Tapestry Reports Strong Q1 Earnings, Exceeding Expectations
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Should l Buy TPR?
Source: seekingalpha
- Strong Earnings Report: Tapestry's Q1 non-GAAP EPS of $1.66 beats expectations by $0.36, indicating a significant improvement in profitability and resilience in a competitive market.
- Significant Revenue Growth: The company reported revenue of $1.92 billion, a 24.7% year-over-year increase, exceeding expectations by $130 million, reflecting strong product demand and expanding market share.
- Optimistic 2026 Outlook: Revenue is projected to reach $7.95 billion, representing approximately 14% growth, with pro forma revenue expected to grow about 17% excluding Stuart Weitzman, showcasing confidence in future growth.
- Improved Profitability: Operating margin is expected to be around 23%, an increase of 300 basis points from the prior year, surpassing previous guidance of 180 basis points, indicating significant progress in cost control and efficiency improvements.
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Analyst Views on TPR
Wall Street analysts forecast TPR stock price to rise
15 Analyst Rating
13 Buy
2 Hold
0 Sell
Strong Buy
Current: 130.520
Low
120.00
Averages
136.57
High
155.00
Current: 130.520
Low
120.00
Averages
136.57
High
155.00
About TPR
Tapestry, Inc. is a house of accessories and lifestyle brands. The Company's global house of brands include Coach and kate spade new york. Coach brand is a global fashion house of accessories and lifestyle collections. Kate Spade New York is a global lifestyle brand that designs things for the everyday, delivering seasonal collections of handbags, ready-to-wear, jewelry, footwear, gifts, home decor and more. Its products include women's handbags, women's accessories, men's and other products. Women's accessories include small leather goods which include mini and micro handbags, money pieces, wristlets, pouches and cosmetic cases. Men's includes bag collections, small leather goods, footwear, watches, sunglasses, and ready-to-wear items. Its products are sold to customers through its direct-to-consumer (DTC), wholesale and licensing businesses. Its DTC business includes retail and outlet stores, branded e-commerce sites as well as concession shop-in-shops.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Tapestry's Earnings Report Sparks Buying Interest
- Earnings Impact: Following Tapestry's fiscal third-quarter earnings report, the stock fell over 12%, yet JPMorgan views the current price as attractive, advising investors to 'buy the dip.'
- Price Target Increase: JPMorgan raised Tapestry's price target from $190 to $200, implying over 50% upside from Thursday's close, reflecting confidence in the company's future growth potential.
- Brand Revival: Analysts noted that Coach has undergone a brand revival in recent years, successfully attracting Gen-Z consumers and driving revenue growth for Tapestry, particularly outperforming other brands in the portfolio in the third quarter.
- Market Consensus: According to LSEG data, 15 out of 24 analysts covering Tapestry have either a buy or strong buy rating, indicating a generally optimistic outlook for the company's future performance.
See More
Midday Stock Movements of Major Companies
- Planet Fitness Earnings Downgrade: Planet Fitness shares fell nearly 33% after the gym operator lowered its full-year earnings outlook, now projecting only a 4% year-over-year growth, down from a previous forecast of 9%-10%, which negatively impacts market confidence.
- Vital Farms Surprise Loss: Vital Farms, the egg producer, dropped 20% following a surprise loss of 3 cents per share in Q1, against analyst expectations of a 6-cent profit, and the company also cut its full-year earnings outlook, indicating increasing industry pressures.
- Datadog Exceeds Expectations: Datadog shares surged 28% after reporting Q1 earnings of 61 cents per share, surpassing the 51-cent consensus, with Q2 revenue guidance between $1.07 billion and $1.08 billion, reflecting strong market demand.
- AAON Revenue Surge: AAON, the air conditioning and heating equipment manufacturer, saw its shares soar 40% after Q1 earnings, EBITDA, and revenue all exceeded Wall Street estimates, raising its full-year revenue guidance by as much as 45%, showcasing robust growth potential.
See More
Tapestry Reports Strong Q3 2026 Earnings, Raises Guidance
- Significant Customer Growth: Tapestry acquired over 2.4 million new customers in Q3, primarily driven by effective marketing strategies targeting Gen Z, which not only enhanced brand market share but also laid a solid foundation for future sales growth.
- Revenue and Profitability Increase: The company achieved a 29% revenue growth in Q3, with an operating margin of 76.9%, indicating strong profitability in a competitive market and reflecting the success of its direct-to-consumer sales strategy.
- Upward Revision of Annual Outlook: Management raised the fiscal year 2026 revenue guidance to $7.95 billion, with expected EPS of $6.95, showcasing confidence in future growth and robust market demand.
- Ongoing Brand Strategy: Despite an 11% revenue decline for the kate spade brand, management emphasized the ongoing brand revitalization and long-term growth strategy, indicating the company's commitment to sustainable development in the face of challenges.
See More
Tapestry Reports 25% Sales Growth in Q1
- Significant Sales Growth: Tapestry reported a 25% year-over-year sales increase in Q1, reaching $1.92 billion, exceeding market expectations by $130 million, demonstrating strong sales performance in a competitive landscape.
- Improved Profitability: The non-GAAP EPS of $1.66 surpassed the consensus estimate of $1.60 and marked a substantial increase from last year's $1.03, indicating successful cost control and enhanced profitability.
- Customer Base Expansion: The company acquired over 2.4 million new customers globally, with 35% being Gen Z consumers, showcasing Tapestry's success in attracting younger demographics while also reflecting increased demand from existing customers.
- Strong Regional Performance: Revenue from China surged 55% to $432 million, while North America saw a 20% increase to $1.11 billion, highlighting the company's robust growth momentum globally, particularly in the rapidly expanding Asia-Pacific market.
See More
Fast Food Giants Show Mixed Earnings Results
- Shake Shack's Poor Performance: Shake Shack reported first-quarter revenue of $366.7 million, falling short of the $372 million consensus estimate, leading to a 17% drop in shares and an operating loss of $2.6 million, highlighting pressures in the competitive fast-food market.
- McDonald's Beats Expectations: McDonald's posted adjusted earnings of $2.83 per share for the first quarter, exceeding the $2.74 expected by analysts, with revenue of $6.52 billion slightly above the $6.47 billion consensus, resulting in a 3.2% increase in shares, reflecting strong market performance.
- Whirlpool Cuts Guidance: Whirlpool lowered its full-year adjusted earnings forecast to a range of $3 to $3.50 per share on revenue of approximately $15 billion, down from previous guidance of $6 per share and $15.3 billion to $15.6 billion, causing an 18% drop in shares and indicating industry challenges.
- DoorDash's Optimistic Guidance: DoorDash anticipates second-quarter marketplace gross order value between $32.4 billion and $33.4 billion, surpassing the $32.43 billion expected by analysts, with first-quarter earnings of $0.42 per share exceeding the $0.36 forecast, leading to a 10% rise in shares and showcasing growth potential.
See More
Tapestry Raises Annual Forecast for Third Time Amid Strong Demand
- Earnings Beat: Tapestry's third-quarter revenue reached $1.92 billion, exceeding analysts' expectations of $1.79 billion, reflecting strong demand among younger consumers for its popular Tabby handbags and other leather goods.
- Annual Forecast Increase: The company raised its fiscal 2026 revenue forecast to approximately $7.95 billion, up from the previous $7.75 billion, and above analysts' estimate of $7.82 billion, indicating confidence in future growth.
- Strong Market Performance: Tapestry recorded a 31% year-over-year revenue increase in Europe and a 20% growth in North America, successfully bucking the trend of declining demand faced by luxury brands in the Middle East and Europe.
- Long-term Investment Confidence: CFO Scott Roe highlighted latent demand for Kate Spade and strong brand resonance, providing confidence for long-term investments, although he acknowledged that short-term progress requires ongoing effort.
See More
Tapestry's Earnings Report Sparks Buying Interest
- Earnings Impact: Following Tapestry's fiscal third-quarter earnings report, the stock fell over 12%, yet JPMorgan views the current price as attractive, advising investors to 'buy the dip.'
- Price Target Increase: JPMorgan raised Tapestry's price target from $190 to $200, implying over 50% upside from Thursday's close, reflecting confidence in the company's future growth potential.
- Brand Revival: Analysts noted that Coach has undergone a brand revival in recent years, successfully attracting Gen-Z consumers and driving revenue growth for Tapestry, particularly outperforming other brands in the portfolio in the third quarter.
- Market Consensus: According to LSEG data, 15 out of 24 analysts covering Tapestry have either a buy or strong buy rating, indicating a generally optimistic outlook for the company's future performance.
See More
Midday Stock Movements of Major Companies
- Planet Fitness Earnings Downgrade: Planet Fitness shares fell nearly 33% after the gym operator lowered its full-year earnings outlook, now projecting only a 4% year-over-year growth, down from a previous forecast of 9%-10%, which negatively impacts market confidence.
- Vital Farms Surprise Loss: Vital Farms, the egg producer, dropped 20% following a surprise loss of 3 cents per share in Q1, against analyst expectations of a 6-cent profit, and the company also cut its full-year earnings outlook, indicating increasing industry pressures.
- Datadog Exceeds Expectations: Datadog shares surged 28% after reporting Q1 earnings of 61 cents per share, surpassing the 51-cent consensus, with Q2 revenue guidance between $1.07 billion and $1.08 billion, reflecting strong market demand.
- AAON Revenue Surge: AAON, the air conditioning and heating equipment manufacturer, saw its shares soar 40% after Q1 earnings, EBITDA, and revenue all exceeded Wall Street estimates, raising its full-year revenue guidance by as much as 45%, showcasing robust growth potential.
See More
Tapestry Reports Strong Q3 2026 Earnings, Raises Guidance
- Significant Customer Growth: Tapestry acquired over 2.4 million new customers in Q3, primarily driven by effective marketing strategies targeting Gen Z, which not only enhanced brand market share but also laid a solid foundation for future sales growth.
- Revenue and Profitability Increase: The company achieved a 29% revenue growth in Q3, with an operating margin of 76.9%, indicating strong profitability in a competitive market and reflecting the success of its direct-to-consumer sales strategy.
- Upward Revision of Annual Outlook: Management raised the fiscal year 2026 revenue guidance to $7.95 billion, with expected EPS of $6.95, showcasing confidence in future growth and robust market demand.
- Ongoing Brand Strategy: Despite an 11% revenue decline for the kate spade brand, management emphasized the ongoing brand revitalization and long-term growth strategy, indicating the company's commitment to sustainable development in the face of challenges.
See More
Tapestry Reports 25% Sales Growth in Q1
- Significant Sales Growth: Tapestry reported a 25% year-over-year sales increase in Q1, reaching $1.92 billion, exceeding market expectations by $130 million, demonstrating strong sales performance in a competitive landscape.
- Improved Profitability: The non-GAAP EPS of $1.66 surpassed the consensus estimate of $1.60 and marked a substantial increase from last year's $1.03, indicating successful cost control and enhanced profitability.
- Customer Base Expansion: The company acquired over 2.4 million new customers globally, with 35% being Gen Z consumers, showcasing Tapestry's success in attracting younger demographics while also reflecting increased demand from existing customers.
- Strong Regional Performance: Revenue from China surged 55% to $432 million, while North America saw a 20% increase to $1.11 billion, highlighting the company's robust growth momentum globally, particularly in the rapidly expanding Asia-Pacific market.
See More
Fast Food Giants Show Mixed Earnings Results
- Shake Shack's Poor Performance: Shake Shack reported first-quarter revenue of $366.7 million, falling short of the $372 million consensus estimate, leading to a 17% drop in shares and an operating loss of $2.6 million, highlighting pressures in the competitive fast-food market.
- McDonald's Beats Expectations: McDonald's posted adjusted earnings of $2.83 per share for the first quarter, exceeding the $2.74 expected by analysts, with revenue of $6.52 billion slightly above the $6.47 billion consensus, resulting in a 3.2% increase in shares, reflecting strong market performance.
- Whirlpool Cuts Guidance: Whirlpool lowered its full-year adjusted earnings forecast to a range of $3 to $3.50 per share on revenue of approximately $15 billion, down from previous guidance of $6 per share and $15.3 billion to $15.6 billion, causing an 18% drop in shares and indicating industry challenges.
- DoorDash's Optimistic Guidance: DoorDash anticipates second-quarter marketplace gross order value between $32.4 billion and $33.4 billion, surpassing the $32.43 billion expected by analysts, with first-quarter earnings of $0.42 per share exceeding the $0.36 forecast, leading to a 10% rise in shares and showcasing growth potential.
See More
Tapestry Raises Annual Forecast for Third Time Amid Strong Demand
- Earnings Beat: Tapestry's third-quarter revenue reached $1.92 billion, exceeding analysts' expectations of $1.79 billion, reflecting strong demand among younger consumers for its popular Tabby handbags and other leather goods.
- Annual Forecast Increase: The company raised its fiscal 2026 revenue forecast to approximately $7.95 billion, up from the previous $7.75 billion, and above analysts' estimate of $7.82 billion, indicating confidence in future growth.
- Strong Market Performance: Tapestry recorded a 31% year-over-year revenue increase in Europe and a 20% growth in North America, successfully bucking the trend of declining demand faced by luxury brands in the Middle East and Europe.
- Long-term Investment Confidence: CFO Scott Roe highlighted latent demand for Kate Spade and strong brand resonance, providing confidence for long-term investments, although he acknowledged that short-term progress requires ongoing effort.
See More
