Tapestry’s fourth quarter results were met with a strong positive market reaction, reflecting management’s emphasis on global customer acquisition and diversified product demand. CEO Joanne Crevoiserat credited the quarter’s performance to the company’s ability to attract 3.7 million new customers, particularly among Gen Z, and broad-based growth across North America, Greater China, and Europe. The direct-to-consumer model, increased marketing investment, and disciplined product innovation were highlighted as primary contributors to higher operating margins and profitability. Crevoiserat stated, “Our efforts, as you can see, are compounding. These are outcomes of the work we've been doing methodically over years.”
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Tapestry (TPR) Q4 CY2025 Highlights:
- Revenue: $2.50 billion vs analyst estimates of $2.32 billion (14% year-on-year growth, 7.7% beat)
- EPS (GAAP): $2.68 vs analyst estimates of $2.22 (20.5% beat)
- Adjusted EBITDA: $758.8 million vs analyst estimates of $655 million (30.3% margin, 15.8% beat)
- The company lifted its revenue guidance for the full year to $7.75 billion at the midpoint from $7.3 billion, a 6.2% increase
- EPS (GAAP) guidance for the full year is $6.43 at the midpoint, beating analyst estimates by 16.4%
- Operating Margin: 28.6%, up from 22.4% in the same quarter last year
- Locations: 1,302 at quarter end, down from 1,393 in the same quarter last year
- Constant Currency Revenue rose 14% year on year (5% in the same quarter last year)
- Market Capitalization: $31.32 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Tapestry’s Q4 Earnings Call
- Matthew Boss (JPMorgan) asked about the sustainability of revenue and margin drivers, to which CEO Joanne Crevoiserat and CFO Scott Roe pointed to ongoing customer acquisition, operational discipline, and a scalable business model supporting continued growth.
- Brooke Roach (Goldman Sachs) questioned Coach’s ability to sustain momentum in North America, with Coach CEO Todd Kahn citing low market share, Gen Z recruitment, and broad-based product appeal as reasons for confidence.
- Ike Boruchow (Wells Fargo Securities) inquired about outperformance in China and Europe, and Crevoiserat highlighted new customer acquisition, digital-led growth in China, and disciplined regional expansion in Europe.
- Rick Patel (Raymond James) sought details on average unit retail (AUR) drivers, and management explained that both product mix and deliberate pricing strategies, rather than promotions, are supporting AUR growth.
- Adrienne Yih (Barclays) asked about AI and technology investments, with Crevoiserat describing how AI tools are now integral to product development, marketing, and decision-making capabilities across the organization.
Catalysts in Upcoming Quarters
Looking ahead, our analyst team will closely monitor (1) the pace and effectiveness of international expansion, especially in Greater China and Europe; (2) progress in Gen Z and new customer acquisitions and their impact on unit growth; and (3) operational execution in achieving margin expansion despite tariff and duty pressures. Additionally, we will track the integration of AI and digital initiatives and their contribution to product development efficiency and customer engagement.
Tapestry currently trades at $155.35, up from $129.92 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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