Tariffs are here to stay — and US manufacturing can't keep up, former Coach CEO says

Core Insights - Former Coach CEO Lew Frankfort expresses skepticism about the effectiveness of new tariffs in bringing luxury handbag production back to the U.S. [1][3] - He emphasizes the importance of manufacturing products outside the U.S. to provide consumers with the best value [2][4]. Industry Challenges - The U.S. faces a shortage of skilled workers, particularly in craftsmanship, which is crucial for luxury goods production [3][4]. - Frankfort highlights that many jobs in the U.S. remain unfilled, affecting various industries, including automotive [3][4]. Company Performance - Tapestry, the parent company of Coach, reported a fiscal fourth-quarter revenue of $1.7 billion, an 8% increase year-over-year, surpassing consensus estimates [6]. - Adjusted earnings per share for Tapestry rose 13% to $1.04, exceeding expectations [6]. Strategic Recommendations - Retailers are advised to be cautious in passing costs to consumers and to avoid jeopardizing their suppliers' viability [5]. - Frankfort suggests developing entry-level products to cater to discerning consumers seeking more affordable options [5]. Future Outlook - Evercore ISI analyst Michael Binetti projects Tapestry's annual earnings could grow to between $6.40 and $6.85 per share by FY28, with a bullish scenario reaching $7.50 [7].