(Bloomberg) -- Ralph Lauren Corp. plans to build on strong revenue growth in the U.S. to expand its fleet of stores, Chief Executive Officer Patrice Louvet said, a sign that the company is rebounding from years of restructuring.
The apparel company opened new stores in the U.S. last quarter for the first time in more than five years and is targeting further expansion in southern states and on the West Coast, Louvet said in an interview Thursday. Ralph Lauren hasn't invested significantly in the South in the past and decided to do so after seeing seeing solid demand from consumers there.
The retailer has closed unproductive stores, cut back on promotions and raised the average prices of its items in an attempt to recover from years of heavy discounting that “cheapened” the brand, Louvet said. Globally, Ralph Lauren now expects to increase its fleet of stores by 90 this fiscal year, which ends in March. In the U.S., the company plans to open around a dozen stores over the next couple of years.
“We're back on offense,” Louvet said. “We see big opportunities to expand.”
Sales increased 28% on a constant-currency basis to $1.82 billion in the fiscal third quarter, surpassing pre-pandemic levels -- an important milestone for the business. Much of that growth was driven by robust sales in North America, where revenue increased 30% in the quarter, the company said on Thursday.
Shares of the New York-based company rose as much as 8%, their biggest intraday gain since Aug. 3.
Learning from past brick-and-mortar missteps, Ralph Lauren is opening stores that can be easily redesigned and will be “inviting for a younger consumer,” Louvet said. “Retail is not dead. Boring retail is dead.”
The company also plans to bolster its home-goods business, where side chairs and sofas can sell for more than $3,000 and $8,000 apiece, respectively.
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