TPR Q4 Earnings Call Puts Coach Growth Durability in Focus

Tapestry Balances Momentum With Prudent Guidance

CFO and COO Scott Roe said fiscal 2027 guidance reflects confidence while remaining disciplined. Tapestry expects revenues of $8.4-$8.5 billion and about 50 basis points of operating margin expansion.

Roe forecast first-quarter revenue growth in the high single digits and EPS of about $1.55. Full-year EPS is expected at $7.80 to $7.90, with revenue growth moderating in the second half.

A JPMorgan analyst questioned that moderation. CEO Joanne Crevoiserat said Coach remains strong with customers, while Roe said the full-year outlook does not require first-quarter growth rates to continue.

TPR Sees Coach Growth From AUR and Units

Coach CEO and brand president Todd Kahn said fourth-quarter handbag units were roughly flat by design as promotions declined, while handbag average unit retail (AUR) increased at a mid-teens rate.

A Morgan Stanley analyst asked about the growth mix. Kahn said fiscal 2027 guidance assumes both AUR and unit gains without using promotions to force volume.

In a Barclays exchange, Kahn clarified that global Coach revenues are expected to rise low teens in the first quarter and high single digits for fiscal 2027. North America Coach is expected to grow in mid-single digits.

Tapestry Pushes International Growth

CEO Crevoiserat said international markets should contribute more to growth. Fiscal fourth-quarter pro forma constant-currency revenue rose 28% in Greater China and 19% in Europe.

A BTIG analyst asked about sustaining that growth. Crevoiserat cited younger local customers and further penetration, while Kahn said Europe offers white space and China is receiving more marketing support.

Kahn said the brand can follow Gen Z shopping patterns. Management expects mid-teens fiscal 2027 growth in both Greater China and Europe.

TPR Keeps Marketing and Stores at the Center

Crevoiserat said Coach increased quarterly marketing spending about 20%, emphasizing brand building and acquisition. CFO and COO Roe said demand-creation spending reached about 12% of sales in fiscal 2026.

A Baird analyst asked about marketing timing. Roe said quarterly timing varies, but Tapestry will keep investing where data supports demand creation.

Roe expects 40 to 50 net Coach store additions in fiscal 2027. Kahn said about 75% should be international as the expressive luxury format expands.

Tapestry Keeps Kate Spade in Rebuild Mode

Crevoiserat said Kate Spade remains in a phased turnaround centered on brand desirability, a tighter assortment and omnichannel execution. She said fiscal 2026 top-line progress was more gradual than planned.

Crevoiserat said the Margot, 454 and Duo handbag families supported customer acquisition, while store renovations improved conversion and average transaction value. Broader unaided brand awareness has not yet improved.

Roe said fiscal 2027 guidance assumes a high-single-digit Kate Spade revenue decline and a modest operating loss as investment continues. First-quarter revenues are expected to fall at a low-double-digit rate.

TPR Stays Focused on Growth, Margins and Returns

Roe said Tapestry expects to return about $1.7 billion to shareholders in fiscal 2027, including roughly $1.35 billion of repurchases and a 16% dividend increase.

Crevoiserat closed with a confident focus on customer relationships, global expansion and operating discipline. Management's priorities remain sustaining Coach, rebuilding Kate Spade and expanding margins despite uneven tariff and marketing effects.

Zacks Signals for Tapestry

TPR carries a Zacks Rank #3 (Hold), with a Value Score of D, Growth Score of A, Momentum Score of A and VGM Score of A. Under the Zacks framework, Hold-rated stocks can be retained, with A and B Style Scores more favorable than lower grades. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Growth, Momentum and VGM Scores of A indicate stronger characteristics in those styles, while a Value Score of D is weaker. The Zacks Rank can change as estimates are revised after the just-reported results, so the current combination is not a fixed signal.

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