Tapestry, Inc.
TPR · NYSE
TPR · NYSE
Reports Nov 5, 2026.
Consensus is $1.55 EPS for Sep 2026 across 6 estimates, ranging $1.54 to $1.58.
Tapestry’s fiscal fourth quarter was a clear earnings beat and the culmination of a strong transition toward a more Coach-led portfolio. Non-GAAP EPS of $1.32 exceeded the $1.26 consensus, while revenue of $1.88 billion rose 9% reported and 12% on a pro forma basis excluding Stuart Weitzman. Compared with the prior quarter, revenue declined from $1.92 billion while GAAP operating income increased from $427.5 million to $442.3 million and GAAP EPS rose from $1.65 to $1.68. The year-ago quarter was heavily distorted by an $854.8 million Kate Spade impairment, producing a $583.5 million operating loss and $(2.49) of GAAP EPS; on a comparable basis, non-GAAP EPS increased 28% from $1.04.
Coach was the central story, with Q4 revenue up 15% and handbag average unit retail rising at a mid-teens rate. Growth was geographically broad, especially in Greater China and Europe, while new-customer acquisition and direct-to-consumer growth supported the Amplify strategy. Profitability also improved, with non-GAAP operating margin reaching 19.3% despite a 60-basis-point tariff headwind. The counterweight was Kate Spade, where revenue fell 7% and the full-year operating margin moved to negative 2.5% on a non-GAAP basis. Fiscal 2027 guidance calls for mid-single-digit revenue growth, further margin expansion and low-double-digit EPS growth.
Coach accounted for the quarter’s momentum and now represents the overwhelming majority of Tapestry’s business. Q4 revenue increased 15% to $1.64 billion, or 14% in constant currency, with handbag average unit retail rising at a mid-teens percentage rate. Full-year Coach revenue grew 24% to $6.91 billion, with double-digit growth in every quarter of fiscal 2026.
Kate Spade continued to offset part of Coach’s performance. Q4 revenue declined 7% to $235.1 million, while full-year revenue fell 10% to $1.07 billion. On a non-GAAP basis, Kate Spade posted a Q4 operating loss of $27.2 million, compared with $6.5 million of operating income a year earlier, as lower sales, unfavorable channel mix and higher marketing investment pressured profitability.
Underlying profitability improved meaningfully despite tariff pressure. Q4 non-GAAP gross profit rose 11% to $1.47 billion, with gross margin up 180 basis points to 78.1%. Operational improvements contributed approximately 170 basis points, while the Stuart Weitzman divestiture added 60 basis points and tariffs reduced margin by 60 basis points. Non-GAAP SG&A was 58.8% of sales, an 80-basis-point improvement despite a 130-basis-point increase in marketing investment.
Management’s initial fiscal 2027 framework preserves the long-term Amplify commitments: mid-single-digit revenue growth, continued operating-margin expansion and low-double-digit EPS growth. The outlook assumes a mid-20% tariff rate on U.S. inventory receipts, resulting in a neutral year-over-year tariff impact, and excludes the benefit of a 53rd week from the reported growth rates.
Tapestry continued to convert earnings into shareholder returns while maintaining a manageable balance sheet. Fiscal 2026 operating cash flow rose to $1.98 billion from $1.22 billion, and adjusted free cash flow increased to $1.86 billion from $1.35 billion. The company ended the year with $1.15 billion of cash and short-term investments, $2.38 billion of debt and a 1.1x gross-debt-to-adjusted-EBITDA leverage ratio.
