RL - Ralph Lauren rises above earnings expectations touts continued revenue growth

Ralph Lauren Corporation ( NYSE: RL ) posted better than expected profits for its fiscal second quarter and maintained optimistic guidance, leading shares higher on Thursday.

The New York-based fashion company notched $2.23 in earnings per share alongside a 5% jump on revenue from the prior year to $1.6B. Analysts had anticipated $2.08 in earnings per share alongside $1.56B in revenue. A strong rebound in Asia Pacific sales alongside a modest rise in North America revenue helped to offset flat European sales trends, according to the company.

"At our investor day in September, we outlined our next phase of growth for our company, our Next Great Chapter: Accelerate plan, focused on ongoing brand elevation, category expansion and scaling our key city ecosystems around the world," CEO Patrice Louvet said. "Our multiple engines of growth helped drive solid second quarter results with outperformance on both the top- and bottom-line as we continue to navigate a highly dynamic global operating environment with agility and a relentless focus on building our brand momentum."

Management anticipates about an 8% rise in revenue in fiscal 2023 from the prior year despite a whopping 730 basis point negative impact from currency fluctuations . Analysts had anticipated a 7.67% growth rate. Additionally, gross margin is still expected to increase approximately 30 to 50 basis points despite persistent inflationary impacts.

Of note, inventory rose to $1.3B, up 36% from the prior year period, due to “earlier receipts and higher goods-in-transit to mitigate global supply chain delays and meet strong consumer demand along with increased product costs and continued elevation in product mix.”

Shares of Ralph Lauren ( RL ) rose over 4% immediately after the print before moderating gains toward the release of the all-important CPI report on Thursday .

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