American luxury brand Ralph Lauren Corporation has recorded a revenue increase of 7 per cent on a reported basis to $7.1 billion and was up 8 per cent on constant currency basis in full fiscal 2025 (FY25) ended March 29. Foreign currency negatively impacted revenue growth by approximately 90 basis points (bps) in this period.

Europe and Asia led regional performance in FY25, increasing 11 per cent and 9 per cent, respectively, on a reported basis and 11 per cent and 12 per cent, respectively, in constant currency. China delivered high-teens growth on both a reported and constant currency basis.

The net income for the full fiscal was $743 million, or $11.61 per diluted share on a reported basis. On an adjusted basis, net income was $789 million, or $12.33 per diluted share. The adjusted gross and operating margins surpassed guidance, with full year adjusted operating margin rising 150 bps to 14 per cent.

In the fourth quarter (Q4) of FY25, the revenue increased by 8 per cent to $1.7 billion on a reported basis and was up 10 per cent in constant currency. Foreign currency negatively impacted revenue growth by approximately 210 bps in this quarter.

North America revenue in Q4 increased 6 per cent to $705 million. In retail, comparable store sales in North America increased by 9 per cent, with a 9 per cent increase in brick-and-mortar stores and an 8 per cent increase in digital commerce. North America wholesale revenue increased 1 per cent, in-line with expectations.

Europe revenue in Q4 increased 12 per cent to $526 million on a reported basis and 16 per cent in constant currency. In retail, comparable store sales in Europe increased 18 per cent, with a 16 per cent increase in brick-and-mortar stores and a 25 per cent increase in digital commerce. Europe wholesale revenue increased 10 per cent on a reported basis and 14 per cent in constant currency, supported by strong re-order trends and a previously discussed timing shift of receipts from the second quarter into the second half of the fiscal, Ralph Lauren said in a press release.

Asia revenue in Q4 increased 9 per cent to $432 million on a reported basis and 13 per cent in constant currency. Comparable store sales in Asia increased 15 per cent, with a 13 per cent increase in its brick-and-mortar stores and a 27 per cent increase in digital commerce.

The company sustained strong momentum in customer acquisition, attracting 5.9 million new customers through its DTC channels. It bolstered consumer engagement with high-impact brand activations during Q4, including the 2025 MLB World Tour Tokyo Series, the Vintage Ralph Lauren Tour in Japan, the Spring '25 Ralph’s Hamptons campaign, a fashion presentation in Paris.

The core business revenue grew by low double digits YoY for both Q4 and FY25 in constant currency, while high-potential categories like women’s, outerwear, and handbags saw high-teens growth in Q4 and mid-teens growth across the year.

The key product highlights included Ralph's Hamptons Spring '25 collection, a limited-edition MLB capsule, and the launch of Polo Play, a new foundational handbag line. Average unit retail (AUR) rose by high single digits in both Q4 and the full year, driven by premium product elevation, favourable channel and geographic mix, and reduced discounting, added the release.

“Our brand has stood the test of time because we have stayed true to the values that define us: quality, authenticity, timeless style. Through periods of economic strength and uncertainty alike, our teams around the world remain focused on delivering our vision with great care and passion, enabling us to make the right choices both for today and into the future,” said

“Our strong performance in the third and final year of our ‘Next Great Chapter: Accelerate plan’ underscores the growing desirability of our brand and our team's powerful execution as we navigated a dynamic global operating environment,” said Patrice Louvet, president and chief executive officer (CEO) at Ralph Lauren. “We successfully delivered on our strategic and financial commitments this fiscal year and through our long-term strategic plan—across our multiple drivers of growth—and at the same time, we continued to lay the groundwork for sustainable growth and value creation into the future.”

For full fiscal 2026 (FY26), the company anticipates low-single-digit revenue growth in constant currency, with performance skewed towards the first half. The operating margin is expected to expand modestly, supported by operating expense leverage, while gross margin is projected to remain flat due to offsetting factors such as AUR growth, lower cotton costs, and favourable mix, against increased tariffs and higher non-cotton material costs. Foreign currency is expected to have minimal impact.

For Q1, the company projects revenue to rise by high-single digits in constant currency, with a 150 to 200 bps improvement in operating margin, primarily from gross margin gains and modest expense leverage. The effective tax rate is forecast at 20 to 22 per cent for FY26 and around 20-21 per cent for Q1, assuming current tax laws remain unchanged. Planned capital expenditures for fiscal 2026 are estimated at approximately 4-5 per cent of revenue.

“As we enter fiscal 2026, we remain on offense—with a focus on driving our multiple engines of growth across lifestyle categories, geographies, and channels. At the same time, we will stay agile and prudent leaning into our diversified supply chain, operating discipline, and strong balance sheet as we manage through ongoing macroeconomic uncertainty,” added Louvet.

Fibre2Fashion News Desk (SG)