Ralph Lauren Gets Ready to Enter the Activewear Game

... in fall 2015.
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Eliza Brooke
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... in fall 2015.
One of the Polo Tech shirts Ralph Lauren introduced this summer. Photo: Ralph Lauren

One of the Polo Tech shirts Ralph Lauren introduced this summer. Photo: Ralph Lauren

Having expanded its Polo brand to include womenswear this summer, Ralph Lauren is now making moves to capitalize on the rapidly growing activewear market. Company execs said on its second quarter 2015 earnings call Wednesday morning that a new line of sport-ready clothing called Polo Sport will arrive in stores for fall 2015, with an initial emphasis on men's. For a brand with such a sporty vibe -- Polo Sport is already the name of one of its men's fragrances -- it's hard to believe Ralph Lauren has waited this long to dive into activewear.

Earlier this summer Ralph Lauren showed off some fancy "Polo Tech" shirts at the U.S. Open, which were equipped with hardware to give the wearer biometric feedback like breathing rate and steps count. While this would seem to go hand-in-hand with the upcoming activewear launch, a rep for the company wouldn't say whether Polo Sport will be incorporating wearable tech into its offering.

Ralph Lauren's projects for 2015 also include starting to move its e-commerce management entirely in-house, a two to three-year affair that will represent a pretty significant monetary investment. The company already handles its backend -- including fulfillment, distribution and customer care -- but has outsourced development of the front end up until now. The point here is to be able to iterate more quickly and reduce costs, execs said on the earnings call.

So while those are a few things to look forward to in the next calendar year, fiscal 2015 -- which we're in right now -- isn't looking so hot. Thanks to unfavorable foreign currency movements, the company has cut its revenue expectations from 6 to 8 percent growth to 5 to 7 percent growth for the fiscal year, which wraps up in March. Stock prices initially dropped 2.8 percent following the news.

As for the quarter that ended on September 27, net revenue grew 4 percent to an even $2 billion. Ralph Lauren is expecting about the same level of growth for the third quarter -- about 3 to 5 percent -- despite it being the holidays. Though it may be a bad holiday period for brands overall, execs asserted that the company is "well-positioned" for the season.