Core Insights - Ralph Lauren Corporation (RL) is a leading luxury lifestyle brand with a market capitalization of $20.1 billion, offering a diverse range of products including clothing, footwear, accessories, and home furnishings [1] Performance Overview - RL shares have significantly outperformed the broader market, gaining 61.7% over the past year compared to the S&P 500 Index's 10.5% increase [2] - Year-to-date (YTD) performance shows RL stock up 41.6%, while the S&P 500 has risen 11.2% [2] - Compared to the Kraneshares Global Luxury Index ETF (KLXY), which gained 14.3% over the past year, RL's YTD returns also exceed the ETF's 6.2% [3] Financial Results - In Q2, RL reported an adjusted EPS of $3.79, exceeding Wall Street's expectation of $3.45, and revenue of $2 billion, surpassing the forecast of $1.9 billion [4] - Analysts project RL's EPS to grow by 25% to $15.41 for the current fiscal year ending in December [4] - RL has consistently beaten consensus estimates in the last four quarters [4] Analyst Ratings - Among 18 analysts covering RL, the consensus rating is a "Strong Buy," with 14 "Strong Buy" ratings, one "Moderate Buy," and three "Holds" [5] - The current analyst sentiment is more bullish than two months ago, with an increase in "Strong Buy" recommendations [6] - Jefferies Financial Group analyst set a price target of $385, indicating a potential upside of 17.8%, while the mean price target is $376.44, representing a 15.1% premium [6]

Financial Data and Key Metrics Changes - The company reported a 4% year-over-year increase in net sales, reaching $296 million, with Adjusted EBITDA rising 45% to $25 million, marking the highest ever for a third quarter [6][30] - Consolidated gross margin improved to 54.6%, an increase of 347 basis points year-over-year, significantly exceeding guidance [9][31] - Free cash flow more than tripled year-over-year, increasing by $43 million, or 265%, for the nine months ended September 30 [10][34] Business Line Data and Key Metrics Changes - Revolve segment net sales increased by 5%, while Forward segment net sales grew by 3% year-over-year [8][30] - Sales of beauty, men's, and home products saw a healthy double-digit percentage increase year-over-year [12] - The owned brand penetration of Revolve segment net sales increased year-over-year for the third consecutive quarter, contributing to higher gross margins [23][70] Market Data and Key Metrics Changes - Domestic net sales increased by 4%, while international net sales rose by 6% year-over-year [30] - The Middle East and Europe showed strong performance, with Mainland China net sales increasing over 50% year-over-year [12] - Active customers increased by 5% year-over-year, with total orders placed reaching 2.3 million, also a 5% increase [30] Company Strategy and Development Direction - The company is focusing on brand investments, expanding owned brands, and physical retail development as key growth drivers [18][26] - The competitive environment in luxury retail is viewed as an opportunity, with the company planning to capture market share amid challenges faced by competitors [20][21] - The company is leveraging AI technology to enhance operational efficiency and drive growth across various functions [14][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties, supported by a strong financial foundation and operational excellence [16][40] - The outlook for gross margin in Q4 2025 is expected to be between 53.1% and 53.6%, indicating a year-over-year increase [37] - Management remains optimistic about the potential for international growth and the impact of new owned brand launches [12][70] Other Important Information - The company has no debt and reported cash and cash equivalents of $315 million, a 25% year-over-year increase [34] - The tariff landscape remains fluid, but the company has made significant progress in mitigating tariff exposure [35][80] Q&A Session Summary Question: Can you size the benefit from the improved markdown algorithm? - Management noted that the markdown margin optimization was the largest driver of gross margin improvement, with positive impacts from promotional strategy shifts and an increase in full-price sales [42][43] Question: What are the trends in October compared to Q3? - October showed mid-single-digit growth, which is encouraging given tougher comparisons, and management is optimistic about the holiday season [46][47] Question: What is the outlook for average order value (AOV)? - AOV is expected to continue increasing slightly due to price increases, with a mix shift impacting overall results [50][51] Question: How is the company addressing higher return rates? - Higher return rates were attributed to mix shifts and higher average unit retail prices, with ongoing efforts to improve return rates in the future [73][74] Question: What is the contribution margin from international sales compared to the U.S.? - The contribution margin gap is closing, with ongoing optimization efforts in last-mile shipping and localized customer experiences [67] Question: What is the expected impact of tariffs going forward? - Management does not anticipate incremental headwinds from tariffs, with potential net benefits from mitigation efforts [79][80]

Financial Data and Key Metrics Changes - Macy's Inc. achieved comparable sales growth of 1.9%, with adjusted EPS of $0.41, exceeding guidance of $0.15 to $0.20 [5][6][23] - Net sales were $4.8 billion, down 2.5% year-over-year, primarily due to the closure of 64 non-GoForward stores [18][19] - Gross margin was 39.7% of net sales, slightly better than expectations, impacted by proactive markdowns and tariffs [21][22] Business Line Data and Key Metrics Changes - Macy's comparable sales grew by 1.2%, driven by GoForward Macy's which rose 1.5% [6][19] - Bloomingdale's achieved a 5.7% increase in comparable sales, marking its fourth consecutive quarter of growth [11][12] - Bluemercury reported a 1.2% increase in comparable sales, its 18th consecutive quarter of gains [13] Market Data and Key Metrics Changes - The luxury segment, particularly Bloomingdale's, is gaining market share, with strong performances in ready-to-wear, fine jewelry, and fragrances [12][81] - The overall consumer remains resilient, with a notable portion of Macy's customer base earning over $100,000 household income [47] Company Strategy and Development Direction - The "Bold New Chapter" strategy focuses on enhancing customer experience, improving product offerings, and leveraging a multi-brand, multi-channel approach [5][14] - The company is committed to closing underperforming locations while investing in growth areas, particularly in the GoForward business and digital initiatives [11][15] - Future growth will be supported by expanding private brands and enhancing partnerships with existing brands [52][56] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the consumer's resilience but acknowledged the uncertainty surrounding tariffs and their impact on demand [14][46] - The company plans to reinvest savings from closed stores into initiatives that support long-term growth aspirations [25][29] - Management remains focused on maintaining a healthy balance sheet and improving operational efficiencies [24][29] Other Important Information - The company recognized $16 million in asset sale gains during the quarter [22] - Year-to-date operating cash flow was $255 million, significantly improved from $137 million last year [23] Q&A Session Summary Question: Drivers of sequential improvement in same-store sales - Management noted strong growth across various categories, with July being the strongest month, driven by back-to-school shopping [33][34] Question: Learnings from Reimagined 125 stores and expansion plans - Positive performance was noted in both the first and next 75 Reimagined stores, with local empowerment being a key factor [39][40] Question: Consumer sentiment and pricing strategies amid tariffs - Management indicated a cautious approach to pricing, with surgical price increases based on category and brand performance [41][42] Question: SG&A savings and growth opportunities - SG&A was down nearly $30 million, with continued focus on cost management while reinvesting in growth initiatives [60][61] Question: Bloomingdale's performance amid luxury market pressures - Bloomingdale's has maintained growth and market share, with strong leadership and strategic brand partnerships [81][82] Question: Tariff impacts and mitigation strategies - Tariffs had a notable impact in Q2, with management focused on mitigating future impacts through negotiations and strategic sourcing [83][84] Question: Investments in service and SG&A leverage - Management emphasized the importance of balancing investments in customer-facing initiatives with maintaining operational efficiency [95][96]

Core Viewpoint - Analysts forecast a quarterly loss of $0.22 per share for Kohl's, indicating an 8.3% year-over-year increase in losses, with revenues expected to be $3.2 billion, a decline of 5.2% compared to the previous year [1] Earnings Estimates - The consensus EPS estimate has been revised upward by 9.1% over the past 30 days, reflecting analysts' reappraisal of their initial projections [2] - Changes in earnings estimates are crucial for predicting investor reactions, with empirical studies showing a strong correlation between earnings estimate revisions and short-term stock price performance [3] Revenue Projections - Analysts predict 'Other revenue' at $179.90 million, down 11.8% from the prior year [5] - 'Net Sales' are expected to reach $2.99 billion, reflecting a year-over-year decline of 6% [5] - 'Revenue Recognition- Accessories' is forecasted at $635.98 million, showing a 2.9% increase from the previous year [5] - 'Revenue Recognition- Children's' is projected at $319.26 million, down 7.2% year-over-year [6] - 'Revenue Recognition- Footwear' is expected to be $246.51 million, a decline of 18.1% from the prior year [6] - 'Revenue Recognition- Men's' is forecasted at $592.47 million, indicating a slight decrease of 1.3% [6] - 'Revenue Recognition- Women's' is expected to be $858.60 million, down 7% from the previous year [7] - 'Revenue Recognition- Home' is projected at $387.74 million, reflecting a decrease of 1.1% [7] Store Metrics - Analysts predict the total number of stores will reach 1,152, an increase from 1,100 in the previous year [7] Stock Performance - Kohl's shares have increased by 15.4% over the past month, outperforming the Zacks S&P 500 composite, which rose by 10.7% [8] - With a Zacks Rank of 3 (Hold), Kohl's is expected to mirror overall market performance in the near future [8]