“We expect to benefit from mid-single-digit pricing actions and continued gains from our shift to a more direct business, offset by another 100 basis points headwind from elevated ocean freight costs, increased product costs, discrete supply chain investments and normalization of historically low markdown rates.”

In context

“and consumer demand. We are also taking a cautious approach to Greater China, given uncertainty around additional COVID disruptions. As such, we have factored various risk scenarios into our guidance for fiscal '23. We expect revenue for the full year to grow low double digits on a currency-neutral basis, partially offset by foreign exchange headwinds of approximately 400 basis points. In the first quarter, we expect real dollar revenue growth to be flat to slightly up versus the prior year due to COVID disruption in Greater China and more than 500 basis points impact from foreign exchange translation. We expect gross margins to be in the range of flat to declining by 50 basis points versus the prior year with a wider-than-usual range reflecting our consideration of a number of scenarios. We expect to benefit from mid-single-digit pricing actions and continued gains from our shift to a more direct business, offset by another 100 basis points headwind from elevated ocean freight costs, increased product costs, discrete supply chain investments and normalization of historically low markdown rates. We expect foreign exchange to be a 30 basis point headwind on gross margin due to strength in the U.S. dollar, largely offset in fiscal '23 by favorable hedge rates versus current spot rates. We expect gross margin pressure to exceed 100 basis points in the first quarter of fiscal '23, both as we recalibrate supply and demand in Greater China and as we anticipate higher promotional activity to sell seasonal inventory, which has arrived late due to a combination of factory closures and longer transit times. We expect SG&A to increase high single digits to low double digits as we continue to invest in our people, our brands, new stores and our transformational capabilities. And lastly, we expect the fiscal '23 effective tax rate to be in the mid-teens range. As we move forward, we will stay”