Ralph Lauren unveils growth plan targeting mid-single digit revenue gains

Ralph Lauren Corporation (NYSE: RL) presented its strategic growth plan called "Next Great Chapter: Drive" at an investor meeting, outlining financial targets through fiscal 2028.

The company projects revenue to increase at a compound annual growth rate of mid-single digits in constant currency over the next three years from fiscal 2025 through fiscal 2028. Operating margin is expected to expand approximately 100 to 150 basis points by fiscal 2028 in constant currency.

Ralph Lauren plans to return at least $2 billion in excess free cash flow to shareholders on a cumulative basis through fiscal 2028 via dividends and share repurchases. The board increased the regular quarterly cash dividend by approximately 10% to $0.9125 per share, representing an annual dividend of $3.65 per share.

The strategic plan focuses on three growth drivers: elevating the lifestyle brand positioning globally, driving core products while expanding in under-penetrated categories, and scaling operations across the top 30 cities worldwide while developing the next 20 cities.

Capital expenditures are expected to represent approximately 4% to 5% of revenue annually through fiscal 2028. The company maintains a current share repurchase authorization of up to $1.6 billion in Class A Common Stock.

"Our execution is anchored in the strength of our teams, balance sheet and operational capabilities," said Patrice Louvet, President and Chief Executive Officer, according to the company statement.

The outlook excludes potential restructuring-related and other charges that may be incurred in future periods. Ralph Lauren executives rang the opening bell of the New York Stock Exchange in conjunction with the investor presentations.

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