The following management's discussion and analysis of financial condition and results of operations ("MD&A") should be read together with our audited consolidated financial statements and footnotes, which are included in this Annual Report on Form 10-K. We utilize a 52-53 week fiscal year ending on the Saturday closest to March 31. As such, Fiscal 2015 ended on March 28, 2015 and was a 52-week period; Fiscal 2014 ended on March 29, 2014 and was a 52-week period; and Fiscal 2013 ended on March 30, 2013 and was also a 52-week period. Fiscal 2016 will end on April 2, 2016 and will be a 53-week period.

OVERVIEW

Our Business

Our Company is a global leader in the design, marketing, and distribution of premium lifestyle products, including apparel, accessories, home furnishings, and other licensed product categories. Our long-standing reputation and distinctive image have been consistently developed across an expanding number of products, brands, sales channels, and international markets. Our brand names include Ralph Lauren, Ralph Lauren Collection, Purple Label, Black Label, Polo, Polo Ralph Lauren, Double RL, RLX Ralph Lauren, Lauren Ralph Lauren, Ralph Lauren Childrenswear, Denim & Supply Ralph Lauren, Chaps, Club Monaco, and American Living, among others.

We classify our businesses into three segments: Wholesale, Retail, and Licensing. Our Wholesale business, which represented approximately 46% of our Fiscal 2015  net revenues, consists of sales made principally to major department stores and specialty stores around the world. Our Retail business, which represented approximately 52% of our Fiscal 2015  net revenues, consists of sales made directly to consumers through our integrated retail channel, which includes our retail stores, concession-based shop-within-shops, and our e-commerce operations around the world. Our Licensing business, which represented approximately 2% of our Fiscal 2015  net revenues, consists of royalty-based arrangements under which we license to unrelated third parties for specified periods the right to operate retail stores and/or to use our various trademarks in connection with the

manufacture and sale of designated products, such as certain apparel, eyewear, and fragrances. Approximately 37% of our Fiscal 2015  net revenues were earned outside of the U.S. See Note 22 to the accompanying audited consolidated financial statements for a summary of net revenues, operating income, and total assets by reportable segment, as well as net revenues and long-lived assets by geographic location.

Our business is typically affected by seasonal trends, with higher levels of wholesale sales in our second and fourth fiscal quarters and higher retail sales in our second and third fiscal quarters. These trends result primarily from the timing of seasonal wholesale shipments and key vacation travel, back-to-school, and holiday shopping periods impacting our Retail segment.

Current Trends and Outlook

The global economy remains in a state of uncertainty, with certain regions of the world currently outperforming others. While the U.S. economy has shown signs of improvement driven by falling unemployment, lower oil prices, and continued low interest rates, economies in certain parts of Europe and Asia have slowed considerably, evidenced by softening business sentiment, lower rates of growth, foreign exchange volatility, and the threat of deflation. Additionally, certain worldwide events, including political unrest in various parts of the world, have added uncertainty and have had an impact on consumer travel and spending. The retail industry was particularly challenged in 2014, with trends likely to continue through 2015. While certain geographic regions are withstanding these pressures better than others, the level of consumer spending on discretionary items remains constrained due to this continued economic uncertainty. Consumer retail traffic remains relatively weak and inconsistent, which has led to increased competition and a desire to offset traffic declines with increased levels of conversion. Certain of our operations have experienced and have been impacted by these dynamics, with variations across the geographic regions and businesses in which we operate.

If the economic uncertainty and challenging industry trends continue or worsen, the constrained level of worldwide consumer spending and modified consumption behavior may continue to have a negative effect on our sales, inventory levels, and operating margin in Fiscal 2016. Furthermore, our results have been, and are expected to continue to be, negatively impacted by unfavorable foreign exchange rate fluctuations. Despite these challenges, we remain optimistic about our future growth prospects and continue to invest in our longer-term growth initiatives, including our planned transition to a global brand-based operating structure as described within " Summary of Financial Performance — Recent Developments, " while continually monitoring macroeconomic risks and remaining focused on disciplined expense management. Although we continue to expect that the dilutive effects of investments that we are making in our business will create operating margin pressure in the near-term, we expect that these initiatives will create longer-term shareholder value. We will continue to monitor these risks and evaluate and adjust our operating strategies and cost management opportunities to mitigate the related impact on our results of operations, while remaining focused on the long-term growth of our business and protecting the value of our brand.

For a detailed discussion of significant risk factors that have the potential to cause our actual results to differ materially from our expectations, see Part I, Item 1A — " Risk Factors " included in this Annual Report on Form 10-K.

Summary of Financial Performance

Operating Results

In Fiscal 2015 , we reported net revenues of $7.620 billion , net income of $702 million , and net income per diluted share of $7.88 , as compared to net revenues of $7.450 billion , net income of $776 million , and net income per diluted share of $8.43 in Fiscal 2014 .

Our operating performance for Fiscal 2015 reflected revenue growth of 2.3% on a reported basis and 4.0% on a constant currency basis, as defined within " Transactions and Trends Affecting Comparability of Results of Operations and Financial Condition " below. On a reported basis, the net revenue increase for Fiscal 2015 reflected higher revenues from our retail business across all major geographies and from our Americas wholesale business, partially offset by lower net revenues from our international wholesale businesses, primarily due to net unfavorable foreign currency effects. Our gross margin percentage declined 40 basis points to 57.5% during Fiscal 2015 , primarily attributable to a more promotional retail environment and less favorable product mix, partially offset by a more favorable channel mix. Selling, general, and administrative ("SG&A") expenses increased during Fiscal 2015 due to increased investments in our stores, facilities, and infrastructure consistent with our longer-term initiatives. During Fiscal 2014, we recorded a $16 million gain relating to our acquisition of the Chaps Menswear Business, as defined within " Recent Developments " below.

Net income declined by $74 million in Fiscal 2015 as compared to Fiscal 2014 , primarily due to a $95 million decrease in operating income and higher foreign currency losses of $18 million , partially offset by a $35 million decline in our provision for income taxes. The lower income tax provision for Fiscal 2015 was primarily driven by lower pretax income and a decline in our reported effective tax rate of 30 basis points . Net income per diluted share declined by $0.55 to $7.88 per share in Fiscal 2015 as compared to Fiscal 2014 , primarily due to lower net income, partially offset by lower weighted-average diluted shares outstanding during Fiscal 2015 . Net income per diluted share also included unfavorable foreign currency impacts of approximately $0.31 per diluted share in Fiscal 2015 .

Financial Condition and Liquidity

We ended Fiscal 2015 in a net cash and investments position (cash and cash equivalents plus short-term and non-current investments, less total debt) of $620 million , compared to $989 million as of the end of Fiscal 2014 . The decline in our net cash and investments position was primarily due to our use of cash to support Class A common stock repurchases of $532 million , including withholdings in satisfaction of tax obligations for stock-based compensation awards, capital expenditures of $391 million , dividend payments of $158 million , and negative foreign currency impacts of $81 million , partially offset by our operating cash flows of $894 million during Fiscal 2015 .

We generated $894 million of cash from operations during Fiscal 2015 , compared to $907 million  during Fiscal 2014 . The decline in our operating cash flows primarily relates to the decline in net income before non-cash charges, partially offset by a net favorable change related to our operating assets and liabilities during Fiscal 2015 as compared to the prior fiscal year.

Our equity declined to $3.891 billion as of March 28, 2015 , compared to $4.034 billion as of March 29, 2014 , primarily due to our Class A common stock repurchases and dividends declared, largely offset by our comprehensive income and the net impact of stock-based compensation arrangements during Fiscal 2015 .

Recent Developments

Global Reorganization Plan

On May 12, 2015, our Board of Directors approved a reorganization and restructuring plan comprised of the following major actions: (i) the reorganization of the Company from its current channel and regional structure to an integrated global brand-based operating structure, which will streamline our business processes to better align our cost structure with our long-term growth strategy; (ii) a strategic store and shop-within-shop performance review conducted by region and brand; (iii) a targeted corporate functional area review; and (iv) the consolidation of certain of our luxury lines (collectively, the "Global Reorganization Plan"). The Global Reorganization Plan will result in a reduction in workforce and, once a performance review is complete, the closure of certain stores and shop-within-shops. When substantially implemented by the end of Fiscal 2016, the Global Reorganization Plan is expected to result in improved operational efficiencies by reducing annual operating expenses by approximately $100 million .

In connection with the Global Reorganization Plan, we expect to incur total estimated charges of $70 million to $100 million , comprised of restructuring charges totaling $55 million to $80 million , to be settled in cash, and non-cash charges totaling $15 million to $20 million . Restructuring charges will consist primarily of severance and benefit charges and lease termination and store closure costs, and non-cash charges will consist primarily of asset impairment and inventory-related charges. We anticipate that these restructuring and non-cash charges will be incurred over the course of Fiscal 2016, primarily during the first half of the year.

Australia and New Zealand Licensed Operations Acquisition

In July 2013, in connection with the transition of the Ralph Lauren-branded apparel and accessories business in Australia and New Zealand (the "Australia and New Zealand Business") from a licensed to a wholly-owned operation, we acquired certain net assets from Oroton Group/PRL Australia ("Oroton") in exchange for an aggregate payment of approximately $15 million (the "Australia and New Zealand Licensed Operations Acquisition"). Oroton was our licensee for the Australia and New Zealand Business. The operating results of the acquired business have been consolidated in our operating results beginning on July 1, 2013.

Chaps Menswear License Acquisition

In April 2013, in connection with the transition of the North American Chaps-branded men's sportswear business (the "Chaps Menswear Business") from a licensed to a wholly-owned operation, we entered into an agreement with The Warnaco Group, Inc. ("Warnaco"), a subsidiary of PVH Corp. ("PVH"), to acquire certain net assets in exchange for an aggregate payment of approximately $18 million (the "Chaps Menswear License Acquisition"). Warnaco was our licensee for the Chaps Menswear Business. The operating results of the Chaps Menswear Business have been consolidated in our operating results beginning on April 10, 2013.

Transactions and Trends Affecting Comparability of Results of Operations and Financial Condition

The comparability of our operating results for the three fiscal years presented herein has been affected by certain events, including:

Since we are a global company, the comparability of our operating results reported in U.S. Dollars is also affected by foreign currency exchange rate fluctuations because the underlying currencies in which we transact change in value over time compared to the U.S. Dollar. These rate fluctuations can have a significant effect on our reported results. As such, in addition to financial measures prepared in accordance with generally accepted accounting principles ("GAAP"), our discussions often contain references to constant currency measures, which are calculated by translating the current-year and prior-year reported amounts into comparable amounts using a single foreign exchange rate for each currency. We present constant currency financial information, which is a non-GAAP financial measure, as a supplement to our reported operating results. We use constant currency information to provide a framework to assess how our businesses performed excluding the effects of foreign currency exchange rate fluctuations. We believe this information is useful to investors to facilitate comparisons of operating results and better identify trends in our businesses. The constant currency performance measures should be viewed in addition to, and not in lieu of or superior to, our operating performance measures calculated in accordance with U.S. GAAP.

Our "Results of Operations" discussion that follows includes the significant changes in operating results arising from these items affecting comparability. However, unusual items or transactions may occur in any period. Accordingly, investors and other financial statement users should consider the types of events and transactions that have affected operating trends.