What guidance did Tapestry's management provide for the next earnings period?

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What is Tapestry's gross profit margin?

What is the revenue and EPS growth rate for Tapestry year over year?

What were the key takeaways from Tapestry’s earnings call?

Did Tapestry beat or miss consensus estimates last quarter?

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- **Record Q2 Growth**: 18% revenue, 34% EPS, 390 bps margin expansion, driven by Coach's 25% growth and Gen Z customer acquisition.
- **Sustainable Momentum**: FY26 outlook raised to $7.75B revenue (+15%), $6.40 EPS, with 25%+ CAGR through 2028. Gross margin to expand 20 bps, offsetting tariffs.
- **Brand Strength**: Coach leathergoods AUR/unit +mid-teens, Kate Spade handbag AUR growth, and 25%+ China digital penetration.
- **Capital Allocation**: $1.5B free cash flow returned via $1.2B buybacks, supporting $10B Coach brand target.

**【CEO Summary Section】**
- Tapestry delivered Q2 2026 revenue growth of 18% (15% constant currency), driven by 25% growth at Coach and 34% in Greater China. Adjusted operating margin expanded 390 basis points to 23.5%, with EPS up 34% to $2.69.
- Coach acquired 3.7 million new customers globally, 2.9 million in North America, fueled by Gen Z engagement and leathergoods AUR/unit growth of mid-teens. Europe and Greater China saw double-digit gains, outpacing industry share.
- Kate Spade revenue declined 14% as part of brand reset, with early signs of progress in Gen Z acquisition and handbag AUR growth. Collaboration with CLOT in China and store format tests showed promise.

**【CFO Financial Commentary】**
- Q2 revenue: $2.0 billion (18% growth), with North America +17%, Europe +22%, Greater China +34%. Gross margin improved 110 bps to 75.5%, offsetting tariff impacts. Operating margin expanded 390 bps to 23.5%, driven by 270 bps SG&A leverage.
- FY26 guidance raised to $7.75 billion revenue (+15%), EPS $6.40-$6.45 (+25%). Free cash flow $1.5 billion, with $1.2 billion share buybacks. Gross margin expected to increase 20 bps, fully offsetting tariffs.

**【Q&A Highlights】**
- **Coach Growth Confidence**: Todd Kahn cited 2.9M new customers, balanced product mix (no family >10% sales), and 25% unit recovery vs. pre-pandemic. AUR gains driven by value, not inflation, with 20%+ runway in North America.
- **China & Europe Strength**: Joanne highlighted 25%+ China growth via digital and store expansion, while Europe's 20% growth reflected market share gains and Gen Z acquisition. Kate Spade testing new store formats in North America.
- **AI & Innovation**: Joanne emphasized AI-driven product iteration (e.g., colorway testing) and 2026 runway show previewing new sizes of popular styles like Tabby and Teri.

Tapestry, Inc. (TPR) Q2 2026 Earnings Call Transcript

- **Record Q1 Growth**: 16% revenue rise, 35% EPS increase, driven by Coach's 21% growth and Kate Spade's sequential improvement.
- **Gen Z Dominance**: 2.2M new customers globally, Gen Z driving 1.7M Coach acquisitions with higher AUR (+mid-teens) and retention.
- **Tariff Resilience**: 50bps FY26 gross margin decline vs. 230bps headwind, 30% mitigation progress, long-term offset strategy intact.
- **Share Buybacks**: $1B authorized, part of $1.3B total shareholder returns (100% free cash flow allocation).
- **Coach 2026 Outlook**: Q2 +20% YoY (2-year stack +25%), targeting $10B by FY27 with 11% marketing investment.

**【CEO Summary Section】**
- Tapestry reported a 16% pro forma revenue increase in Q1 FY26, driven by 21% growth at Coach and sequential improvement at Kate Spade. Adjusted operating margin expanded by 200 basis points, and EPS rose 35% YoY.
- **Coach Highlights**: North America revenue up 26%, China 21%, Europe 39%. Over 1.7M new Gen Z customers acquired, with higher AUR and retention rates. Icon bags (e.g., Tabby, New York) outperformed, and digital sales grew mid-teens.
- **Kate Spade Progress**: Sequential revenue decline narrowed to 9%, with Gen Z acquisition trends improving. Handbag blockbusters outperformed, and full-price selling increased.
- **Amplify Strategy**: Customer acquisition (2.2M new globally), product innovation (leather goods, footwear), and omnichannel experiences (e.g., Coach coffee shops) drove growth.

**【CFO Financial Commentary】**
- **Revenue**: $1.3B (16% YoY), with North America +18%, Europe +32%, China +19%. Direct-to-consumer sales grew 16%.
- **Margins**: Gross margin 76.5% (+120bps YoY), operating margin 20.4% (+200bps). Tariffs and FX headwinds offset by operational improvements.
- **EPS**: $1.38 (35% YoY), guided to $5.45-$5.60 FY26 (+7%-10%). Free cash flow expected at $1.3B, with $1B share buybacks.
- **Tariff Impact**: $170M annualized headwind, 30% mitigated. Long-term confidence in offsetting via pricing and efficiency.

**【Q&A Key Highlights】**
- **Coach Sustainability**: Todd Kahn cites product pipeline strength, 11% marketing spend, and Gen Z store preference as growth drivers. Q2 revenue expected +20% YoY (2-year stack +25%).
- **Gross Margin Trends**: Scott Roe notes 50bps FY26 decline due to tariffs, but 140bps operational improvement. AUR and unit growth balanced in Q1.
- **Kate Spade Turnaround**: Focused on Gen Z acquisition, reduced discounting, and handbag innovation. Sequential improvement expected in H2 FY26, targeting FY27 profitability.
- **Tariff Mitigation**: 30% of $250M annualized impact mitigated. Long-term pricing and supply chain efficiency strategies in place.
- **China Growth**: 19% Q1 revenue, digital outperformance. Positive industry trends (1% market growth) supporting luxury category recovery.

Tapestry, Inc. (TPR) Q1 2026 Earnings Call Transcript

- **Record Fiscal 2025**: $7B revenue, 20% operating margin, $5.10 EPS, surpassing 3-year targets.\n- **Coach Dominance**: 10% revenue growth, 13% Q4 constant currency gain, 4.6M new customers globally.\n- **Tariff Headwinds**: $160M FY26 impact, partially mitigated by supply chain agility.\n- **Q1 '26 Strength**: Low double-digit Coach growth, full-price selling acceleration.\n- **Shareholder Returns**: $2.3B returned in FY25, $800M buybacks planned for FY26.\n- **Kate Spade Turnaround**: 13% Q4 decline, reinvesting in Gen Z marketing and product simplification.\n- **Stuart Weitzman Exit**: Portfolio refresh complete with Caleres sale.

**【CEO Summary Section】**
- Fiscal 2025 was a record year with $7 billion in revenue, 20% operating margin, and $5.10 adjusted EPS, exceeding 3-year targets set at Investor Day 2022.\n- Coach delivered 10% revenue growth, driven by 13% Q4 constant currency growth (North America +16%, China +22%, Europe +12%).\n- New customer acquisition: 6.8 million in North America (70% Gen Z/millennials), 4.6 million at Coach globally.\n- Product innovation: Tabby Shoulder Bag 26, New York collection, and archival Coach Originals (e.g., $695 Kisslock bag sold out within minutes).\n- Omnichannel strategy: 6% DTC growth, mid-teens digital revenue increase.\n- Kate Spade turnaround: 13% Q4 revenue decline, strategic reinvestment in marketing and product simplification.\n- Stuart Weitzman sold to Caleres, completing portfolio refresh.\n\n**【CFO Financial Commentary】**\n- FY25 GAAP net income: $420 million; Non-GAAP EPS: $5.10 (vs. $4.32 prior year).\n- Q4 gross margin: 76.3% (+140bps vs. prior year), driven by AUR growth and operational efficiency.\n- Operating margin: +30bps to 20.3%, SG&A leverage: 120bps.\n- Free cash flow: $1.35 billion; $2.3 billion returned to shareholders (dividends + share buybacks).\n- FY26 guidance: $7.2 billion revenue (+mid-single digits), EPS $5.30-$5.45 (+4%-7%).\n- Tariff impact: $160 million headwind (230bps margin), partially mitigated by supply chain agility.\n- Inventory: 4% increase, well-positioned for FY26.\n\n**【Q&A Highlights】**\n- **Q1 '26 momentum**: Coach revenue up low double digits, driven by full-price selling and new customer acquisition.\n- **Tariff mitigation**: 30% of $235M annualized impact to be offset; 2023 de minimis exemption end adds $90M headwind.\n- **AUR vs. units**: FY26 growth to come from AUR (+mid-single digits), with units also expanding.\n- **Kate Spade progress**: Brand awareness lift, focus on Gen Z marketing (e.g., Ice Spice campaign).\n- **Store expansion**: North America DTC growth, Europe low-penetration opportunity.\n- **Share buybacks**: $800M FY26, consistent with $700M+ annual run rate.\n- **Long-term outlook**: Gross margin expansion to offset tariffs; operating margin resilience despite macro challenges.

Tapestry, Inc. (TPR) Q4 2025 Earnings Call Transcript

- **Revenue Beat**: 8% YoY growth (constant currency), with Coach up 15% and Europe +35%.
- **Customer Growth**: 1.2M new North American customers, 2/3 Gen Z/Millennials, with sticky retention rates.
- **Profit Margin Expansion**: Gross margin 76.1% (15-year high), EPS $1.03 (27% YoY).
- **China Resilience**: 5% growth in Greater China, outperforming category decline.
- **Tariff Mitigation**: $900M U.S. imports exposed, but actions like inventory pull-forward limit impact.

**【CEO Summary Section】**
- **Record Q3 Results**: Total revenue grew 8% YoY (constant currency), driven by 15% growth at Coach. Europe led with 35% growth, while Greater China expanded 5%.
- **Customer Acquisition**: Acquired 1.2M new North American customers, 2/3 Gen Z/Millennials, with higher AUR and sticky retention rates.
- **Digital & Omnichannel Strength**: Digital sales grew mid-teens, accounting for ~30% of revenue. Global brick-and-mortar sales rose mid-single digits.
- **Coach Brand Momentum**: Handbag AUR up mid-teens, footwear growth mid-single digits, and gross margin expanded 100bps.

**【CFO Financial Commentary】**
- **Revenue & Profitability**: Q3 revenue $1.6B, EPS $1.03 (27% YoY growth). Gross margin 76.1%, highest in 15+ years, driven by AUR/AUC gains.
- **Cash Flow & Shareholder Returns**: $1.3B adjusted free cash flow YTD. $2B ASR underway, with $800M remaining under prior repurchase auth. FY25 EPS guidance raised to $5.
- **Tariff Mitigation**: $900M U.S. imports exposed to tariffs. Actions include inventory pull-forward, supply chain optimization, and collaboration with suppliers.

**【Q&A Highlights】**
- **Customer Lifetime Value**: Gen Z retention rates rising, with higher AUR and lifetime value potential.
- **Product Innovation**: Tabby, New York, and Crystal Sync families driving handbag growth. Footwear (Soho, Highline) attracting new customers.
- **China Strategy**: Low-single-digit growth expected, with digital and store acceleration. No signs of anti-U.S. brand sentiment.
- **Tariff Impact**: FY25 impact negligible. Long-term focus on AUR gains to offset cost pressures.

Tapestry (TPR)-8 May 25-2025 Q3 Earnings call transcript

- **Coach Dominance**: 10% revenue growth at Coach, fueled by Gen Z acquisition (60% of new customers) and double-digit AUR gains in handbags. Gross margin hit a record high, driven by reduced markdowns and disciplined pricing.
- **Europe Outperformance**: 42% YoY growth in Europe highlights Tapestry's ability to capitalize on underpenetrated markets with relevant product offerings.
- **Kate Spade Reset**: 10% revenue decline in Q2, but strategic focus on streamlining product (15%+ style reduction) and reinvesting in brand storytelling positions the brand for long-term growth. Gross margin expansion continues despite near-term headwinds.
- **Shareholder Returns**: $2 billion in buybacks and $1.40 annual dividend underscore management's commitment to returning over 100% of free cash flow to shareholders.


**【CEO Summary Section】**
- Global revenue grew 5% YoY, driven by 10% growth at Coach and 42% expansion in Europe. Gen Z customers now represent over half of new North America acquisitions, with the highest retention rates among cohorts.
- Coach's handbag innovation, such as the New York and Tabby families, delivered double-digit AUR gains. The brand's gross margin reached a record high, fueled by disciplined pricing and reduced markdowns.
- Kate Spade is undergoing a strategic reset with a focus on streamlining product offerings, reducing promotional activity, and reinvesting in emotional storytelling to drive new customer acquisition.

**【CFO Financial Commentary】**
- Fiscal 2025 revenue guidance raised to over $6.85 billion, with operating margin expected to expand 100 basis points YoY. EPS guidance increased to $4.85-$4.90, reflecting 13%-14% YoY growth.
- Gross margin expanded 260 basis points in Q2, driven by higher AUR and AUC. Free cash flow for the year is projected at $1.2 billion, with $2 billion in shareholder returns via buybacks and dividends.
- Capital allocation prioritizes brand-building investments (e.g., Kate Spade marketing) while maintaining a strong balance sheet with gross leverage below 2.5x.

**【Q&A Highlights】**
- **Coach Sustainability**: Todd Kahn emphasized the brand's ability to balance near-term success with pipeline innovation, citing examples like the Tabby family's Pillow Tabby iteration. This approach avoids markdown cycles and maintains margin discipline.
- **China Rebound**: Low single-digit growth in Greater China reflects improved brick-and-mortar execution and targeted marketing. The team sees long-term opportunity in middle-class expansion and Gen Z engagement.
- **Kate Spade Execution**: Eva Erdmann's leadership is driving a 15%+ reduction in handbag styles and a shift to brand-first campaigns. Gross margin expansion is expected to continue despite near-term revenue pressure.


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