By Dean Seal

Ralph Lauren said its customers are still spending on luxury goods despite the rocky economic backdrop, and that it will raise prices more than previously planned in order to offset tariffs.

The luxury apparel-and-accessories company on Thursday reported a bigger profit and a jump in revenue for the first three months of the year, citing higher prices and lower cotton costs.

The brand has been successful in drawing in customers that are younger and less skittish when prices go up, according to Chief Financial Officer Justin Picicci.

"We've been on this multi-year journey to shift our customer base towards less price-sensitive consumers, especially in the full-price channel," Picicci said on a call with analysts.

Management had already been planning to increase prices again on some items for the fall, but is now looking at bigger hikes for the fall and for the following spring in response to tariffs.

The new levies are expected to cut into Ralph Lauren's gross margin, though the company said it will try to minimize the impact by making adjustments to its supply chain.

For the fiscal fourth quarter that ended March 29, the New York-based company posted a profit of $129 million, or $2.03 a share, for the first three months of 2025. That's up from $90.7 million, or $1.38 a share, in the same quarter a year earlier.

Stripping out one-time items, adjusted earnings were $2.27 a share. Analysts polled by FactSet had been expecting $2.04 a share.

Revenue jumped 8% to $1.7 billion, topping analyst estimates for $1.65 billion, according to FactSet.

The top line rose in each region and in both the brick-and-mortar and digital channels, Ralph Lauren said. Meanwhile, margins expanded from stronger product mixes, higher prices and lower cotton costs.

For the new fiscal year that started March 30, the company forecasts that revenue will rise in the low-single-digit percentage range, with growth weighted toward the front half of the year.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

May 22, 2025 11:13 ET (15:13 GMT)

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