NYSE$TPR

Tapestry, Inc · Q3 2024 earnings

Q3 2024 earnings · · Investor relations

Briefing

Tapestry's Q3 earnings outperformed expectations due to disciplined brand building and operational excellence.

Tapestry, Inc. reported fiscal third-quarter results that exceeded expectations, driven by gross margin expansion. The company maintained its EPS outlook for fiscal year 2024 and generated robust operating and free cash flow.

  • Operating income and EPS outperformed expectations, fueled by gross margin expansion of 190 basis points.
  • Operating and free cash flow generation was robust, exceeding $900 million year-to-date.
  • Revenue was approximately in line with the prior year in constant currency, driven by growth in wholesale, led by International.
  • The company acquired approximately 1.2 million new customers in North America, with over half being Gen Z and Millennials.

Headline financials

Total Revenue

$1.48B

Previous: $1.51B-1.8%
EPS

$0.60

Previous: $0.78-23.1%
Gross Margin

74.7%

No prior period
Adjusted Free Cash Flow

$21.5M

No prior period
Inventory

$824M

No prior period
Capital Expenditures

-$62.7M

Previous: -$150M+58.1%
Free Cash Flow

$76.7M

Previous: $37.1M+106.7%
Net Income

$139M

Previous: $187M-25.3%
Operating Income

$204M

Previous: $226M-9.7%
Gross Profit

$1.11B

Previous: $1.1B+0.8%
Cash & Equivalents

$6.98B

Previous: $637M+994.6%
Total Assets

$13.7B

Previous: $6.98B+96.6%
Stock-Based Comp

$23.6M

Previous: $20.9M+12.9%

Revenue & EPS history

Tapestry · Revenue · Quarterly

$1.48B

Q3 2024-1.8%vs Q3 2023
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Revenue by segment

Tapestry · $1.51B total across 3 segments · Q1 2024

  • Total Coach
    $1.16B+3.4%
  • Total Kate Spade
    $303M-5.8%
  • Stuart Weitzman
    $52.6M-19.4%

Forward guidance

Tapestry expects revenue of over $6.6 billion, and earnings per diluted share of $4.20 to $4.25.

Tailwinds

  • Revenue approximately in-line with prior year on a reported basis and representing growth of approximately 1% on a constant currency basis
  • Net interest expense of approximately $12 million
  • Tax rate of approximately 20%
  • Weighted average diluted share count of approximately 233 million shares
  • Earnings per diluted share of $4.20 to $4.25, representing 8% to 9% growth compared to the prior year

Headwinds

  • No revenue or earnings contribution or deal-related costs related to the proposed acquisition of Capri Holdings Limited
  • No further appreciation of the U.S. Dollar
  • No material worsening of inflationary pressures or consumer confidence
  • No benefit from the potential reinstatement of the Generalized System of Preferences (“GSP”)
  • Financial results could differ materially from the outlook provided given the dynamic nature of external factors

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2024

Historical avgQ3 2024

+0.2%

Avg return

Earnings day

+2.2%

Avg return

5 days after

+2.7%

Avg return

30 days after

56%

40 / 71 earnings

Positive

+18.8%

Q3 2022

Best reaction

-20.2%

Q4 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q3 2026+1.7%-12.0%-6.0%
Q2 2026+10.2%+17.9%+11.0%
Q1 2026-9.5%-6.7%+6.4%
Q3 2025+3.6%+11.8%+5.6%
Q2 2025+12.0%+10.9%+2.1%
Q1 2025+4.9%+2.8%+25.1%
Q4 2024+6.4%+6.4%+12.6%
Q3 2024+2.8%+8.0%+11.3%
Q2 2024+4.1%+5.8%+16.7%
Q1 2024+2.4%+11.1%+22.1%
Q4 2023+0.8%-14.2%-22.7%
Q3 2023+10.9%+12.8%+14.9%
Q2 2023+2.8%+4.4%-4.3%
Q1 2023+13.3%+12.0%+16.6%
Q4 2022-0.8%-1.6%+2.1%
Q3 2022+18.8%+24.5%+23.3%
Q2 2022-3.8%+0.0%-15.6%
Q1 2022+6.9%+7.0%+1.5%
Q4 2021-2.1%+4.5%-2.6%
Q3 2021+1.5%-3.9%-11.7%
Q2 2021+8.5%+10.8%+21.1%
Q1 2021+4.3%+12.9%+36.1%
Q4 2020+2.1%-1.7%+3.5%
Q3 2020-11.1%-13.4%-20.2%
Q2 2020-1.5%+0.7%-23.6%
Q1 2020-2.2%+2.7%-4.0%
Q4 2019-20.2%-15.8%+0.7%
Q3 2019+4.9%+0.1%-1.6%
Q2 2019-13.9%-10.1%-14.7%
Q1 2019+3.7%+4.9%-6.8%
Q4 2018+9.7%+8.3%+5.3%
Q3 2018-13.8%-14.2%-18.7%
Q2 2018+11.4%+9.1%+15.5%
Q1 2018-3.4%-1.6%+1.2%
Q4 2017-15.0%-15.7%-13.1%
Q3 2017+10.1%+10.1%+19.2%
Q2 2017+5.1%+2.2%+6.8%
Q1 2017-1.2%-1.5%+1.1%
Q4 2016-4.5%-5.1%-9.7%
Q3 2016+4.5%
Q2 2016+12.7%
Q1 2016+2.2%
Q4 2015+4.3%
Q3 2015-9.0%
Q2 2015+2.0%
Q1 2015-6.5%
Q4 2014+2.3%
Q3 2014-11.4%
Q2 2014-6.1%
Q1 2014-10.4%
Q4 2013-8.2%
Q3 2013+11.2%
Q2 2013-16.1%
Q1 2013+6.0%
Q4 2012-17.7%
Q3 2012-4.0%
Q2 2012+7.9%
Q1 2012-0.4%
Q4 2011+1.2%
Q3 2011+0.9%
Q2 2011+0.7%
Q1 2011-0.5%
Q4 2008-1.7%
Q4 2010-1.7%
Q3 2010-6.5%
Q3 2009-6.5%
Q2 2010-3.5%
Q2 2009-3.5%
Q1 2009+3.5%
Q4 2009+3.5%
Q1 2010+3.5%

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