“Our third quarter outperformance reinforces our position of strength. We accelerated top and bottom-line growth and raised our outlook for the fiscal year, demonstrating the power of brand building and our connections with consumers around the world. Importantly, while the external backdrop is complex, our vision remains clear. We maintain a bias for action and will harness our competitive advantages, including our global scale, compelling value, and strong fundamentals, to adapt and win in any environment”, said Joanne Crevoiserat, Chief Executive Officer of Tapestry.

Third Quarter Results

In the third quarter of fiscal 2025, which ended on the 29^th of March, the company’s net sales reached 1.58 billion euros, an increase of 7% or 8% on a constant currency basis, as compared to the same period of the last fiscal year. Foreign exchange rates represented approximately a headwind of 150 basis points in the quarter due to the appreciation of the US dollar.

In the first quarter, the Coach brand contributed 1.29 billion US dollars to Tapestry’s total net sales, reflecting a 12% increase (or 15% on a constant currency basis), on a comparable basis to the same quarter in fiscal year 2024.

Meanwhile, Kate Spade and Stuart Weitzman continued to perform poorly, with net sales decreasing by 13% (or 12% on a constant currency basis) year-on-year to 244.9 million US dollars, and by 18% (or 17% on a constant currency basis) year-on-year to 46.2 million euros, respectively.

Tapestry reported a first quarter gross profit of 1.21 billion US dollars and a gross margin of 76.1%, driven by operational improvements, as compared to a gross profit of 1.11 billion US dollars and a gross margin of 74.7% in the same quarter of the previous year.

In the first quarter of the current fiscal year, the company’s GAAP operating income was 254 million US dollars, and non-GAAP operating income was 277 million US dollars. This compares to a GAAP operating income of 204 million US dollars, and a non-GAAP operating income of 239 million US dollars in the same period the previous year.

The accessible luxury company recorded a first quarter net income of 203 million US dollars, with earnings per diluted share of 0.95 US dollars, as compared to 139 million US dollars, with earnings per diluted share of 0.60 US dollars, in the same quarter of last fiscal year. 

On a non-GAAP basis, net income was 220 million US dollars, with earnings per diluted share of 1.03 US dollars, as compared to 190 million US dollars, with earnings per diluted share of 0.81 US dollars in the same period of last year.

Fiscal 2025 Outlook

Tapestry expects full year revenue of approximately 6.95 billion US dollars, representing growth of 4% on a reported basis, as compared to the previous fiscal year. This exceeds the prior guidance of around 3% year-on-year growth.

Earnings per diluted share are expected in the area of 5.00 US dollars, representing a high-teens percentage growth rate compared to the prior year, and exceeding the prior guidance of 4.85 to 4.90 US dollars.

The outlook is based on the expected tariffs on US imports, including a projected additional tariff of 145% on imports from China and an additional 10% tariff on all other global imports. However, it excludes the one-off transaction costs associated with the pending sale of Stuart Weitzman, expected to conclude in the summer of 2025.