Tapestry, Inc.

Fiscal 2026 revenue was $8 billion, up 17% on a pro forma constant currency basis; operating margin expanded 340 basis points to over 23%; and EPS increased 38% to $7.05. In Q4, sales increased 11% pro forma constant currency, gross margin was 78.1% (up 180 basis points), operating margin expanded 250 basis points, and EPS was $1.32 (up 28%). For fiscal 2027, Tapestry guided to revenue of $8.4 billion to $8.5 billion, mid-single-digit growth, operating margin expansion of 50 basis points to nearly 24%, and EPS of $7.80 to $7.90. Q1 guidance was for revenue growth in the high single digits and EPS of about $1.55. The company also expects adjusted free cash flow to approach $1.7 billion, CapEx and cloud computing costs around $300 million, and continued capital returns of about $1.7 billion to shareholders.

Joanne Crevoiserat framed fiscal 2026 as a defining year, emphasizing that Tapestry hit its three-year revenue, operating margin and EPS commitments two years ahead of plan. Her tone was confident and strategic, focusing on the company’s stronger brand-building capabilities, direct-to-consumer relationships, global reach and AI/data investments as durable advantages. She repeatedly said the greatest opportunities are still ahead, with Coach’s global expansion, younger customer acquisition and Kate Spade’s longer-term turnaround as key pillars.

Scott Roe highlighted the strength of the financial model: fiscal 2026 returned $1.7 billion to shareholders, including $326 million in dividends and $1.35 billion in repurchases, and ended with nearly $1.2 billion in cash and short-term investments, $2.4 billion of borrowings and 1.1x gross debt to adjusted EBITDA leverage. He said adjusted free cash flow totaled $1.86 billion and inventory was 4% below prior year. For fiscal 2027, he guided to $8.4 billion to $8.5 billion of revenue, roughly 30 basis points of gross margin expansion, about 20 basis points of SG&A leverage, EPS of $7.80 to $7.90, and another $1.7 billion in shareholder returns, including a 16% dividend increase to $1.85 per share annualized.

Analysts pressed on whether growth would moderate after a strong year, with questions about Coach demand, the mix of AUR versus units, North America normalization, international growth, marketing spend and CapEx. Management said Q1’s low-teens Coach growth and mid-single-digit full-year Coach growth are deliberate, but the company does not need that level of growth every quarter to hit the full-year plan. They also emphasized that units were intentionally restrained in Q4 because of fewer promotion days and prior-quarter timing, while AUR gains should continue alongside unit growth. On international markets, management pointed to low penetration and strong momentum in China and Europe, and said CapEx will step up to support store fleet renovations and about 40 to 50 net Coach doors, with roughly 75% of those openings international.