What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-27 compared with 2024-03-21 · 267 added, 158 removed, 925 unchanged (31% of the section changed)

9 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of lululemon athletica inc.

To the Board of Directors and Stockholders of lululemon athletica inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of lululemon athletica inc.

and its subsidiaries (together, the Company) as of January 28, 2024 and January 29, 2023, and the related consolidated statements of operations and comprehensive income, of stockholders' equity and of cash flows for each of the 52-week years ended January 28, 2024, January 29, 2023, and January 30, 2022, including the related notes (collectively referred to as the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of January 28, 2024, based on criteria established in Internal Control – Integrated 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 January 28, 2024 and January 29, 2023, and the results of its operations and its cash flows for each of the 52-week years ended January 28, 2024, January 29, 2023, and January 30, 2022 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 January 28, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the COSO.

and its subsidiaries (the Company) as of February 2, 2025 and January 28, 2024, and the related consolidated statements of operations and comprehensive income, of stockholders’ equity and of cash flows for the 53-week year ended February 2, 2025, the 52-week year ended January 28, 2024, and the 52-week year ended January 29, 2023, including the related notes (collectively referred to as the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of February 2, 2025, based on criteria established in Internal Control ‒ Integrated 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 February 2, 2025 and January 28, 2024, and the results of its operations and its cash flows for the 53-week year ended February 2, 2025, the 52-week year ended January 28, 2024, and the 52-week year ended January 29, 2023 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 February 2, 2025, based on criteria established in Internal Control ‒ Integrated Framework (2013) issued by the COSO.

Basis for Opinions

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Provision expense is recorded in cost of goods sold.

As of January 28, 2024, the Company’s consolidated net inventories balance was $1,323.6 million inclusive of the inventory provision of $141.5 million.

As of February 2, 2025, the Company’s consolidated net inventories balance was $1,442.1 million inclusive of the inventory provision of $84.0 million.

The amount of the inventory provision is equal to the difference between the cost of the inventory and its estimated net realizable value based on assumptions about product quality, damages, future demand, selling prices, and market conditions.

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(Amounts in thousands, except per share amounts)

January 28, 2024 January 29, 2023

2025 January 28, 2024

Current assets

59 unchanged sentences

Amortization of intangible assets 2,735 5,010 8,752

Acquisition-related expenses — — 41,394

Gain on disposal of assets — — ( 10,180 )

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(Amounts in thousands)

Exchangeable Stock Special Voting Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

Shares Shares Par Value Shares Par Value

Exchangeable Stock

Special Voting Stock

Additional Paid-in Capital

Retained Earnings

Accumulated Other Comprehensive Loss

Total Stockholders' Equity

Balance as of January 30, 2022 5,203 5,203 $ — 123,297 $ 616 $ 422,507 $ 2,512,840 $ ( 195,917 ) $ 2,740,046

1 unchanged sentence

Other comprehensive income (loss), net of tax ( 56,667 ) ( 56,667 )

Common stock issued upon exchange of exchangeable shares ( 87 ) ( 87 ) — 87 — — —

Stock-based compensation expense 78,075 78,075

1 unchanged sentence

Shares withheld related to net share settlement of stock-based compensation ( 105 ) — ( 35,158 ) ( 35,158 )

Repurchase of common stock ( 2,202 ) ( 11 ) ( 3,681 ) ( 808,910 ) ( 812,602 )

Repurchase of common stock, including excise tax

( 1,396 ) ( 7 ) ( 2,481 ) ( 441,513 ) ( 444,001 )

Balance as of January 29, 2023 5,116 5,116 $ — 122,205 $ 611 $ 474,645 $ 2,926,127 $ ( 252,584 ) $ 3,148,799

1 unchanged sentence

Other comprehensive income (loss), net of tax ( 11,672 ) ( 11,672 )

Common stock issued upon exchange of exchangeable shares ( 87 ) ( 87 ) — 87 — — —

Stock-based compensation expense 93,560 93,560

2 unchanged sentences

Repurchase of common stock, including excise tax

( 1,482 ) ( 7 ) ( 2,690 ) ( 555,955 ) ( 558,652 )

Balance as of January 28, 2024 5,116 5,116 $ — 121,106 $ 606 $ 575,369 $ 3,920,362 $ ( 264,256 ) $ 4,232,081

Exchangeable Stock Special Voting Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Stockholders' Equity

Shares Shares Par Value Shares Par Value

Exchangeable Stock

Special Voting Stock

Additional Paid-in Capital

Retained Earnings

Accumulated Other Comprehensive Loss

Total Stockholders' Equity

Net income 1,814,616 1,814,616

4 unchanged sentences

Repurchase of common stock, including excise tax ( 5,147 ) ( 26 ) ( 11,592 ) ( 1,625,261 ) ( 1,636,879 )

Balance as of January 28, 2024 5,116 5,116 $ — 121,106 $ 606 $ 575,369 $ 3,920,362 $ ( 264,256 ) $ 4,232,081

Balance as of February 2, 2025 5,116 5,116 $ — 116,166 $ 581 $ 638,190 $ 4,109,717 $ ( 424,441 ) $ 4,324,047

See accompanying notes to the consolidated financial statements

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Changes in operating assets and liabilities:

Accounts receivable 1,626 6,580 ( 58,987 )

Inventories ( 156,085 ) 66,584 ( 573,438 )

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Settlement of net investment hedges 50,213 ( 1,609 ) 47,804

Acquisition, net of cash acquired ( 154,146 ) — —

Other investing activities ( 5,009 ) ( 658 ) 20,916

2 unchanged sentences

Proceeds from settlement of stock-based compensation 19,813 42,430 11,704

Shares withheld related to net share settlement of stock-based compensation ( 32,574 ) ( 35,158 ) ( 49,809 )

Taxes paid related to net share settlement of stock-based compensation ( 35,410 ) ( 32,574 ) ( 35,158 )

Repurchase of common stock ( 1,636,879 ) ( 558,652 ) ( 444,001 )

13 unchanged sentences

Note 5 Property and Equipment

Note 6 Acquisition

Note 7 Goodwill

1 unchanged sentence

Note 9 Impairment of Goodwill and Other Assets, Restructuring Costs

Note 9 Acquisition-Related Expenses

Note 10 Other Non-Current Assets

11 unchanged sentences

Note 22 Supplemental Cash Flow Information

Note 23 Segmented Information

Segmented Information

Note 24 Disaggregated Net Revenue

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Nature of operations

lululemon athletica inc., a Delaware corporation, ("lululemon" and, together with its subsidiaries unless the context otherwise requires, the "Company") is engaged in the design, distribution, and retail of performance apparel, footwear, and accessories.

The Company organizes its operations into four regional markets:

Americas, China Mainland, Asia Pacific ("APAC"), and Europe and the Middle East ("EMEA").

It conducts its business through a number of different channels in each market, including company-operated stores, e-commerce, temporary locations, wholesale, outlets, a re-commerce program, and license and supply arrangements.

There were 711 , 655 , and 574 company-operated stores in operation as of January 28, 2024, January 29, 2023, and January 30, 2022, respectively.

It conducts its business through a number of different channels in each market, including company-operated stores, e-commerce, outlets, temporary locations, wholesale, license and supply arrangements, and a re-commerce program.

There were 767 , 711 , and 655 company-operated stores in operation as of February 2, 2025, January 28, 2024, and January 29, 2023, respectively.

Basis of presentation

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dollars and are prepared in accordance with United States generally accepted accounting principles ("GAAP").

On September 10, 2024, the Company acquired the lululemon branded retail locations and operations run by a third party in Mexico.

The Company had previously granted the third party the right to operate retail locations and to sell lululemon products in Mexico.

The results of operations, financial position, and cash flows of the Mexico operations have been included in the Company's consolidated financial statements since the date of acquisition.

Please refer to Note 6.

Acquisition for further information.

The Company's fiscal year ends on the Sunday closest to January 31 of the following year, typically resulting in a 52-week year, but occasionally giving rise to an additional week, resulting in a 53-week year.

Fiscal 2023, fiscal 2022, and fiscal 2021 were each 52-week years.

Fiscal 2023, 2022, and 2021 ended on January 28, 2024, January 29, 2023, and January 30, 2022, respectively, and are referred to as "2023," "2022," and "2021," respectively.

Fiscal 2024 was a 53-week year.

Fiscal 2023 and fiscal 2022 were each 52-week years.

Fiscal 2024, 2023, and 2022 ended on February 2, 2025, January 28, 2024, and January 29, 2023, respectively, and are referred to as "2024," "2023," and "2022," respectively.

The Company's business is affected by the pattern of seasonality common to most retail apparel businesses.

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Receivables are written off against the allowance when management believes that the amount receivable will not be recovered.

As of January 28, 2024 and January 29, 2023, the Company had an insignificant allowance for doubtful accounts.

As of February 2, 2025 and January 28, 2024, the Company had an insignificant allowance for doubtful accounts.

Inventories, consisting of finished goods, inventories in transit, and raw materials, are stated at the lower of cost and net realizable value.

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The estimated accruals for these costs could be significantly affected if future experience differs from the assumptions used in the initial estimate.

The Company has entered into certain subleases, which have been classified as operating leases.

Sublease income is recognized on a straight-line basis beginning on the commencement date of the sublease.

Sublease income offsets the head lease expense within net lease expense.

Revenue recognition

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The Company's liability for sales return refunds is recognized within accrued liabilities and other, and an asset for the value of inventory which is expected to be returned is recognized within other prepaid expenses and other current assets on the consolidated balance sheets.

As of January 28, 2024 and January 29, 2023, the sales return allowance was $ 61.6 million and $ 55.5 million, respectively.

As of February 2, 2025 and January 28, 2024, the sales return allowance was $ 73.9 million and $ 61.6 million, respectively.

Shipping fees billed to customers are recorded as revenue, and shipping costs are recognized within selling, general and administrative expenses in the same period the related revenue is recognized.

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While the Company will continue to honor all gift cards presented for payment, to the extent management determines there is no requirement to remit unused 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.

As of February 2, 2025 and January 28, 2024, the unredeemed gift card liability was $ 308.4 million and $ 306.5 million, respectively.

During 2024, 2023, and 2022, the Company recognized net revenue of $ 180.9 million, $ 151.4 million, and $ 126.9 million, respectively, that was included in the opening balance of the unredeemed gift card liability at the beginning of each year.

For 2024, 2023, and 2022, net revenue recognized on unredeemed gift card balances was $ 36.2 million, $ 28.5 million, and $ 23.3 million, respectively.

1 unchanged sentence

Cost of goods sold includes:

Product costs

• the cost of purchased merchandise, which includes acquisition and production costs including raw material and labor, as applicable;

• the cost incurred to deliver inventory to the Company's distribution centers including freight, non-refundable taxes, duty, and other landing costs;

• the cost of the Company's distribution centers, such as labor, rent, utilities, and depreciation;

• the cost of the Company's production, design, research and development, distribution, and merchandising departments including salaries, stock-based compensation and benefits, and other expenses;

• occupancy costs such as minimum rent, contingent rent where applicable, property taxes, utilities, and depreciation expense for the Company's company-operated store locations;

• hemming costs;

• shrink and inventory provision expense;

• the cost of digital content subscription services;

• hemming costs.

Other cost of sales

• occupancy costs such as minimum rent, contingent rent where applicable, property taxes, utilities, and depreciation expense for the Company's company-operated store locations;

• the cost of the Company's distribution centers, such as labor, rent, utilities, and depreciation, as well as the cost of third-party distribution centers;

• the cost of the Company's product design, raw materials development, product innovation, sourcing, supply chain, and merchandising departments including salaries, stock-based compensation and benefits, and other expenses.

Selling, general and administrative expenses

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The fair value of awards granted is estimated at the date of grant.

Awards settled in cash or common stock at the election of the employee are remeasured to fair value at the end of each reporting period until settlement.

The employee compensation expense is recognized on a straight-line basis over the requisite service period with the offsetting credit to additional paid-in capital for awards that are settled in common shares, and with the offsetting credit to accrued compensation and related expenses for awards that are settled in cash or common stock at the election of the employee.

The employee compensation expense is recognized on a straight-line basis over the requisite service period with the offsetting credit to additional paid-in capital.

For awards with service and/or performance conditions, the amount of compensation expense recognized is based on the number of awards expected to vest, reflecting estimated expected forfeitures, and is adjusted to reflect those awards that do ultimately vest.

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The grant date fair value of restricted shares, performance-based restricted stock units, and restricted stock units is based on the closing price of the Company's common stock on the grant date.

Restricted stock units that were settled in cash or common stock at the election of the employee were remeasured to fair value at the end of each reporting period until settlement.

This fair value was based on the closing price of the Company's common stock on the last business day before each period end.

Earnings per share

8 unchanged sentences

Use of estimates

The preparation of financial statements in conformity with GAAP in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of net revenue and expenses during the reporting period.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of net revenue and expenses during the reporting period.

Actual results could differ from those estimates.

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ASUs adopted during 2024 not listed below were assessed, and determined to be either not applicable or are expected to have minimal impact on its consolidated financial position or results of operations.

In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations, to require annual and interim disclosures about the key terms of supplier finance programs used in connection with the purchase of goods and services along with information about the obligations under these programs, including the amount outstanding at the end of each reporting period and a roll-forward of those obligations.

The Company adopted this update during the first quarter of 2023 and the related disclosures are included in Note 13.

Supply Chain Financing Program .

Recently issued accounting pronouncements

ASUs recently issued not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company's consolidated financial position or results of operations.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

Entities will be required to provide disclosures of significant segmented expenses and other categories used by the Chief Operating Decision Maker ("CODM") in order to enhance disclosure at the segment level.

This amendment is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024, and is applied retrospectively for periods presented in the financial statements.

The Company is currently evaluating the impact that this new guidance may have on its financial statement disclosures.

Entities are required to provide disclosures of significant segmented expenses and other categories used by the Chief Operating Decision Maker ("CODM") in order to enhance disclosure at the segment level.

The Company adopted this update for 2024 and the related disclosures are included in Note 23.

Segmented Information.

Recently issued accounting pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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The Company is currently evaluating the impact that this new guidance may have on its financial statement disclosures.

January 28, 2024 January 29, 2023

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses.

Entities will be required to provide disaggregated disclosures for certain income statement expense line items.

This amendment is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, and shall be applied retrospectively for periods presented in the financial statements.

The Company is currently evaluating the impact that this new guidance may have on its financial statement disclosures.

February 2, 2025 January 28, 2024

(In thousands)

Inventories, at cost $ 1,526,055 $ 1,465,076

Provision to reduce inventories to net realizable value:

Inventory provisions and reserves:

lululemon Studio Mirror provision — ( 62,956 )

4 unchanged sentences

Inventories $ 1,442,081 $ 1,323,602

During 2024, we disposed of the lululemon Studio Mirror inventories which had previously been provided for.

Please refer to Note 9.

1 unchanged sentence

Prepaid Expenses and Other Current Assets

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

(In thousands)

4 unchanged sentences

Property and Equipment

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

(In thousands)

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The income tax effect of the gain on disposal of assets was an expense of $ 1.7 million.

On September 10, 2024, the Company acquired the lululemon branded retail locations and operations run by a third party in Mexico.

The Company acquired all outstanding shares of the third party, and had previously granted it the right to operate retail locations and to sell lululemon products in Mexico.

The following table summarizes the fair value of the consideration transferred, as well as the calculation of goodwill based on the excess of consideration over the fair value of net assets acquired.

September 10, 2024

(In thousands)

Fair value of consideration transferred:

Cash paid to shareholders $ 159,380

Contingent consideration 15,000

Settlement of intercompany balances 6,975

Less cash acquired ( 5,234 )

Fair value of consideration transferred, net of cash and cash equivalents acquired $ 176,121

Less fair value of net assets acquired:

Assets acquired:

Inventories $ 15,275

Intangible assets 15,500

Other current and non-current assets 14,013

Liabilities assumed ( 15,668 )

Net assets acquired $ 29,120

Goodwill $ 147,001

Goodwill relates to the assembled workforce and benefits expected as a result of the acquisition and has been allocated to the Americas segment.

None of the goodwill is expected to be deductible for income tax purposes.

Reacquired franchise rights were valued using the future expected cash flows of the remaining contractual franchise period until November 2026.

These intangible assets have a fair value of $ 15.5 million, which is being amortized until November 2026.

Contingent consideration of $ 15.0 million relates to performance related conditions from the acquisition date to December 31, 2025, and has been recognized at fair value.

The Company has not disclosed pro forma information of the combined business as the transaction is not material to net revenue or net earnings.

During 2024, the Company recognized $ 3.5 million in acquisition-related expenses within selling, general and administrative expenses primarily related to legal, accounting, valuation, and other professional services.

The changes in the carrying amounts of goodwill were as follows:

1 unchanged sentence

Balance as of January 29, 2023

Impairment of goodwill ( 362,492 )

Effect of foreign currency translation ( 61 )

Balance as of January 28, 2024

Acquisition of the Mexico operations 147,001

Effect of foreign currency translation ( 11,566 )

Balance as of January 28, 2024

The Company recognized an impairment charge of $ 362.5 million related to the lululemon Studio reporting unit as of January 29, 2023 on the goodwill that arose from the acquisition of MIRROR.

Balance as of February 2, 2025

Of the Company's goodwill, $ 147.0 million relates to the acquisition of the Mexico operations in 2024.

Goodwill relates to the assembled workforce and benefits expected as a result of the acquisition and has been allocated to the Americas segment.

Please refer to Note 6.

Impairment of Goodwill and Other Assets, Restructuring Costs for further information.

Acquisition for further information.

Intangible Assets

A summary of the balances of the Company's intangible assets as of January 28, 2024, January 29, 2023, is presented below:

A summary of the balances of the Company's intangible assets as of February 2, 2025, January 28, 2024, is presented below:

February 2, 2025

Gross Carrying Amount Accumulated Amortization Net Carrying Amount Remaining Useful Life (Years)

(In thousands, except in years)

Franchise rights 14,325 ( 2,652 ) 11,673 1.8

Other 270 ( 270 ) — n/a

Intangible assets $ 14,595 $ ( 2,922 ) $ 11,673 1.8

January 28, 2024

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Intangible assets $ 85,270 $ ( 27,733 ) $ ( 57,537 ) $ —

January 29, 2023

Gross Carrying Amount Accumulated Amortization Impairment Net Carrying Amount Remaining Useful Life (Years)

(In thousands, except in years)

MIRROR brand $ 26,500 $ ( 3,423 ) $ ( 20,077 ) $ 3,000 3.0

Customer relationships 28,000 ( 7,492 ) ( 20,508 ) — n/a

Technology 25,500 ( 8,956 ) — 16,544 3.0

Content 5,000 ( 2,583 ) — 2,417 2.4

Other 270 ( 270 ) — — n/a

Intangible assets $ 85,270 $ ( 22,724 ) $ ( 40,585 ) $ 21,961 2.9

As part of the acquisition of the Mexico operations in 2024, the Company recognized intangible assets related to reacquired franchise rights, which are being amortized until November 2026.

Please refer to Note 6.

Acquisition for further information.

Amortization of intangible assets was $ 2.7 million, $ 5.0 million, and $ 8.8 million in 2024, 2023, and 2022, respectively.

Future expected amortization expense as of February 2, 2025, is $ 6.4 million and $ 5.2 million, for 2025 and 2026, respectively.

During 2023 and 2022, the Company recognized intangible asset impairment charges of $ 17.0 million and $ 40.6 million, respectively.

10 unchanged sentences

The following table summarizes the amounts recognized:

2024 2023 2022

(In thousands)

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During 2023, the Company recognized restructuring costs of $ 30.3 million for lululemon Studio primarily related to contract termination costs, employee severance costs, and professional fees.

Acquisition-Related Expenses

In connection with the acquisition of MIRROR in fiscal 2020, the Company recognized certain expenses which were included within acquisition-related expenses in the consolidated statements of operations.

These amounts included acquisition-related compensation, transaction and integration costs, and a gain on the Company's existing investment in MIRROR.

During 2021, $ 41.4 million was recognized.

There were no acquisition-related expenses recognized in 2023 or 2022.

Other Non-Current Assets

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

(In thousands)

3 unchanged sentences

Other non-current assets $ 237,841 $ 186,684

As of January 28, 2024 and January 29, 2023, cloud computing arrangement implementation costs consisted of deferred costs of $ 289.3 million and $ 212.4 million, respectively, and associated accumulated amortization of $ 155.7 million and $ 97.7 million, respectively.

As of February 2, 2025 and January 28, 2024, cloud computing arrangement implementation costs consisted of deferred costs of $ 385.4 million and $ 289.3 million, respectively, and associated accumulated amortization of $ 223.7 million and $ 155.7 million, respectively.

Accrued Liabilities and Other

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

(In thousands)

Accrued operating expenses $ 166,745 $ 126,380

Forward currency contract liabilities 74,638 2,872

Sales return allowances 73,892 61,634

Accrued freight 53,121 41,241

Accrued capital expenditures 31,936 19,365

Accrued duty 45,400 25,817

Accrued digital marketing 45,392 20,835

Accrued capital expenditures 36,690 31,936

Accrued rent 17,962 12,522

Accrued inventory liabilities 4,783 4,345

Sales tax collected 16,967 3,088

Forward currency contract liabilities 2,872 25,625

Other 28,656 22,230

3 unchanged sentences

On December 14, 2021, the Company entered into an amended and restated credit agreement extending its existing credit facility, which provides for $ 400.0 million in commitments under an unsecured five-year revolving credit facility.

The credit facility has a maturity date of December 14, 2026, subject to extension under certain circumstances.

The credit facility has a maturity date of December 14, 2026.

Borrowings under the credit facility may be prepaid and commitments may be reduced or terminated without premium or penalty (other than customary breakage costs).

As of January 28, 2024, aside from letters of credit of $ 6.3 million, the Company had no other borrowings outstanding under this credit facility.

As of February 2, 2025, aside from letters of credit of $ 6.1 million, the Company had no other borrowings outstanding under this credit facility.

Borrowings made under the credit facility bear interest at a rate per annum equal to, at the Company's option, either (a) a rate based on the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York ("SOFR"), or (b) an alternate base rate, plus, in each case, an applicable margin.

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If an event of default occurs, the credit agreement may be terminated, and the maturity of any outstanding amounts may be accelerated.

As of January 28, 2024, the Company was in compliance with the covenants of the credit facility.

As of February 2, 2025, the Company was in compliance with the covenants of the credit facility.

China Mainland revolving credit facility

In December 2019, the Company entered into an uncommitted and unsecured 130.0 million Chinese Yuan ($ 18.1 million) revolving credit facility with terms that are reviewed on an annual basis.

The credit facility was increased to 230.0 million Chinese Yuan ($ 32.0 million) during 2020 and increased to 240.0 million Chinese Yuan ($ 33.4 million) during 2023.

It is comprised of a revolving loan of up to 200.0 million Chinese Yuan ($ 27.9 million) and a financial guarantee facility of up to 40.0 million Chinese Yuan ($ 5.6 million), or its equivalent in another currency.

The Company has an uncommitted and unsecured 300.0 million Chinese Yuan ($ 41.4 million) revolving credit facility with terms that are reviewed on an annual basis.

It is comprised of a revolving loan of up to 200.0 million Chinese Yuan ($ 27.6

million) and a guarantee facility of up to 100.0 million Chinese Yuan ($ 13.8 million), or its equivalent in another currency.

Loans are available for a period not to exceed 12 months, at an interest rate equal to the loan prime rate plus a spread of 0.5175 %.

The Company is required to follow certain covenants.

As of January 28, 2024, the Company was in compliance with the covenants and, aside from letters of credit of 32.5 million Chinese Yuan ($ 4.5 million), there were no other borrowings or guarantees outstanding under this credit facility.

As of February 2, 2025, the Company was in compliance with the covenants and, aside from letters of credit of 45.8 million Chinese Yuan ($ 6.3 million), there were no other borrowings or guarantees outstanding under this credit facility.

Supply Chain Financing Program

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Stock-based compensation expense charged to income for the plans was $ 88.6 million, $ 92.7 million, and $ 77.2 million for 2024, 2023, and 2022, respectively.

Total unrecognized compensation cost for all stock-based compensation plans was $ 135.9 million as of January 28, 2024, which is expected to be recognized over a weighted-average period of 2.0 years, and was $ 118.0 million as of January 29, 2023 over a weighted-average period of 2.1 years.

A summary of the balances of the Company's stock-based compensation plans as of January 28, 2024, January 29, 2023, and January 30, 2022, and changes during the fiscal years then ended is presented below:

Stock Options Performance-Based Restricted Stock Units Restricted Shares Restricted Stock Units Restricted Stock Units

(Liability Accounting)

Number Weighted-Average Exercise Price Number Weighted-Average Grant Date Fair Value Number Weighted-Average Grant Date Fair Value Number Weighted-Average Grant Date Fair Value Number Weighted-Average Fair Value

Total unrecognized compensation cost for all stock-based compensation plans was $ 122.3 million as of February 2, 2025, which is expected to be recognized over a weighted-average period of 2.0 years, and was $ 135.9 million as of January 28, 2024 over a weighted-average period of 2.0 years.

A summary of the balances of the Company's stock-based compensation plans as of February 2, 2025, January 28, 2024, and January 29, 2023, and changes during the fiscal years then ended is presented below:

Stock Options Performance-Based Restricted Stock Units Restricted Shares Restricted Stock Units

Number Weighted-Average Exercise Price Number Weighted-Average Grant Date Fair Value Number Weighted-Average Grant Date Fair Value Number Weighted-Average Grant Date Fair Value

(In thousands, except per share amounts)

11 unchanged sentences

Forfeited/expired 71 363.58 23 374.15 — — 29 371.69

Balance as of January 28, 2024 783 $ 285.69 175 $ 349.84 4 $ 370.85 223 $ 359.12 — $ —

Balance as of February 2, 2025 849 $ 314.27 177 $ 371.83 5 $ 317.86 239 $ 371.09

A total of 3.5 million shares of the Company's common stock have been authorized for future issuance under the Company's 2023 Equity Incentive Plan.

3 unchanged sentences

The grant date fair value of the restricted shares and restricted stock units is based on the closing price of the Company's common stock on the grant date.

Restricted stock units that were settled in cash or common stock at the election of the employee were remeasured to fair value at the end of each reporting period until settlement.

This fair value was based on the closing price of the Company's common stock on the last business day before each period end.

The grant date fair value of each stock option granted is estimated on the date of grant using the Black-Scholes model.

1 unchanged sentence

The assumptions used to calculate the fair value of the options granted are evaluated and revised, as necessary, to reflect market conditions and the Company's historical experience.

The expected term of the options is based upon the historical experience of similar awards, giving consideration to expectations of future employee exercise behavior.

The expected term of the options is based upon the historical experience of similar awards, giving consideration to expectations of future exercise behavior.

Expected volatility is based upon the historical volatility of the Company's common stock for the period corresponding with the expected term of the options.

7 unchanged sentences

Dividend yield — % — % — %

The following table summarizes information about stock options outstanding and exercisable as of January 28, 2024:

The following table summarizes information about stock options outstanding and exercisable as of February 2, 2025:

Range of Exercise Prices

19 unchanged sentences

$ 84,990 $ 64,006

As of January 28, 2024, the unrecognized compensation cost related to these options was $ 35.8 million, which is expected to be recognized over a weighted-average period of 2.6 years.

As of February 2, 2025, the unrecognized compensation cost related to these options was $ 38.1 million, which is expected to be recognized over a weighted-average period of 2.5 years.

The weighted-average grant date fair value of options granted during 2024, 2023, and 2022 was $ 130.87 , $ 130.75 , and $ 124.17 , respectively.

6 unchanged sentences

Restricted stock units 37,972 38,016 37,275

Restricted stock units (liability accounting) — — 5,938

$ 93,621 $ 142,191 $ 96,005

Employee share purchase plan

The Company's board of directors and stockholders approved the Company's Employee Share Purchase Plan ("ESPP") in September 2007.

The Company has an Employee Share Purchase Plan ("ESPP").

Contributions are made by eligible employees, subject to certain limits defined in the ESPP, and the Company matches one-third of the contribution.

2 unchanged sentences

During each of 2024, 2023, and 2022, there were 0.1 million shares purchased.

As of January 28, 2024, 4.4 million shares remain authorized to be purchased under the ESPP.

As of February 2, 2025, 4.3 million shares remain authorized to be purchased under the ESPP.

Defined contribution pension plans

5 unchanged sentences

Assets and liabilities measured at fair value on a recurring basis

As of January 28, 2024 and January 29, 2023, the Company held certain assets and liabilities that are required to be measured at fair value on a recurring basis:

January 28, 2024 Level 1 Level 2 Level 3 Balance Sheet Classification

As of February 2, 2025 and January 28, 2024, the Company held certain assets and liabilities that are required to be measured at fair value on a recurring basis:

February 2, 2025 Level 1 Level 2 Level 3 Balance Sheet Classification

(In thousands)

27 unchanged sentences

The Company holds a significant portion of its assets in Canada and enters into forward currency contracts designed to hedge a portion of the foreign currency exposure that arises on translation of a Canadian subsidiary into U.S.

forward currency contracts are designated as net investment hedges.

These forward currency contracts are designated as net investment hedges.

The Company assesses hedge effectiveness based on changes in forward rates.

5 unchanged sentences

The notional amounts and fair values of forward currency contracts were as follows:

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

Gross Notional Assets Liabilities Gross Notional Assets Liabilities

6 unchanged sentences

Forward currency contracts $ 76,848 $ 74,638 $ 647 $ 2,872

As of January 28, 2024, there were derivative assets of $ 0.6 million and derivative liabilities of $ 2.9 million subject to enforceable netting arrangements.

The forward currency contracts designated as net investment hedges outstanding as of January 28, 2024 mature on different dates between February 2024 and September 2024.

The forward currency contracts not designated in a hedging relationship outstanding as of January 28, 2024 mature on different dates between February 2024 and October 2024.

As of February 2, 2025, there were derivative assets of $ 76.8 million and derivative liabilities of $ 74.6 million subject to enforceable netting arrangements.

The forward currency contracts designated as net investment hedges outstanding as of February 2, 2025 mature on different dates between February 2025 and October 2025.

The forward currency contracts not designated in a hedging relationship outstanding as of February 2, 2025 mature on different dates between February 2025 and November 2025.

The pre-tax gains and losses on foreign currency exchange forward contracts recorded in accumulated other comprehensive income or loss were as follows:

10 unchanged sentences

Derivatives not designated in a hedging relationship ( 118,423 ) 22,765 ( 11,945 )

Net foreign exchange and derivative losses $ ( 467 ) $ ( 7,535 ) $ ( 8,363 )

Net foreign exchange and derivative gains (losses) $ 9,420 $ ( 467 ) $ ( 7,535 )

The Company has obligations under operating leases for its store and other retail locations, distribution centers, offices, and equipment.

As of January 28, 2024, the initial lease terms of the various leases generally range from two to 15 years.

As of February 2, 2025, the initial lease terms of the various leases generally range from two to 15 years.

The majority of the Company's leases include renewal options at the sole discretion of the Company.

10 unchanged sentences

Variable lease expense 188,358 152,791 114,441

Sublease income ( 2,805 ) — —

$ 537,897 $ 450,968 $ 376,998

The following table presents future minimum lease payments by fiscal year and the impact of discounting.

January 28, 2024

February 2, 2025

(In thousands)

7 unchanged sentences

Non-current lease liabilities 1,300,637

As of January 28, 2024, the Company's minimum lease commitment for distribution center operating leases which have been committed to, but not yet commenced, was $ 299.6 million, which is not reflected in the table above.

As of February 2, 2025, the Company's minimum lease commitment for distribution center operating leases which have been committed to, but not yet commenced, was $ 274.8 million, which is not reflected in the table above.

The weighted-average remaining lease terms and weighted-average discount rates were as follows:

January 28, 2024 January 29, 2023

February 2, 2025 January 28, 2024

Weighted-average remaining lease term 6.68 years 6.95 years

24 unchanged sentences

Gain on disposal of assets — — 1,661

Acquisition-related expenses — — ( 1,417 )

Total discrete income tax expense (recovery) $ — $ ( 26,085 ) $ ( 26,510 )

Please refer to Note 5.

Property and Equipment, Note 8.

Impairment of Goodwill and Other Assets, Restructuring Costs, and Note 9.

Acquisition-Related Expenses for further information.

As of January 28, 2024, the Company's net investment in its Canadian subsidiaries was $ 2.5 billion, of which $ 1.6 billion was determined to be indefinitely reinvested.

Property and Equipment and Note 9.

Impairment of Goodwill and Other Assets, Restructuring Costs for further information.

As of February 2, 2025, the Company's net investment in its Canadian subsidiaries was $ 3.7 billion, of which $ 1.6 billion was determined to be indefinitely reinvested.

A deferred income tax liability of $ 107.0 million has been recognized in relation to the portion of the Company's net investment in its Canadian subsidiaries that is not indefinitely reinvested, representing the Canadian withholding taxes and U.S.

2 unchanged sentences

Specifically, to the extent that the Canadian subsidiaries have paid-up-capital, any such distributions would be structured as a return of capital, and therefore not subject to Canadian withholding tax.

The unrecognized deferred tax liability on the indefinitely reinvested amount is approximately $ 89.7 million.

The unrecognized deferred income tax liability on the indefinitely reinvested amount is approximately $ 88.8 million.

No deferred income tax liabilities have been recognized on any of the undistributed earnings of the Company's other foreign subsidiaries as these earnings are permanently reinvested outside of the United States.

Excluding its Canadian subsidiaries, cumulative undistributed earnings of the Company's foreign subsidiaries as of January 28, 2024 were $ 466.5 million.

As of January 28, 2024, the Company had cash and cash equivalents of $ 822.5 million outside of the United States.

Excluding its Canadian subsidiaries, cumulative undistributed earnings of the Company's foreign subsidiaries as of February 2, 2025 were $ 599.1 million.

As of February 2, 2025, the Company had cash and cash equivalents of $ 1.3 billion outside of the United States.

A summary reconciliation of the effective tax rate is as follows:

9 unchanged sentences

Effective tax rate 29.6 % 28.8 % 35.9 %

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities as of January 28, 2024 and January 29, 2023 are presented below:

January 28, 2024 January 29, 2023

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities as of February 2, 2025 and January 28, 2024 are presented below:

February 2, 2025 January 28, 2024

(In thousands)

13 unchanged sentences

Property and equipment, net $ ( 180,664 ) $ ( 162,312 )

Intangible assets, net — ( 5,224 )

Right-of-use lease assets ( 269,089 ) ( 265,157 )

Unremitted foreign earnings ( 106,986 ) ( 41,198 )

Other ( 4,442 ) ( 1,851 )

5 unchanged sentences

Net deferred income tax liabilities $ ( 81,103 ) $ ( 20,346 )

As of January 28, 2024, the Company had net operating loss carryforwards of $ 20.0 million.

As of February 2, 2025, the Company had net operating loss carryforwards of $ 25.0 million.

The majority of the net operating loss carryforwards expire, if unused, between fiscal 2030 and fiscal 2044.

There was a $ 1.6 million net increase in the valuation allowance in 2023, compared to a $ 2.1 million net decrease in 2022, and a $ 3.7 million net decrease in 2021.

There was a $ 5.6 million net increase in the valuation allowance in 2024, compared to a $ 1.6 million net increase in 2023, and a $ 2.1 million net decrease in 2022.

The Company files income tax returns in the U.S., Canada, and various foreign and state jurisdictions.

1 unchanged sentence

federal and state tax authorities.

The 2013 tax year is still open for certain state tax authorities.

The 2017 to 2023 tax years remain subject to examination by Canadian tax authorities.

The 2016 to 2022

tax years remain subject to examination by tax authorities in certain foreign jurisdictions.

The 2015 to 2023 tax years remain subject to examination by the China Mainland tax authorities.

The 2017 to 2023 tax years remain subject to examination by tax authorities in certain other foreign jurisdictions.

The Company does not have any significant unrecognized tax benefits arising from uncertain tax positions taken, or expected to be taken, in the Company's tax returns.

16 unchanged sentences

During the first quarter of 2022, the Company completed the remaining stock repurchases under this program.

On March 23, 2022 and November 29, 2023, the Company's board of directors approved stock repurchase programs, each for up to $ 1.0 billion of the Company's common shares on the open market or in privately negotiated transactions.

The repurchase plans have no time limit and do not require the repurchase of a minimum number of shares.

On March 23, 2022, the Company's board of directors approved a stock repurchase program for up to $ 1.0 billion of the Company's common shares on the open market or in privately negotiated transactions.

During the first quarter of 2024, the Company completed the remaining stock repurchases under this program.

On November 29, 2023, the Company's board of directors approved a stock repurchase program for up to $ 1.0 billion of the Company's common shares on the open market or in privately negotiated transactions.

On each of May 29, 2024 and December 3, 2024, the Company's board of directors approved an additional increase of $ 1.0 billion to the existing stock repurchase program.

The repurchase plan has no time limit and does not require the repurchase of a minimum number of shares.

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.

The timing and actual number of common shares to be repurchased will depend upon market conditions, eligibility to trade, and other factors, in accordance with Securities and Exchange Commission requirements.

The authorized value of shares available to be repurchased under these programs excludes the cost of commissions and excise taxes and as of January 28, 2024, the remaining authorized value was $ 1.2 billion.

During 2023, 2022, and 2021, 1.5 million, 1.4 million, and 2.2 million shares, respectively, were repurchased under the programs at a total cost including commissions and excise taxes of $ 558.7 million, $ 444.0 million, and $ 812.6 million, respectively.

Subsequent to January 28, 2024, and up to March 15, 2024, 0.2 million shares were repurchased at a total cost including commissions and excise taxes of $ 99.2 million .

The authorized value of shares available to be repurchased under this program excludes the cost of commissions and excise taxes and as of February 2, 2025, the remaining authorized value was $ 1.6 billion.

During 2024, 2023, and 2022, 5.1 million, 1.5 million, and 1.4 million shares, respectively, were repurchased under the programs at a total cost including commissions and excise taxes of $ 1.6 billion, $ 558.7 million, and $ 444.0 million, respectively.

Subsequent to February 2, 2025, and up to March 21, 2025, 0.6 million shares were repurchased at a total cost including commissions and excise taxes of $ 230.5 million .

Commitments and Contingencies

3 unchanged sentences

License and supply arrangements .

The Company has entered into license and supply arrangements with partners in the Middle East and Mexico which grant them the right to operate lululemon branded retail locations and sell lululemon products on websites in specific countries.

The Company has entered into license and supply arrangements with partners which grant them the right to operate lululemon branded retail locations and sell lululemon products on websites in specific countries.

Under these arrangements, the Company supplies the partners with lululemon products, training, and other support.

As of January 28, 2024, there were 39 licensed locations, including 15 in Mexico, eight in the United Arab Emirates, six in Saudi Arabia, three in Qatar, three in Kuwait, three in Israel, and one in Bahrain.

One-time transition tax payable .

tax reforms enacted in December 2017 imposed a mandatory transition tax on accumulated foreign subsidiary earnings which have not previously been subject to U.S.

income tax at a rate of 15.5% on cash and cash equivalents and 8% on the remaining earnings, net of foreign tax credits.

The one-time transition tax is payable over eight years beginning in fiscal 2018.

The table below outlines the remaining expected payments due by fiscal year.

Payments Due by Fiscal Year

Total 2024 2025 2026 2027 2028 Thereafter

(In thousands)

One-time transition tax payable $ 28,555 $ 12,691 $ 15,864 $ — $ — $ — $ —

As of February 2, 2025, there were 34 licensed locations, including ten in the United Arab Emirates, eight in Saudi Arabia, seven in Israel, four in Qatar, four in Kuwait, and one in Bahrain.

On September 10, 2024, we acquired the lululemon branded retail locations and operations run by a third party in Mexico.

We had previously granted the third party the right to operate retail locations and to sell lululemon products in Mexico.

Please refer to Note 6.

Acquisition for further information.

Contingencies

Legal proceedings.

The Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental agencies and other third parties which are incidental to the conduct of its business.

In addition to the legal proceedings described below, the Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental agencies and other third parties which are incidental to the conduct of its business.

This includes legal matters such as initiation and defense of proceedings to protect intellectual property rights, employment claims, product liability claims, personal injury claims, and similar matters.

1 unchanged sentence

The Company has recognized immaterial provisions related to the expected outcome of legal proceedings.

On July 12, 2024, lululemon and its subsidiary, lululemon usa inc., were named as defendants in a putative consumer class action ( Gyani v.

Lululemon Athletica Inc., et al., No.

1:24-cv-22651-BB) in the United States District Court for the Southern District of Florida.

On September 16, 2024, plaintiffs filed an amended complaint, asserting claims under the Florida Deceptive and Unfair Trade Practices Act, New York General Business Law, California Consumer Legal Remedies Act, California Unfair Competition Law, and for unjust enrichment based on statements by the Company relating to the sustainability and environmental impact of the Company's products and actions during the period October 28, 2020 to present.

The amended complaint seeks monetary damages, as well as non-monetary relief such as an injunction to end the alleged unlawful practices.

lululemon moved to dismiss the amended complaint, and on February 19, 2025, the Court granted lululemon's motion in full, dismissing the action without prejudice and without leave to amend.

On August 8, 2024, lululemon athletica inc.

and certain officers of the Company were named as defendants in a purported securities class action ( Patel v.

Lululemon Athletica Inc., et al ., No.

1:24-cv-06033) in the United States District Court for the Southern District of New York.

On March 10, 2025, plaintiffs filed an amended complaint, asserting claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on allegedly false and misleading public statements and omissions by Defendants during the period December 8, 2023 to July 24, 2024 relating to lululemon's business, product offerings, and inventory allocation that plaintiffs allege artificially inflated the Company’s stock price.

The amended complaint currently seeks unspecified monetary damages.

The Company intends to defend the action vigorously.

On November 4, 2024, November 8, 2024, November 12, 2024, November 18, 2024, and November 20, 2024, stockholder derivative complaints were filed against certain of the Company's officers, and all of the Company's directors as of that date in the United States Court for the Southern District of New York:

McDonald et al.

1:24-cv-08405 (the " Bhavsar Action");

McDonald et al.

1:24-cv-08507 (the " Muszynski Action");

McDonald et al.

1:24-cv-08572 (the " Holtz Action");

McDonald et al.

1:24-cv-08752 (the " Wong Action");

and Kanaly v.

McDonald et al , No.

1:24-cv-08839 (the " Kanaly Action," and collectively with the Bhavsar Action, the Muszynski Action, the Holtz Action, and the Wong Action, the "Derivative Actions.").

The Kanaly Action additionally names certain of the Company's former directors.

The Derivative Actions assert claims for (a) violating Sections 10(b), 14(a) and 20(a) of the Exchange Act, (b) breach of fiduciary duties, and (c) unjust enrichment and waste of corporate assets on allegations substantially similar to the allegations in the securities action complaint.

The Bhavsar Action further asserts claims for abuse of control, gross mismanagement, and contribution under Sections 10(b) and 21D of the Exchange Act.

The Wong Action also asserts a claim for contribution under Sections 10(b) and 21D of the Exchange Act.

The Kanaly Action also asserts claims for gross mismanagement and aiding and abetting breach of fiduciary duty.

The Wong Action and the Kanaly Action further bring claims based on allegedly false and misleading public statements and omissions during the period October 28, 2020 to March 21, 2024 relating to lululemon's "IDEA" program.

The complaints seek monetary damages, equitable relief, and attorneys' fees and costs on behalf of the Company, as well as an order directing certain governance reforms.

Supplemental Cash Flow Information

7 unchanged sentences

The Company's segments are based on the financial information the CODM, who is the Chief Executive Officer, uses to evaluate performance and allocate resources.

During the fourth quarter of 2023, the financial information the CODM regularly uses to evaluate performance and allocate resources was revised.

As the Company has further executed on its omni-channel retail strategy, and with the continued expansion of its international operations, the CODM has shifted resource allocation decisions to be focused by regional market, rather than by selling channel.

This resulted in a change in the Company's operating segments.

As of January 28, 2024, the Company reports three segments, Americas, China Mainland, and Rest of World, which is APAC and EMEA on a combined basis.

The CODM approves the annual budget on a segment level, and regularly assesses the performance of the Company's segments using key financial metrics, including net revenue and segmented income from operations.

The Company reports three segments:

Americas, China Mainland, and Rest of World, which is comprised of its non-significant operating segments APAC and EMEA reported on a combined basis.

The Company does not report capital expenditures and assets by segment as that information is not reviewed by the CODM.

Previously, the Company's segments were comprised of company-operated stores, direct to consumer (or "e-commerce"), and other.

The Company has restated the prior period information to reflect its new segments.

2023 2022 2021

(In thousands)

Americas $ 7,631,647 $ 6,817,454 $ 5,299,906

China Mainland

Rest of World

Total Segments

Corporate (1)

(In thousands)

Net revenue $ 7,928,156 $ 1,361,337 $ 1,298,633 $ 10,588,126 $ — $ 10,588,126

Product costs (2)

2,336,251 324,237 364,906 3,025,394 — 3,025,394

Segmented income from operations:

Americas $ 2,937,184 $ 2,503,740 $ 1,867,016

Other cost of sales (2)

641,699 198,373 217,536 1,057,608 234,313 1,291,921

Selling, general and administrative expenses 1,934,649 328,868 401,245 2,664,762 1,097,617 3,762,379

Amortization of intangible assets — — — — 2,735 2,735

Income from operations $ 3,015,557 $ 509,859 $ 314,946 $ 3,840,362 $ ( 1,334,665 ) $ 2,505,697

Other income (expense), net 70,380

Income before income tax expense $ 2,576,077

Supplemental information:

Depreciation and amortization (3)

$ 204,922 $ 33,206 $ 30,872 $ 269,000 $ 177,524 $ 446,524

China Mainland

Rest of World

Total Segments

Corporate (1)

(In thousands)

Net revenue $ 7,631,647 $ 963,760 $ 1,023,871 $ 9,619,278 $ — $ 9,619,278

Product costs (2)

2,283,490 241,663 316,542 2,841,695 23,709 2,865,404

General corporate expenses 1,240,436 1,005,988 718,477

lululemon Studio obsolescence provision 23,709 62,928 —

Impairment of goodwill and other assets, restructuring costs 74,501 407,913 —

Other cost of sales (2)

576,810 154,136 171,992 902,938 241,531 1,144,469

Selling, general and administrative expenses 1,834,163 230,645 333,505 2,398,313 998,905 3,397,218

Impairment of assets and restructuring costs — — — — 74,501 74,501

Amortization of intangible assets — — — — 5,010 5,010

Acquisition-related expenses — — 41,394

Gain on disposal of assets — ( 10,180 ) —

Income from operations $ 2,937,184 $ 337,316 $ 201,832 $ 3,476,332 $ ( 1,343,656 ) $ 2,132,676

1 unchanged sentence

Income before income tax expense $ 2,175,735

Supplemental information:

Depreciation and amortization (3)

Americas $ 170,417 $ 137,260 $ 121,278

$ 170,417 $ 25,746 $ 23,644 $ 219,807 $ 159,577 $ 379,384

China Mainland

Rest of World

Total Segments

Corporate (1)

(In thousands)

Net revenue $ 6,817,454 $ 576,503 $ 716,561 $ 8,110,518 $ — $ 8,110,518

Product costs (2)

2,236,509 134,810 235,084 2,606,403 62,928 2,669,331

Long-lived assets, including property and equipment, net and right-of-use lease assets, by geographic area as of January 28, 2024 and January 29, 2023 were as follows:

January 28, 2024 January 29, 2023

Other cost of sales (2)

501,331 101,825 136,326 739,482 209,365 948,847

Selling, general and administrative expenses 1,575,874 143,003 241,947 1,960,824 796,623 2,757,447

Impairment of goodwill and other assets — — — — 407,913 407,913

Amortization of intangible assets — — — — 8,752 8,752

Gain on disposal of assets — — — — ( 10,180 ) ( 10,180 )

Income from operations $ 2,503,740 $ 196,865 $ 103,204 $ 2,803,809 $ ( 1,475,401 ) $ 1,328,408

Other income (expense), net 4,163

Income before income tax expense $ 1,332,571

Supplemental information:

Depreciation and amortization (3)

$ 137,260 $ 17,842 $ 19,346 $ 174,448 $ 117,343 $ 291,791

(1) Corporate includes centrally managed support functions including product design, raw material development, product innovation, sourcing, supply chain, and global merchandising which are included in other cost of sales.

Administrative corporate expenses include technology, brand and marketing, finance, human resources, legal, and other head office costs.

An inventory obsolescence provision in relation to lululemon Studio of $ 23.7 million and $ 62.9 million in 2023 and 2022, respectively, is included within product costs.

(2) Please refer to Note 2.

Summary of Significant Accounting Policies "Cost of goods sold" for a definition of product costs and other cost of sales.

(3) The amounts of depreciation and amortization disclosed by reportable segment are included within other cost of sales and selling, general and administrative expenses.

Long-lived assets, including property and equipment, net and right-of-use lease assets, by geographic area as of February 2, 2025 and January 28, 2024 were as follows:

February 2, 2025 January 28, 2024

(In thousands)

7 unchanged sentences

Segmented Information, the following table disaggregates the Company's net revenue by geographic area.

Prior to the acquisition of the Mexico operations on September 10, 2024, wholesale sales to the third party under the license and supply arrangement by lululemon athletica canada inc.

were disclosed as net revenue recognized within Canada.

2024 2023 2022

2 unchanged sentences

Canada 1,411,673 1,285,255 1,163,111

Mexico 33,300 — —

Americas 7,928,156 7,631,647 6,817,454

China Mainland 1,361,337 963,760 576,503

5 unchanged sentences

The following table disaggregates the Company's net revenue by category.

Other categories is primarily composed of accessories, lululemon Studio, and footwear.

Other categories is primarily composed of accessories, footwear, and lululemon Studio.

2024 2023 2022

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data