 2020,] [added: January 31, 2021,] we had cash and cash equivalents of [removed: $1.1] [added: $1.2] billion and the capacity under our committed revolving credit facility was [removed: $398.2] [added: $397.6] million.

[removed: | • | Net revenue increased 21% to $4.0 billion.] On a constant dollar basis, net revenue increased [removed: 22%. |][added: 10%.]

[removed: | – |] [added: -] Direct to consumer net revenue increased [removed: 35%,] [added: 101% to $2.3 billion,] or increased [removed: 35%] [added: 101%] on a constant dollar basis. [removed: |]

[removed: | • |] [added: -] Gross profit increased [removed: 22%] [added: 11%] to [removed: $2.2] [added: $2.5] billion. [removed: |]

[removed: | • |] [added: -] Gross margin increased [removed: 70] [added: 10] basis points to [removed: 55.9%. |][added: 56.0%.]

[removed: | • |] [added: -] Income from operations [removed: increased 26%] [added: decreased 8%] to [removed: $889.1] [added: $820.0] million. [removed: |]

[removed: | • |] [added: -] Operating margin [removed: increased 80] [added: decreased 370] basis points to [removed: 22.3%. |][added: 18.6%.]

[removed: | • |] [added: -] Diluted earnings per share were [removed: $4.93] [added: $4.50] for [removed: fiscal 2019] [added: 2020] compared to [removed: $3.61] [added: $4.93] in [removed: fiscal 2018. Adjusted diluted earnings per share were $3.84 for fiscal 2018. |][added: 2019.]

Management's Discussion and Analysis of Financial Condition and Results of Operations" for reconciliations between constant dollar changes in net [removed: revenue, total comparable sales, comparable store sales,] [added: revenue] and direct to consumer net revenue, and [removed: adjusted income tax expense, effective tax rates, and diluted earnings per share, and] the most directly comparable measures calculated in accordance with GAAP.

The following [removed: tables summarize] [added: table summarizes] key components of our results of operations for the periods [removed: indicated, both in dollars and as a percentage of net revenue:][added: indicated:]

| | | [removed: February 2, 2020] | | | | [removed: February 3, 2019] [added: 2020] | | | | [removed: February 2, 2020] | | [added: 2019] | [removed: February 3, 2019] | | [added: | | | 2020 | | | | | | 2019 | | |]

| | | [added: | | | |] *(In thousands)* | | | | | | [added: *(Percentages)*] | | [removed: *(Percentages)*] | | | | [added: *(Percentages)*] | [added: | |]

| Net revenue | | [added: | | | |] $ | [removed: 3,979,296] [added: 4,401,879] | | | [added: | |] $ | [removed: 3,288,319] [added: 3,979,296] | | | [added: | |] 100.0 | [added: |] % | | [added: | |] 100.0 | [added: |] % |

| Cost of goods sold | | [added: | | | | 1,937,888 | | | | | |] 1,755,910 | | | | [removed: 1,472,032] | | [added: 44.0] | | [removed: 44.1] | | | [removed: 44.8] | [added: 44.1] | [added: | |]

| Gross profit | | [added: | | | | 2,463,991 | | | | | |] 2,223,386 | | | | [removed: 1,816,287] | | [added: 56.0] | | [removed: 55.9] | | | [removed: 55.2] | [added: 55.9] | [added: | |]

| Selling, general and administrative expenses | | [removed: 1,334,276] | | | | [removed: 1,110,451] [added: 1,609,003] | | | | [removed: 33.5] | | [added: 1,334,247] | [removed: 33.8] | | [added: | | | 36.6 | | | | | | 33.5 | | |]

| Income from operations | | [added: | | | | 819,986 | | | | | |] 889,110 | | | | [removed: 705,836] | | [added: 18.6] | | [removed: 22.3] | | | [removed: 21.5] | [added: 22.3] | [added: | |]

| Other income (expense), net | | [added: | | | | (636) | | | | | |] 8,283 | | | | [removed: 9,414] | | [added: —] | | [removed: 0.2] | | | [removed: 0.3] | [added: 0.2] | [added: | |]

| Income before income tax expense | | [added: | | | | 819,350 | | | | | |] 897,393 | | | | [removed: 715,250] | | [added: 18.6] | | [removed: 22.6] | | | [removed: 21.8] | [added: 22.6] | [added: | |]

| Income tax expense | | [added: | | | | 230,437 | | | | | |] 251,797 | | | | [removed: 231,449] | | [added: 5.2] | | [removed: 6.3] | | | [removed: 7.0] | [added: 6.3] | [added: | |]

| Net income | | [added: | | | |] $ | [removed: 645,596] [added: 588,913] | | | [added: | |] $ | [removed: 483,801] [added: 645,596] | | | [removed: 16.2] | [added: | 13.4 | |] % | | [removed: 14.7] | [added: | 16.2 | |] % |

Comparison of [removed: Fiscal 2019 to Fiscal 2018][added: 2020 to 2019]

On a constant dollar basis, assuming the average exchange rates in [removed: fiscal 2019] [added: 2020] remained constant with the average exchange rates in [removed: fiscal 2018,] [added: 2019,] net revenue increased [removed: $718.5] [added: $412.7] million, or [removed: 22%.][added: 10%.]

Net revenue [removed: on a segment basis] for [removed: fiscal 2019] [added: 2020] and [removed: fiscal 2018] [added: 2019] is summarized below.

| Company-operated stores | | [added: | | | |] $ | [removed: 2,501,067] [added: 1,658,807] | | | [added: | |] $ | [removed: 2,126,363] [added: 2,501,067] | | | [added: | | 37.7 | | % | | | |] 62.9 | [added: |] % | | [removed: 64.7] | [added: | $ | (842,260) | | | | | (33.7) | |] % |

[added: *Company-Operated Stores.*] The [removed: following contributed to the increase] [added: decrease] in net revenue from our company-operated stores [removed: segment:][added: segment was primarily due to the impact of COVID-19.]

[removed: Based on a shifted calendar, direct] [added: *Direct] to [added: Consumer.* Direct to] consumer net revenue increased [removed: 35%, or] [added: 101%, and] increased [removed: 35%] [added: 101%] on a constant dollar basis.

The increase in net revenue from our direct to consumer segment was primarily the result of increased [removed: traffic on our e-commerce websites] [added: traffic,] and improved conversion rates, partially offset by a decrease in dollar value per transaction.

Components of management's discussion and analysis of financial condition and results of operations include:

- [Overview](#i6020f5b3b81c432e8c1c0401e9df00a0_46)

- [Financial Highlights](#i6020f5b3b81c432e8c1c0401e9df00a0_46)

- [Results of Operations](#i6020f5b3b81c432e8c1c0401e9df00a0_52)

- [Comparison of](#i6020f5b3b81c432e8c1c0401e9df00a0_58) [2020](#i6020f5b3b81c432e8c1c0401e9df00a0_58) [to](#i6020f5b3b81c432e8c1c0401e9df00a0_58) [2019](#i6020f5b3b81c432e8c1c0401e9df00a0_58)

- [Non-GAAP Financial Measures](#i6020f5b3b81c432e8c1c0401e9df00a0_67)

- [Liquidity and Capital Resources](#i6020f5b3b81c432e8c1c0401e9df00a0_73)

- [Revolving Credit Facilities](#i6020f5b3b81c432e8c1c0401e9df00a0_79)

- [Contractual Obligations and Commitments](#i6020f5b3b81c432e8c1c0401e9df00a0_82)

- [Off-Balance Sheet Arrangements](#i6020f5b3b81c432e8c1c0401e9df00a0_85)

- [Critical Accounting Policies and Estimates](#i6020f5b3b81c432e8c1c0401e9df00a0_88)

Fiscal 2020 and 2019 were each 52-week years.

Fiscal 2020 was a year in which we had to adapt our priorities, and evolve our strategies, to navigate the challenges of the COVID-19 pandemic and begin to more impactfully address systemic inequities in our society.

We put three foundational principles in place to help guide us through the pandemic.

These principles are: 1) protect our people to ensure their health, safety, and well-being, 2) make balanced decisions including investing in our digital and omni capabilities while tightly managing discretionary expenses, and 3) continue to invest in our future.

We completed our first acquisition in 2020, with our purchase of MIRROR.

MIRROR bolsters our digital sweatlife offerings and brings immersive and personalized at-home sweat and mindfulness solutions to new and existing lululemon guests.

In addition, we established IDEA – our commitment to Inclusion, Diversity, Equity, and Action – to help drive lasting change both within our company and the communities in which we operate.

In October 2020, we released our Impact Agenda detailing our strategies to become a more sustainable and equitable business, to minimize our environmental impact, and to accelerate positive change both internally and externally.

Despite the global pandemic, we remain committed to our Power of Three growth plan and the targets contemplated by this plan which include a doubling of our men's business, a doubling of our e-commerce business, and a quadrupling of our international business by 2023 from levels realized in 2018.

Due to a shift towards online shopping as a result of COVID-19, we exceeded our e-commerce goal this year.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

We continued to leverage our Science of Feel development platform and brought innovations to our guests including a relaunch of our Everlux fabric and an expansion of our Align franchise into tops.

We also brought newness into our bra offering and expanded our On the Move assortment.

We introduced more inclusive sizing into our core women's styles in 2020 with additional styles to be added in 2021.

In men's, our guests responded well to shorts, sweats, hoodies, and joggers as they adapted their wardrobes to working and sweating from home.

The COVID-19 pandemic impacted the way guests interacted with our brand in 2020.

Temporary store closures, social distancing requirements, and other actions taken within our stores to keep our guests and employees safe, contributed to a decline in store traffic relative to 2019.

Revenue in stores decreased 34%.

However, this was offset by significant strength in our e-commerce business.

We invested in IT infrastructure, fulfillment capacity, and increased the number of educators assisting guests in our Guest Education Center, including an online digital educator experience to provide a more personalized shopping experience.

In addition, we used our social channels to engage with our guests by offering ambassador-led digital sweat sessions, meditation classes, and other recovery and well-being tools.

Revenue in our e-commerce channel increased 101% in 2020.

In 2020, as it was safe to welcome guests back into our stores, we launched several initiatives to enhance the in-store experience.

We adapted our Buy Online Pick-up In-store capability to allow guests to pick-up their purchases at the door of the store or at curbside, we implemented virtual waitlist capabilities so that guests did not have to physically wait in line to enter stores operating under strict capacity constraints, and we offered appointment shopping in-store.

In addition, in the fourth quarter, we opened 11 of these stores in close proximity to permanent lululemon stores.

Having two stores in select locations, where locally mandated capacity constraints were contributing to long wait times, allowed guests quicker and easier access to our in-store shopping experience.

COVID-19 Pandemic

The outbreak of the COVID-19 coronavirus was declared a pandemic by the World Health Organization in March 2020 and it has caused governments and public health officials to impose restrictions and to recommend precautions to mitigate the spread of the virus.

Throughout the pandemic we have prioritized the safety of our employees and guests.

Fiscal 2019 was a 52 week year and fiscal 2018 was a 53 week year.

Net revenue includes results from the 53rd week, however, comparable sales are calculated on a one week shifted basis such that the 52 weeks ended February 2, 2020 are compared to the 52 weeks ended February 3, 2019 rather than January 27, 2019.

We have omitted the results of operations and cash flows for fiscal 2017, and the comparison of fiscal 2018 to fiscal 2017.

For the omitted results and comparisons please refer to "Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations" of our fiscal 2018 Annual Report on Form 10-K filed with the SEC on March 27, 2019.

Our business momentum continued in fiscal 2019.

Net revenue grew 21% and total comparable sales increased 17%.

In addition, we expanded our operating margin 80 basis points to 22.3% and grew earnings per share 37%, or 28% excluding certain discrete tax items which were recognized in fiscal 2018.

Fueling our performance this year was strength across our product assortment, 18% square footage growth driven by new stores and our remodel program, and a robust e-commerce business.

In addition, our local community events and educators continued to connect us with our guests in a truly unique manner.

We believe the first year of our Power of Three growth plan proved to be particularly successful.

Throughout fiscal 2019, response to our product offerings was strong as we continued to grow our core product categories, expand our merchandise range, and deliver new innovation through our Science of Feel development platform.

Momentum continued in both our men's and women's pant category, and we continued to expand the important categories of bras and outerwear.

In men's, one of our key growth areas, revenue increased 34% in 2019.

We also moved beyond test phase with our new assortment of selfcare personal-care products.

We rolled out our initial assortment to 50 stores and online.

Performance was strong across both our company-operated store and direct to consumer channels in fiscal 2019, with comparable store sales increasing 9% and direct to consumer net revenue growing 35%, each based on a shifted calendar.

In fiscal 2019 we began to engage with our guests in new ways.

We began testing a new membership program, with four markets tested in fiscal 2019.

We also opened and began testing our first two fully experiential stores in 2019, one in the Lincoln Park neighborhood of Chicago and the second at the Mall of America near Minneapolis.

These stores were designed to offer dedicated studio space for sweat classes and meditation, locker rooms, healthy foods, and an elevated shopping experience.

In addition to our SeaWheeze half marathon and festival in Vancouver, we hosted 10K races in Toronto, Edmonton, and San Diego, our first in the United States.

In Europe, we held Sweatlife festivals in London, Paris, and Berlin, and in Mainland China, we hosted our 4th annual Unroll China event.

These festivals and events brought together guests, educators, ambassadors, and other members of the local community to engage in sweat classes, yoga, personal development, and meditation.

In fiscal 2019, we continued to expand our presence both in North America and in our international markets.

We expanded into two new markets in Europe during the year, the Netherlands and Norway.

We also launched local market e-commerce sites in Germany and France.

In Asia, we opened our first stores in Malaysia and launched a local e-commerce site in Japan.

Coronavirus (COVID-19)

The outbreak of the COVID-19 coronavirus has been declared a pandemic by the World Health Organization and continues to spread in the United States, Canada, and in many other countries globally.

The spread of COVID-19 has caused public health officials to recommend precautions to mitigate the spread of the virus, especially when congregating in heavily populated areas, such as malls and lifestyle centers.

Government authorities in certain markets in which we operate have also issued orders that require the closure of non-essential businesses and people to remain at home.

We have taken actions to close certain retail locations and to reduce operating hours, and we continue to monitor the situation and work closely with local authorities to prioritize the safety of our people and guests.

All but one of these locations have since reopened.

In March 2020, we temporarily closed all of our retail locations in North America, Europe, Malaysia, New Zealand, and we temporarily closed our distribution center in Sumner, WA.

These locations currently remain closed.

We expect our sales growth trends to experience a meaningful deterioration from those achieved in fiscal 2019 and to experience a material adverse impact on our fiscal 2020 results.

The extent to which COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions taken to contain it or treat its impact.

The summary below provides both GAAP and non-GAAP financial measures.

The adjusted financial measures for fiscal 2018 exclude the amounts recognized in connection with U.S. tax reform and taxes on the repatriation of foreign earnings.

As of [removed: February 2, 2020,] [added: January 31, 2021,] we had certain forward currency contracts outstanding in order to hedge a portion of the foreign currency exposure that arises on translation of a Canadian subsidiary into U.S. dollars.

[removed: Please refer to Note 12 to our audited consolidated financial statements] [added: Derivative Financial Instruments] included in Item 8 of Part II of this report for further information, including details of the notional amounts outstanding.

A [removed: strengthening] [added: weakening] of the U.S. dollar against the Canadian dollar results in:

[removed: | • |] [added: -] the following impacts to the consolidated statements of operations: [removed: |]

[removed: | – | a decrease] [added: –an increase] in our net revenue upon translation of the sales made by our Canadian operations into U.S. dollars for the purposes of consolidation; [removed: |]

[removed: | – | a decrease] [added: –an increase] in our selling, general and administrative expenses incurred by our Canadian operations upon translation into U.S. dollars for the purposes of consolidation; [removed: |]

[removed: | – | foreign] [added: –foreign] exchange revaluation [removed: gains] [added: losses] by our Canadian subsidiaries on U.S. dollar denominated monetary assets and liabilities; and [removed: |]

[removed: | – | derivative] [added: –derivative] valuation [removed: losses] [added: gains] on forward currency contracts not designated in a hedging relationship; [removed: |]

[removed: | • |] [added: -] the following impacts to the consolidated balance sheets: [removed: |]

[removed: | – | a decrease] [added: –an increase] in the foreign currency translation adjustment which arises on the translation of our Canadian subsidiaries' balance sheets into U.S. dollars; and [removed: |]

[removed: | – | an increase] [added: –a decrease] in the foreign currency translation adjustment from derivative valuation losses on forward currency contracts, entered into as net investment hedges of a Canadian subsidiary. [removed: |]

During [removed: fiscal] 2019, the change in the relative value of the U.S. dollar against the Canadian dollar resulted in a $4.6 million increase in accumulated other comprehensive loss within stockholders' equity.

During [removed: fiscal 2018,] [added: 2020,] the change in the relative value of the U.S. dollar against the Canadian dollar resulted in a [removed: $83.2] [added: $57.0] million [removed: increase] [added: reduction] in accumulated other comprehensive loss within stockholders' equity.

A 10% appreciation in the relative value of the U.S. dollar against the Canadian dollar compared to the exchange rates in effect for [removed: fiscal 2019] [added: 2020] would have resulted in lower income from operations of approximately [removed: $4.6] [added: $22.0] million in [removed: fiscal 2019.][added: 2020.]

Our committed revolving credit facility provides us with available borrowings in an amount up to $400.0 [removed: million in the aggregate.][added: million.]

As of [removed: February 2, 2020,] [added: January 31, 2021,] aside from letters of credit of [removed: $1.8] [added: $2.4] million, [removed: we had] [added: there were] no [removed: other] borrowings outstanding under these credit facilities.

Please refer to Note 15.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| | |

| --- | --- |

We have a vision to be the experiential brand that ignites a community of people through sweat, grow, and connect, which we call "living the sweatlife." Since our inception, we have fostered a distinctive corporate culture; we promote a set of core values in our business which include taking personal responsibility, nurturing entrepreneurial spirit, acting with honesty and courage, valuing [removed: connection,] [added: connection] and [added: inclusion, and] choosing to have fun.

In this Annual Report on Form 10-K [removed: ("10-K" or "Report")] for the fiscal year ended [removed: February 2, 2020 ("fiscal 2019"),] [added: January 31, 2021,] lululemon athletica inc. (together with its subsidiaries) is referred to as "lululemon," "the Company," "we," [removed: "us"] [added: "us,"] or "our." [added: We refer to the fiscal year ended January 31, 2021 as "2020" and the fiscal year ended February 2, 2020 as "2019."]

We offer a comprehensive line of apparel and [removed: accessories for women and men.][added: accessories.]

Through our vertical retail strategy and direct connection with our [added: customers, who we refer to as] guests, we are able to collect feedback and incorporate unique performance and fashion needs into our design process.

In this way, we believe we [removed: solve problems for] [added: are better positioned to address the needs of] our guests, helping us advance our product lines and differentiate us from the competition.

Although our [removed: primary and] largest customer group is made up of [removed: women,] [added: guests who shop our women's range, representing 69% of our 2020 net revenue,] we also design a comprehensive men's line and have a targeted strategy in [removed: place to serve our male guests.][added: place.]

Our business is growing as more [removed: men] [added: guests] discover the technical rigor and premium quality of our [added: men's] products, and are attracted by our distinctive brand.

[removed: Additionally, we] [added: We] are expanding internationally across Europe, the People's Republic of China ("PRC"), and the rest of Asia Pacific.

We also [removed: generate net revenue from outlets, sales from] [added: conduct business through MIRROR, operate outlets and] temporary locations, [removed: sales to] [added: serve certain] wholesale accounts, [removed: through] [added: have] license and supply arrangements, and [added: hold] warehouse [removed: sales.][added: sales from time to time.]

At the end of [removed: fiscal 2019,] [added: 2020,] we [removed: had 491] [added: operated 521] stores in 17 countries across the globe.

In addition to being a venue to sell [removed: product,] our [added: products, our] stores give us a direct connection to our guest, which we view as a valuable tool in helping us build our brand and product line.

[removed: Our direct to consumer segment includes the net revenue which we generate from] [added: We serve] our [added: guests via our] e-commerce website www.lululemon.com, other country and region specific websites, and mobile apps, including mobile apps on in-store devices that allow demand to be fulfilled via our distribution centers or other retail locations.

| United States | | [removed: 305] | | | [removed: 285] | [added: 315] | [added: | | | | | 305 | | |]

| Canada | | [removed: 63] | | | [removed: 64] | [added: 62] | [added: | | | | | 63 | | |]

| People's Republic of China(1) | | [removed: 38] | | | [removed: 22] | [added: 55] | [added: | | | | | 38 | | |]

| Australia | | [added: | | | |] 31 | | | [removed: 29] | | [added: | 31 | | |]

| United Kingdom | | [removed: 14] | | | [removed: 12] | [added: 16] | [added: | | | | | 14 | | |]

| Japan | | [removed: 7] | | | [removed: 5] | [added: 6] | [added: | | | | | 7 | | |]

| New Zealand | | [added: | | | |] 7 | | | [added: | | |] 7 | | [added: |]

| Germany | | [removed: 6] | | | [removed: 5] | [added: 7] | [added: | | | | | 6 | | |]

| South Korea | | [removed: 5] | | | [removed: 4] | [added: 7] | [added: | | | | | 5 | | |]

| Singapore | | [added: | | | |] 4 | | | [removed: 3] | | [added: | 4 | | |]

| France | | [added: | | | |] 3 | | | [removed: 1] | | [added: | 3 | | |]

| Malaysia | | [added: | | | |] 2 | | | [removed: —] | | [added: | 2 | | |]

| Sweden | | [added: | | | |] 2 | | | [removed: 1] | | [added: | 2 | | |]

| Ireland | | [added: | | | |] 1 | | | [added: | | |] 1 | | [added: |]

| Netherlands | | [added: | | | |] 1 | | | [removed: —] | | [added: | 1 | | |]

| Norway | | [added: | | | |] 1 | | | [removed: —] | | [added: | 1 | | |]

| Switzerland | | [added: | | | |] 1 | | | [added: | | |] 1 | | [added: |]

| Total company-operated stores | | [removed: 491] | | | [removed: 440] | [added: 521] | [added: | | | | | 491 | | |]

[removed: | (1) | PRC included six company-operated stores in Hong Kong, Special Administrative Region, two company-operated stores in Macao, Special Administration Region, and one company-operated store in Taiwan, PRC as of February 2, 2020.] As of February [removed: 3, 2019,] [added: 2, 2020,] there were [removed: five company-operated] [added: six] stores in Hong Kong, Special Administrative Region, [removed: one company-operated store] [added: two stores] in Macao, Special Administration Region, and one [removed: company-operated] store in [removed: Taiwan, PRC. |][added: Taiwan.]

We opened [removed: 51] [added: 30] net new company-operated stores in [removed: fiscal 2019,] [added: 2020,] including [removed: 32] [added: 21] net new stores outside of North America.

During [removed: fiscal 2019,] [added: 2020,] we closed [removed: four] [added: 10] of our lululemon branded company-operated [removed: stores and two of our ivivva branded company-operated] stores.

As we continue our evaluations we may, in [removed: future periods,] [added: the future,] close or relocate additional company-operated stores.

In fiscal [removed: 2020,] [added: 2021,] our new store growth will come primarily from company-operated store openings in Asia and in the United States.

We [added: typically] use sales per square foot to assess the performance of our company-operated [removed: stores relative to their square footage.][added: stores.]

We believe that e-commerce is convenient for our core [removed: customer] [added: guest] and enhances the image of our brand.

[removed: Other Channels][added: Other]

[removed: | • | *Outlets] [added: *•Outlets] and warehouse sales* - We utilize outlets as well as physical warehouse sales, which are held from time to time, to sell slow moving inventory and inventory from prior seasons [removed: to retail customers] at discounted prices. [removed: |]

[removed: | • |] [added: -] *Temporary locations* - Our temporary locations, including seasonal stores, are typically opened for a short period of [removed: time in markets in which we may not already have a presence. |][added: time.]

Components of this discussion of our business include:

- [Our](#i6020f5b3b81c432e8c1c0401e9df00a0_2084) [Pro](#i6020f5b3b81c432e8c1c0401e9df00a0_2084)[ducts](#i6020f5b3b81c432e8c1c0401e9df00a0_2084)

- [Our Market](#i6020f5b3b81c432e8c1c0401e9df00a0_2130)

- [Our Segments](#i6020f5b3b81c432e8c1c0401e9df00a0_2125)

- [Community-Based Marketing](#i6020f5b3b81c432e8c1c0401e9df00a0_2105)

- [P](#i6020f5b3b81c432e8c1c0401e9df00a0_2100)[roduct Design and Development](#i6020f5b3b81c432e8c1c0401e9df00a0_2100)

- [Sourcing and Manufacturing](#i6020f5b3b81c432e8c1c0401e9df00a0_2095)

- [Distri](#i6020f5b3b81c432e8c1c0401e9df00a0_2153)[bution Facilities](#i6020f5b3b81c432e8c1c0401e9df00a0_2153)

- [Competition](#i6020f5b3b81c432e8c1c0401e9df00a0_2148)

- [Seasona](#i6020f5b3b81c432e8c1c0401e9df00a0_2143)[lity](#i6020f5b3b81c432e8c1c0401e9df00a0_2143)

- [Human Capital](#i6020f5b3b81c432e8c1c0401e9df00a0_2090)

- [Intellec](#i6020f5b3b81c432e8c1c0401e9df00a0_2182)[tual Property](#i6020f5b3b81c432e8c1c0401e9df00a0_2182)

- [Securities and Exchange](#i6020f5b3b81c432e8c1c0401e9df00a0_2177) [Commission](#i6020f5b3b81c432e8c1c0401e9df00a0_2177) [Filings](#i6020f5b3b81c432e8c1c0401e9df00a0_2177)

We

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

also offer a range of products designed for being On the Move and fitness-related accessories.

We expect to continue to broaden our merchandise offerings through expansion across these product areas.

During the second quarter of 2020, we acquired Curiouser Products Inc., dba MIRROR.

MIRROR is an in-home fitness company with an interactive workout platform that features live and on-demand classes.

The acquisition of MIRROR bolsters our digital sweatlife offerings and brings immersive and personalized in-home sweat and mindfulness content to new and existing lululemon guests.

North America is our largest market by geographical split, representing 86% of our 2020 net revenue.

The financial results of these operations are disclosed in Other.


[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Number of company-operated stores by country | | | | | | January 31, 2021 | | | | | | February 02, 2020 | | |

(1)PRC included seven stores in Hong Kong, Special Administrative Region, two stores in Macao, Special Administration Region, and two stores in Taiwan, as of January 31, 2021.

As a significant number of our stores were temporarily closed due to COVID-19 during the first two quarters of 2020, we do not believe sales per square foot is currently useful to investors in understanding performance, therefore we have not included this metric.

Our direct to consumer channel also allows us to reach and serve guests in markets beyond where our physical retail locations are based.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

Our other operations include:

*•MIRROR -* we offer in-home fitness through an interactive workout platform that allows our guests to subscribe for live and on-demand classes

As of January 31, 2020, we operated 38 outlets, with the majority in North America.

We believe these retail locations enable us to serve guests during peak shopping periods in markets where we do not ordinarily have a physical location, or enable us to better serve our guest in markets where we see high demand at our existing locations.

- *Wholesale* - Our wholesale accounts include premium yoga studios, health clubs, and fitness centers.

We do not intend wholesale to be a significant contributor to overall sales.

Instead, we use the channel to build brand awareness, including outside of North America.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

We are in direct competition with wholesalers and direct sellers of athletic apparel, such as Nike, Inc., adidas AG, Under Armour, Inc, and Columbia Sportswear Company.

We also offer fitness-related accessories.

Although we benefit from the growing number of people that participate in yoga, we believe the percentage of our products sold for other activities will continue to increase as we broaden our product range.

North America is our largest market by geographical split, offering a mature health and wellness industry and sophisticated consumer.

The net revenue we generate from these sources is combined in our other segment.

We operate in both the physical and digital space to better cater to the shopping desires of our guest.

As of February 2, 2020, our retail footprint included 491 company-operated stores.

While most of our company-operated stores are branded lululemon, five of our company-operated stores are branded ivivva and specialize in athletic wear for female youth.

Our company-operated stores by country as of February 2, 2020 and February 3, 2019 are summarized in the table below:

| | | | | | | |

| --- | --- | --- | --- | --- | --- | --- |

| | | February 2, 2020 | | | February 3, 2019 | |

| | |

| --- | --- |

We believe that sales per square foot is useful in evaluating the performance of our company-operated stores.

During fiscal 2019, our sales per square foot was $1,657.

Sales per square foot is calculated using total net revenue from company-operated stores that opened, or opened in their significantly expanded space, prior to the current fiscal year.

The total net revenue of these stores for the fiscal year is divided by the total square footage of these stores at the end of the year.

The fiscal 2019 sales per square foot metric is based on an average square footage of 3,127 per store as of February 2, 2020.

In fiscal years with 53 weeks, the 53rd week of net revenue is excluded from the calculation of sales per square foot.

The square footage of our company-operated stores includes all retail related space, storage areas, and administrative space used by the store employees.

It excludes any space used for non-retail related activities.

The sales per square foot metric we report may not be equivalent to similarly titled metrics reported by other companies.

Direct to consumer is a substantial part of our business, representing 28.6% of our net revenue in fiscal 2019.

Our direct to consumer channel

makes our product accessible to more markets than our company-operated store channel alone.

Other net revenue accounted for 8.6% of total net revenue in fiscal 2019, compared to 9.2% in fiscal 2018, and 8.9% of total net revenue in fiscal 2017.

Other net revenue includes sales made through the following channels:

During fiscal 2019, the largest single manufacturer produced approximately 17% of our

products.

Our Employees

As of February 2, 2020, we had approximately 19,000 employees, of which approximately 11,000 were employed in the United States, approximately 5,200 were employed in Canada, and approximately 2,800 were employed outside of North America.

None of our employees are currently covered by a collective bargaining agreement.

We have had no labor-related work stoppages by our employees and we believe our relations with our employees are excellent.

Please see the legal proceedings described in Note 19.

Commitments and Contingencies included in Item 8 of Part II of this report.

Please see the legal proceedings described in Note 17 to our audited consolidated financial statements included in Item 8 of Part II of this report.

PART II

[removed: SECURITIES] [added: UNITED STATES SECURITIES] AND EXCHANGE COMMISSION

[removed: Form 10-K][added: Form 10-K]

| ☑ | [added: | |] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | [added: | |]

For the fiscal year [removed: ended February 2, 2020][added: ended January 31, 2021]

| ☐ | [added: | |] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | [added: | |]

Commission file [removed: number 001-33608][added: number 001-33608]

| Delaware | | [added: | | | |] 20-3842867 | [added: | |]

| (State or other jurisdiction [removed: of incorporation] [added: of incorporation] or organization) | | [added: | | | |] (I.R.S. [removed: Employer Identification] [added: Employer Identification] Number) | [added: | |]

1818 Cornwall [removed: Avenue, Vancouver, British Columbia V6J] [added: Avenue, Vancouver, British Columbia V6J] 1C7

Registrant's telephone number, including area code: [removed: (604) 732-6124][added: (604) 732-6124]

| Title of each class | | [added: | | | |] Trading symbol(s) | | [added: | | | |] Name of each exchange on which registered | [added: | |]

| Common Stock, par value $0.005 per share | | [added: | | | |] LULU | | [added: | | | |] Nasdaq Global Select Market | [added: | |]

| Large Accelerated Filer | | [added: | | | |] ☑ | | [added: | | | |] Accelerated filer | | [added: | | | |] ☐ | [added: | |]

| Non-accelerated filer | | [added: | | | |] ☐ | | [added: | | | |] Smaller reporting company | | [added: | | | |] ☐ | [added: | |]

| Emerging growth company | | [added: | | | |] ☐ | | | | | [added: | | | | | | | | | |]

The aggregate market value of the voting stock held by non-affiliates of the registrant on [removed: August 2, 2019] [added: July 31, 2020] was approximately [removed: $20,011,000,000.][added: $36,382,000,000.]

Such aggregate market value was computed by reference to the closing price of the common stock as reported on the Nasdaq Global Select Market on [removed: August 2, 2019.][added: July 31, 2020.]

For purposes of determining this amount only, the registrant has defined affiliates as including the executive officers, directors, and owners of 10% or more of the outstanding voting stock of the registrant on [removed: August 2, 2019.][added: July 31, 2020.]

[added: *Common Stock:*] At March [removed: 20, 2020] [added: 24, 2021] there were [removed: 124,115,144] [added: 125,164,616] shares of the registrant's common stock, par value $0.005 per share, outstanding.

[added: *Exchangeable and Special Voting Shares:*] At March [removed: 20, 2020,] [added: 24, 2021,] there were outstanding [removed: 6,049,939] [added: 5,203,012] exchangeable shares of Lulu Canadian Holding, Inc., a wholly-owned subsidiary of the registrant.

In addition, at March [removed: 20, 2020,] [added: 24, 2021,] the registrant had outstanding [removed: 6,049,939] [added: 5,203,012] shares of special voting stock, through which the holders of exchangeable shares of Lulu Canadian Holding, Inc. may exercise their voting rights with respect to the registrant.

Portions of the Proxy Statement for the [removed: 2020] [added: 2021] Annual Meeting of Stockholders have been incorporated by reference into Part III of this Annual Report on Form 10-K.

| | | [added: | | | |] Page | [added: | |]

| Item 1. | [removed: [BUSINESS](#s125C75873E585A6E8412F4890FB74A25)] | [removed: [1](#s125C75873E585A6E8412F4890FB74A25)] | [added: [Business](#i6020f5b3b81c432e8c1c0401e9df00a0_16) | | | [1](#i6020f5b3b81c432e8c1c0401e9df00a0_16) | | |]

| Item 1A. | [removed: [RISK FACTORS](#sA158E233892E5E8F81F222EF7146D97B)] | [removed: [6](#sA158E233892E5E8F81F222EF7146D97B)] | [added: [Risk Factors](#i6020f5b3b81c432e8c1c0401e9df00a0_22) | | | [8](#i6020f5b3b81c432e8c1c0401e9df00a0_22) | | |]

| Item 2. | [removed: [PROPERTIES](#s5B06193EC71C5A518A7A72BF3DE9BF2D)] | [removed: [16](#s5B06193EC71C5A518A7A72BF3DE9BF2D)] | [added: [Properties](#i6020f5b3b81c432e8c1c0401e9df00a0_25) | | | [20](#i6020f5b3b81c432e8c1c0401e9df00a0_25) | | |]

| Item 3. | [removed: [LEGAL PROCEEDINGS](#sB3AB56870555529B882A8BE7D8E0B760)] | [removed: [16](#sB3AB56870555529B882A8BE7D8E0B760)] | [added: [Legal Proceedings](#i6020f5b3b81c432e8c1c0401e9df00a0_31) | | | [20](#i6020f5b3b81c432e8c1c0401e9df00a0_31) | | |]

| Item 5. | [removed: [MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](#s2A347646F7AA512D9E06C9EB3DA96A51)] | [removed: [17](#s2A347646F7AA512D9E06C9EB3DA96A51)] | [added: [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#i6020f5b3b81c432e8c1c0401e9df00a0_37) | | | [21](#i6020f5b3b81c432e8c1c0401e9df00a0_37) | | |]

| Item 6. | [removed: [SELECTED CONSOLIDATED FINANCIAL DATA](#sF4B74F4C620155A0AB86CA01A2C4F362)] | [removed: [19](#sF4B74F4C620155A0AB86CA01A2C4F362)] | [added: [Selected Consolidated Financial Data](#i6020f5b3b81c432e8c1c0401e9df00a0_40) | | | [22](#i6020f5b3b81c432e8c1c0401e9df00a0_40) | | |]

| Item 7. | [removed: [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#sE73A47CA34DF5CBCBD67A9DF41628FB2)] | [removed: [20](#sE73A47CA34DF5CBCBD67A9DF41628FB2)] | [added: [Management's Discussion and Analysis of Financial Condition and Results of Operations](#i6020f5b3b81c432e8c1c0401e9df00a0_43) | | | [23](#i6020f5b3b81c432e8c1c0401e9df00a0_43) | | |]

| Item 7A. | [removed: [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#sCD0C03B9CFE35A52A2C82109CEB686CF)] | [removed: [33](#sCD0C03B9CFE35A52A2C82109CEB686CF)] | [added: [Quantitative and Qualitative Disclosures About Market Risk](#i6020f5b3b81c432e8c1c0401e9df00a0_91) | | | [35](#i6020f5b3b81c432e8c1c0401e9df00a0_91) | | |]

| Item 8. | [removed: [FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](#s2EAC0A13248054FDAB615E57C750251E)] | [removed: [35](#s2EAC0A13248054FDAB615E57C750251E)] | [added: [Financial Statements and Supplementary Data](#i6020f5b3b81c432e8c1c0401e9df00a0_94) | | | [37](#i6020f5b3b81c432e8c1c0401e9df00a0_94) | | |]

| | [removed: [INDEX FOR NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS](#s9D8162E8A99B5D4289481C91726A1C8B)] | [removed: [42](#s9D8162E8A99B5D4289481C91726A1C8B)] | [added: [Index for Notes to the Consolidated Financial Statements](#i6020f5b3b81c432e8c1c0401e9df00a0_115) | | | [46](#i6020f5b3b81c432e8c1c0401e9df00a0_115) | | |]

| Item 9A. | [removed: [CONTROLS AND PROCEDURES](#s59CD819AEEB4522FBBBAC94AAC2DD108)] | [removed: [68](#s59CD819AEEB4522FBBBAC94AAC2DD108)] | [added: [Controls and Procedures](#i6020f5b3b81c432e8c1c0401e9df00a0_196) | | | [72](#i6020f5b3b81c432e8c1c0401e9df00a0_196) | | |]

| [removed: [PART III](#s167D8057D34054EBBB52F3BBE3CAFA01)] [added: [PART III](#i6020f5b3b81c432e8c1c0401e9df00a0_199)] | | | [added: | | | | | |]

| Item 10. | [removed: [DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](#s327A18E9FA4B5E93AF2F57E183F66E1C)] | [removed: [70](#s327A18E9FA4B5E93AF2F57E183F66E1C)] | [added: [Directors, Executive Officers and Corporate Governance](#i6020f5b3b81c432e8c1c0401e9df00a0_202) | | | [74](#i6020f5b3b81c432e8c1c0401e9df00a0_202) | | |]

| Item 11. | [removed: [EXECUTIVE COMPENSATION](#s89EB241EB03059B99A9959E6901268F0)] | [removed: [70](#s89EB241EB03059B99A9959E6901268F0)] | [added: [Executive Compensation](#i6020f5b3b81c432e8c1c0401e9df00a0_205) | | | [74](#i6020f5b3b81c432e8c1c0401e9df00a0_205) | | |]

| Item 12. | [removed: [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](#sBDB1E054CE7653B8AFE7AA91415716B8)] | [removed: [70](#sBDB1E054CE7653B8AFE7AA91415716B8)] | [added: [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#i6020f5b3b81c432e8c1c0401e9df00a0_208) | | | [74](#i6020f5b3b81c432e8c1c0401e9df00a0_208) | | |]

| Item 13. | [removed: [CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](#s344973C4826D58F891F8B75871026864)] | [removed: [70](#s344973C4826D58F891F8B75871026864)] | [added: [Certain Relationships and Related Transactions, and Director Independence](#i6020f5b3b81c432e8c1c0401e9df00a0_211) | | | [75](#i6020f5b3b81c432e8c1c0401e9df00a0_211) | | |]

| Item 14. | [removed: [PRINCIPAL ACCOUNTANT FEES AND SERVICES](#sC55046C51BF350968C4A0D1DE7B30433)] | [removed: [71](#sC55046C51BF350968C4A0D1DE7B30433)] | [added: [Principal Accountant Fees and Services](#i6020f5b3b81c432e8c1c0401e9df00a0_214) | | | [75](#i6020f5b3b81c432e8c1c0401e9df00a0_214) | | |]

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

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Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

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| [PART I](#i6020f5b3b81c432e8c1c0401e9df00a0_10) | | | | | | | | |

| Item 4. | | | [Mine Safety Disclosures](#i6020f5b3b81c432e8c1c0401e9df00a0_2266) | | | [20](#i6020f5b3b81c432e8c1c0401e9df00a0_2266) | | |

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| [PART II](#i6020f5b3b81c432e8c1c0401e9df00a0_34) | | | | | | | | |

| Item 9B. | | | [Other Information](#i6020f5b3b81c432e8c1c0401e9df00a0_2234) | | | [73](#i6020f5b3b81c432e8c1c0401e9df00a0_2234) | | |

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| [PART IV](#i6020f5b3b81c432e8c1c0401e9df00a0_217) | | | | | | | | |

| Item 16. | | | [Form 10-K Summary](#i6020f5b3b81c432e8c1c0401e9df00a0_2240) | | | [79](#i6020f5b3b81c432e8c1c0401e9df00a0_2240) | | |

| [Signatures](#i6020f5b3b81c432e8c1c0401e9df00a0_229) | | | | | | [80](#i6020f5b3b81c432e8c1c0401e9df00a0_229) | | |

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

UNITED STATES

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*Common Stock:*

*Exchangeable and Special Voting Shares:*

| [PART I](#s6D103C917810566FA597A6F66204B4A9) | | |

| [PART II](#s4D3311A7BAF359E4AC47E41B9D6F9E0E) | | |

| [PART IV](#s72DAE0A93EA551B79560A06D49070B6E) | | |

The general location, use and approximate size of our principal owned properties as of [removed: February 2, 2020,] [added: January 31, 2021,] are set forth below:

| Location | | [added: | | | |] Use | | [added: | | | |] Approximate Square Feet | | [added: |]

| Columbus, OH | | [added: | | | |] Distribution Center | | [added: | | | |] 310,000 | | [added: |]

| Vancouver, BC | | [added: | | | |] Executive and Administrative Offices | | [added: | | | |] 140,000 | | [added: |]

The general location, use, approximate size and lease renewal date of our principal non-retail leased properties as of [removed: February 2, 2020,] [added: January 31, 2021,] are set forth below:

| Location | | [added: | | | |] Use | | [added: | | | |] Approximate Square Feet | | | [added: | | |] Lease Renewal Date | [added: | |]

| Toronto, ON | | [added: | | | |] Distribution Center | | [added: | | | |] 250,000 | | | [added: | | |] September 2033 | [added: | |]

| Sumner, WA | | [added: | | | |] Distribution Center | | [added: | | | |] 150,000 | | | [added: | | |] July 2025 | [added: | |]

| [removed: Vancouver,] [added: Delta,] BC | | [added: | | | |] Distribution Center | | [added: | | | |] 155,000 | | | [added: | | |] January 2031 | [added: | |]

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During 2020, we entered into a new lease for a second distribution center in Toronto of approximately 255,000 square feet which is due to expire in May 2031.

We expect this distribution center to be operational in fiscal 2021.

It will replace a temporary distribution center in Toronto of approximately 90,000 square feet that we began leasing during 2020.

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Not applicable.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

PART II

As of March [removed: 20, 2020,] [added: 24, 2021,] there were approximately [removed: 900] [added: 1,000] holders of record of our common stock.

The graph set forth below compares the cumulative total stockholder return on our common stock between [removed: February 1, 2015] [added: January 31, 2016] (the date of our fiscal year end five years ago) and [removed: February 2, 2020,] [added: January 31, 2021,] with the cumulative total return of (i) the S&P 500 Index and (ii) S&P 500 Apparel, Accessories & Luxury Goods Index, over the same period.

This graph assumes the investment of $100 on [removed: February 1, 2015] [added: January 31, 2016] at the closing sale price our common stock, the S&P 500 Index and the S&P Apparel, Accessories & Luxury Goods Index and assumes the reinvestment of dividends, if any.

[removed: ][added: ]

| | | [removed: 01-Feb-15] | | | | 31-Jan-16 | | | | [added: | |] 29-Jan-17 | | | | [added: | |] 28-Jan-18 | | | | [added: | |] 03-Feb-19 | | | | [added: | |] 02-Feb-20 | | | [added: | | | 31-Jan-21 | | |]

| S&P 500 Apparel, Accessories & Luxury Goods Index | | [added: | | | |] $ | 100.00 | | | [added: | |] $ | [removed: 82.75] [added: 83.89] | | | [added: | |] $ | [removed: 69.42] [added: 109.20] | | | [added: | |] $ | [removed: 90.37] [added: 96.21] | | | [added: | |] $ | [removed: 79.62] [added: 86.88] | | | [added: | |] $ | [removed: 71.89] [added: 83.24] | |

The following table provides information regarding our purchases of shares of our common stock during the thirteen weeks ended [removed: February 2, 2020] [added: January 31, 2021] related to our stock repurchase program:

| Period(1) | | [added: | | | |] Total Number of Shares Purchased(2) | | | [added: | | |] Average Price Paid per Share | | | | [added: | |] Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | | | [added: | | |] Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(2) | | |

| Total | | [removed: 1,584] | | | | [added: —] | | | [removed: 1,584] | | | | | | [added: | | | — | | | | | | | | |]

[removed: | (1) | Monthly] [added: (1)Monthly] information is presented by reference to our fiscal periods during our fourth quarter of [removed: fiscal 2019. |][added: 2020.]

[removed: | (2) | On January 31, 2019, our board of directors approved a stock repurchase program of up to $500 million of our common shares on the open market or in privately negotiated transactions.] Common shares repurchased on the open market are at prevailing market prices, including under plans complying with the provisions of Rule 10b5-1 and Rule 10b-18 of the Securities Exchange Act of 1934. [removed: The timing and actual number of common shares to be repurchased will depend upon market conditions, eligibility to trade, and other factors. The repurchases are expected to be completed by January 2021. |]

The following table [removed: provides information regarding our] [added: summarizes] purchases of shares of our common stock during the thirteen weeks ended [removed: February 2, 2020] [added: January 31, 2021] related to our Employee Share Purchase [removed: Plan:][added: Plan (ESPP):]

| Period(1) | | [added: | | | |] Total Number of Shares Purchased(2) | | | [added: | | |] Average Price Paid per Share | | | | [added: | |] Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | | | [added: | | |] Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs(2) | | [added: |]

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

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| lululemon athletica inc. | | | | | | $ | 100.00 | | | | | $ | 107.65 | | | | | $ | 127.40 | | | | | $ | 235.41 | | | | | $ | 385.68 | | | | | $ | 529.53 | |

| S&P 500 Index | | | | | | $ | 100.00 | | | | | $ | 118.27 | | | | | $ | 148.07 | | | | | $ | 139.49 | | | | | $ | 169.24 | | | | | $ | 191.43 | |

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| November 2, 2020 - November 29, 2020 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 263,646,016 | |

| November 30, 2020 - January 3, 2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | 500,000,000 | | |

| January 4, 2021 - January 31, 2021 | | | | | | — | | | | | | — | | | | | | — | | | | | | 500,000,000 | | |

(2)On January 31, 2019, our board of directors approved a stock repurchase program of up to $500 million of our common shares on the open market or in privately negotiated transactions.

On December 1, 2020, our board of directors approved an increase in the remaining authorization of our existing stock repurchase program from $264 million to $500 million.

The repurchase plan has no time limit.

The timing and actual number of common shares to be repurchased will depend upon market conditions, eligibility to trade, and other factors.

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| November 2, 2020 - November 29, 2020 | | | | | | 4,348 | | | | | | $ | 347.01 | | | | | 4,348 | | | | | | 4,669,317 | | |

| November 30, 2020 - January 3, 2021 | | | | | | 5,071 | | | | | | 352.51 | | | | | | 5,071 | | | | | | 4,664,246 | | |

| January 4, 2021 - January 31, 2021 | | | | | | 4,834 | | | | | | 352.43 | | | | | | 4,834 | | | | | | 4,659,412 | | |

| Total | | | | | | 14,253 | | | | | | | | | | | | 14,253 | | | | | | | | |

(1)Monthly information is presented by reference to our fiscal periods during our fourth quarter of 2020.

(2)The ESPP was approved by our board of directors and stockholders in September 2007.

All shares purchased under the ESPP are purchased on the Nasdaq Global Select Market (or such other stock exchange as we may designate).

Unless our board terminates the ESPP earlier, it will continue until all shares authorized for purchase have been purchased.

The maximum number of shares authorized to be purchased under the ESPP was 6,000,000.

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| lululemon athletica inc. | | $ | 100.00 | | | $ | 93.70 | | | $ | 100.88 | | | $ | 119.38 | | | $ | 220.59 | | | $ | 361.40 | |

| S&P 500 Index | | $ | 100.00 | | | $ | 97.26 | | | $ | 115.02 | | | $ | 144.00 | | | $ | 135.67 | | | $ | 161.68 | |

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| November 4, 2019 - December 1, 2019 | | 1,584 | | | $ | 194.10 | | | 1,584 | | | $ | 327,302,004 | |

| December 2, 2019 - January 5, 2020 | | — | | | — | | | | — | | | 327,302,004 | | |

| January 6, 2020 - February 2, 2020 | | — | | | — | | | | — | | | 327,302,004 | | |

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| November 4, 2019 - December 1, 2019 | | 5,644 | | | $ | 221.41 | | | 5,644 | | | 4,737,749 | |

| December 2, 2019 - January 5, 2020 | | 5,629 | | | 227.93 | | | | 5,629 | | | 4,732,120 | |

| January 6, 2020 - February 2, 2020 | | 5,474 | | | 238.34 | | | | 5,474 | | | 4,726,646 | |

| Total | | 16,747 | | | | | | | 16,747 | | | | |

| (2) | Our Employee Share Purchase Plan (ESPP) was approved by our board of directors and stockholders in September 2007. All shares purchased under the ESPP are purchased on the Nasdaq Global Select Market (or such other stock exchange as we may designate from time to time). Unless our board of directors terminates the ESPP earlier, the ESPP will continue until all shares authorized for purchase under the ESPP have been purchased. The maximum number of shares authorized to be purchased under the ESPP is 6,000,000. |

Not applicable.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

The selected consolidated financial data set forth below is derived from our consolidated financial statements and should be read in conjunction with our audited consolidated financial statements and notes included in Item 8 of Part II of this report as well as "Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations".

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| | | Fiscal Year Ended | | | | | | | | | | | | | | | | | | |

| | | February 2, 2020 | | | | February 3, 2019 | | | | January 28, 2018 | | | | January 29, 2017 | | | | January 31, 2016 | | |

| | | *(In thousands, except per share data)* | | | | | | | | | | | | | | | | | | |

| Consolidated statement of operations and comprehensive income data: | | | | | | | | | | | | | | | | | | | | |

| Net revenue | | $ | 3,979,296 | | | $ | 3,288,319 | | | $ | 2,649,181 | | | $ | 2,344,392 | | | $ | 2,060,523 | |

| Cost of goods sold | | 1,755,910 | | | | 1,472,032 | | | | 1,250,391 | | | | 1,144,775 | | | | 1,063,357 | | |

| Gross profit | | 2,223,386 | | | | 1,816,287 | | | | 1,398,790 | | | | 1,199,617 | | | | 997,166 | | |

| Selling, general and administrative expenses | | 1,334,276 | | | | 1,110,451 | | | | 904,264 | | | | 778,465 | | | | 628,090 | | |

| Asset impairment and restructuring costs | | — | | | | — | | | | 38,525 | | | | — | | | | — | | |

| Income from operations | | 889,110 | | | | 705,836 | | | | 456,001 | | | | 421,152 | | | | 369,076 | | |

| Other income (expense), net | | 8,283 | | | | 9,414 | | | | 3,997 | | | | 1,577 | | | | (581 | | ) |

| Income before income tax expense | | 897,393 | | | | 715,250 | | | | 459,998 | | | | 422,729 | | | | 368,495 | | |

| Income tax expense | | 251,797 | | | | 231,449 | | | | 201,336 | | | | 119,348 | | | | 102,448 | | |

| Net income | | $ | 645,596 | | | $ | 483,801 | | | $ | 258,662 | | | $ | 303,381 | | | $ | 266,047 | |

| Other comprehensive income (loss), net of tax: | | | | | | | | | | | | | | | | | | | | |

| Foreign currency translation adjustment | | (7,773 | | ) | | (73,885 | | ) | | 58,577 | | | | 36,703 | | | | (64,796 | | ) |

| Comprehensive income | | $ | 637,823 | | | $ | 409,916 | | | $ | 317,239 | | | $ | 340,084 | | | $ | 201,251 | |

| Basic earnings per share | | $ | 4.95 | | | $ | 3.63 | | | $ | 1.90 | | | $ | 2.21 | | | $ | 1.90 | |

| Diluted earnings per share | | $ | 4.93 | | | $ | 3.61 | | | $ | 1.90 | | | $ | 2.21 | | | $ | 1.89 | |

| Basic weighted-average number of shares outstanding | | 130,393 | | | | 133,413 | | | | 135,988 | | | | 137,086 | | | | 140,365 | | |

| Diluted weighted-average number of shares outstanding | | 130,955 | | | | 133,971 | | | | 136,198 | | | | 137,302 | | | | 140,610 | | |

| | | As of | | | | | | | | | | | | | | | | | | |

| | | *(In thousands)* | | | | | | | | | | | | | | | | | | |

| Consolidated balance sheet data1: | | | | | | | | | | | | | | | | | | | | |

| Cash and cash equivalents | | $ | 1,093,505 | | | $ | 881,320 | | | $ | 990,501 | | | $ | 734,846 | | | $ | 501,482 | |

| Inventories | | 518,513 | | | | 404,842 | | | | 329,562 | | | | 298,432 | | | | 284,009 | | |

| Total assets | | 3,281,354 | | | | 2,084,711 | | | | 1,998,483 | | | | 1,657,541 | | | | 1,314,077 | | |

| Total liabilities | | 1,329,136 | | | | 638,736 | | | | 401,523 | | | | 297,568 | | | | 286,595 | | |

| Total stockholders' equity | | 1,952,218 | | | | 1,445,975 | | | | 1,596,960 | | | | 1,359,973 | | | | 1,027,482 | | |

__________

| | |

| --- | --- |

| (1) | We adopted ASC 842 on February 4, 2019 using the modified retrospective approach with no restatement of comparative periods. See Note 2 to the audited consolidated financial statements included in Item 8 of Part II of this report for additional information. |

| [Report of Independent Registered Public Accounting [removed: Firm](#s5610FF7F006B59598FE1FDDA8DB78717)] [added: Firm](#i6020f5b3b81c432e8c1c0401e9df00a0_97)] | [removed: [36](#s5610FF7F006B59598FE1FDDA8DB78717)] | [added: | [38](#i6020f5b3b81c432e8c1c0401e9df00a0_97) | | |]

| [Consolidated Balance [removed: Sheets](#s8A929793B174531AB0A8CC21D0FD7FCF)] [added: Sheets](#i6020f5b3b81c432e8c1c0401e9df00a0_100)] | [removed: [38](#s8A929793B174531AB0A8CC21D0FD7FCF)] | [added: | [41](#i6020f5b3b81c432e8c1c0401e9df00a0_100) | | |]

| [Consolidated Statements of Operations and Comprehensive [removed: Income](#s98FF38C72C7E5D7B833A36E62686B17A)] [added: Income](#i6020f5b3b81c432e8c1c0401e9df00a0_106)] | [removed: [39](#s98FF38C72C7E5D7B833A36E62686B17A)] | [added: | [42](#i6020f5b3b81c432e8c1c0401e9df00a0_106) | | |]

| [Consolidated Statements of Stockholders' [removed: Equity](#s793F57785AF2529F8AF5663817799FF6)] [added: Equity](#i6020f5b3b81c432e8c1c0401e9df00a0_109)] | [removed: [40](#s793F57785AF2529F8AF5663817799FF6)] | [added: | [43](#i6020f5b3b81c432e8c1c0401e9df00a0_109) | | |]

| [Consolidated Statements of Cash [removed: Flows](#sF17F66A919615E5DB652FC3D2051FF77)] [added: Flows](#i6020f5b3b81c432e8c1c0401e9df00a0_112)] | [removed: [41](#sF17F66A919615E5DB652FC3D2051FF77)] | [added: | [45](#i6020f5b3b81c432e8c1c0401e9df00a0_112) | | |]

| [Index for Notes to the Consolidated Financial [removed: Statements](#s9D8162E8A99B5D4289481C91726A1C8B)] [added: Statements](#i6020f5b3b81c432e8c1c0401e9df00a0_115)] | [removed: [42](#s9D8162E8A99B5D4289481C91726A1C8B)] | [added: | [46](#i6020f5b3b81c432e8c1c0401e9df00a0_115) | | |]

We have audited the [removed: accompanying] consolidated balance sheets of lululemon athletica inc. and its subsidiaries (together, the Company) as of [removed: February 2, 2020] [added: January 31, 2021] and February [removed: 3, 2019,] [added: 2, 2020,] and the related consolidated statements of operations and comprehensive income, [removed: stockholders'] [added: stockholders’] equity and cash flows for [removed: each of] the [removed: 52 week] [added: 52-week] period ended [added: January 31, 2021, the 52-week period ended] February 2, 2020, [added: and] the [removed: 53 week] [added: 53-week] period ended February 3, 2019, [removed: and the 52 week period ended January 28, 2018,] including the related notes, [added: listed in the index appearing under item 15(a)(1)] and the financial statement schedule listed in the index appearing under Item 15(a)(2) (collectively referred to as the consolidated financial statements).

We also have audited the Company's internal control over financial reporting as of [removed: February 2, 2020,] [added: January 31, 2021,] based on criteria established in [removed: *Internal] [added: Internal] Control [removed: -] [added: –] Integrated [removed: Framework*] [added: Framework] (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of [removed: February 2, 2020] [added: January 31, 2021] and February [removed: 3, 2019,] [added: 2, 2020,] and the results of its operations and its cash flows for the [removed: 52 week] [added: 52-week] period ended [removed: February 2, 2020,] [added: January 31, 2021,] the [removed: 53 week] [added: 52-week] period ended February [removed: 3, 2019,] [added: 2, 2020,] and the [removed: 52 week] [added: 53-week] period ended [removed: January 28, 2018] [added: February 3, 2019] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of [removed: February 2, 2020,] [added: January 31, 2021,] based on criteria established in [removed: *Internal] [added: Internal] Control [removed: -] [added: –] Integrated [removed: Framework*] [added: Framework] (2013) issued by the COSO.

A [removed: company's] [added: company’s] internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as [removed: necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the]

[added: necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the] company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the [removed: company's] [added: company’s] assets that could have a material effect on the financial statements.

The critical audit [removed: matter] [added: matters] communicated below [removed: is a matter] [added: are matters] arising from the current period audit of the consolidated financial statements that [removed: was] [added: were] communicated or required to be communicated to the audit committee and that (i) [removed: relates] [added: relate] to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matter] [added: matters] below, providing [removed: a] separate [removed: opinion] [added: opinions] on the critical audit [removed: matter] [added: matters] or on the accounts or disclosures to which [removed: it relates.][added: they relate.]

As described in [removed: Note] [added: Notes] 2 and [removed: Note] 3 to the consolidated financial statements, inventory is valued at the lower of cost and net realizable value, and management records a provision as necessary to appropriately value inventories that are obsolete, have quality issues, or are damaged.

As of [removed: February 2, 2020,] [added: January 31, 2021,] the [removed: Company's] [added: Company’s] consolidated net inventories balance was [removed: $518.5] [added: $647.2] million [removed: and] [added: inclusive of] the inventory provision [removed: was $22.1] [added: of $31.0] million.

The principal considerations for our determination that performing procedures relating to the inventory provision is a critical audit matter are (i) management identified the matter as a critical accounting estimate; and (ii) significant judgment was required by management in determining the estimated net realizable value of inventories that are obsolete, have quality issues, or are damaged, which in turn led to [removed: increased] [added: significant] audit effort and a [removed: higher] [added: high] degree of subjectivity in evaluating audit evidence relating to the estimate.

These procedures [removed: included testing the effectiveness of controls relating to the review of the provision including the assumptions used*.* These procedures] also included, among [removed: others:] [added: others,] (i) observing the physical condition of inventories during inventory counts; (ii) evaluating the appropriateness of [removed: management's] [added: management’s] process for developing the estimates of net realizable [removed: value] [added: value;] (iii) testing the reliability of reports used by management by agreeing to underlying records; (iv) testing the reasonableness of the assumptions about quality, damages, future demand, selling prices and market conditions by considering [removed: with] historical trends and consistency with evidence obtained in other areas of the audit; and corroborating the assumptions with individuals within the product team.

| /s/ PricewaterhouseCoopers LLP | [added: | |]

| [removed: Chartered] [added: Chartered] Professional [removed: Accountants] [added: Accountants] | [added: | |]

| Vancouver, Canada | [added: | |]

| [removed: March 26, 2020] | [added: | | | | | 2020 | | |]

| | | [removed: February 2, 2020] | | | | [removed: February 3, 2019] [added: 2020] | | | [added: | | | 2019 | | |]

| ASSETS | | | | | | | | | [added: | | | | | |]

| Current assets | | | | | | | | | [added: | | | | | |]

| Cash and cash [removed: equivalents] [added: equivalents, beginning of period] | | [added: | | | |] $ | 1,093,505 | | | [added: | |] $ | 881,320 | | [added: | | | $ | 990,501 | |]

| Accounts receivable | | [removed: 40,219] | | | | [removed: 35,786] [added: 62,399] | | | [added: | | | 40,219 | | |]

| Inventories | | [removed: 518,513] | | | | [removed: 404,842] [added: 647,230] | | | [added: | | | 518,513 | | |]

| Prepaid and receivable income taxes | | [removed: 85,159] | | | | [removed: 49,385] [added: 139,126] | | | [added: | | | 85,159 | | |]

[removed: | Other prepaid expenses and other current assets | | 70,542 | | | | 57,949 | | |][added: PREPAID EXPENSES AND OTHER CURRENT ASSETS]

| Property and equipment, net | | [removed: 671,693] | | | | [removed: 567,237] [added: 745,687] | | | [added: | | | 671,693 | | |]

| Right-of-use lease assets | | [removed: 689,664] | | | | [removed: —] [added: 734,835] | | | [added: | | | 689,664 | | |]

| [removed: Goodwill and intangible] [added: Intangible] assets, [removed: net] [added: net:] | | [removed: 24,423] | | | | [removed: 24,239] | | | [added: | | | | | | | | | | | |]

| Deferred income tax assets | | [removed: 31,435] | | | | [removed: 26,549] [added: 6,731] | | | [added: | | | 31,435 | | |]

| Other non-current assets | | [removed: 56,201] | | | | [removed: 37,404] [added: 106,626] | | | [added: | | | 56,201 | | |]

| LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | | | [added: | | | | | |]

| Current liabilities | | | | | | | | | [added: | | | | | |]

| Accounts payable | | [added: | | | |] $ | [removed: 79,997] [added: 172,246] | | | [added: | |] $ | [removed: 95,533] [added: 79,997] | |

| Accrued inventory liabilities | | [removed: 6,344] | | | | [removed: 16,241] [added: 14,956] | | | [added: | | | 6,344 | | |]

| Accrued compensation and related expenses | | [removed: 133,688] | | | | [removed: 109,181] [added: 130,171] | | | [added: | | | 133,688 | | |]

| | | | | | |

| --- | --- | --- | --- | --- | --- |

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

These procedures included testing the effectiveness of controls relating to the review of the provision including the assumptions used.

*Acquisition of MIRROR – valuation of intangible assets*

As described in Notes 1, 2 and 6 to the consolidated financial statements, the Company completed the acquisition of Curiouser Products Inc., dba MIRROR, ("MIRROR") for net consideration of $452.6 million in 2020 which resulted in $85.0 million of intangible assets being recorded.

The fair values of intangible assets were based upon valuation techniques including discounted cash flows, relief from royalty, and replacement cost methods.

Management applied judgment in estimating the fair values of intangible assets acquired, which involved the use of significant estimates and assumptions with respect to future revenue growth rates, royalty rates, and the discount rate.

The principal considerations for our determination that performing procedures relating to the valuation of intangible assets in the acquisition of MIRROR – is a critical audit matter are (i) the high degree of auditor judgment and subjectivity in applying procedures relating to the fair value measurements of intangible assets acquired due to the judgment by management when estimating the fair values of the intangible assets; (ii) significant audit effort in evaluating the significant assumptions relating to the intangible assets, such as the future revenue growth rates, royalty rates, and the discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the valuation of intangible assets, including controls over management’s development of the future revenue growth rates, royalty rates, and discount rate assumptions utilized in the valuation of the intangible assets.

These procedures also included, among others, (i) reading the purchase agreement and (ii) testing management’s process for estimating the fair values of intangible assets.

Testing management’s process included evaluating the appropriateness of the valuation methods, testing the completeness and accuracy of data provided by management, and evaluating the reasonableness of significant assumptions related to the future revenue growth rates, royalty rates and discount rate assumptions for the intangible assets.

Evaluating the reasonableness of the future revenue growth rates involved considering the past performance of the acquired business, as well as economic and industry forecasts.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the royalty rates and discount rate assumptions.

| March 30, 2021 | | |

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Cash and cash equivalents | | | | | | $ | 1,150,517 | | | | | $ | 1,093,505 | |

| Prepaid expenses and other current assets | | | | | | 125,107 | | | | | | 70,542 | | |

| | | | | | | 2,124,379 | | | | | | 1,807,938 | | |

| Goodwill | | | | | | 386,877 | | | | | | 24,182 | | |

| Intangible assets, net | | | | | | 80,080 | | | | | | 241 | | |

| | | | | | | $ | 4,185,215 | | | | | $ | 3,281,354 | |

| Other accrued liabilities | | | | | | 211,911 | | | | | | 112,641 | | |

| | | | | | | 883,178 | | | | | | 620,418 | | |

| | | | | | | 1,626,649 | | | | | | 1,329,136 | | |

| | | | | | | 2,558,566 | | | | | | 1,952,218 | | |

| | | | | | | $ | 4,185,215 | | | | | $ | 3,281,354 | |

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| Amortization of intangible assets | | | | | | 5,160 | | | | | | 29 | | | | | | 72 | | |

| Acquisition-related expenses | | | | | | 29,842 | | | | | | — | | | | | | — | | |

| | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | |

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | |

| --- | --- |

| |

| --- |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | 1,807,938 | | | | 1,429,282 | | |

| | | $ | 3,281,354 | | | $ | 2,084,711 | |

| Other current liabilities | | 125,043 | | | | 112,698 | | |

| | | 620,418 | | | | 500,477 | | |

| | | 1,329,136 | | | | 638,736 | | |

| | | 1,952,218 | | | | 1,445,975 | | |

| | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Asset impairment and restructuring costs | | — | | | | — | | | | 38,525 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Balance at January 29, 2017 | | 9,781 | | | 9,781 | | | $ | — | | | 127,304 | | | $ | 637 | | | $ | 266,622 | | | $ | 1,294,214 | | | $ | (201,500 | ) | | $ | 1,359,973 | |

| Net income | | | | | | | | | | | | | | | | | | | | | | | 258,662 | | | | | | | | 258,662 | | |

| Repurchase of common stock | | | | | | | | | | | | (1,861 | ) | | (10 | | ) | | (2,377 | | ) | | (97,874 | | ) | | | | | | (100,261 | | ) |

| Asset impairment for ivivva restructuring | | — | | | | — | | | | 11,593 | | |

| Current income taxes payable | | (40,264 | | ) | | 52,597 | | | | (16,470 | | ) |

| Cash and cash equivalents, beginning of period | | $ | 881,320 | | | $ | 990,501 | | | $ | 734,846 | |

| | | |

| --- | --- | --- |

| Note 7 | [Other Non-Current Liabilities](#s3E78D67C601D5E1EA42013B2224F5EC2) | [51](#s3E78D67C601D5E1EA42013B2224F5EC2) |

| Note 8 | [Long-Term Debt and Credit Facilities](#s8713E544AE385867AA27F8B7D37A62FB) | [51](#s8713E544AE385867AA27F8B7D37A62FB) |

| Note 14 | [Asset Impairment and Restructuring](#sF9D31FD2F3EB50498CBE84AE9A5CA5A2) | [59](#sF9D31FD2F3EB50498CBE84AE9A5CA5A2) |

| Note 19 | [Segmented Information and Disaggregated Net Revenue](#s08F2A4041FD3503EB42E5E61F8E5E7B9) | [65](#s08F2A4041FD3503EB42E5E61F8E5E7B9) |

| Note 20 | [Quarterly Financial Information (Unaudited)](#sA4795BA578575D97B9380FC22806E85E) | [67](#sA4795BA578575D97B9380FC22806E85E) |

| Note 21 | [Subsequent Events](#s7b866d3bde084686878de5da212e52c8) | [68](#s7b866d3bde084686878de5da212e52c8) |

During fiscal 2017, the Company restructured its ivivva operations.

Please refer to Note 14 for further details regarding the ivivva restructuring.

Please refer to Note 21 for further details on the impact of the COVID-19 coronavirus on the Company's operations subsequent to February 2, 2020.

The Company's operating segment for goodwill is its company-operated stores.

While the Company will continue to honor all gift cards presented for payment, management may determine the likelihood of redemption to be remote for certain card balances due to, among other things, long periods of inactivity.

In these circumstances, to the extent management determines there is no requirement for remitting card balances to government agencies under unclaimed property laws, the portion of card balances not expected to be redeemed are recognized in net

revenue in proportion to the gift cards which have been redeemed, under the redemption recognition method.

See Note 19 for disaggregated net revenue by channel, geographic area, and product category.

| • | hemming; and |

[removed: Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial] statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

[added: Based on] this evaluation, management concluded that we maintained effective internal control over financial reporting as of [removed: February 2, 2020.][added: January 31, 2021.]

The effectiveness of our internal control over financial reporting as of [removed: February 2, 2020] [added: January 31, 2021] has been audited by PricewaterhouseCoopers LLP our independent registered public accounting firm, as stated in their report in Item 8 of Part II of this Form 10-K.

There were no changes in our internal control over financial reporting during the fourth quarter of [removed: the fiscal year ended February 2,] 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

Based on

PART III

On March 24, 2021, our board of directors amended and restated our bylaws.

The amendments are designed to update and modernize the bylaws to (1) conform them to the General Corporation Law, (2) reflect recent developments in public company governance, (3) remove certain outdated provisions and eliminate redundancies, (4) clarify certain corporate procedures, and (5) conform language and style.

The amended and restated bylaws include amendments to:

- clarify the provisions for stockholder meetings, including those held solely by means of remote communications;

- update the provisions governing the notice of stockholder meetings;

- update and modernize the provisions governing stockholder lists;

- update and modernize the procedures for meetings of the board of directors, including notice of meetings;

- update and modernize the provisions governing board action by written consent;

- require that any delayed effectiveness of officer or director resignations be subject to the approval of the board of directors;

- update, modernize, and clarify the provisions regarding the Board chair;

- update and modernize provisions regarding the committees of the board of directors;

- update and modernize the provisions governing the indemnification of officers and directors of the company, including providing that the company is required to indemnify (and advance expenses to) officers and directors to the fullest extent permitted by applicable law; and

- make certain other updates, clarifications, and administerial and conforming changes.

The foregoing description of the amended and restated bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the amended and restated bylaws, a copy of which is attached as Exhibit 3.5 and incorporated by reference herein.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

PART III

The information required by this item concerning our directors, director nominees and Section 16 beneficial ownership reporting compliance is incorporated by reference to our definitive Proxy Statement for our [removed: 2020] [added: 2021] Annual Meeting of Stockholders under the captions "Election of Directors," [removed: "Section 16(a) Beneficial Ownership Reporting Compliance,"] "Executive Officers," and "Corporate Governance," and, to the extent necessary, under the caption "Delinquent Section 16(a) Reports."

The information required by this item is incorporated by reference to our [removed: 2020] [added: 2021] Proxy Statement under the captions "Executive Compensation" and "Executive Compensation Tables."

The information required by this item is incorporated by reference to our [removed: 2020] [added: 2021] Proxy Statement under the caption "Principal Stockholders and Stock Ownership by Management."

Equity Compensation Plan Information (as [removed: of February 2, 2020)][added: of January 31, 2021)]

| Plan Category | | [added: | | | |] Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(1) (A) | | | [added: | | |] Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights(2) (B) | | | | [added: | |] Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (A))(3) (C) | | [added: |]

| Equity compensation plans [added: not] approved by stockholders | | [removed: 1,377,299] | | | [removed: $] | [removed: 113.41] [added: —] | | | [removed: 18,017,693] | | [added: | — | | | | | | — | | |]

| Equity compensation plans [removed: not] approved by stockholders | | [removed: —] | | | [removed: —] | [added: 1,293,025] | | | [removed: —] | | [added: | $ | 139.27 | | | | | 17,608,484 | | |]

[removed: | (1) | This] [added: (1)This] amount represents the following: (a) [removed: 776,124] [added: 804,307] shares subject to outstanding options, (b) [removed: 238,280] [added: 199,085] shares subject to outstanding performance-based restricted stock units, (c) [removed: 333,481] [added: 274,707] shares subject to outstanding restricted stock units, and (d) [removed: 29,414] [added: 14,926] shares subject to outstanding restricted stock units that settle in cash or common stock at the election of the employee. [removed: The options, performance-based restricted stock units and restricted stock units are all under our 2007 Equity Incentive Plan or our 2014 Equity Incentive Plan. Restricted shares outstanding under our 2014 Equity Incentive Plan have already been reflected in our total outstanding common stock balance. |]

[removed: | (2) | The] [added: (2)The] weighted-average exercise price is calculated solely on the exercise prices of the outstanding options and does not reflect the shares that will be issued upon the vesting of outstanding awards of performance-based restricted stock units and restricted stock units, which have no exercise price. [removed: |]

[removed: | (3) | This includes (a) 13,291,047 shares of our common stock available for future issuance under our 2014 Equity Incentive Plan and (b) 4,726,646 shares of our common stock available for future issuance under our Employee Share Purchase Plan. The number of shares remaining available for future issuance under our 2014 Equity Incentive Plan is reduced by 1.7 shares for each award other than stock options granted and by one share for each stock option award granted.] Outstanding awards that expire or are canceled without having been exercised or settled in full are available for issuance again under our 2014 Equity Incentive Plan and shares that are withheld in satisfaction of tax withholding obligations for full value awards are also again available for issuance. [removed: No further awards may be issued under the predecessor plan, our 2007 Equity Incentive Plan. |]

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total | | | | | | 1,293,025 | | | | | | $ | 139.27 | | | | | 17,608,484 | | |

The options, performance-based restricted stock units and restricted stock units are all under our 2007 Equity Incentive Plan or our 2014 Equity Incentive Plan.

Restricted shares outstanding under our 2014 Equity Incentive Plan have already been reflected in our total outstanding common stock balance.

(3)This includes (a) 12,949,072 shares of our common stock available for future issuance under our 2014 Equity Incentive Plan and (b) 4,659,412 shares of our common stock available for future issuance under our Employee Share Purchase Plan.

The number of shares remaining available for future issuance under our 2014 Equity Incentive Plan is reduced by 1.7 shares for each award other than stock options granted and by one share for each stock option award granted.

No further awards may be issued under the predecessor plan, our 2007 Equity Incentive Plan.

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total | | 1,377,299 | | | $ | 113.41 | | | 18,017,693 | |

| | |

| --- | --- |

The information required by this item is incorporated by reference to our [removed: 2020] [added: 2021] Proxy Statement under the captions "Certain Relationships and Related Party Transactions" and "Corporate Governance."

The information required by this item is incorporated by reference to our [removed: 2020] [added: 2021] Proxy Statement under the caption "Fees for Professional Services."

[Table o](#i6020f5b3b81c432e8c1c0401e9df00a0_7)[f Contents](#i6020f5b3b81c432e8c1c0401e9df00a0_7)

| Description | | [added: | | | |] Balance at Beginning of Year | | | | [added: | |] Charged to Costs and Expenses | | | | [added: | |] Write-offs Net of Recoveries | | | | [added: | |] Balance at End of Year | | |

| | | [added: | | | |] *(In thousands)* | | | | | | | | | | | | | | | [added: | | | | | |]

| [removed: Shrink] [added: Shrink] Provision on Finished [removed: Goods] [added: Goods] | | | | | | | | | | | | | | | | | [added: | | | | | | | | | |]

| For the year ended February 3, 2019 | | [removed: (310] | | [removed: )] | | [removed: (13,597] [added: $] | [added: (310)] | [removed: )] | | [added: | | $ | (13,597) | | | | | $ |] 12,713 | | | | [removed: (1,194] | [added: $] | [removed: )] [added: (1,194)] | [added: |]

| For the year ended February 2, 2020 | | [removed: (1,194] | | [removed: )] | | [removed: (12,593] [added: (1,194)] | | [removed: )] | | [added: | | (12,593) | | | | | |] 11,712 | | | | [removed: (2,075] | | [removed: )] [added: (2,075)] | [added: | |]

| [removed: Obsolescence] [added: Obsolescence] and Quality Provision on Finished Goods and Raw [removed: Materials] [added: Materials] | | | | | | | | | | | | | | | | | [added: | | | | | | | | | |]

| For the year ended February 3, 2019 | | [removed: (9,303] | | [removed: )] | | [removed: (2,453] [added: $] | [added: (9,303)] | [removed: )] | | [added: | | $ | (2,453) | | | | | $ |] 4,204 | | | | [removed: (7,552] | [added: $] | [removed: )] [added: (7,552)] | [added: |]

| For the year ended February 2, 2020 | | [removed: (7,552] | | [removed: )] | | [removed: (5,363] [added: (7,552)] | | [removed: )] | | [added: | | (5,363) | | | | | |] 2,533 | | | | [removed: (10,382] | | [removed: )] [added: (10,382)] | [added: | |]

| [removed: Damage] [added: Damage] Provision on Finished [removed: Goods] [added: Goods] | | | | | | | | | | | | | | | | | [added: | | | | | | | | | |]

| For the year ended February 3, 2019 | | [removed: (5,520] | | [removed: )] | | [removed: (22,912] [added: $] | [added: (5,520)] | [removed: )] | | [added: | | $ | (22,912) | | | | | $ |] 21,089 | | | | [removed: (7,343] | [added: $] | [removed: )] [added: (7,343)] | [added: |]