Tapestry Q4 tops Street as demand for Coach soars; expects $160M hit from tariffs
Tapestry Inc. ended its fiscal year with another strong performance by its Coach brand even as Kate Spade continued its revenue decline.
The luxury accessories brand gave disappointing guidance for its new fiscal year, citing tariff impacts. It anticipates $160 million in tariff-related headwinds.
Tapestry reported a net loss of $517 million, or a loss of $2.49 a share, for the quarter ended June 28, compared to net income of $159.3 million, or $0.68 a share, in the year-ago quarter. The loss was attributed to the extinguishment of debt related to the company’s failed attempt to acquire Capri Holdings, and a $855 million in asset and goodwill impairment charges connected to a write down on the brand value of Kate Spade
On an adjusted basis, Tapestry earned $1.04 a share, just above analysts’ estimates of $1.02 a share.
Revenue increased 8% to $1.723 billion, topping estimates of $1.681 billion. The growth was fueled by Coach brand, where sales jumped 14% to $1.4 billion. Sales at Kate Spade sales fell 13% to $252.6 million, marking the 10th straight quarter of year-over-year declines.
Revenue at Stuart Weitzman declined 10% to $45.5 million. (Tapestry’s sale of Stuart Weitzman to Caleres, parent company of Famous Footwear, was completed earlier this month.)
For the full year, Tapestry’s sales rose 5% to $7 billion, with adjusted earnings of $1.13 billion, or $5.10 a share.
Tapestry has been successful in attracting young consumers. The company said it acquired approximately 1.5 million new customers in North America for the quarter and over 6.8 million during the year, driven by a growing number of Gen Z and millennial consumers, which represented approximately 60% of new customers for the quarter and year.
“Fiscal 2025 was a breakout year for Tapestry as our systemic approach to brand-building is capturing a new generation of consumers around the world,” stated Joanne Crevoiserat, CEO of Tapestry. “Our strong growth, capped by our fourth quarter outperformance, reinforces that our strategies are working. Importantly, we achieved bold targets we set three years ago in a dynamic landscape, delivering over $5 in adjusted earnings per share and returning more than $3 billion cumulatively to shareholders.”
The company noted that its full-year outlook includes the impact of tariffs and U.S. trade policy. For fiscal 2026, Tapestry expects revenue approaching $7.2 billion, which represents low-single-digit percentage growth versus the prior year, excluding Stuart Weitzman.
The company expects adjusted full-year earnings of $5.30 to $5.45, which includes negative impact of incremental tariffs and duties of over $0.60 a share.
