Ralph Lauren Corp Earnings: Third Straight Quarter of Rising Profit

S&P 500 (NYSE:SPY) component Ralph Lauren Corporation (NYSE:RL) reported net income above Wall Street’s expectations for the third quarter. Polo Ralph Lauren designs and sells premium lifestyle products, including apparel, accessories, fragrances and home furnishings.

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Ralph Lauren Earnings Cheat Sheet for the Third Quarter

Results: Net income for Ralph Lauren Corporation rose to $169 million ($1.78 per share) vs. $168.4 million ($1.72 per share) in the same quarter a year earlier. This marks a rise of 0.4% from the year earlier quarter.

Revenue: Rose 16.6% to $1.81 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: Ralph Lauren Corporation beat the mean analyst estimate of $1.67 per share. It beat the average revenue estimate of $1.75 billion.

Quoting Management: “I am extremely proud of what we have accomplished in the first nine months of the fiscal year,” said Ralph Lauren, Chairman and Chief Executive Officer. “Our design-driven culture is delivering highly desirable products across a growing range of lifestyle sensibilities and merchandise categories. We continue to support this innovation with best-in-class marketing, merchandising and distribution that not only distinguishes us in the marketplace, but also deepens our connection with our customers around the world. The progress we are making at our retail segment is very encouraging, particularly as we continue to invest in new stores and e-commerce worldwide.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 13.8% and in the first quarter, the figure rose 52.4%.

Gross margin shrank 1.5 percentage points to 57.1%. The contraction appeared to be driven by increased costs, which rose 20.9% from the year earlier quarter while revenue rose 16.6%.

Revenue has risen the past four quarters. Revenue increased 24.3% to $1.9 billion in the second quarter. The figure rose 32.4% in the first quarter from the year earlier and climbed 6.7% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company has now topped analyst estimates for the last three quarters. It beat the mark by 22 cents in the second quarter and by 45 cents in the first quarter.

Looking Forward: Expectations for the company’s next quarter results are lower than they have been. Over the past sixty days, the average estimate for fourth quarter has fallen from 98 cents per share to 96 cents. Over the past three months, the average estimate for the fiscal year has climbed from $6.85 per to share to $6.97.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com