Group 1: Market Overview - The luxury goods sector is experiencing a mixed performance, with some brands showing resilience while others struggle in a declining market environment [1] - Ralph Lauren reported a 14% year-over-year revenue increase to $1.7 billion in Q1 of FY2026, exceeding market expectations [3] - Capri Holdings saw a 6% decline in revenue to $797 million but turned a profit of $53 million, indicating a strategic focus on its core brands [4] Group 2: Brand Performance - Crocs' stock plummeted by 29.2% after a disappointing earnings outlook, forecasting a 9% to 11% revenue decline for Q3 [2] - Shiseido's sales fell by 7.6% to 470 billion yen (approximately 22.9 billion RMB) in the first half of FY2025, but core operating profit rose by 21.3% [6] - Hugo Boss reported flat sales of 2 billion euros in H1 2025, with a slight profit increase to 87 million euros [7] Group 3: Strategic Moves - Anta is reportedly acquiring Reebok, aiming to enhance its global presence, although the deal's finalization remains uncertain [8] - Tapestry has sold its struggling Stuart Weitzman brand for $120.2 million, allowing it to focus on its core brands Coach and Kate Spade [9] - Kering Group is partnering with Swire Properties to promote sustainable retail practices, aligning with its environmental commitments [11] Group 4: Regional Expansion - Fendi opened its first store in Cancun, Mexico, to expand its market presence, featuring a design that blends Italian aesthetics with local culture [10] - The Asian market showed significant growth for Ralph Lauren, with revenue increasing by over 30% in China [3] - The Americas and Asia regions reported growth for the global cosmetics giant Intercos, with a 15.6% increase in the Asian market [12]

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Core Insights - Ralph Lauren Corporation (RL) reported strong first-quarter fiscal 2026 results, with both revenue and earnings exceeding expectations, highlighting the company's brand strength and strategic execution [1][2][3] Financial Performance - Adjusted earnings per share reached $3.77, surpassing the consensus estimate of $3.48, marking a 39.6% increase from $2.70 in the same quarter last year [2][9] - Net revenues grew 14% year over year to $1,719 million, exceeding the Zacks Consensus Estimate of $1,651 million, with an 11% increase on a constant-currency basis [3][9] - Global direct-to-consumer comparable store sales increased by 13%, positively influenced by foreign currency rates [4] Regional Performance - North America: Revenues rose 8% to $656 million, with retail channel comps up 12% [7] - Europe: Revenues increased 16% to $555 million, with retail channel comps up 10% [8] - Asia: Revenues grew 21% to $474 million, with comps up 18% [10] Margin and Cost Analysis - Adjusted gross profit margin expanded by 180 basis points to 72.3%, driven by favorable product mix and lower cotton costs [11][9] - Adjusted operating income was $293 million, with an operating margin increase of 270 basis points to 17% [12] Balance Sheet and Capital Management - Cash and short-term investments totaled $2.3 billion, with total debt at $1.6 million and total shareholders' equity at $2.5 billion [13] - The company repurchased nearly $250 million of Class A Common Stock and returned about $300 million to shareholders through dividends and stock repurchases [14] Outlook - For fiscal 2026, RL expects low to mid-single-digit revenue growth on a constant currency basis, with operating margin expansion of approximately 40 to 60 basis points [17] - For the fiscal second quarter, revenue growth is anticipated in the high single digits on a constant currency basis, with operating margin expected to expand by 120 to 160 basis points [19]

Financial Performance - Ralph Lauren's fiscal first-quarter net income rose sharply [1] Sales Performance - Ralph Lauren boosted its sales projection for the fiscal year [1] - Consumers paid up for its clothes and accessories in many parts of the world, especially in Asia [1]

Economic Overview - U.S. pre-market futures are at peak highs, with the Dow up 185 points, S&P 500 up 35 points, and Nasdaq up 120 points, indicating a healthy market environment [1] - The small-cap Russell index is up 20 points, showing recovery from a previous selloff, with Q2 earnings season exceeding expectations across various industries [2] Productivity and Labor Costs - U.S. Productivity in Q2 increased by 2.4%, surpassing the expected 1.9%, marking a significant recovery from the previous quarter's -1.8% [3] - Unit Labor Costs rose by 1.6%, slightly above the estimated 1.3%, and down from a revised 6.9% in Q1, indicating improved economic conditions [4] Employment Data - Initial Jobless Claims rose to 226K, 5K higher than estimated, but still below the near-term high of 250K reported in early June [5] - Continuing Jobless Claims reached 1.974 million, the highest since November 2021, but still below the psychologically significant 2 million mark [6] Company Earnings Reports - Eli Lilly reported Q2 earnings of $6.31 per share, exceeding the $5.61 estimate, with revenues of $15.56 billion, up 5.5% [7] - Despite strong earnings, Eli Lilly's shares fell 7% due to disappointing performance of its new obesity pill, which had a 12% weight loss rate [8] - Warner Bros. Discovery reported earnings of $0.63 per share, significantly better than the expected -$0.16, with revenues of $9.81 billion [9] - Ralph Lauren's fiscal Q1 earnings were $3.77 per share, beating the $3.48 estimate, with revenues of $1.7 billion, up 14% year over year [10] Upcoming Economic Data - Wholesale Inventories for June and Consumer Credit data will be released later today, following a previous Consumer Credit increase of $5.1 billion [11]

View all Key Company Metrics for Ralph Lauren here>>> Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Ralph Lauren performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Ralph Lauren (RL) reported $1.72 billion in revenue for the quarter ended June 2025, ...

Financial Performance - For the three-month period ended June 28, 2025, the company reported net revenues of approximately $1.5 billion, reflecting a 10% increase compared to the same period in the prior year[165]. - Net revenues increased by $206.9 million, or 13.7%, to $1.719 billion for the three months ended June 28, 2025, compared to the same period in 2024, with growth across all reportable segments[181][196]. - Net income rose by $51.8 million to $220.4 million during the same period, reflecting a 30.7% increase year-over-year[185][196]. - Gross profit increased by $176.5 million, or 16.6%, to $1.242 billion, with gross profit as a percentage of net revenues rising to 72.3%[203]. - Operating income increased by $65.1 million, or 31.2%, to $273.6 million, with an operating margin of 15.9%[207]. - Net income per diluted share rose to $3.52 for the three months ended June 28, 2025, compared to $2.61 for the same period in 2024, an increase of $0.91 per share[216]. Revenue Breakdown - The North America segment accounted for approximately 43% of Fiscal 2025 net revenues, while Europe and Asia represented 31% and 24%, respectively[171]. - Approximately 57% of Fiscal 2025 net revenues were generated outside of the U.S., indicating a strong international presence[169]. - North America net revenues rose by $48.0 million, or 7.9%, driven by a $48.1 million increase in comparable store sales[200]. - Europe net revenues increased by $75.4 million, or 15.7%, with a constant currency increase of 10.3%[201]. - Asia net revenues grew by $83.1 million, or 21.2%, with a constant currency increase of 18.9%[202]. Operational Efficiency - Selling, general, and administrative expenses as a percentage of net revenues declined by 100 basis points to 55.2% due to operating leverage on higher revenues[184][196]. - The company is executing a multi-year Next Generation Transformation project aimed at enhancing operational efficiency and transitioning to a direct-to-consumer model[173]. - The company plans to enhance its digital commerce capabilities and expand its direct-to-consumer presence through new retail stores and concession shops[161]. Cash Flow and Liquidity - The company ended the first quarter of Fiscal 2026 with a net cash and short-term investments position of $639.8 million, down from $940.4 million at the end of Fiscal 2025[187]. - Net cash provided by operating activities was $176.1 million, a decrease from $277.3 million in the prior year period[188]. - Cash and cash equivalents increased to $2,090.2 million as of June 28, 2025, from $1,922.5 million as of March 29, 2025, a change of $167.7 million[218]. - The company had $2.277 billion in cash, cash equivalents, and short-term investments as of June 28, 2025, with $1.308 billion held by subsidiaries outside the U.S.[226]. Risk Management - The company is focused on mitigating risks related to supply chain disruptions, including potential delays and increased costs due to geopolitical tensions and natural disasters[161]. - Ongoing global economic challenges, including inflation and geopolitical tensions, are impacting consumer sentiment and may affect future performance[175][177]. - The company has identified risks related to changes in consumer preferences and economic conditions that could impact discretionary spending on luxury products[161]. - The company actively manages foreign currency risk using forward foreign currency exchange and cross-currency swap contracts, primarily related to the Euro and Japanese Yen[249]. Capital Expenditures and Investments - The company plans to spend approximately 4% to 5% of net revenues on capital expenditures in Fiscal 2026, primarily for real estate purchases, store openings, and IT system enhancements[223]. - The company incurred restructuring-related charges of $19.3 million during the three months ended June 28, 2025, compared to $7.4 million in the prior year[186][196]. Shareholder Returns - The quarterly cash dividend was increased from $0.825 to $0.9125 per share, effective May 15, 2025[242]. - As of June 28, 2025, the remaining availability under the Class A common stock repurchase program was approximately $1.602 billion, following an expansion approved on May 15, 2025, allowing for an additional $1.500 billion in repurchases[240]. - The company has maintained a regular quarterly cash dividend program since 2003 and intends to continue this practice, subject to Board discretion[243].

Financial Data and Key Metrics Changes - The company reported a total revenue growth of 11% in the first quarter, exceeding the high single-digit outlook, driven by strong performance in direct-to-consumer channels [21][22] - Adjusted gross margin expanded by 160 basis points to 72.1%, attributed to average unit retail (AUR) growth, favorable mix shift towards full-price and international businesses, and lower cotton costs [23][24] - Adjusted operating margin increased by 230 basis points to 16.6%, with operating profit rising by 29%, both ahead of guidance [25] Business Line Data and Key Metrics Changes - Core product sales, which represent over 70% of the business, grew in the mid-teens, driven by seasonal sweater polos and lightweight outerwear [12][13] - High potential categories, including women's apparel, outerwear, and handbags, saw strong double-digit growth, outpacing total company growth [13][14] - Direct-to-consumer (DTC) retail comps increased by 13%, with double-digit growth in both digital and brick-and-mortar stores [15][16] Market Data and Key Metrics Changes - Asia led performance with a 19% increase in revenue, followed by Europe at 10% and North America at 8% [22][23] - China experienced over 30% growth, driven by strong consumer response to brand-building initiatives [30][31] - North America maintained healthy trends with high single-digit growth, supported by strong DTC channels [17][26] Company Strategy and Development Direction - The company focuses on three long-term strategic pillars: elevating the lifestyle brand, driving core products, and winning in key cities with a consumer ecosystem [8][15] - Continued investment in technology, AI, and analytics to enhance consumer service and operational efficiency [7][18] - The company aims to expand its presence in key city ecosystems globally, leveraging brand desirability and diverse growth drivers [5][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong start to the fiscal year but remains cautious about the second half due to potential tariff-related pressures on consumer behavior [7][22] - The company anticipates low to mid-single-digit revenue growth for the full year, with a focus on the first half being stronger [33][34] - Management highlighted the importance of operational discipline and agility in navigating a dynamic macro environment [39] Other Important Information - The company ended the quarter with $2.3 billion in cash and short-term investments, and $1.6 billion in total debt [31] - Inventory increased by 18% year-over-year, reflecting strong global demand and strategic receipt pull-forwards to mitigate tariff impacts [32][90] - The company plans to exit 90 to 100 wholesale doors in fiscal 2026, with approximately half related to Hudson's Bay [26] Q&A Session Summary Question: What have been the largest drivers of upside and how sustainable are they? - Management noted the shift towards a more elevated full-price consumer base and the resilience of core consumers across regions as key drivers [44][45] Question: Can you walk us through your updated guidance assumptions? - The updated guidance reflects over-delivery in Q1 and a better outlook for Q2, with tariff impacts remaining broadly in line with previous guidance [54][56] Question: What is the outlook for the handbag business? - The handbag category is seen as a high potential growth area, with strong initial responses to recent product launches [60][62] Question: How much of the inventory increase was driven by tariffs? - The inventory increase was partially due to strategic pull-forwards related to tariffs, but overall inventory growth is expected to align with revenue growth [90][92] Question: Can you quantify the tariff impact on gross margin this year? - Tariffs are the biggest headwind for gross margin, but management is confident in offsetting this pressure through various growth strategies [97][99]

Financial Data and Key Metrics Changes - The company reported a total revenue growth of 11% in the first quarter, exceeding the high single-digit outlook, driven by strong performance in direct-to-consumer channels [21][22] - Adjusted gross margin expanded by 160 basis points to 72.1%, influenced by average unit retail (AUR) growth and a favorable mix shift towards full-price and international businesses [24][25] - Adjusted operating margin increased by 230 basis points to 16.6%, with operating profit rising by 29%, both ahead of guidance [26] Business Line Data and Key Metrics Changes - Core product sales, which represent over 70% of the business, grew in the mid-teens, driven by seasonal items and new product offerings [12][13] - High-potential categories, including women's apparel, outerwear, and handbags, saw strong double-digit growth, outpacing total company growth [13] - Direct-to-consumer (DTC) retail comps increased by 13%, with double-digit growth in both digital and brick-and-mortar stores [14][27] Market Data and Key Metrics Changes - Asia led performance with a 19% increase in revenue, followed by Europe at 10% and North America at 8% [22][23] - China experienced over 30% growth, significantly outpacing competitors, driven by brand-building initiatives and strong consumer response [16][30] - North America maintained healthy trends with high single-digit growth, supported by strong DTC channels and stabilization in wholesale [16][27] Company Strategy and Development Direction - The company focuses on three long-term strategic pillars: elevating the lifestyle brand, driving core products, and winning in key cities through a consumer ecosystem [7][19] - Continued investment in technology, AI, and analytics is emphasized to enhance consumer service and operational efficiency [6][18] - The company plans to expand its presence in key city ecosystems, leveraging brand desirability and diverse growth drivers [48][49] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about the second half of the year due to potential tariff-related pressures on consumer behavior, despite a strong start to the fiscal year [6][19] - The company expects low to mid-single-digit revenue growth for the full year, with a focus on maintaining operational discipline amid macroeconomic uncertainties [34][36] - Management highlighted the importance of brand desirability and value proposition in sustaining growth, particularly in a challenging economic environment [46][48] Other Important Information - The company ended the quarter with $2.3 billion in cash and short-term investments, and $1.6 billion in total debt, indicating a strong balance sheet [31] - Inventory increased by 18% year-over-year, primarily due to strategic pull-forwards to mitigate tariff impacts, with expectations for inventory levels to align with sales as the year progresses [31][91] - The company was recognized as one of America's Best Employers for Women by Forbes, reflecting its commitment to diversity and inclusion [18] Q&A Session Summary Question: What have been the largest drivers of upside and how sustainable are they? - Management noted the shift towards a more elevated full-price consumer base and the resilience of core consumers across regions as key drivers of upside, emphasizing the durability of these drivers [46][48] Question: Can you walk us through your updated guidance assumptions? - The updated guidance reflects over-delivery in Q1 and a positive outlook for Q2, with tariff impacts remaining broadly in line with previous expectations [56][57] Question: What is the outlook for the handbag business? - The handbag category is seen as a high-potential area, with strong initial responses to new product launches and a focus on building long-term capabilities [60][62] Question: How do you view the growth rates in Europe moving forward? - Management expects continued momentum in Europe but anticipates some deceleration in the second half due to timing shifts and macroeconomic pressures [71][72] Question: Can you comment on inventory levels and expectations for alignment with sales? - Inventory levels increased due to strategic pull-forwards related to tariffs, but management expects inventory growth to moderate and align with sales as the year progresses [89][91]

EXHIBIT 99.1 RALPH LAUREN REPORTS FIRST QUARTER FISCAL 2026 RESULTS EXCEEDING EXPECTATIONS AND RAISES FULL YEAR OUTLOOK NEW YORK -- (BUSINESS WIRE) -- August 7, 2025 -- Ralph Lauren Corporation (NYSE:RL), a global leader in the design, marketing, and distribution of luxury lifestyle products, today reported earnings per diluted share of $3.52, up 35% to prior year on a reported basis and $3.77, up 40% on an adjusted basis, excluding restructuring-related and other net charges, for the first quarter of Fisca ...