Ralph Lauren (RL) Q1 2027 earnings summary

Executive summary

• First quarter revenue rose 14% year-over-year to $2.0 billion, exceeding expectations, with strong double-digit growth in Asia and North America and mid-single-digit growth in Europe.

• Adjusted EPS increased 22% to $4.59, and net income rose 19% to $262.2 million, driven by higher gross and operating margins and robust full-price demand.

• Direct-to-consumer comparable store sales grew low double digits, with 15% AUR growth and healthy digital and store performance globally.

• Strategic investments in AI, technology, and marketing supported brand elevation and consumer engagement.

• Over $300 million returned to shareholders via dividends and share repurchases in the quarter.

Financial highlights

• Net revenues: $2.0 billion (+14% year-over-year); Asia +25%, North America +13%, Europe +7%.

• Gross margin expanded 140 bps to 73.7%; AUR increased 15%.

• Adjusted operating margin expanded 170 bps to 18.7%; operating income grew 25% to $342 million.

• Net income: $262 million (+19% year-over-year); diluted EPS: $4.28 (+21.6%).

• Inventory ended at $1.2 billion, down 5% year-over-year; ended quarter with $1.9B in cash and $1.2B in debt.

Outlook and guidance

• Fiscal 2027 constant currency revenue growth outlook raised to 5–6% (from 4–5%).

• Full-year operating margin expected to expand 60–80 bps; gross margin to expand 50–70 bps.

• Asia revenue outlook increased to high single to low double digits; North America and Europe to grow low to mid-single digits.

• Second quarter revenue expected to grow 5–6% in constant currency; operating margin to expand 80–100 bps.

• Full-year tax rate expected at 21–22%; capital expenditures to be 4–5% of revenue.