Ralph Lauren Q2 revenues up 3 percent, earnings drop

Ralph Lauren Corporation reported net income of 147 million dollars or earnings per diluted share of 2.19 dollars on a reported basis and 141 million dollars or 2.10 dollars on an adjusted basis for the second quarter.

The above results are compared to 2.18 dollars on a reported basis and 2.23 dollars on an adjusted basis in the second quarter of previous fiscal.

The company’s revenue increased 3 percent to 1.6 billion dollars on a reported basis and 2 percent in constant currency.

"Our teams delivered solid second quarter performance ahead of our commitments with stronger top-line growth across all regions, supported by our iconic brand, pricing power and continued strategic investments," said Patrice Louvet, the company’s president and CEO.

Ralph Lauren’s Q2 results across core geographies

The company’s North America revenue decreased 1 percent to 718 million dollars. In retail, comparable store sales improved 4 percent, including a 4 percent increase in digital commerce and a 4 percent increase in brick and mortar stores. North America wholesale revenue decreased 7 percent.

Revenue in Europe increased 7 percent to 527 million dollars on a reported basis and was flat in constant currency. In retail, comparable store sales improved 6 percent, with a 5 percent increase in brick and mortar stores and a 14 percent increase in digital commerce. Europe wholesale revenue was flat to prior year on a reported basis and declined 7 percent in constant currency.

Asia revenue increased 10 percent to 348 million dollars on a reported basis and 13 percent in constant currency. Comparable store sales in Asia increased 8 percent, with a 7 percent increase in brick and mortar stores and a 19 percent increase in digital commerce.

Ralph Lauren expects FY24 revenues to increase low-single digits

For fiscal 2024, the company continues to expect revenues to increase approximately low-single digits on a constant currency basis, centering around 1 percent to 2 percent.

The company continues to expect operating margin to expand approximately 30 to 50 basis points in constant currency to 12.3 percent to 12.5 percent, driven by gross margin expansion.

Gross margin is now expected to increase approximately 120 to 170 basis points in constant currency, up from the prior outlook of 100 basis points . For the third quarter, the company expects revenue to be up approximately 1 percent to 2 percent in constant currency and operating margin to be roughly flat in constant currency.