Ralph Lauren Corp (NYSE:RL) reported first-quarter FY24 sales growth of 0.4% year-on-year to $1.50 billion, beating the analyst consensus of $1.48 billion. Comparable store sales grew 2%.
Revenue in North America decreased by 10% to $632 million, Europe increased by 8% to $450 million, and Asia grew by 13% to $378 million.
Gross profit was $1 billion, with a gross margin of 69%. Adjusted gross margin was 68.8%.
Operating margin was 11.1%, and operating income for the quarter decreased by 5% to $166 million. Adjusted operating margin was 13.4%, 70 basis points above the prior year.
The company held $1.68 billion in cash and equivalents as of July 1, 2023. Operating cash flow for the quarter totaled $270.7 million.
Adjusted EPS of $2.34 beat the consensus estimate of $2.13.
Outlook: Ralph Lauren reiterated its FY24 outlook for revenues to increase approximately low-single digits on a constant currency basis.
It continues to expect FY24 operating margin to expand 30-50 basis points in constant currency, driven by gross margin expansion.
For Q2, the company expects revenue to be flat to up slightly to last year on a constant currency basis. The company sees operating margin of 9.5%-10% on a reported basis and 9.0%-9.5% in constant currency.
Price Action: RL shares are trading lower by 1.37% at $126.72 on the last check Thursday.
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