Tapestry's Q4 2025 Earnings: Navigating Tariff Challenges and Coach's Growth Strategy Contradictions

Tariff impact mitigation, Coach brand growth and product strategy, tariff impact and mitigation strategies, Coach's growth strategy and AUR performance are the key contradictions discussed in Tapestry, Inc.'s latest 2025Q4 earnings call.



Revenue and Profit Growth:
- Tapestry Inc. reported revenue of $7 billion for fiscal 2025, with operating margins of 20% and adjusted EPS of $5.10.
- Growth was driven by strong global expansion, particularly in North America, China, and Europe, and effective brand building, resulting in significant customer acquisition.

Coach Brand Performance:
- The Coach brand achieved a 10% increase in revenue with a strong margin, capped by a 13% constant currency top-line gain in the fourth quarter.
- Growth was driven by emotional connections with Gen Z and millennial consumers, innovative product offerings like the Tabby family, and effective marketing campaigns featuring global ambassadors.

Kate Spade Turnaround:
- Kate Spade experienced a 13% decline in revenue in the fourth quarter due to strategic investments and a focus on brand heat and relevancy.
- Despite the decline, the brand is working to improve unaided brand awareness and search interest, with the next step being increased customer acquisition and traffic.

Earnings and Shareholder Returns:
- Tapestry's earnings per share grew by 19%, with the company returning $2.3 billion to shareholders, including $300 million in dividends and $2 billion in share repurchases.
- The strong financial performance was attributed to disciplined execution and robust cash flow generation.