Ralph Lauren's stock falls toward a 5th-straight loss after downbeat outlook, while earnings beat views

Shares of Ralph Lauren Corp. (RL) took a 3.2% hit toward a fifth-straight loss in premarket trading Thursday, after the luxury lifestyle products company beat fiscal first-quarter earnings expectations but provided a somewhat downbeat second-quarter outlook, amid inflationary and consumer spending-related headwinds. Net income for the quarter to July 1 rose to $132.1 million, or $1.96 a share, from $123.4 million, or $1.73 a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of $2.34 beat the FactSet consensus of $2.14. Revenue grew 0.4% to $1.497 billion, above the FactSet consensus of $1.483 billion, as a 10% decline in North America revenue was offset by an 8% rise in Europe revenue and a 13% increase in Asia revenue. Operating margin of 11.1% was down from 11.8% a year ago. For the second quarter, the company expects revenue to be flat to up slightly in constant currency, with currency expected to boost growth by about 1 percentage point, while the FactSet revenue consensus of $1.63 billion including currency implies 3.4% growth. And operating margin is expected to contract to 9.5% to 10%, below first-quarter levels and down from 13.1% a year ago. The stock, which has slid 2.8% the past four sessions after closing Aug. 3 at an 18-month high, has run up 17.1% over the past three months while the S&P 500 has gained 8%.

-Tomi Kilgore

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08-10-23 0822ET

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