Luxury fashion retailer Ralph Lauren has seen a 13.7 per cent increase in its net revenue for the first quarter of this financial year, up to $1.7 billion from $1.5 billion year-on-year. 

In North America, the brand saw an 8 per cent increase in its net revenue to $656 million, with a 16 per cent increase to $555 million in Europe, and a 21 per cent increase in Asia’s net revenue to $474 million. 

The company’s gross profit was $1.2 billion, up from $1 billion, with a gross margin of 72.3 per cent.

“The positive trading momentum also underlines the fact that the slowdown in luxury is concentrated at the top end of the market where much higher price points continue to push some consumers – especially middle-income segments – away,” said Neil Saunders, GlobalData MD.  

“In accessible luxury, which includes brands like Ralph Lauren and Coach, performance is far better. 

“Consumers remain willing to pay a modest premium for products that offer both quality and distinctiveness,” he said. 

Its operating income was reported at $273.6 million, up from $208.5 million during the same period last year, with an operating margin of 15.9 per cent. 

Ralph Lauren’s North American operating income for the first quarter of the fiscal year was $136 million, with an operating margin of 20.7 per cent.

Its Europe operating income was $146 million with an operating margin of 26.4 per cent, and in Asia, the company reported an operating income of $145 million with an operating margin of 30.7 per cent.   

The brand’s net income was reported at $220.4 million, up from $168.6 million year-on-year.

“While we continue to approach the current global operating environment with prudence, we are encouraged by the broad-based strength in our brand and our businesses as we execute on our long-term strategic priorities – including recruiting new and younger consumers, strengthening our core and high-potential categories, and developing our key city ecosystems in each region,” said Patrice Louvet, president and CEO. 

For the current financial year, Ralph Lauren expects its revenue to increase by low to mid-single digits, with its operating margin seeing an expansion of between 40 and 60 basis points. 

“Looking ahead, sales growth may not be as toppy as this quarter,” said Saunders. 

“However, we expect continued uplifts and further market share gains in the year ahead.”