Ralph Lauren has revised its outlook for fiscal 2026 (FY26), anticipating increased revenues and improved operating margins after experiencing what it calls “strong, high-quality growth” across diverse regions and consumer segments during the holiday season.
In the third quarter (Q3) ending December 27, 2025, the brand reported a 12% year-over-year rise in net revenue, reaching $2.4 billion. Currency fluctuations contributed approximately 220 basis points to this growth.
On a constant currency basis, revenue increased by 10%, surpassing the company’s previous expectations of mid-single-digit growth.
Regionally, North America saw an 8% increase in revenue, amounting to $1.1 billion. This growth was supported by a 7% rise in comparable store sales and an 11% boost in wholesale revenues.
In Europe, the revenue climbed by 12% to $676 million on a reported basis, while it grew by 4% in constant currency. Digital sales rose by 5%, although physical store sales saw a slight decline of 1%.
Asia displayed remarkable performance, achieving a 22% revenue increase to $620 million, bolstered by a 20% rise in comparable store sales.
The company’s gross profit reached $1.7 billion, resulting in a gross margin of 69.9%, which is up 150 basis points from the previous year. The improvement in gross margin is attributed to higher average unit retail prices, coupled with lower cotton costs, which effectively countered rising tariffs and other product expenses. Operating income rose to $471.3 million, significantly increasing from $389.7 million in the prior year.
In Q3, net income was reported at $362 million, leading to a diluted share value of $5.82. This contrasts with $297 million or $4.66 per diluted share from the previous year.
“This holiday season, our teams delivered strong, high-quality growth across geographies and consumer segments, enabling accelerated investment in our long-term strategic priorities and brand elevation,” remarked Patrice Louvet, president and CEO. “In a dynamic operating environment, our Next Great Chapter: Drive strategy supported by multiple growth drivers, the enduring and emotional power of our brand, and strong operational discipline positions us well to continue to deliver sustainable growth and long-term value creation.”
Future Outlook for FY26 and Q4
Looking ahead, Ralph Lauren now expects fiscal 2026 revenues to grow by high-single to low-double digits on a constant currency basis, a notable adjustment from its prior guidance of a 5–7% increase.
For the fourth quarter, the company anticipates revenue growth in the mid-single digits, with foreign exchange expected to contribute an added 200–300 basis points to overall growth.
