Ralph Lauren stock leaps after topping Q3 earnings estimates

Ralph Lauren's (RL) stock soars after beating third-quarter expectations. The luxury apparel retailer generated $1.93 billion in revenue, a 6% increase year-over-year. The company also beat adjusted EPS expectations, reporting gains of $4.17 per share.

Yahoo Finance's Julie Hyman and Josh Lipton break down the details.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Angel Smith

Video Transcript

JULIE HYMAN: All right. Let's talk about Ralph Lauren. Those shares are also higher today, as the luxury retailer beat third quarter estimates. Revenue up 6% year over year to $1.9 billion. A couple of things going on here. One, China as we already alluded to, was a strong area of demand for them. They raised prices, again, the second year in a row. Average selling price is going up by 9%. And they're doing a lot more direct to consumer selling.

Ralph Lauren, the model used to be man, you got to get that in the department stores. And that model hasn't worked as well in recent years so they've pivoted to doing more direct to consumer, and that has worked better for them seemingly.

JOSH LIPTON: Yeah. And speaking to that, there was a good piece in Bloomberg to your point, ticking over the tactics and strategy of the CEO, and the moves he's made there. And to your point, Julie, they went over listen, growing sales in his own stores and website, that's been the priority. Decreasing reliance on the department stores which have been more choppy, raising average prices, cutting discounts. And he's been rewarded. I mean, the stock's up now more than 40% over the past 12 months, and that just blows past S&P's consumer discretionary index.

JULIE HYMAN: Right. Definitely it's been an outperformer in comparison.