Luxury apparel brand Ralph Lauren reported weak third quarter results on Wednesday, and the shares are down more than 16% on the news. Compounding the bad news, the company revised its revenue growth for 215 downward by over 40%.

Strong Dollar Hits Ralph Lauren Corp Results; Weak Sales Forecast

The clothing retailer indicated the poor results and weak guidance are largely related to foreign currency issues (ie, a stronger dollar and weaker European currencies).

More on Ralph Lauren earnings

Further details from Ralph Lauren’s third quarter earnings report: income was down 9.3% to $215 million ($2.41 a share) from about $237 million a year earlier, according to the retailer’s statement. The consensus analyst estimate according to Bloomberg was $2.50 a share. The firm noted revenues are now expected to be up 4% in 2015, a 40% cut from an earlier projection of a 7% increase in revenue for the year.

According to Robert Drbul at Nomura, Ralph Lauren faces a potential $100 million currency headwind this fiscal year given the strong dollar. Of note, Europe and Asia represent close to one third of the company’s revenue.

Shares of the clothing maker slumped more than $27 a share (16%) in morning trading Wednesday. Ralph Lauren shares were up 4.9% last year.

Revenue was up 0.9% to $2.03 billion in the third quarter, but the consensus analyst estimate was $2.09 billion.

The firm noted it is planning a new customer-focused brand-management structure over the next few months. The new structure is designed maximize customer satisfaction and to improve operating efficiency.

Sales in the wholesale segment were down 0.4% to $837 million. Shipments to Europe were up, but decreased shipments to the U.S. and a stronger dollar hurt the overall results. Taking out the impact of currency fluctuations, wholesale sales were actually up around 2%.

Statement from Ralph Lauren COO

“Foreign exchange and global consumer spending remain unpredictable, and we are planning our business accordingly,” COO Jacki Nemerov noted in the statement released Wednesday. “While we are cautious with our outlook, we are bold with our actions to offset some of these ongoing external pressures.”