Ralph Lauren Corp - Class A
Q2 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.90%.
Did RL Beat Earnings? Q2 2026 Results
Ralph Lauren posted a standout second quarter of Fiscal 2026, delivering adjusted diluted EPS of $3.79 against a consensus estimate of $3.45, a beat of nearly 9.96%, while revenue of $2.01 billion topped expectations by 6.66% and climbed 16.5% year-over-year. The headline driver was broad-based momentum across all three geographic segments, with direct-to-consumer comparable store sales rising 13% globally as the company's brand elevation strategy kept full-price selling strong and promotional activity well below plan. China was a particular standout, posting revenue growth above 30% for the second consecutive quarter, reinforcing the thesis that Asia remains a durable growth engine for premium apparel brands. Gross margin expanded 100 basis points to 68.0%, while adjusted operating margin widened 270 basis points to 14.1%, reflecting both pricing power and operating leverage. Encouraged by the momentum, management raised its full-year Fiscal 2026 outlook, now guiding for constant currency revenue growth of 5% to 7% alongside 60 to 80 basis points of operating margin expansion.
- Global DTC comparable store sales grew 13%, driven by broad-based performance across regions and channels
- Average unit retail (AUR) increased 12% across DTC network, above expectations, reflecting brand elevation and strong full-price selling
- 1.5 million new consumers acquired in DTC businesses
- High-potential categories (Women's Apparel, Outerwear, Handbags) increased strong double-digits, outpacing total Company growth
- Core business momentum up mid-teens
- China revenue increased more than 30% year-over-year
- Gross margin expanded 100 basis points to 68.0% driven by AUR growth, favorable product mix, and lower cotton costs
- Adjusted operating margin expanded 270 basis points to 14.1% driven by operating expense leverage
- Favorable tax rate decline from 21.5% to 15.5% adjusted, driven by favorable tax benefits
“We are off to a strong start in the execution of our Next Great Chapter: Drive strategic plan introduced at our Investor Day in September, with second quarter performance outpacing our expectations across geographies, channels and consumer segments.”
Ralph Lauren CEO, on the earnings call
Forward Guidance & Outlook
For full year Fiscal 2026, Ralph Lauren now expects revenues to increase 5% to 7% on a constant currency basis, with foreign currency expected to benefit revenue growth by approximately 200 to 250 basis points. Operating margin is now expected to expand approximately 60 to 80 basis points in constant currency, up from prior outlook, with foreign currency expected to benefit gross and operating margins by approximately 30 to 50 basis points. For Q3, the company expects revenues to grow approximately mid-single digits on a constant currency basis, with FX benefiting revenue growth by approximately 150 to 200 basis points. Q3 operating margin is expected to expand approximately 60 to 80 basis points in constant currency. Full year Fiscal 2026 tax rate is expected to be approximately 19% to 21%, with Q3 tax rate of approximately 21% to 23%. Capital expenditures are expected to be approximately 4% to 5% of revenue.
RL YoY Financials
RL Revenue by Segment
RL Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.