Ralph Lauren Corporation

Strong Q1 execution; raised full-year outlook - Revenue up 13% (constant currency); beats expectations on both top and bottom line. - Asia +25%, North America +13%, Europe +5% (constant currency). - DTC and wholesale both up in constant currency: DTC comps +12%, wholesale +13%. - Net new customers: +1.5 million in DTC; social followers up high single digits to 70M+. - Full-year outlook raised (based on Q1 overdelivery) while staying prudent on Europe macro.

Margins and pricing power: gross margin expansion above plan - Adjusted gross margin up 130 bps to 73.6%; driven by better-than-expected AUR, favorable mix/channel/geo, and reduced promotional activity / higher full-price selling. - Adjusted operating margin up 150 bps to 18.5%; operating income +23%. - AUR (Average Unit Retail) +15% in Q1 (strong full-price sell-through, selective pricing, disciplined inventory); management now expects mid-to-high single-digit AUR growth in Q2 and mid-to-high single-digit for full year (to more than offset freight/tariff pressures).

Spending and brand investment: marketing up, but ROI-focused - Adjusted operating expenses +13%, but down 10 bps as % of sales (10-bps-like leverage via non-marketing expense leverage). - Marketing increased to 8.2% of sales from 7.5% last year (investing in activations/campaigns), with guidance that marketing will be ~8% of sales in FY27 (and potentially higher as margins evolve). - Risks/“bad” reality: tariff and cost headwinds remain real—Q1 expansion still had to offset incremental tariff costs and higher labor/non-cotton materials.