Tapestry Stock Earnings Reports

Tapestry delivered a strong Q1, driven by broad-based strength at Coach and momentum in DTC channels. Key financials: pro forma revenue +16%, adjusted operating margin +200 bps, and adjusted EPS +35% vs. prior year. Coach grew 21% with double-digit gains across North America, China and Europe, strong new-customer acquisition (1.7M+ new Coach customers, led by Gen Z), mid-teens handbag AUR growth, and an inflection in units. Kate Spade is in early-stage turnaround: revenue down 9% but sequential improvements in consideration, Gen Z acquisition and full-price sell-through; management expects sequential improvement in H2 and return to profitable growth in FY27. Management raised FY26 guidance: revenue ~ $7.3B (pro forma +6–7% constant currency), EPS $5.45–$5.60, adjusted free cash flow ~$1.3B. Gross margin faces tariff/duty headwinds (~$170M headwind for the year, after partial mitigation) but the company expects ~50 bps of operating margin expansion for FY26, supported by SG&A discipline and marketing investments (~11% of sales). Capital allocation: board declared $0.40 quarterly dividend and management expects to return ~$1.3B to shareholders in FY26 (including ~$1B in buybacks), while maintaining an investment-grade target and gross leverage goal <2.5x (Q1 gross debt/EBITDA ~1.5x). Key investor takeaways: durable growth at Coach supported by product, marketing and retail experience; Kate Spade turnaround progressing but remains a drag near-term; tariffs are a known near-term headwind; strong cash generation enables meaningful shareholder returns and continued brand investments.