Dive Brief:
- Ralph Lauren reported Q1 fiscal 2026 revenue of $1.7 billion, a 14% year-over-year increase, according to a press release Thursday. Net income rose 30.7%.
- The company saw growth across all regions it operates, with North America revenue growing by 8%, Europe growing 10% and Asia revenue increasing 21%.
- Following the results, Ralph Lauren raised its full-year revenue outlook, estimating an increase of low- to mid-single digits.
Dive Insight:
Ralph Lauren has consistently bucked the luxury sector slowdown with revenue growth while other firms have experienced significant declines. Thursday’s results continued that trend.
“While we continue to approach the current global operating environment with prudence, we are encouraged by the broad-based strength in our brand and our businesses as we execute on our long-term strategic priorities — including recruiting new and younger consumers, strengthening our core and high-potential categories, and developing our key city ecosystems in each region,” President and CEO Patrice Louvet said in the release.
The company’s projections include the anticipated impact of tariffs and weakened consumer sentiment, according to the release.
In May, the company said it was shifting its production levels to countries subject to lower U.S. tariff rates. At the time, CFO Justin Picicci explained that Ralph Lauren was doing this because no single country represents more than 20% of its production.
By sales channel, Ralph Lauren’s Q1 retail segment grew 16%. Wholesale grew 8.5%, while licensing grew 1%.
Ralph Lauren’s focus on selling, marketing and merchandising has brought higher margins and prices, with the average unit retail price increasing 14% this quarter, according to David Swartz, senior equity analyst for Morningstar Research Services.
Looking to Q2, Ralph Lauren anticipates revenue to grow high single digits.
Picicci said in an earnings call that Ralph Lauren’s momentum in Q4 last year carried into Q1 this year. That growth was led by DTC and digital. The company expects Q2 also to be led by DTC.
Evercore analysts led by Michael Benetti said in a client note that they previously believed Ralph Lauren’s strategy was to set guidance more conservatively than normal “to be able to demonstrate the strength of its model,” but the new projections are guided “well above consensus.”
“And importantly, RL is signaling that it has not changed its 2H guidance…leaving room for consistent positive revisions throughout the year,” Benetti said.
