US' Ralph Lauren's Q2 earnings exceed projections; raises FY25 outlook

Ralph Lauren’s net revenue for the second quarter reached $1.7 billion, a 6 per cent year-over-year (YoY) increase. Gross profit stood at $1.2 billion, with a gross margin of 67.0 per cent—an increase of 160 basis points from the prior year, the company said in a its financial statement.

Its operating expenses were $977 million, with adjusted operating expenses at $958 million, representing a 7 per cent increase. The operating income reached $179 million, while adjusted operating income rose to $197 million, marking an operating margin of 11.4 per cent.

The brand’s regional revenue growth showed positive trends across major markets. In Asia, revenue rose by 9 per cent to $380 million on a reported basis (10 per cent in constant currency), driven by strong performance in China. Europe experienced a 7 per cent increase in revenue, reaching $566 million (6 per cent in constant currency), with notable growth in both physical stores and digital channels. North America saw a 3 per cent rise in revenue to $739 million, where direct-to-consumer growth counterbalanced a planned decrease in wholesale revenue.

The second quarter also saw significant achievements across Ralph Lauren’s strategic growth initiatives. The company attracted 1.5 million new customers, boosted brand consideration, and increased net promoter scores. Social media engagement grew by a low double-digit percentage, surpassing 62 million followers. The company outfitted Team USA for the 2024 Paris Olympics, sponsored Wimbledon and the US Open Tennis Championships, and hosted the Spring 2025 World of Ralph Lauren fashion show inspired by the Hamptons in this quarter.

Looking ahead, Ralph Lauren Corporation has updated its outlook for the full fiscal, projecting constant currency revenue growth of 3-4 per cent. Operating margins are expected to expand by 110 to 130 basis points, driven by robust gross margin improvements. The full-year tax rate is forecast to be in the range of 22-23 per cent, reflecting changes from the prior year.

Ralph Lauren, executive chairman and chief creative officer, highlighted the brand’s enduring appeal: “A spirit of optimism and the easy elegance of timeless style—these are elements that have come to define our brand. This summer was a celebration of all that we cherish, and as we turn our focus to holiday, we will continue inspiring people around the world to come together and step into their dreams.”

Patrice Louvet, president and CEO, praised the company's strategic execution: “Our teams are executing well on our long-term strategy, injecting energy and excitement behind our storied brand through what continues to be a choppy global operating environment. Our strong business performance across every geography this quarter underscores the resilience of our diversified growth drivers and our elevated consumer base, giving us confidence to take up our financial outlook for the full fiscal ahead of the all-important holiday season.”

Fibre2Fashion News Desk (KD)