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Oct 01, 2022
Ralph Lauren Q2 2023 Earnings Report
Ralph Lauren reported better-than-expected results, driven by growth across all regions and channels.
Key Takeaways
Ralph Lauren Corporation reported a 5% increase in revenue to $1.6 billion and earnings per diluted share of $2.18 for the second quarter of Fiscal 2023. The company's performance was driven by growth in Asia and Europe, as well as strong digital sales. Ralph Lauren is maintaining its full year fiscal 2023 outlook.
Revenue increased by 5% on a reported basis and 13% in constant currency, exceeding expectations.
Adjusted operating margin of 13.4% slightly exceeded outlook.
The company continued to invest in key strategic priorities while returning cash to shareholders through dividends and share repurchases.
Full year fiscal 2023 outlook maintained with net revenue expected to increase high-single-digits in constant currency and adjusted operating margin at the low end of the prior range of 14.0% to 14.5%.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
The Company expects revenue to increase low- to mid-single digits in constant currency for Q3. Foreign currency is expected to negatively impact revenue growth by approximately 780 basis points. Operating margin for the third quarter is expected to be in a range of 17.3% to 17.8% in constant currency.
Positive Outlook
- Revenue expected to increase low- to mid-single digits in constant currency.
- Operating margin expected to be in a range of 17.3% to 17.8% in constant currency.
- Gross margin expansion expected to drive operating margin.
- Tax rates are expected to be in the range of 25% to 26%.
- Capital expenditures for Fiscal 2023 moderated to approximately $250 million to $275 million.
Challenges Ahead
- Foreign currency expected to negatively impact revenue growth by approximately 780 basis points.
- Third quarter and second half outlook reflects increased caution around consumer sentiment in Europe and North America.
- Foreign currency expected to negatively impact third quarter operating margin by approximately 180 basis points.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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