Ralph Lauren Reports 14% Revenue Growth in Q1 Fiscal 2027

Ralph Lauren, one of America’s leading fashion brands, reported its first-quarter fiscal 2027 results on August 6. Revenue increased 14% year over year to $2.0 billion and rose 13% in constant currency, exceeding the company’s expectations on broad-based growth led by Asia and North America.

Reported net income increased from $220 million in the prior-year period to $262 million, while diluted earnings per share rose 22% to $4.28. Adjusted net income, excluding restructuring-related and other net charges, reached $281 million, with adjusted diluted earnings per share increasing 22% to $4.59.

Following the stronger-than-expected first-quarter performance, the company raised its full-year fiscal 2027 outlook for revenue growth and operating margin expansion.

Summary

Asia Revenue Jumps 24%, Led by Growth of More Than 40% in China

Asia delivered the company’s strongest regional performance during the quarter. Revenue increased 24% year over year on a reported basis to $589 million and rose 25% in constant currency.

Comparable store sales in the region increased 23%, including growth of 22% across brick-and-mortar stores and 32% in digital commerce. China was a particular standout, with revenue increasing by more than 40% from the prior-year period.

North America revenue rose 13% to $740 million. Comparable retail sales increased 9%, with brick-and-mortar sales up 10% and digital commerce growing 8%.

Wholesale revenue in North America increased 22%. Approximately 15 percentage points of that growth, however, came from resumed shipments to a luxury wholesale account and a previously announced shift in shipment timing from the fourth quarter of fiscal 2026.

In Europe, reported revenue increased 7% to $594 million and rose 5% in constant currency. Comparable store sales grew 1%, while digital commerce increased 6%. Wholesale revenue rose 11% on a reported basis and 8% in constant currency.

Average Unit Retail Rises 15% as Full-Price Demand Supports Profitability

Comparable store sales across Ralph Lauren’s global direct-to-consumer network increased in the low double digits, supported by growth in both physical retail and digital channels. Average unit retail, or AUR, rose 15% and exceeded the company’s expectations.

The increase reflected the company’s continued brand elevation efforts, strong full-price demand and lower-than-planned promotional activity.

Gross profit reached $1.4 billion, while gross margin expanded by 140 basis points from the prior-year period to 73.7%. Higher average unit retail and favorable shifts in channel and geographic mix more than offset increased pressure from tariffs and other product costs.

Reported operating income totaled $342 million, representing an operating margin of 17.5%. Adjusted operating income reached $366 million, while adjusted operating margin expanded by 170 basis points to 18.7%.

By region, North America’s operating margin rose 240 basis points to 23.1%. Europe’s operating margin remained unchanged at 26.4%, while Asia’s operating margin increased 280 basis points to 33.5%.

Ralph Lauren Attracts 1.5 Million New Consumers

Ralph Lauren added 1.5 million new consumers across its direct-to-consumer businesses during the first quarter. Its social media audience surpassed 70 million followers, representing a high-single-digit increase from the previous year.

The company’s core business grew in the mid-teens. High-potential categories, including women’s apparel, outerwear and handbags, increased by more than 20% in constant currency, outpacing the company’s overall growth.

Key product launches during the quarter included the Spring 2026 collections, featuring airy, sophisticated silhouettes for women and modern voyager-inspired looks for men, as well as a Wimbledon capsule collection. At Milan’s Salone del Mobile, the company also introduced its latest home collections, Sterling Square and Saddlebrook.

Ralph Lauren continued to expand its global retail network, opening 22 new company-owned and partner-operated stores during the quarter. Key openings included The Grove in Los Angeles and Stanford Shopping Center in Palo Alto, as well as locations in Istanbul, Sydney and Perth.

The Palo Alto store also features Ralph’s Coffee’s second location in California.

Ralph Lauren, Executive Chairman and Chief Creative Officer, said: “As we celebrate America’s 250th anniversary and look ahead to important milestones for our Company over the coming year, I’m reminded of what has inspired us for nearly 60 years — optimism and aspiration, authenticity and the belief that we all can step into our dreams. These are the values that our teams around the world embrace every day, that will endure as we continue to grow and evolve.”

Patrice Louvet, President and Chief Executive Officer, added: “We are off to a strong start in the second year of our Next Great Chapter: Drive plan, with broad-based performance across geographies, channels and consumer segments in the first quarter — exceeding our expectations and driving an increase in our full year Fiscal 2027 outlook. Our iconic brand is resonating around the world, and we continue to invest behind the long-term strategic priorities that will drive further sustainable growth and value creation into the future – from recruiting new and younger consumers to strengthening our core and high-potential categories and developing our key city ecosystems in every region.”

Full-Year Outlook Raised

Following the stronger-than-expected first-quarter performance, Ralph Lauren raised its full-year fiscal 2027 outlook.

On a comparable 52-week basis, the company now expects constant-currency revenue to increase by approximately 5% to 6% year over year. Foreign exchange is expected to reduce reported revenue growth by approximately 50 to 100 basis points for the full fiscal year.

The company now expects operating margin to expand by approximately 60 to 80 basis points in constant currency, supported by gross margin expansion and operating expense leverage.

Fiscal 2027 is a 53-week year. The additional week is expected to contribute approximately one percentage point to revenue growth and provide a modest benefit to the full-year operating margin.

For the second quarter, Ralph Lauren expects constant-currency revenue growth of approximately 5% to 6%. Operating margin is projected to expand by approximately 80 to 100 basis points in constant currency.

The company ended the first quarter with $1.9 billion in cash and short-term investments. Inventory declined 5% year over year to $1.2 billion. Ralph Lauren also repurchased approximately $250 million of Class A common stock during the quarter, returning more than $300 million to shareholders through share repurchases and dividends.

Alongside expanding sales in Asia and North America, Ralph Lauren strengthened its profitability through higher average unit retail and continued full-price selling. As tariffs, inflation and foreign exchange volatility continue to shape the operating environment, the company remains focused on delivering further sustainable growth through its brand elevation strategy.

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