On May 22, Ralph Lauren reported its fourth-quarter results for fiscal year 2025, surpassing market expectations for both revenue and profit. While the brand continues to expand its global direct-to-consumer presence backed by strong brand equity, the company offered a cautious outlook for fiscal 2026, forecasting low single-digit revenue growth in constant currency.
8% Revenue Growth Driven by Higher Average Unit Retail
Revenue for the quarter reached $1.7 billion, up 8% year-over-year (+10% in constant currency). The company’s global direct-to-consumer comparable store sales rose 13%, with both brick-and-mortar and digital channels contributing to growth across all regions. Average Unit Retail (AUR) rose in the high single digits, underlining the effectiveness of Ralph Lauren’s long-term elevation and pricing strategy.
Asia saw strong momentum with a 13% increase in constant currency, led by over 20% growth in China. Europe grew by 16% and North America by 6%, securing positive performance across all three key markets.
Gross margin rose by 200 basis points to 68.6%, driven by favorable channel and geographic mix, AUR improvement, and lower input costs.
Net income rose 42% year-over-year to $129 million, reflecting strong profitability. Adjusted earnings per share (EPS) came in at $2.27, beating analyst estimates of $2.04.
Leadership Comments Highlight Brand Resilience
“Our brand has stood the test of time because we have stayed true to the values that define us: quality, authenticity, timeless style,” said Ralph Lauren, Executive Chairman and Chief Creative Officer.
“Through periods of economic strength and uncertainty alike, our teams around the world remain focused on delivering our vision with great care and passion, enabling us to make the right choices both for today and into the future.”
Patrice Louvet, President and Chief Executive Officer, added, “As we enter Fiscal 2026, we remain on offense — with a focus on driving our multiple engines of growth across lifestyle categories, geographies, and channels. At the same time, we will stay agile and prudent — leaning into our diversified supply chain, operating discipline, and strong balance sheet as we manage through ongoing macroeconomic uncertainty.”
Fiscal 2026: Growth Skewed Toward First Half, Caution Ahead
The company expects low single-digit revenue growth for fiscal 2026 on a constant currency basis, with growth concentrated in the first half of the year. Louvet suggested that weakened consumer sentiment and trade policy uncertainty could lead to increased pricing pressure for consumers in the second half, hinting at potential impacts from tariff-related price adjustments.
On the financial side, Ralph Lauren ended the fiscal year with $2.1 billion in cash and short-term investments. The company announced a 10% increase in its annual dividend to $3.65 per share and approved a new $1.5 billion share repurchase authorization, underscoring its dual commitment to brand investment and shareholder return.
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