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Coach Powers Tapestry's Momentum: Find Out What's Driving it
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Key Takeaways
Coach posted 13% reported and 15% constant-currency sales growth in 3Q25 to $1.29 billion.
Strong AUR gains and premium pricing lifted Coach's gross margin to a record 79% in the quarter.
Coach's growth was led by leather goods, popular styles and the One Coach cross-channel strategy.
Tapestry, Inc.’s (TPR - Free Report) Coach brand delivered exceptional performance in the third quarter of fiscal 2025, achieving net sales of $1.29 billion, reflecting a 13% year-over-year increase on a reported basis and 15% growth on a constant-currency basis. The results reinforce Coach's leadership in the accessible luxury segment. Coach continues to thrive as Tapestry’s top-performing brand, driven by strong brand equity, product innovation and deep engagement with consumers.
Coach achieved a record 79% gross margin in the fiscal third quarter, supported by operational efficiency and premium pricing power. Average Unit Retail (AUR) grew in the mid-teens, with AUR in North America now approximately 70% higher than in 2019. The brand has raised AUR in 18 of the last 20 quarters not only by simply raising prices but also by delivering perceived customer value through compelling products and emotional storytelling.
Coach’s leather goods business saw strong double-digit growth in the fiscal third quarter, led by the Tabby and New York collections. Several key products, such as the Kiss Lock Bag, sold out within minutes. Footwear also contributed to growth, led by the Soho and Highline sneakers, designed for younger, fashion-forward consumers. The “One Coach” strategy, which aligns product and pricing across both outlet and full-price channels, drove engagement and margin expansion.
Looking ahead, Coach is central to Tapestry’s upgraded fiscal 2025 guidance. The company expects revenues of $6.95 billion, indicating 4% growth from the prior year on a reported basis. This revised forecast is ahead of the previous guidance, which called for 3% growth.
Regionally, the company expects sales to grow 3-4% in North America, around 30% in Europe, in the low-single digits in Greater China and the high-single digits in other parts of Asia. The operating margin is expected to expand 100 basis points year over year. Earnings per share are forecast to be $5.00, implying high-teens percentage growth from the prior year’s actual and exceeding the earlier mentioned $4.85-$4.90. With a clear focus on customer acquisition, product excellence and omnichannel experience, Coach is well-positioned for continued sustainable growth and global market share expansion.
TPR’s Zacks Rank & Share Performance Details
Shares of this Zacks Rank #3 (Hold) company have rallied 27.1% in the past six months compared with the Zacks Retail-Apparel and Shoes industry’s sharp 16.8% decline. This leading lifestyle specialty retailer’s ongoing strategic initiative and operational efficiencies have enabled it to outperform the broader Retail-Wholesale sector and the S&P 500 index’s decline of 0.1% and growth of 1.3%, respectively, during the same period.
TPR Stock Past 6-Month Performance
Image Source: Zacks Investment Research
Closing at $84.26 as of yesterday, the TPR stock is trading 7.3% below its 52-week high of $90.85 attained on Feb. 18, 2025. Technical indicators support Tapestry’s strong performance. The stock is trading above its 50 and 200-day SMAs (simple moving averages) of $74.23 and $64.73, respectively, highlighting a continued uptrend. This technical strength, along with sustained momentum, indicates positive market sentiment and investors’ confidence in TPR’s financial health and growth prospects.
TPR Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
Upward Estimate Revisions Favor Tapestry Stock
The positive sentiment surrounding TPR is reflected in the upward revisions in the Zacks Consensus Estimate for earnings. In the past 60 days, the consensus estimate has moved up 13 cents to $5.05 per share for the current fiscal year and by 10 cents to $5.43 for the next fiscal year, indicating year-over-year growth of 17.7% and 7.5%, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
The Zacks Consensus Estimate for the current and the next fiscal year’s sales is pegged at $6.96 billion and $7.17 billion, respectively, implying year-over-year growth of 4.3% and 3%.
The Zacks Consensus Estimate for Stitch Fix’s current fiscal year’s earnings implies growth of 69.7% from the year-ago actuals. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
Canada Goose is a global outerwear brand. GOOS is a designer, manufacturer, distributor and retailer of premium outerwear for men, women and children. It carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Canada Goose’s current fiscal year’s earnings and sales indicates growth of 10% and 2.9%, respectively, from the year-ago actuals. Canada Goose delivered a trailing four-quarter average earnings surprise of 57.2%.
Allbirds is a lifestyle brand that uses naturally derived materials to make footwear and apparel products. It carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for BIRD’s current financial-year earnings implies growth of 16.1% from the year-ago actual. The company delivered a trailing four-quarter average earnings surprise of 21.3%.
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Coach Powers Tapestry's Momentum: Find Out What's Driving it
Key Takeaways
Tapestry, Inc.’s (TPR - Free Report) Coach brand delivered exceptional performance in the third quarter of fiscal 2025, achieving net sales of $1.29 billion, reflecting a 13% year-over-year increase on a reported basis and 15% growth on a constant-currency basis. The results reinforce Coach's leadership in the accessible luxury segment. Coach continues to thrive as Tapestry’s top-performing brand, driven by strong brand equity, product innovation and deep engagement with consumers.
Coach achieved a record 79% gross margin in the fiscal third quarter, supported by operational efficiency and premium pricing power. Average Unit Retail (AUR) grew in the mid-teens, with AUR in North America now approximately 70% higher than in 2019. The brand has raised AUR in 18 of the last 20 quarters not only by simply raising prices but also by delivering perceived customer value through compelling products and emotional storytelling.
Coach’s leather goods business saw strong double-digit growth in the fiscal third quarter, led by the Tabby and New York collections. Several key products, such as the Kiss Lock Bag, sold out within minutes. Footwear also contributed to growth, led by the Soho and Highline sneakers, designed for younger, fashion-forward consumers. The “One Coach” strategy, which aligns product and pricing across both outlet and full-price channels, drove engagement and margin expansion.
Looking ahead, Coach is central to Tapestry’s upgraded fiscal 2025 guidance. The company expects revenues of $6.95 billion, indicating 4% growth from the prior year on a reported basis. This revised forecast is ahead of the previous guidance, which called for 3% growth.
Regionally, the company expects sales to grow 3-4% in North America, around 30% in Europe, in the low-single digits in Greater China and the high-single digits in other parts of Asia. The operating margin is expected to expand 100 basis points year over year. Earnings per share are forecast to be $5.00, implying high-teens percentage growth from the prior year’s actual and exceeding the earlier mentioned $4.85-$4.90. With a clear focus on customer acquisition, product excellence and omnichannel experience, Coach is well-positioned for continued sustainable growth and global market share expansion.
TPR’s Zacks Rank & Share Performance Details
Shares of this Zacks Rank #3 (Hold) company have rallied 27.1% in the past six months compared with the Zacks Retail-Apparel and Shoes industry’s sharp 16.8% decline. This leading lifestyle specialty retailer’s ongoing strategic initiative and operational efficiencies have enabled it to outperform the broader Retail-Wholesale sector and the S&P 500 index’s decline of 0.1% and growth of 1.3%, respectively, during the same period.
TPR Stock Past 6-Month Performance
Image Source: Zacks Investment Research
Closing at $84.26 as of yesterday, the TPR stock is trading 7.3% below its 52-week high of $90.85 attained on Feb. 18, 2025. Technical indicators support Tapestry’s strong performance. The stock is trading above its 50 and 200-day SMAs (simple moving averages) of $74.23 and $64.73, respectively, highlighting a continued uptrend. This technical strength, along with sustained momentum, indicates positive market sentiment and investors’ confidence in TPR’s financial health and growth prospects.
TPR Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
Upward Estimate Revisions Favor Tapestry Stock
The positive sentiment surrounding TPR is reflected in the upward revisions in the Zacks Consensus Estimate for earnings. In the past 60 days, the consensus estimate has moved up 13 cents to $5.05 per share for the current fiscal year and by 10 cents to $5.43 for the next fiscal year, indicating year-over-year growth of 17.7% and 7.5%, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
The Zacks Consensus Estimate for the current and the next fiscal year’s sales is pegged at $6.96 billion and $7.17 billion, respectively, implying year-over-year growth of 4.3% and 3%.
Image Source: Zacks Investment Research
Key Picks
Some better-ranked stocks are Stitch Fix (SFIX - Free Report) , Canada Goose (GOOS - Free Report) and Allbirds Inc. (BIRD - Free Report) .
Stitch Fix delivers customized shipments of apparel, shoes and accessories for women, men and kids. It carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Stitch Fix’s current fiscal year’s earnings implies growth of 69.7% from the year-ago actuals. SFIX delivered a trailing four-quarter average earnings surprise of 51.4%.
Canada Goose is a global outerwear brand. GOOS is a designer, manufacturer, distributor and retailer of premium outerwear for men, women and children. It carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Canada Goose’s current fiscal year’s earnings and sales indicates growth of 10% and 2.9%, respectively, from the year-ago actuals. Canada Goose delivered a trailing four-quarter average earnings surprise of 57.2%.
Allbirds is a lifestyle brand that uses naturally derived materials to make footwear and apparel products. It carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for BIRD’s current financial-year earnings implies growth of 16.1% from the year-ago actual. The company delivered a trailing four-quarter average earnings surprise of 21.3%.