Financial Data and Key Metrics Changes - The company achieved pro forma revenue growth of 18% in the second quarter, with earnings per share (EPS) increasing by 34% to $2.69 compared to the prior year [5][21] - Operating margin expanded by 390 basis points, reflecting strong operational performance [21][24] - Gross margin for the quarter was reported at 75.5%, an increase of 110 basis points year-over-year [24] Business Line Data and Key Metrics Changes - Coach brand revenue increased by 25%, with customer acquisition driving top-line gains, welcoming 2.9 million new customers [8][21] - Kate Spade experienced a revenue decline of 14%, attributed to a strategic pullback in promotional activity [16][21] Market Data and Key Metrics Changes - North America sales increased by 17%, with Coach leading at 27% growth [21][22] - Greater China revenue grew by 34%, significantly outperforming expectations [22][23] - Europe saw a revenue increase of 22%, driven by direct business strength and market share gains [22] Company Strategy and Development Direction - The company is focused on building emotional connections with consumers, particularly targeting Gen Z, which is central to their growth strategy [6][14] - There is a strong emphasis on fashion innovation and product excellence, particularly in leather goods, which are driving growth [7][10] - The company aims to strengthen brand desirability through immersive retail experiences and targeted marketing campaigns [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to sustain growth, citing a strong product pipeline and effective strategies [20][42] - The outlook for fiscal 2026 has been raised, with expected revenue over $7.75 billion and continued growth in key markets [30][31] - Management highlighted the importance of operational discipline and strategic investments in marketing to drive future growth [45][46] Other Important Information - The company plans to return $1.5 billion to shareholders through dividends and share repurchases in fiscal 2026 [26][28] - Inventory levels are expected to be down modestly year-over-year, indicating effective inventory management [29] Q&A Session Summary Question: What gives you confidence in the earnings guidance? - Management highlighted the systematic approach to brand building and strong customer acquisition as key drivers of confidence in future performance [41][42] Question: How can Coach sustain growth momentum in North America? - Management emphasized the importance of lower promotions and exceptional margins, along with a focus on acquiring new customers, particularly Gen Z [53][55] Question: Can you elaborate on the strength in China? - Management noted significant share gains driven by new customer acquisition and effective regional execution, with digital channels leading growth [62][63] Question: What are the opportunities for AUR growth? - Management discussed the importance of maintaining value while driving AUR growth through product innovation and customer experience [70][72]

Tapestry (NYSE:TPR) Q2 2026 Earnings call February 05, 2026 08:00 AM ET Company ParticipantsChristina Colone - Global Head of Investor RelationsJoanne Crevoiserat - CEOScott Roe - CFO and COOTodd Kahn - CEO and Brand President of CoachConference Call ParticipantsMichael Binetti - Senior Managing Director and Fundamental Research AnalystRick Patel - Managing Director and Equity Research AnalystOperatorGood day, and welcome to this Tapestry conference call. Today's call is being recorded. Later, you will have ...

Tapestry (NYSE:TPR) Q2 2026 Earnings call February 05, 2026 08:00 AM ET Speaker2Good day, and welcome to this Tapestry conference call. Today's call is being recorded. Later, you will have the opportunity to ask questions during the question-and-answer session. To register to ask a question at any time, please press star one on your telephone keypad. At this time, for opening remarks and introductions, I would like to turn the call over to the Global Head of Investor Relations, Christina Colone.Speaker0Good ...

This presentation contains certain "forward-looking statements" based on management's current expectations. Forward-looking statements include, but are not limited to, the statements under "Financial Outlook," statements regarding long-term performance, statements regarding the Company's capital deployment plans, including anticipated annual dividend rates and share repurchase plans, and statements that can be identified by the use of forward-looking terminology such as "may," "can," "if," "continue," "proj ...

Core Insights - Tapestry reported higher second-quarter revenue, indicating strong performance driven by its Coach brand, which helped offset declines in Kate Spade sales [1] Financial Performance - The company raised its fiscal-year outlook, reflecting confidence in continued growth despite challenges faced by the Kate Spade brand [1]

Financial Performance - Net sales for the second quarter of fiscal 2026 reached $2,502.4 million, a 14.0% increase compared to $2,195.4 million in the second quarter of fiscal 2025[184] - Gross profit for the second quarter of fiscal 2026 was $1,888.4 million, representing 75.5% of net sales, up from 74.4% in the prior year[184] - Operating income increased by 45.4% to $716.4 million in the second quarter of fiscal 2026, compared to $492.8 million in the same period last year[184] - Net income for the second quarter of fiscal 2026 was $561.3 million, an 80.9% increase from $310.4 million in the second quarter of fiscal 2025[184] - Basic net income per share rose to $2.75 in the second quarter of fiscal 2026, up 94.9% from $1.41 in the prior year[184] - Net sales for the second quarter of fiscal 2026 increased by 14.0% or $307.0 million to $2.50 billion compared to the same period in fiscal 2025[195] - Coach's net sales rose by 25.3% or $433.1 million to $2.14 billion, driven by a $373.6 million increase in DTC sales, particularly in North America, Greater China, and Europe[198] - Kate Spade's net sales decreased by 13.6% or $56.4 million to $360.0 million, primarily due to a $54.0 million decline in DTC sales[198] - Gross profit increased by 15.6% or $255.3 million to $1.89 billion, with a gross margin improvement of 110 basis points to 75.5%[196] - Operating income for the second quarter of fiscal 2026 was reported at $716.4 million, reflecting a significant increase from $492.8 million in the same quarter of fiscal 2025[203] - Net income increased by 80.9% or $250.9 million to $561.3 million in Q2 fiscal 2026, compared to $310.4 million in Q2 fiscal 2025[210] - Net income per diluted share was $2.68 in Q2 fiscal 2026, up from $1.38 in Q2 fiscal 2025, reflecting a significant increase in profitability[211] - Net income increased by 68.2% or $339.1 million to $836.1 million in the first six months of fiscal 2026, compared to $497.0 million in the same period of fiscal 2025[239] - Net income per diluted share rose to $3.93 in the first six months of fiscal 2026, up from $2.17 in the same period of fiscal 2025[240] Expenses and Margins - SG&A expenses rose by 2.8% or $31.7 million to $1.17 billion, while the percentage of net sales decreased to 46.8% from 51.9%[201] - SG&A expenses decreased by 1.3% or $2.8 million to $202.8 million in Q2 fiscal 2026, while SG&A as a percentage of net sales increased to 56.4% from 49.3%[205] - Gross margin increased by 80 basis points due to net pricing improvements, despite higher tariffs impacting costs[212] - Kate Spade's operating income decreased by $51.7 million to $16.3 million, with an operating margin decline to 4.5% from 16.4% in Q2 fiscal 2025[212] - SG&A expenses rose by 6.0% or $121.1 million to $2.14 billion, but as a percentage of net sales, they decreased to 51.0% from 54.6%[230] - Operating income increased by $299.8 million to $1.04 billion, with an operating margin of 24.8%, up from 20.1%[231] - The divestiture of Stuart Weitzman contributed to a 100 basis point increase in operating margin, reflecting improved profitability[233] - Coach Operating Income increased by $326.4 million to $1.33 billion in the first six months of fiscal 2026, with an operating margin of 37.3% compared to 35.0% in the same period of fiscal 2025[238] - Kate Spade Operating Income decreased by $73.1 million to $21.9 million in the first six months of fiscal 2026, resulting in an operating margin of 3.5%, down from 13.6% in the prior year[238] Cash Flow and Financing - Net cash provided by operating activities increased by $568.2 million to $1,193.7 million in the first six months of fiscal 2026, driven by higher net income and changes in operating assets and liabilities[250] - Net cash used in financing activities was $1.26 billion in the first six months of fiscal 2026, a decrease of $5.52 billion compared to $6.78 billion in the same period of fiscal 2025[253] - The Company reported a decrease in cash and cash equivalents of $46.7 million in the first six months of fiscal 2026, compared to a decrease of $5.16 billion in the same period of fiscal 2025[249] - The Company had total availability of $2.00 billion under its Amended Revolving Credit Facility as of December 27, 2025[258] - The Company entered into a Commercial Paper Program allowing for the issuance of up to $2.00 billion of unsecured commercial paper notes, with no borrowings outstanding as of December 27, 2025[262] Divestitures and Acquisitions - The Company divested the Stuart Weitzman Business for total cash consideration of $105.0 million, completed on August 4, 2025[169] - The divestiture of the Stuart Weitzman business was effective in the first quarter of fiscal 2026, leading to a restructuring of reportable segments to Coach and Kate Spade[194] - Total pre-tax income related to the Stuart Weitzman divestiture was $0.8 million, primarily from a Transition Services Agreement[188] - The Company completed the divestiture of the Stuart Weitzman Business for total cash consideration of $105.0 million on August 4, 2025[263] Organizational Changes and Efficiency - The Company aims to sustain growth in North America while accelerating momentum in international markets, particularly in Greater China and Europe[168] - Organizational efficiency costs amounted to $4.2 million, mainly associated with technology expenses[188] - The Company has a voluntary supply chain finance program to improve working capital efficiency, allowing suppliers to sell receivables on a non-recourse basis[264] Market and Economic Factors - The macroeconomic environment has negatively impacted gross margin by approximately 190 basis points for the three months ended December 27, 2025, due to tariff changes[175] - Fluctuations in foreign currency exchange rates resulted in increased net sales of $11.4 million for the six months ended December 27, 2025, but negatively impacted gross margin and operating margin by approximately 20 basis points each[177] - There have been no significant changes to the Company's market risk management as of the latest reporting period[273] Capital Expenditures and Share Repurchase - Capital expenditures and cloud computing implementation costs for the three and six months ended December 27, 2025, were $54.2 million and $92.2 million, respectively, with an expectation of approximately $200.0 million for fiscal 2026[265] - The Company announced a 2026 Share Repurchase Program to repurchase up to $3.00 billion of its outstanding common stock, replacing the previous program with $561.7 million remaining[266] - During the six months ended December 27, 2025, the Company repurchased $900.0 million of common stock, with $661.7 million under the 2026 Share Repurchase Program[267] - As of December 27, 2025, the Company had $2.34 billion of remaining repurchase authorization under the 2026 Share Repurchase Program[267]

Core Viewpoint - Tapestry raised its annual earnings targets for the second time due to strong demand for its Tabby handbags, which led to a significant beat in holiday-quarter estimates [1] Group 1 - Tapestry's strong performance was driven by the popularity of its Tabby handbags [1] - The company comfortably exceeded holiday-quarter estimates, indicating robust consumer demand [1] - This marks the second time Tapestry has increased its annual earnings targets this year [1]

Exhibit 99.1 CONTACTS: Tapestry, Inc. Analysts and Investors: Christina Colone Global Head of Investor Relations 212/946-7252 ccolone@tapestry.com Media: Jennifer Leemann Global Head of Communications 212/631-2797 jleemann@tapestry.com "Our second quarter outperformance reflects the compounding impact of our Amplify strategy, driving deeper consumer engagement, accelerated growth, and record results. This holiday season, our talented teams brought creativity, craftsmanship, and value to consumers around the ...

NEW YORK--(BUSINESS WIRE)--Tapestry, Inc. (NYSE: TPR), a house of iconic accessories and lifestyle brands, today reported results for the fiscal second quarter ended December 27, 2025. Joanne Crevoiserat, Chief Executive Officer of Tapestry, Inc., commented: "Our second quarter outperformance reflects the compounding impact of our Amplify strategy, driving deeper consumer engagement, accelerated growth, and record results. This holiday season, our talented teams brought creativity, craftsmanshi. ...

Core Viewpoint - Tapestry, Inc. is a prominent player in the retail apparel and shoes industry, recognized for its luxury brands and strategic growth initiatives [1] Earnings Expectations - Tapestry is scheduled to release its quarterly earnings report on February 5, 2026, with analysts forecasting an earnings per share (EPS) of $2.20 and revenue of approximately $2.32 billion [2][6] Historical Performance - The company has a track record of exceeding earnings estimates, with a recent average surprise of 6.69% and a notable earnings report last quarter where it achieved $1.38 per share against a consensus estimate of $1.25, resulting in a 10.40% surprise [3][4][6] Financial Health - Tapestry's financial metrics include a high P/E ratio of 101.50, a price-to-sales ratio of 3.69, and an enterprise value to sales ratio of 4.17, indicating strong market valuation. The debt-to-equity ratio stands at 10.51, reflecting significant reliance on debt, while the current ratio of 1.52 suggests sufficient liquidity to meet short-term obligations [5][6]