By Deborah Mary Sophia
(Reuters) -Ralph Lauren Corp beat profit estimates and reported a surprise rise in fourth-quarter revenue on Thursday as its new seasonal collections resonated with affluent shoppers at a time when luxury spending has cooled in the United States.
The company's shares rose about 7% after it also posted a more than 30% jump in sales in China, as demand in the key luxury market rebounded sharply after the easing of COVID-19 restrictions.
While overall U.S. luxury spending has taken a hit, Ralph Lauren's moves to double down on its outdoor wear and women's clothing collections have drawn more customers.
Strong demand for its cable-knit sweaters, Polos, tailored shirts and dresses have also helped the company keep promotions minimal, with quarterly revenue in North America, the company's biggest market, decreasing a smaller-than-expected 3%.
Meanwhile, companies ranging from ultra-luxury groups such as LVMH and Gucci-owner Kering to Coach handbag maker Tapestry have flagged softer demand in the United States.
"Ralph Lauren has been running a really good business on all fronts, so even in a volatile sort of time, they've been able to have a decent performance," said Jessica Ramirez, senior analyst at Jane Hali and Associates.
The company's Asia segment revenue rose 13% to $390 million, powering a 1% rise in net revenue to $1.54 billion in the fourth quarter, while analysts were expecting a drop to $1.47 billion, according to Refinitiv IBES data.
On an adjusted basis, Ralph Lauren earned 90 cents per share in the quarter, beating estimates of 61 cents.
The company said it expects revenue to increase in the low-single digit range for fiscal 2024, on a constant currency basis. Analysts estimated a 5.6% rise to $6.73 billion.
(Reporting by Deborah Sophia in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta)
