To our shareholders

2020 was a year unlike any other—and it presented both challenges and
opportunities as world events shifted around us.
I am incredibly proud of how lululemon navigated the year. Our success was
grounded in putting our collective first by providing pay protection for our
employees, supporting our Ambassadors, creating a hardship fund to support
our people, and honouring commitments to our landlords and vendors.
How we protected our teams reflects the unique culture and values of lululemon,
which separates us in our industry. Cutting costs may be easy in the short term,
but investing in our teams, Ambassadors, and business partners demonstrates
that our values truly matter.
This guiding principle enabled us to remain agile and innovate over the course
of the year. And I believe we will look back and view 2020 as a pivotal moment
for lululemon, as we accelerated innovations and initiatives that will create
additional opportunities for us into the future.
This letter is an exciting opportunity to share a few highlights of the past year,
as we delivered on our Power of Three growth strategy, completed the
acquisition of MIRROR, and further strengthened our financial position.
mmof how the results
More than any single accomplishment, I am proud
demonstrate the strength of our product assortment and the connection
to our guests, which enabled us to win and to gain market share, both
before and during the pandemic.
Looking ahead, we know lululemon is uniquely positioned and differentiated
in the market, given people want to live a healthy and active lifestyle, demand
technical products that perform above the competition, and are attracted
to a brand that authentically connects with guests, our collective, and
our communities.
These consumer behaviours will fuel our momentum well into the future,
and, in fact, lululemon is just getting started with our growth potential across
channels, regions, genders, and activities.
In 2020, we remained focused on delivering on our Power of Three growth
strategy to double our men’s business, double our digital business, and
quadruple our international business by year end 2023. At the same time,
we recognized this was an important moment for lululemon to use our voice
and brand to create positive change for our people and planet, which we
reference internally as the Power of Impact.
Consistent Performance
The numbers in our Annual Report show the level of success we achieved. Total
revenue grew by 11% to $4.4 billion—with 23% revenue growth in the second half
of the year. We also more than doubled our e-commerce business, and we ended
the year with $1.2 billion in cash and no debt.
This is all the more impressive given there was no playbook to a year like 2020.
When the realities of COVID-19 became clear, our global leadership team quicky
established three guiding principles: support our people, make balanced decisions,
and continue to invest in the future.
We invested in areas of the business where immediate opportunities existed, such as
our digital and technology platforms, and leaning into innovative programs such as
having our store Educators connect virtually and shop with our guests. And we looked
into the future and welcomed MIRROR to the lululemon family, jumpstarting our move
into at-home fitness and extending our eco-system of how we serve guests.
These guiding principles paid off, and we gained market share driven by both our
men’s and women’s business, as indicated by our nearly one-point US retailer market
share gain in fiscal year.*
• Omni guest experience. Our digital comps more than doubled for the full year,
enabling us to achieve our goal of doubling our e-commerce business from 2018
levels three years early. We pulled forward investments in our digital ecosystem and
quickly rolled out new capabilities, including a digital educator service and online
sweatlife tools. We introduced virtual waitlists, appointment shopping, and buy
online pickup at door and curbside to elevate the guest experience in our stores,
and continued to expand with 30 net new stores. And MIRROR joined the lululemon
family, increasing our total addressable market through its strong community focus.
• International expansion. International revenue grew 31% in 2020, a clear
demonstration of our brand’s ability to translate across geographies and cultures.
At 14% penetration, we are in the early days of our international growth opportunity—
and remain on track to quadruple the business from 2018 levels by 2023. Looking
into the not-too-distant future, I can see a time when our international revenues are
on par with what we deliver in North America.
The Power of Impact
We also saw how the stress and unknowns of COVID-19 took a toll on the wellbeing of
our communities, drawing attention to the need to be physically, mentally, and socially
well. We conducted our first Global Wellbeing Report and surveyed people around the
world, finding that only 29% of all respondents have a strong state of wellbeing, with
younger generations experiencing the lowest wellbeing of all groups. I am determined
for lululemon to help advocate for and support people in their pursuit of wellbeing,
with our unique experience in the Science of Feel, mindfulness, exercise and building
communities each playing a role.
We also released our first Impact Agenda to detail our strategies and plans related to
product sustainability and equity for our people. Our dozen goals for the future include
making 100% of our products with sustainable materials and end of use solutions by
2030, using 100% renewable electricity to power our operations by 2021, and achieving
a 60% intensity reduction in carbon emissions across our global supply chain by
2030 as well.
Importantly, we also accelerated programs to become a more inclusive and diverse
company. Our approach is called IDEA – Inclusion, Diversity, Equity and Action – and
it started with us focusing on the systemic changes we need to make within lululemon
to truly reflect the diversity of the communities in which we serve. Our actions thus
far include expanding our IDEA team globally, establishing voluntary employee-led
resource groups, and leveraging our brand and our voice to stand against hate and
discrimination around the world.
Within each of these components of the Power of Impact, we recognize and take
seriously the near-term and long-term responsibilities we have to create and sustain
positive change, and we know the strength of our company performance allows
us to do so.
Our Future
In closing, I would like to express my deep gratitude to our global teams, our guests
and Ambassadors, our Board of Directors, and, to all of you, our shareholders.
I couldn’t be more excited about the opportunities in front of us. We are in the early
innings of our growth, as we continue to expand across geographies, categories, and
channels. Our success over multiple years enables us to ask ourselves “how high is
high” in terms of the future we will create. It will be exciting to see what our incredible
team of leaders and people can accomplish.
Thank you for your support and the confidence you have in all of us at lululemon.
We will continue to work tirelessly to innovate together and inspire one another to
continue delivering for the many groups who form our expanding lululemon family.
Sincerely,

The Power of Three

Despite all the potential distractions in 2020, I am proud of how our teams across
lululemon remained continually focused on our long-term growth drivers. Established Calvin McDonald
in 2019, the Power of Three guides our discussions and fuels our aspirations, and we Chief Executive Officer
made considerable progress this year:
• Product innovation. Guided by our Science of Feel innovation platform,
we continued to raise the bar in our core Yoga, Run, Train, and On the Move
categories, from relaunching our proprietary Everlux fabric in new styles,
to expanding our Align franchise into tops, to offering some of our best
performing styles in a more inclusive size range for women. AR | 2020