Ralph Lauren Corp (NYSE:RL) early Thursday posted market-beating fiscal third quarter earnings results, but news of its CEO’s departure sent shares plummeting up to 6% in morning trading.
Written by StockNews.com
The New York City-based fashion giant reported adjusted Q3 EPS of $1.86, which was a full $0.22 better than the Wall Street consensus estimate of $1.64. Revenues plunged 11.9% from last year to $1.71 billion, matching analysts’ view of $1.71 billion.
For the current fiscal fourth quarter, RL expects revenue to be down in the mid-teens, which is in-line with Wall Street expectations for a -17% decline.
Hands down the biggest news coming out of today’s report was that Ralph Lauren CEO Stefan Larsson and the company have mutually agreed to part ways. Larsson will stay will the company until May 1, 2017, and a search for a new chief executive has commenced. CFO Jane Nielsen will lead execution of RL’s current business plan until a new CEO is hired.
The company commented on the CEO departure via a separate press release:
Ralph Lauren, Executive Chairman and Chief Creative Officer, said: “Stefan and I share a love and respect for the DNA of this great brand, and we both recognize the need to evolve. However, we have found that we have different views on how to evolve the creative and consumer-facing parts of the business. After many conversations with one another, and our Board of Directors, we have agreed to part ways. I am grateful for what Stefan has contributed during his time with us, setting us in the right direction with the Way Forward Plan.”
Ralph Lauren Corp shares fell $5.46 (-6.25%) to $81.91 in premarket trading Thursday. Prior to today’s report, RL had declined -3.27% year-to-date, versus a +1.83% rise in the benchmark S&P 500 index during the same period.
RL currently has a StockNews.com POWR Rating of C (Neutral), and is ranked #24 of 67 stocks in the Fashion & Luxury category.
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