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Dec 26, 2020
Ralph Lauren Q3 2021 Earnings Report
Ralph Lauren's Q3 2021 earnings were impacted by COVID-19, but Asia exceeded expectations and digital commerce grew.
Key Takeaways
Ralph Lauren reported Q3 Fiscal 2021 results with revenue of $1.4 billion, down 18% year-over-year. Despite the revenue decline, the company saw stronger than expected gross and operating margins driven by increased average unit retail and expense reductions. Asia outperformed expectations with mid-teens growth, and global digital commerce sales increased more than 20%.
Third quarter revenues were $1.4 billion, reflecting continued recovery from COVID-19 impacts.
Asia exceeded expectations with mid-teens growth.
Global digital commerce sales increased more than 20%, with double-digit growth across all regions and continued expansion in profitability.
Gross and operating margins were stronger than expected, driven by a 19% increase in average unit retail and continued expense reductions.
Ralph Lauren
Ralph Lauren
Ralph Lauren Revenue by Segment
Ralph Lauren Revenue by Geographic Location
Revenue by Segment
North America Revenue
CapyFin.comEurope Revenue
CapyFin.comAsia Revenue
CapyFin.comOther Revenue
CapyFin.comRevenue by Geographic Location
North America Revenue
CapyFin.comEurope Revenue
CapyFin.comAsia Revenue
CapyFin.com Forward Guidance
For the fourth quarter, the company expects revenues to decline approximately mid-to-high single digits to last year.
Positive Outlook
- Gross margin expansion continuing through the fourth quarter, albeit at a more moderate rate compared to the first three quarters of the year.
- Excluding marketing investments, we expect operating expenses to decline low single-digits compared to last year.
- Based on our current outlook, we plan to reinstate the Company's quarterly dividend in the first half of Fiscal 2022.
Challenges Ahead
- Ongoing high level of uncertainty and evolving situation surrounding COVID-19 impacting the timing and path of recovery in each market, including the potential for further resurgences of the pandemic across various markets.
- Financial results for both the fourth quarter and full year Fiscal 2021 to continue to be adversely impacted by the pandemic and prolonged demand recovery.
- Revenues to decline approximately mid-to-high single digits to last year, a sequential improvement from the first three quarters of the fiscal year.
- Outlook reflects confirmed government-mandated lockdowns and other COVID-related restrictions across several of our key markets, notably in Europe and Japan.
- Current outlook could be negatively impacted if government-mandated lockdowns or restrictions are extended or more severe measures are applied.
Revenue & Expenses
Visualization of income flow from segment revenue to net income