Tapestry's Q3 Report: Bags of Money and Zero Drama
Key Points
- Tapestry, Inc. reported a 7% revenue increase to $1.58 billion for Q3 2025, with Coach's sales up 15% thanks to a surge in Gen Z and Millennial shoppers.
- Digital sales are thriving, and Tapestry plans to return over $2 billion to shareholders through dividends and buybacks, reflecting strong company confidence.
- Despite challenges like tariffs, Tapestry remains optimistic, raising its revenue forecast and cleaning house with the potential sale of Stuart Weitzman.
Ever wondered how a company named after wall decorations manages to rake in billions? Well, grab your overpriced handbag and settle in for some financially fabulous news from Tapestry, Inc.'s Q3 earnings report.
Coach's Cash Carnival
The luxury retailer strutted its way through fiscal 2025's third quarter with a swagger that would make any Wall Street fashionista proud. Revenue jumped 7% to $1.58 billion, while GAAP diluted EPS soared 60% to $0.95 - numbers that sparkle brighter than a sequined clutch at a midnight gala.
Gen Z's Shopping Spree: More Bags, Less Budget
Coach, the crown jewel in Tapestry's collection, flexed its retail muscles with a 15% revenue boost. The brand apparently convinced 1.2 million new North American customers - mostly Gen Z and Millennials - that they absolutely needed another designer bag. These young shoppers now represent two-thirds of new customers, proving that living paycheck to paycheck doesn't stop anyone from looking fabulous.
Digital Dollars and Brick-and-Mortar Magic
Tapestry's gross margin expanded by 140 basis points, a feat that probably had accountants doing victory laps around their spreadsheets. Digital sales grew in the mid-teens percentage range, showing that clicking "add to cart" at 3 AM is still very much in vogue.
The company is feeling so generous they're planning to shower shareholders with over $2 billion through dividends and share repurchases in fiscal 2025. They've already declared a quarterly dividend of $0.35 per share, which is basically like getting a designer coin purse with every investment.
Looking ahead, Tapestry raised its full-year revenue forecast to approximately $6.95 billion, showing more confidence than a runway model in six-inch heels. Even with looming tariffs threatening to rain on their parade, management seems unfazed, probably because they've got enough designer umbrellas to weather any storm.
The pending sale of Stuart Weitzman suggests Tapestry is doing some closet cleaning of its own. While challenges like international trade policies and fickle consumer tastes remain, Tapestry continues to prove that in the world of luxury retail, they're not just hanging on the wall - they're hanging onto success.
Note to investors: Keep your designer glasses focused on August's quarterly results. Just remember, past performance in fashion, as in finance, doesn't guarantee future runway success.
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