RALPH LAUREN CORP
For the period ended Jun 28, 2025. Filed Aug 7, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2025 · Filed Aug 7, 2025
RL$376.56-1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-28; filed 2025-02-06.
0001037038-25-000007
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-28; filed 2025-08-07.
0001037038-25-000018
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 231 previous paragraphs and 197 current paragraphs.
104 unchanged; 71 reworded; 19 added; 45 removed; 11 previous and 3 current paragraphs rearranged.
Tables are not compared: 21 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
The global economy and retail industry are impacted by many factors beyond our control. Most recently, the U.S. announced significant changes to its trade policies, including widespread tariff increases on imported goods, with potential further increases and revisions or terminations to existing trade agreements. In response, many countries have announced or are otherwise considering retaliatory tariffs on U.S. exports and other trade restrictions. This has led to significant uncertainty regarding the future relationship between the U.S. and other countries, as well as growing concerns about a global trade war, higher inflation, and a potential global recession, which has already caused significant volatility of global stock markets and foreign currency exchange rates. In addition, the U.S. signed into law tax legislation commonly referred to as the One Big Beautiful Bill Act in July 2025, which extends many of the provisions of the Tax Cuts and Jobs Act of 2017, as well as introduces certain other new provisions.
Current report
During the three months ended June 28, 2025, we reported net revenues of $1.719 billion, net income of $220.4 million, and net income per diluted share of $3.52, as compared to net revenues of $1.512 billion, net income of $168.6 million, and net income per diluted share of $2.61 during the three months ended June 29, 2024. The comparability of our operating results has been affected by net restructuring-related charges and certain other charges (benefits), as well as foreign currency volatility. Our operating results are also susceptible to changes in macroeconomic conditions.
Current report
Net income increased by $51.8 million to $220.4 million during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, primarily due to a $65.1 million increase in our operating income, partially offset by a $9.6 million increase in our income tax provision. Net income per diluted share increased by $0.91 to $3.52 per share during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, driven by the higher level of net income and lower weighted-average diluted shares outstanding.
Current report
During the three-month periods ended June 28, 2025 and June 29, 2024, our operating results were negatively impacted by net restructuring-related charges and certain other charges (benefits) totaling $19.3 million and $7.4 million, respectively, which had an after-tax effect of reducing net income by $15.4 million, or $0.25 per diluted share, and $6.0 million, or $0.09 per diluted share, respectively.
Current report
Net Revenues. Net revenues increased by $206.9 million, or 13.7%, to $1.719 billion during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, reflecting growth across all of our reportable segments, including favorable foreign currency effects of $35.0 million. On a constant currency basis, net revenues increased by $171.9 million, or 11.4%.
Current report
North America net revenues — Net revenues increased by $48.0 million, or 7.9%, during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024. On a constant currency basis, net revenues also increased by $48.0 million, or 7.9%.
Current report
The $48.0 million increase in North America net revenues was driven by:
Current report
Europe net revenues — Net revenues increased by $75.4 million, or 15.7%, during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024. On a constant currency basis, net revenues increased by $49.4 million, or 10.3%.
Current report
Asia net revenues — Net revenues increased by $83.1 million, or 21.2%, during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024. On a constant currency basis, net revenues increased by $74.1 million, or 18.9%.
Current report
•an $83.6 million increase related to our Asia retail business, inclusive of favorable foreign currency effects of $9.0 million. On a constant currency basis, net revenues increased by $74.6 million, reflecting increases of $56.9 million in comparable store sales and $17.7 million in non-comparable store sales. The increase in our comparable store sales reflected low-teens AUR growth during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, as well as higher traffic. The following table summarizes the percentage changes in comparable store sales related to our Asia retail business:
Current report
Gross profit is the difference between total net revenues and cost of goods sold. Cost of goods sold includes the amounts incurred to acquire and produce inventory for sale to our customers, including product costs, freight-in, and import costs, as well as changes in reserves for shrinkage and inventory realizability. Gains and losses associated with forward foreign currency exchange contracts that are designated and qualifying as cash flow hedges of inventory transactions are also recognized within cost of goods sold when the hedged inventory is sold. The costs of selling merchandise, including those associated with preparing merchandise for sale, such as picking, packing, warehousing, and order charges, are included in SG&A expenses in the consolidated statements of operations. As a result, our gross profit may not be comparable to that of other entities.
Current report
(a)See discussion above for additional information related to restructuring and other charges, net recorded during the fiscal periods presented.
Current report
Europe operating margin improved by 120 basis points, primarily due to an increase of 210 basis points in gross margin, partially offset by an increase of 100 basis points in SG&A expenses as a percentage of net revenues. The overall improvement in operating margin was inclusive of the favorable impact of approximately 140 basis points related to foreign currency effects.
Current report
The income tax provision and effective tax rate for the three months ended June 28, 2025 were $57.6 million and 20.7%, respectively, compared to $48.0 million and 22.1%, respectively, for the three months ended June 29, 2024. The $9.6 million increase in our income tax provision was primarily driven by an increase in our pretax income, partially offset by a 140 basis point decline in our effective tax rate. The decline in our effective tax rate was due to favorable tax impacts of the foreign-derived intangible income deduction and tax impacts of compensation-related adjustments, partially offset by the unfavorable impact of additional income tax reserves associated with certain income tax audits and the absence of favorable state and local credits received in the prior fiscal year period. See Note 8 to the accompanying consolidated financial statements.
Current report
•an unfavorable change in our accrued liabilities largely driven by accrued payroll and benefits resulting from the higher bonus payout during the first quarter of Fiscal 2026 as compared to the prior fiscal year period.
Current report
These decreases related to our operating assets and liabilities were partially offset by a favorable change related to our prepaid expenses and other current assets, largely driven by the timing of cash payments.
Current report
•a $498.2 million increase in cash proceeds from the issuance of debt. During the three months ended June 28, 2025, we received $498.2 million in proceeds from our issuance of the 5.000% Senior Notes (as defined below). On a comparative basis, during the three months ended June 29, 2024, we did not issue or repay any debt.
Current report
This increase in cash provided by financing activities was partially offset by:
Current report
In June 2025, we completed a $500 million registered public debt offering of 5.000% Senior Notes due June 15, 2032 (see Note 9 to the accompanying consolidated financial statements). Our aggregate interest obligation related to this debt is approximately $175 million, with interest payable semi-annually.
Removed paragraphs (45)
Previous report
During the three months ended December 28, 2024, we reported net revenues of $2.143 billion, net income of $297.4 million, and net income per diluted share of $4.66, as compared to net revenues of $1.934 billion, net income of $276.6 million, and net income per diluted share of $4.19 during the three months ended December 30, 2023. During the nine months ended December 28, 2024, we reported net revenues of $5.382 billion, net income of $613.9 million, and net income per diluted share of $9.57, as compared to net revenues of $5.063 billion, net income of $555.6 million, and net income per diluted share of $8.31 during the nine months ended December 30, 2023. The comparability of our operating results has been affected by net restructuring-related charges and certain other charges (benefits). We have also experienced varying degrees of business disruptions resulting from the current macroeconomic environment, including global supply chain disruptions, inflationary pressures, ongoing military conflicts taking place in various parts of the world, and foreign currency volatility, among other factors.
Previous report
Net income increased by $20.8 million to $297.4 million during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023, primarily due to a $72.0 million increase in our operating income, partially offset by a $33.1 million increase in our income tax provision and an $18.1 million increase in non-operating expense, net. Net income per diluted share increased by $0.47 to $4.66 per share during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023, primarily driven by the higher level of net income and lower weighted-average diluted shares outstanding. Net income increased by $58.3 million to $613.9 million during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023, primarily due to a $128.5 million increase in our operating income, partially offset by a $64.2 million increase in our income tax provision. Net income per diluted share increased by $1.26 to $9.57 per share during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023, driven by the higher level of net income and lower weighted-average diluted shares outstanding.
Previous report
Our operating results during the three months ended December 28, 2024 were negatively impacted by net restructuring-related charges and certain other charges (benefits) of $12.2 million, which had an after-tax effect of reducing net income by $10.5 million, or $0.16 per diluted share. During the three months ended December 30, 2023, our operating results were favorably impacted by net restructuring-related charges and certain other charges (benefits) of $0.2 million, which had an after-tax effect of increasing net income by $1.5 million, or $0.02 per diluted share. During the nine-month periods ended December 28, 2024 and December 30, 2023, our operating results were negatively impacted by net restructuring-related charges and certain other charges (benefits) totaling $38.0 million and $40.7 million, respectively, which had an after-tax effect of reducing net income by $30.7 million, or $0.48 per diluted share, and $30.2 million, or $0.45 per diluted share, respectively. Net income during the nine months ended December 30, 2023 also reflected an income tax benefit of $11.8 million, or $0.18 per diluted share, respectively, recorded in connection with non-recurring income tax events.
Previous report
•pretax charges incurred in connection with our restructuring activities, as well as certain other benefits (charges), as summarized below (references to "Notes" are to the notes to the accompanying consolidated financial statements):
Previous report
(a)Non-routine inventory benefits are recorded within cost of goods sold in the consolidated statements of operations. The benefits recorded during the three months ended December 30, 2023 primarily related to reversals of amounts previously recognized in connection with delays in U.S. customs shipment reviews and approvals. The benefits recorded during the nine months ended December 30, 2023 primarily related to reversals of amounts previously recognized in connection with delays in U.S. customs shipment reviews and approvals (approximately $4 million) and the COVID-19 pandemic (approximately $1 million).
Previous report
(b)Non-routine bad debt expense reversals are recorded within SG&A expenses in the consolidated statements of operations. The reversals recorded during the nine months ended December 30, 2023 primarily related to charges previously recognized in connection with the Russia-Ukraine war.
Previous report
•a one-time tax benefit of $11.8 million recorded within our income tax provision during the second quarter of Fiscal 2024 in connection with Swiss tax reform and the European Union's anti-tax avoidance directive, which decreased our effective tax rate by 170 basis points during the nine months ended December 30, 2023. See Note 8 to the accompanying consolidated financial statements for further discussion.
Previous report
Net Revenues. Net revenues increased by $209.5 million, or 10.8%, to $2.143 billion during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023, reflecting growth across all of our reportable segments, partially offset by unfavorable foreign currency effects of $6.9 million. On a constant currency basis, net revenues increased by $216.4 million, or 11.2%.
Previous report
North America net revenues — Net revenues increased by $64.4 million, or 6.9%, during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023. On a constant currency basis, net revenues increased by $65.9 million, or 7.1%.
Previous report
The $64.4 million increase in North America net revenues was driven by:
Previous report
Europe net revenues — Net revenues increased by $82.9 million, or 15.9%, during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023. On a constant currency basis, net revenues increased by $81.4 million, or 15.6%.
Previous report
•a $32.5 million increase related to our Europe wholesale business largely driven by stronger re-order trends and a timing shift of inventory receipts from the second quarter of Fiscal 2025 into the third quarter, which more than offset planned reductions within the off-price wholesale channel.
Previous report
Asia net revenues — Net revenues increased by $60.3 million, or 13.5%, during the three months ended December 28, 2024 as compared to the three months ended December 30, 2023. On a constant currency basis, net revenues increased by $67.1 million, or 15.0%.
Previous report
•a $65.1 million increase related to our Asia retail business, inclusive of unfavorable foreign currency effects of $7.0 million. On a constant currency basis, net revenues increased by $72.1 million, reflecting increases of $51.6 million in comparable store sales and $20.5 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our Asia retail business:
Previous report
This increase was partially offset by a $4.8 million decline related to our Asia wholesale business, largely driven by decreases in South Korea and Japan.
Previous report
Gross profit as a percentage of net revenues is dependent upon a variety of factors, including changes in the relative sales mix among distribution channels, changes in the mix of products sold, pricing, the timing and level of promotional activities, foreign currency exchange rates, and fluctuations in product costs. These factors, among others, may cause gross profit as a percentage of net revenues to fluctuate from period to period.
Previous report
Operating Income. Operating income increased by $72.0 million, or 22.6%, to $389.7 million for the three months ended December 28, 2024. Foreign currency effects were inconsequential to operating income during the three months ended December 28, 2024. Additionally, our operating results included net restructuring-related charges and certain other charges (benefits), which had an unfavorable impact of $12.2 million during the three months ended December 28, 2024 and a favorable impact of $0.2 million during the three months ended December 30, 2023. Operating income as a percentage of net revenues was 18.2% for the three months ended December 28, 2024, reflecting a 180 basis point increase from the prior fiscal year period. The increase in operating income as a percentage of net revenues was primarily driven by the increase in our gross margin, as well as the decrease in SG&A expenses as a percentage of net revenues, partially offset by the higher net restructuring-related charges and certain other charges (benefits) recorded during the three months ended December 28, 2024 as compared to the prior fiscal year period, all as previously discussed.
Previous report
North America operating margin improved by 450 basis points, primarily due to the favorable impact of approximately 460 basis points driven by an increase in gross margin and a decrease in SG&A expenses as a percentage of net revenues. This overall improvement in operating margin was partially offset by the unfavorable impact of 10 basis points attributable to the absence of non-routine inventory benefits during the three months ended December 28, 2024 as compared to those recorded during the prior fiscal year period.
Previous report
Europe operating margin improved by 420 basis points, primarily due to the favorable impact of approximately 350 basis points driven by an increase in gross margin and a decrease in SG&A expenses as a percentage of net revenues. This overall improvement in operating margin also reflected favorable foreign currency effects of 70 basis points.
Previous report
Unallocated restructuring and other charges, netincreased by $11.5 million to $12.2 million during the three months ended December 28, 2024, as previously discussed above and in Note 7 to the accompanying consolidated financial statements.
Previous report
The income tax provision and effective tax rate for the three months ended December 28, 2024 were $86.3 million and 22.5%, respectively, as compared to $53.2 million and 16.1%, respectively, for the three months ended December 30, 2023. The $33.1 million increase in our income tax provision was primarily driven by a 640 basis point increase in our effective tax rate, as well as an increase in our pretax income. The increase in our effective tax rate was primarily due to the absence of a prior fiscal year favorable deferred tax adjustment related to a transaction entered into as part of a reorganization of the Company's corporate entity structure. See Note 8 to the accompanying consolidated financial statements.
Previous report
Net Income. Net income increased to $297.4 million for the three months ended December 28, 2024, from $276.6 million for the three months ended December 30, 2023. The $20.8 million increase in net income was due to the increases in our operating income, partially offset by increases in our income tax provision and non-operating expense, net, all as previously discussed. Additionally, our operating results during the three months ended December 28, 2024 were negatively impacted by net restructuring-related charges and certain other charges (benefits) of $12.2 million, which had an after-tax effect of reducing net income by $10.5 million. During the three months ended December 30, 2023, our operating results were favorably impacted by net restructuring-related charges and certain other charges (benefits) of $0.2 million, which had an after-tax effect of increasing net income by $1.5 million.
Previous report
Nine Months Ended December 28, 2024 Compared to Nine Months Ended December 30, 2023
Previous report
Net Revenues. Net revenues increased by $318.2 million, or 6.3%, to $5.382 billion during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023, reflecting growth across all of our reportable segments, partially offset by unfavorable foreign currency effects of $32.2 million. On a constant currency basis, net revenues increased by $350.4 million, or 6.9%.
Previous report
North America net revenues — Net revenues increased by $62.6 million, or 2.7%, during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023. On a constant currency basis, net revenues increased by $65.0 million, or 2.8%.
Previous report
The $62.6 million increase in North America net revenues was driven by:
Previous report
•an $85.7 million increase related to our North America retail business. On a constant currency basis, net revenues increased by $87.7 million, reflecting increases of $83.3 million in comparable store sales and $4.4 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our North America retail business:
Previous report
This increase was partially offset by a $23.1 million decline related to our North America wholesale business primarily driven by planned reductions within the off-price wholesale channel.
Previous report
Europe net revenues — Net revenues increased by $150.6 million, or 10.0%, during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023. On a constant currency basis, net revenues increased by $147.1 million, or 9.8%.
Previous report
•a $103.3 million increase related to our Europe retail business, inclusive of favorable foreign currency effects of $0.9 million. On a constant currency basis, net revenues increased by $102.4 million, reflecting increases of $99.8 million in comparable store sales and $2.6 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our Europe retail business:
Previous report
Asia net revenues — Net revenues increased by $105.5 million, or 9.0%, during the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023. On a constant currency basis, net revenues increased by $138.7 million, or 11.8%.
Previous report
•a $121.9 million increase related to our Asia retail business, inclusive of unfavorable foreign currency effects of $31.9 million. On a constant currency basis, net revenues increased by $153.8 million, reflecting increases of $107.0 million in comparable store sales and $46.8 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our Asia retail business:
Previous report
This increase was partially offset by a $16.4 million decline related to our Asia wholesale business, largely driven by decreases in South Korea and Japan.
Previous report
Gross Profit. Gross profit increased by $299.5 million, or 8.8%, to $3.688 billion for the nine months ended December 28, 2024, including unfavorable foreign currency effects of $30.5 million. Gross profit as a percentage of net revenues increased to 68.5% for the nine months ended December 28, 2024 from 66.9% for the nine months ended December 30, 2023. The 160 basis point increase was primarily driven by favorable product, channel, and geographic mix, lower cotton costs, and AUR growth, partially offset by higher freight and other product costs.
Previous report
Selling, General, and Administrative Expenses. SG&A expenses increased by $178.6 million, or 6.6%, to $2.873 billion for the nine months ended December 28, 2024, including favorable foreign currency effects of $15.7 million. SG&A expenses as a percentage of net revenues increased to 53.4% for the nine months ended December 28, 2024 from 53.2% for the nine months ended December 30, 2023. The 20 basis point increase was largely attributable to geographic and channel mix resulting from growth of our international and retail businesses which typically carry higher operating expense margins, as well as increases across various expense categories, including higher marketing investments due to planned key campaign events and higher compensation related expenses.
Previous report
North America operating margin improved by 230 basis points, primarily due to the favorable impact of approximately 250 basis points driven by an increase in gross margin and a decrease in SG&A expense as a percentage of net revenues. This overall improvement in operating margin was partially offset by the unfavorable impact of 20 basis points attributable to the absence of non-routine inventory benefits during the nine months ended December 28, 2024 as compared to those recorded during the prior fiscal year period.
Previous report
Europe operating margin improved by 280 basis points, primarily due to the favorable impact of approximately 300 basis points driven by an increase in gross margin and a decrease in SG&A expenses as a percentage of net revenues, as well as favorable foreign currency effects of 10 basis points. This overall improvement in operating margin was partially offset by the unfavorable impact of 20 basis points attributable to channel mix, as well as the unfavorable impact of 10 basis points attributable to the absence of non-routine bad debt expense reversals during the nine months ended December 28, 2024 as compared to those recorded during the prior fiscal year period.
Previous report
Unallocated restructuring and other charges, netdecreased by $7.6 million to $38.0 million during the nine months ended December 28, 2024, as previously discussed above and in Note 7 to the accompanying consolidated financial statements.
Previous report
Non-operating Income (Expense), Net. During the nine months ended December 28, 2024, we reported non-operating income, net of $11.3 million as compared to $17.3 million during the nine months ended December 30, 2023. The $6.0 million net decrease in non-operating income, net was primarily driven by an investment write-down recorded during the nine months ended December 28, 2024.
Previous report
Income Tax Provision. The income tax provision and effective tax rate for the nine months ended December 28, 2024 were $174.5 million and 22.1%, respectively, compared to $110.3 million and 16.6%, respectively, for the nine months ended December 30, 2023. The $64.2 million increase in our income tax provision was primarily driven by an increase in our pretax income, as well as a 550 basis point increase in our effective tax rate. The increase in our effective tax rate was due to the absence of prior year favorable adjustments related to the accrual of deferred tax assets in connection with a transaction entered into as part of a reorganization of the Company's corporate entity structure, and revaluation of deferred tax assets as a result of tax rate changes enacted in the prior year period, partially offset by a current year favorable adjustment related to the revaluation of a deferred tax liability on foreign earnings. The increase in our effective tax rate was also due to the absence of a one-time tax benefit of $11.8 million recorded during the second quarter of Fiscal 2024 in connection with Swiss tax reform and the European Union's anti-tax avoidance directive, which lowered our prior fiscal year period effective tax rate by 170 basis points. See Note 8 to the accompanying consolidated financial statements.
Showing the first 40 of 45 passages. Open the source sections for the rest.
Reworded paragraphs (71)
Previous wording
•the impact to our business resulting from the potential imposition of additional duties, tariffs, taxes, and other charges or barriers to trade, including those resulting from trade developments between the U.S. and China or other countries, and any related impact to global stock markets, as well as our ability to implement mitigating sourcing strategies;
Current wording
•the impact to our business resulting from the potential imposition of additional tariffs, duties, or taxes, changes to existing trade agreements, and other charges or barriers to trade, including those recently announced by the U.S. and any responding retaliatory actions implemented by impacted countries, and any related impact to global stock markets, foreign currency exchange rates, and existing inflationary pressures, as well as our ability to implement mitigating sourcing strategies;
Previous wording
•the impact of economic, political, and other conditions on us, our customers, suppliers, vendors, and lenders, including potential business disruptions related to ongoing military conflicts taking place in various parts of the world, most notably the Russia-Ukraine and Israel-Hamas wars, other recent hostilities in the Middle East, and militant attacks on cargo vessels in the Red Sea, civil and political unrest, diplomatic tensions between the U.S. and other countries, high interest rates, and bank failures, among other factors described herein;
Current wording
•the impact of economic, political, and other conditions on us, our customers, suppliers, vendors, and lenders, including potential business disruptions related to ongoing military conflicts taking place in various parts of the world, most notably the Russia-Ukraine and Israel-Hamas wars, other recent hostilities in the Middle East, including between Israel and Iran, and militant attacks on cargo vessels in the Red Sea, civil and political unrest, diplomatic tensions between the U.S. and other countries and any resulting anti-American sentiment, high interest rates, and bank failures, among other factors described herein;
Previous wording
•our ability to achieve our goals regarding citizenship and sustainability practices, including those related to climate change, our human capital, and our supply chain;
Current wording
•our ability to achieve our goals regarding citizenship and sustainability practices, including those related to climate change, our human capital, and our supply chain, or if our stakeholders disagree with such goals;
Previous wording
•a variety of legal, regulatory, tax, political, and economic risks, including risks related to the importation and exportation of products which our operations are currently subject to, or may become subject to as a result of potential changes in legislation, and other risks associated with our international operations, such as compliance with the Foreign Corrupt Practices Act or violations of other anti-bribery and corruption laws prohibiting improper payments, and the burdens of complying with a variety of foreign laws and regulations, including tax laws, trade and labor restrictions, and related laws that may reduce the flexibility of our business;
Current wording
•a variety of legal, regulatory, tax, political, and economic risks, including risks related to the importation, exportation, and traceability and transparency of products which our operations are currently subject to, or may become subject to as a result of potential changes in legislation, and other risks associated with our international operations, such as compliance with the Foreign Corrupt Practices Act or violations of other anti-bribery and corruption laws prohibiting improper payments, and the burdens of complying with a variety of foreign laws and regulations, including tax laws, trade and labor restrictions, and related laws that may reduce the flexibility of our business;
Previous wording
In this Form 10-Q, references to "Ralph Lauren," "ourselves," "we," "our," "us," and the "Company" refer to Ralph Lauren Corporation and its subsidiaries, unless the context indicates otherwise. We utilize a 52-53 week fiscal year ending on the Saturday closest to March 31. As such, fiscal year 2025 will end on March 29, 2025 and will be a 52-week period ("Fiscal 2025"). Fiscal year 2024 ended on March 30, 2024 and was also a 52-week period ("Fiscal 2024"). The third quarter of Fiscal 2025 ended on December 28, 2024 and was a 13-week period. The third quarter of Fiscal 2024 ended on December 30, 2023 and was also a 13-week period.
Current wording
In this Form 10-Q, references to "Ralph Lauren," "ourselves," "we," "our," "us," and the "Company" refer to Ralph Lauren Corporation and its subsidiaries, unless the context indicates otherwise. We utilize a 52-53 week fiscal year ending on the Saturday closest to March 31. As such, fiscal year 2026 will end on March 28, 2026 and will be a 52-week period ("Fiscal 2026"). Fiscal year 2025 ended on March 29, 2025 and was also a 52-week period ("Fiscal 2025"). The first quarter of Fiscal 2026 ended on June 28, 2025 and was a 13-week period. The first quarter of Fiscal 2025 ended on June 29, 2024 and was also a 13-week period.
Previous wording
•Overview. This section provides a general description of our business, global economic conditions and industry trends, and a summary of our financial performance for the three-month and nine-month periods ended December 28, 2024. In addition, this section includes a discussion of recent developments and transactions affecting comparability that we believe are important in understanding our results of operations and financial condition, and in anticipating future trends.
Current wording
•Overview. This section provides a general description of our business, global economic conditions and industry trends, and a summary of our financial performance for the three-month period ended June 28, 2025. In addition, this section includes a discussion of recent developments and transactions affecting comparability that we believe are important in understanding our results of operations and financial condition, and in anticipating future trends.
Previous wording
•Results of operations. This section provides an analysis of our results of operations for the three-month and nine-month periods ended December 28, 2024 as compared to the three-month and nine-month periods ended December 30, 2023.
Current wording
•Results of operations. This section provides an analysis of our results of operations for the three-month period ended June 28, 2025 as compared to the three-month period ended June 29, 2024.
Previous wording
•Financial condition and liquidity. This section provides a discussion of our financial condition and liquidity as of December 28, 2024, which includes (i) an analysis of our financial condition as compared to the prior fiscal year-end; (ii) an analysis of changes in our cash flows for the nine months ended December 28, 2024 as compared to the nine months ended December 30, 2023; (iii) an analysis of our liquidity, including the availability under our commercial paper borrowing program and credit facilities, our supplier finance program, outstanding debt and covenant compliance, common stock repurchases, and payments of dividends; and (iv) a description of any material changes in our material cash requirements since March 30, 2024.
Current wording
•Financial condition and liquidity. This section provides a discussion of our financial condition and liquidity as of June 28, 2025, which includes (i) an analysis of our financial condition as compared to the prior fiscal year-end; (ii) an analysis of changes in our cash flows for the three months ended June 28, 2025 as compared to the three months ended June 29, 2024; (iii) an analysis of our liquidity, including the availability under our commercial paper borrowing program and credit facilities, our supplier finance program, outstanding debt and covenant compliance, common stock repurchases, and payments of dividends; and (iv) a description of any material changes in our material cash requirements since March 29, 2025.
Previous wording
We diversify our business by geography (North America, Europe, and Asia, among other regions) and channel of distribution (retail, wholesale, and licensing). This allows us to maintain a dynamic balance as our operating results do not depend solely on the performance of any single geographic area or channel of distribution. We sell directly to consumers through our integrated retail channel, which includes our retail stores, concession-based shop-within-shops, and digital commerce operations around the world. Our wholesale sales are made principally to major department stores, specialty stores, and third-party digital partners around the world, as well as to certain third-party-owned stores to which we have licensed the right to operate in defined geographic territories using our trademarks. In addition, we license to third parties for specified periods the right to access our various trademarks in connection with the licensees' manufacture and sale of designated products, such as certain apparel, eyewear, fragrances, and home furnishings.
Current wording
We diversify our business by geography (North America, Europe, and Asia, among other regions) and channel of distribution (retail, wholesale, and licensing). This allows us to maintain a dynamic balance as our operating results do not depend solely on the performance of any single geographic area or channel of distribution. We sell directly to consumers through our integrated retail channel, which includes our retail stores, concession-based shop-within-shops, and digital commerce operations around the world. Our wholesale sales are made principally to major department stores, specialty stores, and third-party digital partners around the world, as well as to certain third-party-owned stores to which we have licensed the right to operate in defined geographic territories using our trademarks. In addition, we license to third parties for specified periods the right to access our various trademarks in connection with the licensees' manufacture and sale of designated products, such as certain apparel categories, eyewear, fragrances, and home furnishings.
Previous wording
•North America— Our North America segment, representing approximately 44% of our Fiscal 2024 net revenues, primarily consists of sales of our Ralph Lauren branded products made through our retail and wholesale businesses primarily in the U.S. and Canada. In North America, our retail business is primarily comprised of our Ralph Lauren stores, our outlet stores, and our digital commerce sites, www.RalphLauren.com and www.RalphLauren.ca. Our wholesale business in North America is comprised primarily of sales to department stores and, to a lesser extent, specialty stores.
Current wording
•North America— Our North America segment, representing approximately 43% of our Fiscal 2025 net revenues, primarily consists of sales of our Ralph Lauren branded products made through our retail and wholesale businesses primarily in the U.S. and Canada. In North America, our retail business is primarily comprised of our Ralph Lauren stores, our outlet stores, and our digital commerce sites, www.RalphLauren.com and www.RalphLauren.ca. Our wholesale business in North America is comprised primarily of sales to department stores and, to a lesser extent, specialty stores.
Previous wording
•Europe— Our Europe segment, representing approximately 30% of our Fiscal 2024 net revenues, primarily consists of sales of our Ralph Lauren branded products made through our retail and wholesale businesses in Europe and emerging markets. In Europe, our retail business is primarily comprised of our Ralph Lauren stores, our outlet stores, our concession-based shop-within-shops, and our various digital commerce sites. Our wholesale business in Europe is comprised primarily of a varying mix of sales to both department stores and specialty stores, depending on the country, as well as to various third-party digital and licensee partners.
Current wording
•Europe— Our Europe segment, representing approximately 31% of our Fiscal 2025 net revenues, primarily consists of sales of our Ralph Lauren branded products made through our retail and wholesale businesses in Europe and emerging markets. In Europe, our retail business is primarily comprised of our Ralph Lauren stores, our outlet stores, our concession-based shop-within-shops, and our various digital commerce sites. Our wholesale business in Europe is comprised primarily of a varying mix of sales to both department stores and specialty stores, depending on the country, as well as to various third-party digital and licensee partners.
Previous wording
Approximately 55% of our Fiscal 2024 net revenues were earned outside of the U.S. See Note 16 to the accompanying consolidated financial statements for further discussion of our segment reporting structure.
Current wording
Approximately 57% of our Fiscal 2025 net revenues were earned outside of the U.S. See Note 16 to the accompanying consolidated financial statements for further discussion of our segment reporting structure.
Previous wording
Our business is typically affected by seasonal trends, with higher levels of retail sales in our second and third fiscal quarters and higher wholesale sales in our second and fourth fiscal quarters. These trends result primarily from the timing of key vacation travel, back-to-school, and holiday shopping periods impacting our retail business and timing of seasonal wholesale shipments. As a result of changes in our business, consumer spending patterns, and the macroeconomic environment, including those resulting from pandemic diseases and other catastrophic events, historical quarterly operating trends and working capital requirements may not be indicative of our future performance. In addition, fluctuations in sales, operating income (loss), and cash flows in any fiscal quarter may be affected by other events affecting retail sales, such as changes in weather patterns. Accordingly, our operating results and cash flows for the three-month and nine-month periods ended December 28, 2024 are not necessarily indicative of the operating results and cash flows that may be expected for the full Fiscal 2025.
Current wording
Our business is typically affected by seasonal trends, with higher levels of retail sales in our second and third fiscal quarters and higher wholesale sales in our second and fourth fiscal quarters. These trends result primarily from the timing of key vacation travel, back-to-school, and holiday shopping periods impacting our retail business and timing of seasonal wholesale shipments. As a result of changes in our business, consumer spending patterns, and the macroeconomic environment, including those resulting from pandemic diseases and other catastrophic events, historical quarterly operating trends and working capital requirements may not be indicative of our future performance. In addition, fluctuations in sales, operating income (loss), and cash flows in any fiscal quarter may be affected by other events affecting retail sales, such as changes in weather patterns. Accordingly, our operating results and cash flows for the three-month period ended June 28, 2025 are not necessarily indicative of the operating results and cash flows that may be expected for the full Fiscal 2026.
Previous wording
We are in the early stages of executing a large-scale, multi-year global project that is expected to significantly transform the way in which we operate our business and further enable our long-term strategic pivot towards a global direct-to-consumer-oriented model (the "Next Generation Transformation project" or "NGT project"). The NGT project will be completed in phases and involves the redesigning of certain end-to-end processes and the implementation of a suite of information systems on a global scale. Such efforts are expected to result in significant process improvements and the creation of synergies across core areas of operations, including merchandise buying and planning, procurement, inventory management, retail and wholesale operations, and financial planning and reporting, better enabling us to optimize inventory levels and increase the speed with which we react to changes in consumer demand across markets, among other benefits.
Current wording
We are in the early stages of executing a large-scale, multi-year global project that is expected to significantly transform the way in which we operate our business and further enable our long-term strategic pivot towards a global direct-to-consumer-oriented model (the "Next Generation Transformation project" or "NGT project"). The NGT project will be completed in phases and involves the redesigning of certain end-to-end processes and the implementation of a suite of technology systems on a global scale. Such efforts are expected to result in significant process improvements and the creation of synergies across core areas of operations, including merchandise buying and planning, procurement, inventory management, retail and wholesale operations, and financial planning and reporting, better enabling us to optimize inventory levels and increase the speed with which we react to changes in consumer demand across markets, among other benefits.
Previous wording
In connection with the preliminary phase of the NGT project, we incurred other charges of $9.1 million and $17.1 million during the three-month and nine-month periods ended December 28, 2024, respectively, which were recorded within restructuring and other charges, net in the consolidated statements of operations.
Current wording
In connection with the preliminary phase of the NGT project, we incurred other charges of $11.0 million and $2.3 million during the three-month periods ended June 28, 2025 and June 29, 2024, respectively, which were recorded within restructuring and other charges, net in the consolidated statements of operations.
Previous wording
The global economy and retail industry are impacted by many different factors. Changes in economic conditions, most notably persisting inflationary pressures (including increases in the cost of raw materials, transportation, and salaries & benefits), organized labor disputes, high interest rates, significant foreign currency volatility, bank failures, and concerns of a potential recession, continue to impact consumer discretionary income levels, spending, and sentiment in the U.S. and beyond. In response to such pressures, as well as in an effort to reduce elevated inventory levels, many retailers (particularly in the U.S.) continue to resort to promotional activity in an attempt to offset traffic declines and increase conversion. Furthermore, the department store sector has experienced numerous consolidations, restructurings, reorganizations, bankruptcies, and other ownership changes in recent times, as well as an increase in store closures. The future geopolitical landscape also remains particularly uncertain, as over 60 countries held national elections during 2024, including the recent U.S. presidential election. Any resulting changes in international trade relations, legislation and regulations (including those related to taxation, tariffs, and importation), or economic and monetary policies, or heightened diplomatic tensions or political and civil unrest, among other potential impacts, could adversely impact the global economy and our operating results.
Current wording
Other recent economic conditions, including ongoing inflationary pressures, organized labor disputes, high interest rates, significant foreign currency volatility, and military conflicts (as discussed below), continue to impact consumer discretionary income levels, spending, and sentiment in the U.S. and beyond. In response to such pressures, as well as to reduce elevated inventory levels, many retailers (particularly in the U.S.) continue to resort to promotional activity in an attempt to offset traffic declines and increase conversion. Furthermore, the department store sector has also experienced consolidations, restructurings, bankruptcies, and other ownership changes in recent times, as well as an increase in store closures.
Previous wording
The global economy has also been negatively impacted by ongoing military conflicts taking place in various parts of the world, most notably the Russia-Ukraine and Israel-Hamas wars, other recent hostilities in the Middle East, and militant attacks on cargo vessels in the Red Sea. Although our voluntary decision to suspend operations in Russia has not resulted in a material impact to our consolidated financial statements and our ongoing operations in Israel are also not material, our business has been, and may continue to be, impacted by the broader macroeconomic implications resulting from these and other military conflicts, including inflationary pressures, unfavorable foreign currency exchange rates, increases in energy prices, food shortages, and volatility in financial markets, among other factors, which have adversely impacted consumer sentiment and confidence. It is not clear at this time how long these conflicts will endure, or if they will escalate further with additional countries declaring war against each other, which could further amplify the impacts of the various macroeconomic factors described above and potentially result in a global recession.
Current wording
The global economy has also been negatively impacted by ongoing military conflicts, including the Russia-Ukraine and Israel-Hamas wars, militant attacks on cargo vessels in the Red Sea, and other hostilities in the Middle East, such as the Israel-Iran conflict. Although our voluntary decision to suspend operations in Russia has not resulted in a material impact to our consolidated financial statements and our ongoing operations in Israel are also not material, our business has been, and may continue to be, affected by the broader macroeconomic implications resulting from these and other military conflicts, including inflationary pressures, unfavorable foreign currency exchange rates, increases in energy prices, food shortages, and financial market volatility, among other factors, which have adversely impacted consumer sentiment and confidence. It is not clear at this time how long these conflicts will endure, or if they will escalate further with additional countries taking part, which could further amplify the impacts of the various macroeconomic factors described above and potentially result in a global recession.
Previous wording
The global supply chain has been negatively impacted by various factors, including disruptions at U.S. ports and in the Red Sea. Although our business has not been significantly impacted by such disruptions, we have experienced some shipping delays impacting the timing of inventory receipts, and if such disruptions were to continue over a prolonged period, it could result in further inventory receipt delays and/or higher freight costs in the near-term and beyond.
Current wording
The global supply chain has also been negatively impacted by various factors, including disruptions at U.S. ports and in the Red Sea. Although our business has not been significantly impacted by such disruptions, we have experienced some shipping delays impacting the timing of inventory receipts, and if such disruptions were to continue over a prolonged period, it could result in further inventory receipt delays and/or higher freight costs in the near-term and beyond.
Previous wording
We have implemented various strategies globally to help address many of these current challenges and continue to build a foundation for long-term profitable growth centered around strengthening our consumer-facing areas of product, stores, and marketing across channels and driving a more efficient operating model. Our strategy for mitigating inflationary pressures includes numerous levers, including our ability to effectively increase prices, leveraging our diversified supply chain and strong supplier relationships, and leveraging our in-house quality control to reduce time and cost from the manufacturing process, among other efforts. We have also taken earlier receipts of inventory and strategically utilized faster means of transportation (i.e., air freight) when necessary to maximize full-price selling windows, as well as diverted certain near-term shipments to U.S. West Coast ports to mitigate risk had a labor agreement on the East and Gulf Coasts not been reached by the January 15, 2025 deadline. While we remain agile and mindful of the continued competitive promotional environment, we plan to continue driving our broader long-term strategy of brand elevation, which includes multiple levers to continue driving average unit retail growth and brand equity.
Current wording
We have implemented various global strategies to address many of these challenges and continue to build a foundation for long-term profitable growth by strengthening our consumer-facing areas and driving a more efficient operating model. We continue to monitor the current geopolitical landscape, including the potential impact of changes to tariffs. We have taken proactive measures in recent years to diversify our supply chain from a geographic perspective and believe we can further mitigate potential cost pressures associated with new tariffs through a combination of our disciplined inventory management, leveraging our relationships with suppliers to reduce product costs, our ability to change country of origin, and pricing actions. However, our profitability will be negatively impacted should tariffs increase significantly across our supply chain. Regarding mitigating inflationary pressures, our strategy includes numerous levers, including our ability to effectively increase prices, leveraging our diversified supply chain and strong supplier relationships, and leveraging our in-house quality control to reduce time and cost from the manufacturing process, among other efforts. Despite the competitive environment, we plan to continue driving our broader long-term strategy of brand elevation, which includes multiple levers to continue driving average unit retail growth and brand equity.
Previous wording
We will continue to monitor these conditions and trends and will evaluate and adjust our operating strategies and foreign currency and cost management opportunities to help mitigate the related impacts on our results of operations, while remaining focused on the long-term growth of our business and protecting and elevating the value of our brand.
Current wording
We will continue to monitor these conditions and trends and adjust our operating strategies to help mitigate the related impacts on our results of operations, while remaining focused on the long-term growth of our business and protecting and elevating the value of our brand.
Previous wording
Our operating performance for the three-month and nine-month periods ended December 28, 2024 as compared to the prior fiscal year periods reflected revenue increases of 10.8% and 6.3%, respectively, on a reported basis and 11.2% and 6.9%, respectively, on a constant currency basis, as defined within "Transactions and Trends Affecting Comparability of Results of Operations and Financial Condition" below. Net revenues reflected growth across all of our reportable segments.
Current wording
Our operating performance for the three-month period ended June 28, 2025 as compared to the prior fiscal year period reflected revenue increases of 13.7% on a reported basis and 11.4% on a constant currency basis, as defined within "Transactions and Trends Affecting Comparability of Results of Operations and Financial Condition" below. Net revenues reflected growth across all of our reportable segments.
Previous wording
Our gross profit as a percentage of net revenues increased by 190 basis points to 68.4% during the three months ended December 28, 2024 and by 160 basis points to 68.5% during the nine months ended December 28, 2024, as compared to the prior fiscal year periods, primarily driven by favorable product, channel, and geographic mix, lower cotton costs, and average unit retail ("AUR") growth, partially offset by higher freight and other product costs.
Current wording
Our gross profit as a percentage of net revenues increased by 180 basis points to 72.3% during the three months ended June 28, 2025 as compared to the prior fiscal year period, primarily driven by average unit retail ("AUR") growth, favorable foreign currency effects, favorable channel and geographic mix, and lower cotton costs, more than offsetting incremental pressure from tariffs and non-cotton products costs.
Previous wording
Selling, general, and administrative ("SG&A") expenses as a percentage of net revenues during the three months ended December 28, 2024 declined by 30 basis points to 49.7% as compared to the prior fiscal year period, largely attributable to operating leverage on higher net revenues and our operational discipline, which more than offset increases across various expense categories, including compensation-related expenses, and geographic and channel mix resulting from growth of our international and retail businesses which typically carry higher operating expense margins. During the nine months ended December 28, 2024, SG&A expenses as a percentage of net revenues increased by 20 basis points to 53.4% as compared to the prior fiscal year period, largely attributable to geographic and channel mix, as well as increases across various expense categories, including higher marketing investments due to planned key campaign events and higher compensation-related expenses.
Current wording
Selling, general, and administrative ("SG&A") expenses as a percentage of net revenues during the three months ended June 28, 2025 declined by 100 basis points to 55.2% as compared to the prior fiscal year period, largely attributable to operating leverage on higher net revenues despite higher marketing investments and variable selling expenses.
Previous wording
We ended the third quarter of Fiscal 2025 in a net cash and short-term investments position (calculated as cash and cash equivalents, plus short-term investments, less total debt) of $1.001 billion, as compared to $642.7 million as of the end of Fiscal 2024. The increase in our net cash and short-term investments position was primarily due to our operating cash flows of $1.113 billion, partially offset by our use of cash to support Class A common stock repurchases of $404.6 million, including withholdings in satisfaction of tax obligations for stock-based compensation awards, to make dividend payments of $150.1 million, to invest in our business through $136.3 million in capital expenditures, and the unfavorable effect of exchange rate changes of $40.9 million primarily related to our cash and cash equivalents.
Current wording
We ended the first quarter of Fiscal 2026 in a net cash and short-term investments position (calculated as cash and cash equivalents, plus short-term investments, less total debt) of $639.8 million, as compared to $940.4 million as of the end of Fiscal 2025. The decrease in our net cash and short-term investments position was primarily due to our use of cash to support Class A common stock repurchases of $323.3 million, including withholdings in satisfaction of tax obligations for stock-based compensation awards, to invest in our business through $187.3 million in capital expenditures, and to make dividend payments of $50.7 million, partially offset by our operating cash flows of $176.1 million and the favorable effect of exchange rate changes of $76.1 million, primarily related to our cash and cash equivalents.
Previous wording
Net cash provided by operating activities was $1.113 billion during the nine months ended December 28, 2024, as compared to $948.7 million during the nine months ended December 30, 2023. The net increase in cash provided by operating activities was due to an increase in net income before non-cash charges, as well as a net favorable change related to our operating assets and liabilities, including our working capital, as compared to the prior fiscal year period.
Current wording
Net cash provided by operating activities was $176.1 million during the three months ended June 28, 2025, as compared to $277.3 million during the three months ended June 29, 2024. The net decrease in cash provided by operating activities was due to a net unfavorable change related to our operating assets and liabilities, including our working capital, as compared to the prior fiscal year period, partially offset by an increase in net income before non-cash charges.
Previous wording
Our equity increased to $2.539 billion as of December 28, 2024 compared to $2.450 billion as of March 30, 2024 due to our comprehensive income and the net impact of stock-based compensation arrangements, partially offset by our share repurchase activity and dividends declared during the nine months ended December 28, 2024.
Current wording
Our equity decreased to $2.515 billion as of June 28, 2025 compared to $2.589 billion as of March 29, 2025 due to our share repurchase activity and dividends declared during the three months ended June 28, 2025, partially offset by our comprehensive income and the net impact of stock-based compensation arrangements.
Previous wording
The comparability of our operating results for the three-month and nine-month periods ended December 28, 2024 and December 30, 2023 has been affected by certain events, including:
Current wording
The comparability of our operating results for the three-month periods ended June 28, 2025 and June 29, 2024 has been affected by certain events, including net restructuring-related charges and certain other charges (benefits) totaling $19.3 million and $7.4 million, respectively. See Note 7 to the accompanying consolidated financial statements.
Previous wording
The following table summarizes our results of operations and expresses the percentage relationship to net revenues of certain financial statement captions. All percentages shown in the below table and the discussion that follows have been calculated using unrounded numbers.
Current wording
The following table summarizes our results of operations and expresses the percentage relationship to net revenues of certain financial statement captions. All percentages shown in the table below and the discussion that follows have been calculated using unrounded numbers.
Previous wording
The following table summarizes the percentage changes in our consolidated comparable store sales for the three months ended December 28, 2024 as compared to the prior fiscal year period:
Current wording
The following table summarizes the percentage change in our consolidated comparable store sales for the three months ended June 28, 2025 as compared to the prior fiscal year period:
Previous wording
Our global average store count decreased by 21 stores and concession shops during the three months ended December 28, 2024 compared with the three months ended December 30, 2023, largely driven by strategic store closures in Asia and North America. The following table details our retail store presence by segment as of the periods presented:
Current wording
Our global average store count decreased by 28 stores and concession shops during the three months ended June 28, 2025 compared with the three months ended June 29, 2024, largely driven by concession shop closures in Asia. The following table details our retail store presence by segment as of the periods presented:
Previous wording
•a $50.5 million increase related to our North America retail business. On a constant currency basis, net revenues increased by $51.8 million, reflecting an increase of $53.5 million in comparable store sales, partially offset by a decrease of $1.7 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our North America retail business:
Current wording
•a $44.3 million increase related to our North America retail business. On a constant currency basis, net revenues also increased by $44.3 million, reflecting an increase of $48.1 million in comparable store sales, partially offset by a decrease of $3.8 million in non-comparable store sales. The increase in our comparable store sales reflected low-teens AUR growth during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, as well as higher traffic. The following table summarizes the percentage changes in comparable store sales related to our North America retail business:
Previous wording
•a $13.9 million increase related to our North America wholesale business primarily driven by improved Fall sell-out trends and strong replenishment orders.
Current wording
•a $3.7 million increase related to our North America wholesale business.
Previous wording
The $82.9 million increase in Europe net revenues was driven by:
Current wording
The $75.4 million increase in Europe net revenues was driven by:
Previous wording
•a $50.4 million increase related to our Europe retail business, inclusive of favorable foreign currency effects of $0.3 million. On a constant currency basis, net revenues increased by $50.1 million, reflecting increases of $49.5 million in comparable store sales and $0.6 million in non-comparable store sales. The following table summarizes the percentage changes in comparable store sales related to our Europe retail business:
Current wording
•a $40.7 million increase related to our Europe retail business, inclusive of favorable foreign currency effects of $13.6 million. On a constant currency basis, net revenues increased by $27.1 million, reflecting increases of $22.8 million in comparable store sales and $4.3 million in non-comparable store sales. The increase in our comparable store sales reflected low-double digit AUR growth during the three months ended June 28, 2025 as compared to the three months ended June 29, 2024, as well as higher traffic. The following table summarizes the percentage changes in comparable store sales related to our Europe retail business:
Previous wording
•a $47.3 million increase related to our Europe wholesale business largely driven by stronger re-order trends more than offsetting planned reductions within the off-price wholesale channel.
Current wording
•a $34.7 million increase related to our Europe wholesale business largely driven by stronger re-order trends and favorable foreign currency effects of $12.4 million.
Previous wording
The $60.3 million increase in Asia net revenues was driven by:
Current wording
The $83.1 million increase in Asia net revenues was primarily driven by:
Previous wording
Gross Profit. Gross profit increased by $180.1 million, or 14.0%, to $1.466 billion for the three months ended December 28, 2024, including unfavorable foreign currency effects of $3.4 million. Gross profit as a percentage of net revenues increased to 68.4% for the three months ended December 28, 2024 from 66.5% for the three months ended December 30, 2023. The 190 basis point increase was primarily driven by favorable product, channel, and geographic mix, lower cotton costs, and AUR growth, partially offset by higher freight and other product costs.
Current wording
Gross Profit. Gross profit increased by $176.5 million, or 16.6%, to $1.242 billion for the three months ended June 28, 2025, including favorable foreign currency effects of $28.8 million. Gross profit as a percentage of net revenues increased to 72.3% for the three months ended June 28, 2025 from 70.5% for the three months ended June 29, 2024. The 180 basis point increase was primarily driven by favorable foreign currency effects of approximately 60 basis points and the favorable impact of approximately 40 basis points attributable to geographic and channel mix. The remaining 80 basis point improvement was primarily due to AUR growth of approximately mid-teens and lower cotton costs, more than offsetting incremental pressure from tariffs and non-cotton products costs.
Previous wording
Selling, General, and Administrative Expenses. SG&A expenses include costs relating to compensation and benefits, marketing and advertising, rent and occupancy, distribution, information technology, legal, depreciation and amortization, bad debt, and other selling and administrative costs. SG&A expenses increased by $96.6 million, or 10.0%, to $1.064 billion for the three months ended December 28, 2024, including favorable foreign currency effects of $3.4 million. SG&A expenses as a percentage of net revenues declined to 49.7% for the three months ended December 28, 2024 from 50.0% for the three months ended December 30, 2023. The 30 basis point improvement was largely attributable to operating leverage on higher net revenues and our operational discipline, which more than offset increases across various expense categories, including compensation-related expenses, and geographic and channel mix resulting from growth of our international and retail businesses which typically carry higher operating expense margins.
Current wording
Selling, General, and Administrative Expenses. SG&A expenses include costs relating to compensation and benefits, marketing and advertising, rent and occupancy, distribution, information technology, legal, depreciation and amortization, bad debt, and other selling and administrative costs. SG&A expenses increased by $99.5 million, or 11.7%, to $949.4 million for the three months ended June 28, 2025, including unfavorable foreign currency effects of $15.3 million. SG&A expenses as a percentage of net revenues declined to 55.2% for the three months ended June 28, 2025 from 56.2% for the three months ended June 29, 2024. The 100 basis point decline was largely attributable to operating leverage on higher net revenues despite higher marketing investments and variable selling expenses.
Previous wording
The $96.6 million increase in SG&A expenses was driven by:
Current wording
The $99.5 million increase in SG&A expenses was driven by:
Previous wording
Restructuring and Other Charges, Net. During the nine-month periods ended December 28, 2024 and December 30, 2023, we recorded net restructuring charges of $13.9 million and $38.3 million, respectively, primarily consisting of severance and benefits costs, as well as other charges of $9.1 million and $14.3 million, respectively, primarily related to rent and occupancy costs associated with certain previously exited real estate locations in connection with our restructuring activities for which the related lease agreements have not yet expired. In addition, during the nine months ended December 28, 2024, we recorded other charges of $17.1 million in connection with our Next Generation Transformation project (refer to"Recent Developments" for additional discussion) and recorded other income of $2.1 million and $7.0 million during the nine-month periods ended December 28, 2024 and December 30, 2023, respectively, related to consideration received from Regent, L.P. in connection with our previously sold Club Monaco business. See Note 7 to the accompanying consolidated financial statements.
Current wording
Restructuring and Other Charges, Net. During the three-month periods ended June 28, 2025 and June 29, 2024, we recorded net restructuring charges of $6.4 million and $3.3 million, respectively, primarily consisting of severance and benefits costs, as well as other charges of $2.5 million and $2.8 million, respectively, primarily related to rent and occupancy costs associated with certain previously exited real estate locations in connection with our restructuring activities for which the related lease agreements have not yet expired. In addition, during the three-month periods ended June 28, 2025 and June 29, 2024, we recorded other charges of $11.0 million and $2.3 million, respectively, in connection with our Next Generation Transformation project (refer to"Recent Developments" for additional discussion), and recorded other income of $0.6 million and $1.0 million, respectively, related to consideration received from Regent, L.P. in connection with our previously sold Club Monaco business. See Note 7 to the accompanying consolidated financial statements.
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Current report — wording carried from elsewhere
This increase in cash used in investing activities was partially offset by:
Current report — wording carried from elsewhere
taxation. We intend to permanently reinvest undistributed foreign earnings generated after December 31, 2017 that were not subject to the one-time mandatory transition tax. However, if our plans change and we choose to repatriate post-2017 earnings to the U.S. in the future, we would be subject to applicable U.S. and foreign taxes.
Current report — wording carried from elsewhere
Dollar, the Canadian Dollar, the British Pound Sterling, the Swiss Franc, and the Chinese Renminbi, we generally hedge a portion of our related exposures anticipated over the next twelve months using forward foreign currency exchange contracts with maturities of two months to one year to provide continuing coverage over the period of the respective exposure.
Rearranged previous paragraphs (11)
Previous report — wording carried elsewhere
Restructuring and Other Charges, Net. During the three-month periods ended December 28, 2024 and December 30, 2023, we recorded restructuring charges of $1.6 million and $1.0 million, respectively, as well as other charges of $2.2 million and $4.7 million, respectively, primarily related to rent and occupancy costs associated with certain previously exited real estate locations for which the related lease agreements have not yet expired. In addition, during the three months ended December 28, 2024, we recorded other charges of $9.1 million in connection with our Next Generation Transformation project (refer to"Recent Developments" for additional discussion) and other income of $0.7 million and $5.0 million during the three-month periods ended December 28, 2024 and December 30, 2023, respectively, related to consideration received from Regent, L.P. in connection with our previously sold Club Monaco business. See Note 7 to the accompanying consolidated financial statements.
Previous report — wording carried elsewhere
Unallocated corporate expenses increased by $49.7 million to $196.9 million during the three months ended December 28, 2024 as compared to the prior fiscal year. The increase in unallocated corporate expenses was due to higher compensation-related expenses of $26.5 million, lower intercompany sourcing commission of $9.2 million (which is offset at the segment level and eliminates in consolidation), higher non-income taxes of $3.3 million, and higher other expenses of $10.7 million.
Previous report — wording carried elsewhere
The following table summarizes our results of operations and expresses the percentage relationship to net revenues of certain financial statement captions. All percentages shown in the below table and the discussion that follows have been calculated using unrounded numbers.
Previous report — wording carried elsewhere
(a)Effective tax rate is calculated by dividing the income tax provision by income before income taxes.
Previous report — wording carried elsewhere
The following table summarizes the percentage changes in our consolidated comparable store sales for the nine months ended December 28, 2024 as compared to the prior fiscal year period:
Previous report — wording carried elsewhere
Our global average store count decreased by 18 stores and concession shops during the nine months ended December 28, 2024 compared with the nine months ended December 30, 2023, largely driven by strategic store closures in Asia and North America.
Previous report — wording carried elsewhere
Net revenues for our segments, as well as a discussion of the changes in each reportable segment's net revenues from the comparable prior fiscal year period, are provided below:
Previous report — wording carried elsewhere
The $150.6 million increase in Europe net revenues was driven by:
Previous report — wording carried elsewhere
The $105.5 million increase in Asia net revenues was driven by:
Previous report — wording carried elsewhere
The $178.6 million increase in SG&A expenses was driven by:
Previous report — wording carried elsewhere
Operating income and margin for our segments, as well as a discussion of the changes in each reportable segment's operating margin from the comparable prior fiscal year period, are provided below: