Ralph Lauren's stock rises on first-quarter earnings and revenue beat, boosted by Europe and Asia

By James Rogers

Ralph Lauren reported first-quarter results before market open Wednesday

Ralph Lauren Corp. shares rose 4.3% premarket Wednesday after the apparel and accessories maker reported better-than-expected first-quarter revenue and earnings, boosted by growth in Europe and Asia.

The New York-based company had net income of $168.6 million, or $2.61 a share, for the quarter, up from $132.1 million, or $1.96 a share, in the prior year's quarter. Adjusted per-share earnings came to $2.70, above the FactSet consensus of $2.48.

Revenue rose to $1.51 billion from $1.5 billion in the same period last year, above the $1.491 billion FactSet consensus. In Europe, revenue grew 6% on a reported basis and 7% in constant currency, exceeding Ralph Lauren's expectations. Asia sales grew 4% on a reported basis and 9% in constant currency, with China up by high single digits on a reported basis and up by low double digits in constant currency year over year, Ralph Lauren (RL) said in a statement. North America revenue declined 4% as stronger direct-to-consumer performance was "more than offset by planned declines in wholesale," according to the company.

Related: Ralph Lauren's fourth-quarter earnings beat offsets soft revenue guidance

"We delivered a solid start to the year, with first-quarter performance exceeding our expectations on the top- and bottom-line led by our direct-to-consumer and international businesses," Ralph Lauren CEO Patrice Louvet said in the statement.

Same-store sales increased 5%, above the 1.4% FactSet consensus.

For fiscal 2025, Ralph Lauren reaffirmed its guidance for revenue to increase approximately by low single digits year over year on a constant-currency basis, centering on around 2% to 3%. Based on current exchange rates, foreign currency is now expected to negatively impact revenue growth by approximately 150 basis points in fiscal 2025, the company said. For the second quarter, Ralph Lauren expects constant-currency revenues to grow approximately by low to mid-single digits over last year, in a range centered around 3% to 4%.

Related: China's consumers are buying more luxury clothes even as the economy struggles

Ralph Lauren shares are up 14.4% in 2024, outpacing the S&P 500's SPX gain of 9.9%.

-James Rogers

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08-07-24 0931ET

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