Tapestry (TPR) Q2 2026 earnings summary

Executive summary

• Achieved record quarterly revenue of $2.5 billion, up 14% year-over-year, with pro forma revenue growth of 18% led by a 25% gain at the Coach brand and strong global sales momentum.

• Operating margin expanded by 620 basis points (GAAP) and 390 basis points (non-GAAP), driven by gross margin improvement and SG&A leverage.

• Diluted EPS rose 94% to $2.68 (GAAP) and 34% to $2.69 (non-GAAP) compared to the prior year.

• Raised full-year outlook for revenue, operating margin, EPS, and free cash flow, citing structural advantages and strong brand momentum.

• Completed the sale of the Stuart Weitzman business in August 2025, focusing the portfolio on core brands.

Financial highlights

• Q2 FY26 pro forma net sales reached $2.50 billion, up 18% year-over-year; gross profit was $1.89 billion with a gross margin of 75.5%, up 110 bps.

• Operating income was $716 million (GAAP) and $720 million (non-GAAP); operating margin expanded to 28.6% (GAAP) and 28.8% (non-GAAP).

• Adjusted EPS was $2.69, up 34% year-over-year; net income was $561 million (GAAP) and $565 million (non-GAAP).

• Adjusted free cash flow for the quarter was $1.04 billion, up from $772 million a year ago.

• Coach delivered $2.14 billion in sales (+25% YoY), while Kate Spade saw $360 million in sales (-14% YoY).

Outlook and guidance

• Fiscal 2026 revenue expected to exceed $7.75 billion, up 15% nominally and 14% constant currency; pro forma revenue to grow 15%.

• Raised EPS guidance to $6.40–$6.45, over 25% growth year-over-year; operating margin expansion of ~180 bps and gross margin increase of ~20 bps expected.

• Adjusted free cash flow outlook increased to $1.5 billion; capex and cloud computing costs expected to be ~$200 million.

• Coach projected to grow high teens %, Kate Spade to decline high single digits with sequential improvement.

• Guidance assumes no material worsening of inflation or consumer confidence and excludes one-time costs from the Stuart Weitzman sale.