From Yahoo Finance: 2025-05-08 06:49:00

Tapestry raised its 2025 revenue and profit forecasts for the third time this year due to increased full-price sales of Coach handbags and limited exposure to U.S. tariffs. Sales were driven by popular products like Tabby and Empire leather handbags, exceeding third-quarter expectations in North America, Europe, and China.

Despite a downturn in the luxury market, Tapestry’s sales were bolstered by product innovations, effective marketing, and full-price selling. The company’s price increases led to a 140 basis point margin growth in the quarter. Tapestry’s Empire bags range from $250 to $895, while Tabby shoulder bags sell for $450.

Coach products are manufactured in Vietnam, Cambodia, the Philippines, and India, with no vendor accounting for more than 10% of total inventory purchases. Tapestry also has limited exposure to China. The company’s shares initially rose 5% after exceeding expectations but dipped due to a conservative fourth-quarter profit forecast amid macroeconomic uncertainty.

Tapestry brought inventory to the U.S. ahead of tariffs, optimizing its global supply chain to minimize duty exposure. The company expects a profit of around $5 per share, up from a previous forecast of $4.85 to $4.90, with projected annual revenue of about $6.95 billion compared to over $6.85 billion earlier.

Net sales for the quarter ended March 29 totaled $1.58 billion, surpassing estimates of $1.53 billion. Earnings per share were $1.03, beating estimates of 88 cents. Tapestry’s success is attributed to its strategic pricing, marketing, and product innovation, positioning it well in the luxury market.

Read more: Tapestry lifts forecasts on booming demand for Coach handbags