Limited discounting helped Lulu's grow its income in 2021, while repeat buyers drove revenue for the apparel retailer.

(Bloomberg)—Lulu’s Fashion Lounge Holdings Inc., an online retailer focused on women’s apparel, filed for an initial public offering this week. The web-only retailer disclosed that it was able to turn a profit in 2021, after a net loss during the coronavirus pandemic’s first year.

The company in its filing Tuesday with the U.S. Securities and Exchange Commission listed the size of the offering as $100 million, a placeholder that will change when terms of the share sale are set. Backed by H.I.G. Capital, Lulu’s could have a value of $1 billion in an IPO, Bloomberg News reported in July. The online-only apparel retailer is No. 120 in the 2021 Digital Commerce 360 Top 1000.

Lulu’s, based in Chico, California, was started by mother and daughter Debra Cannon and Colleen Winter in 1996. The company, which doesn’t operate physical stores, has 2.5 million active customers and 7.5 million followers on social media, according to the filing. During the first half of 2021, 65% of sales came from repeat buyers, Lulu’s said in its filing.

“Brick-and-mortar businesses, especially in the apparel, footwear and accessories industry, were acutely challenged during the COVID-19 pandemic as they were generally considered ‘non-essential’ by federal, state and local authorities,” Lulu’s said.


The company had net income of about $7.0 million on net revenue of $172.5 million for the six months ended July 4, compared with a net loss of more than $15.5 million on revenue of $139.6 million for the comparable period a year earlier, according to the filing. Revenue fell 32.7% in 2020 to $248.7 million from $369.6 million in 2019.

The income turnaround is thanks in part to analytic product buying that reduced its need to mark down items. Lulu’s tests hundreds of small batches of products each week, keeping inventory of those new items low until its algorithm spots what’s working best, the company said in its filing. It then reorders those items “winning” products in much higher volume. Those reordered items generated 70% of revenue for the company and 94% were sold without discounts.

While Lulu’s does sell some outside brands, 88% of revenue during the first two quarters came from proprietary brands, up from 86% in the first half of 2020.

Goldman Sachs Group Inc., Bank of America Corp. and Jefferies Financial Group Inc. are leading the IPO. The company plans for its shares to trade on the Nasdaq Global Market under the symbol LVLU.