Tapestry (TPR) Q4 2026 earnings summary

Executive summary

• Achieved FY26 revenue, operating margin, and EPS targets two years ahead of plan, with annual revenue of $8.0B and 17% global sales growth, led by Coach's 24% annual increase and strong Gen Z-led customer acquisition.

• Welcomed 11 million new customers globally, with 35% from Gen Z, and accelerated growth in core leather goods with both AUR and unit increases.

• Continued investment in brands, people, and proprietary AI and technology, securing the first AI patent and building on data fabric technology.

• Strong global performance, with double-digit growth across North America, Europe, and APAC, and a focus on direct-to-consumer and digital expansion.

• Returned $1.7B to shareholders in FY26 via $326M in dividends and $1.35B in share repurchases; Board approved a 16% dividend increase.

Financial highlights

• FY26 revenue reached $8.0B, up 17% on a pro forma constant currency basis; gross profit $6.12B (76.6% margin); operating income $1.87B (23.4% margin); EPS $7.05, up 38% year-over-year.

• Q4 sales rose 11% year-over-year to $1.88B; gross margin for Q4 was 78.1%, up 180 basis points; Q4 EPS $1.32, up 28%.

• Coach FY26 net sales: $6.91B (+24%); operating margin: 35.8%. Kate Spade FY26 net sales: $1.07B (-10%); operating margin: -2.5%.

• Adjusted free cash flow for FY26: $1.86B, up from $1.35B prior year.

• Year-end cash and short-term investments: nearly $1.2B; net debt: $1.2B; gross debt to adjusted EBITDA leverage ratio: 1.1x.

Outlook and guidance

• FY27 revenue guidance: $8.4–$8.5B, representing mid-single-digit growth; Coach expected to grow high-single-digits, Kate Spade to decline high-single-digits.

• Operating margin expected to expand by 50 basis points to nearly 24%; gross margin to increase by ~30 bps.

• EPS guidance for FY27: $7.80–$7.90, reflecting low double-digit growth; adjusted free cash flow approaching $1.7B.

• CapEx and cloud computing costs projected at $300M, with 70% allocated to store fleet growth and enhancements.

• Plan to return $1.7B to shareholders in FY27, with a 16% dividend increase to $1.85/share and continued share repurchases.