(Reuters) – Ralph Lauren Corp (NYSE:) said on Wednesday a surge in online shopping was helping it get back on track in China and putting it on course for a recovery from the financial damage wrought by the COVID-19 lockdowns in other markets as well.
Online sales in China, a crucial growth market for luxury goods companies, jumped 76% in the fourth quarter.
The New York-based company said it expanded the number of stores that could fulfill online orders in the country during the pandemic and rolled out digital services like advising big-spending clients on style and events.
Ralph Lauren, which is now testing these services in North America as well as Europe, said sales growth in China could return to pre-health crisis levels by its second quarter as most of its stores there are now open.
“We ultimately have an opportunity to gain market share as we emerge from this crisis,” Chief Executive Officer Patrice Louvet said.
Ralph Lauren said loungewear and athleisure products were in strong demand as people spend more time at home. The company also said Spring collections stocked in warehouses could still be sold later in the year.
However, as a deep recession looms, Ralph Lauren said it continues to expect significant pain in fiscal 2021.
In the fourth quarter, net revenue fell 15.4% to $1.27 billion, but was slightly above analysts’ average estimate of $1.22 billion, according to IBES data from Refinitiv.
Excluding certain items, it lost 68 cents per share, while analysts were expecting a loss of 40 cents.
The company’s shares were up about 2% in morning trading.
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