Ralph Lauren in knockout quarter with growth across all regions; raises guidance
Ralph Lauren Corp. continued to maintain momentum in its second quarter, reporting growth across all regions and an increase in its average unit retail price.
Net income totaled $147.9 million, or $2.31 a share, for the quarter ended Sept. 28, up from $146.9 million, or $2.19 a share, in the year-ago period. Adjusted earnings per share were $2.54, ahead of analysts’ estimates of $2.42 per share.
Revenue rose to $1.726 billion from $1.633 billion, better than the $1.681 billion analyst expected. Sales increased 7% in Europe and 3% in North America, where stronger direct-to-consumer sales made up for an expected decline in wholesale.
Global same-store sales rose 10%, driven by positive numbers across all regions. Same-store sales rose 6% in North America, with a 9% increase in brick-and-mortar stores more than offsetting a 2% decrease in digital commerce.
Asia revenue increased 9% to $380 million. Comparable store sales in Asia increased 11%, with a 10% increase in stores and a 19% increase in digital commerce.
The average unit retail (AUR) price increased by 10% across the direct-to-consumer network, above its own expectations and on top of a 9% increase last year, reflecting continued mix shift toward our full-price businesses and the “durability of our multi-pronged elevation approach,” the company said.
"Our teams are executing well on our long-term strategy, injecting energy and excitement behind our storied brand through what continues to be a choppy global operating environment," said Patrice Louvet, president and CEO. "Our strong business performance across every geography this quarter underscores the resilience of our diversified growth drivers and our elevated consumer base, giving us confidence to take up our financial outlook for the full fiscal year ahead of the all-important holiday season."
The company ended the second quarter with $1.7 billion in cash and short-term investments and $1.1 billion in total debt, compared to $1.5 billion and $1.1 billion, respectively, at the end of the second quarter of fiscal 2024.
Ralph Lauren now expects fiscal 2025 revenue to grow 3% to 4% on a constant currency basis, up from previous guidance of 2% to 3%.
