US luxury retailer Ralph Lauren Corporation reported stronger holiday-quarter earnings and upgraded its annual outlook after sales growth and margin expansion across multiple regions.
For the quarter ended 27 December 2025, revenue climbed 12% year-on-year to $2.40bn on a reported basis and 10% in constant currency, with foreign exchange contributing about 220 basis points.
Net income reached $362m, while adjusted net income was $387m.
A year earlier, reported profit stood at $297m and adjusted net income at $308m.
While gross profit totalled $1.68bn, gross margin widened 150 basis points to 69.9%. This was supported by high-teens growth in average unit retail, a “favourable” product mix and lower cotton costs, which offset higher US tariffs and other product expenses.
Operating income reached $471m reported and $503m adjusted.
Global direct-to-consumer comparable sales rose at a high-single-digit rate while wholesale revenue increased by double digits.
Adjusted operating margin improved 220 basis points to 20.9%.
Operating expenses were $1.2bn on both reported and adjusted bases, up 12% and 11% respectively.
The adjusted operating expense rate eased to 49% from 49.7%.
North America revenue advanced 8% to $1.07bn, with retail comparable up 7% and wholesale up 11%.
Europe posted reported growth of 12% to $676.5m, or 4% in constant currency, while Asia surged 22% to $620.3m and delivered 20% comparable-store growth.
Asia generated $197.3m with a 31.8% margin, while North America recorded $292.7m at 27.1%.
Europe produced $179m, though margin slipped 150 basis points to 26.4%.
The quarter also saw the opening of 32 new owned and partnered stores in cities such as Chengdu, Sydney, Bangkok, London and New Delhi, as well as 2.1 million direct-to-consumer customers were added.
Ralph Lauren Corporation executive chairman and chief creative officer Ralph Lauren said: “Our holiday collection was inspired by the rugged landscapes of the American West, which have long been both a place of refuge and inspiration for me.
"They reflect connections to the land, to family, and to each other - and as we start a new year with renewed optimism, they are a fitting reminder to dream big and find the space to become who you are.”
Over the nine months to 27 December 2025, net revenue reached $6.13bn from $5.38bn in the same period last year. In addition, net income climbed to $789.5m from $613.9m.
Gross profit rose to $4.29bn from $3.68bn, while operating income increased to $990.6m from $777.1m.
For the year, Ralph Lauren now expects high-single to low-double-digit constant-currency revenue growth and operating-margin expansion of 100–140 basis points.
Fourth-quarter revenue is forecast to grow at a mid-single-digit rate, with margins seen contracting 80–120 basis points.
