Shares of luxury handbag maker Tapestry, Inc. plunged over 15% on Thursday after the company issued a lower-than-expected full-year sales forecast for fiscal 2027. Softer sales projections and persistent underperformance at its Kate Spade brand overshadowed stronger-than-expected fourth-quarter earnings and record full-year results for fiscal 2026.
Key Financial Highlights
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Stock Reaction: Tapestry (NYSE: TPR) tumbled ~15% in morning trading, ranking among the top losers in the S&P 500.
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FY 2027 Revenue Guidance: Projecting between $8.4 billion and $8.5 billion, slightly below Wall Street estimates of $8.47 billion at the midpoint.
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FY 2026 Full-Year Performance:
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Total revenue rose 14% to $8.0 billion.
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Adjusted earnings per share reached $7.05, expanding operating margins by 340 basis points to 23.4%.
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Q1 FY 2027 Earnings Outlook: Offered stronger near-term profitability guidance with expected adjusted EPS of ~$1.55, topping analyst estimates of $1.48.
Brand Performance: Coach Outpaces Kate Spade
The luxury parent company continues to see a sharp divergence in performance across its brand portfolio:
| Brand | FY 2026 Performance & Trends |
| Coach | +23% constant-currency growth. Remains the standout performer, driven by higher average unit retail prices (AUR) and strong global customer acquisition. |
| Kate Spade | -11% revenue decline. Continued structural challenges and shifting consumer demand have weighed down overall margins, forcing strategic redesigns. |
Wall Street Reaction & Outlook
Despite delivering robust Q4 earnings and margin expansion, investors focused heavily on the modest revenue shortfall for the upcoming fiscal year. Analysts highlighted that execution surrounding Kate Spade’s brand turnaround and broader macroeconomic pressures on luxury retail remain central hurdles for the stock in the near term.
