Lululemon tries on ship from store for the holidays

September 6, 2016 09:19 AM

Lululemon Athletica Inc. will significantly increase the number of stores it uses to fulfill online orders.

CEO Laurent Potdevin told analysts on the athletic apparel manufacturer and retailer’s fiscal second quarter 2016 earnings call that the company is expanding its ship from store program to 65 stores from 11 in time for the holidays. Lululemon has 379 retail locations, which means the company will use 17.1% of its stores to fulfill online orders.

Lululemon, No. 96 in the Internet Retailer 2016 Top 500 Guide, reported online sales of $87.4 million for the quarter ended July 31, up 6.3% from $82.2 million last year. Online accounts for 17.0% of total revenue, compared to 18.1% last year. Through the first half of the fiscal year, Lululemon reported online sales of $185.0 million, up 11.5% from $165.9 million last year. Online accounted for 18.3% of overall sales, compared with 18.9%.

The company launched a redesigned website during the quarter, and Potdevin told analysts his team will work to improve how the site serves online shoppers.

“We’ve got capabilities to do A/B testing on everything we do,” he told analysts on the call, according to a transcript from Seeking Alpha. “We are really relentlessly focused on reducing all the frictions with our guests.  From the way you’re browsing, to the way you’re looking at the product pages, to the checkouts, you’re going to see a lot of improvements.”

For the second quarter ended July 31, Lululemon also reported:

  • Net revenue of $514.5 million, up 13.6% from $453.0 million last year.
  • Net income of $53.6 million, up 12.4% from $47.7 million last year.
  • A total comparable sales gain, including e-commerce, of 4%, compared to a 6% gain last year.

For the first half of 2016, Lululemon reported:

  • Net revenue of $1.010 billion, up 15.2% from $876.6 million last year.
  • Net income of $99.0 million, up 3.7% from $95.5 million last year.



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