TPR

Tapestry, Inc. TPR enters fiscal 2027 with a tougher earnings test after fourth-quarter adjusted earnings beat the Zacks Consensus Estimate and margins expanded sharply. Management still expects profit growth even as revenue growth moderates.The question is whether operating gains can absorb higher marketing spending and changing tariff pressure. Coach remains the earnings engine, while Kate Spade limits the margin for execution errors. Tapestry, Inc. price-consensus-eps-surprise-chart | Tapestry, Inc. Quote Tapestry expects fiscal 2027 revenues of $8.4-$8.5 billion, representing mid-single-digit growth on a nominal and constant-currency basis. That compares with fiscal 2026 pro forma constant-currency growth of 17%.Coach revenues are projected to rise at a high-single-digit rate, while Kate Spade revenues are expected to decline at a high-single-digit rate. Ralph Lauren Corporation RL provides a sector comparison, with first-quarter fiscal 2027 revenues up 14% reported and 13% in constant currency. Management expects fiscal 2027 operating margin to expand about 50 basis points. The plan includes roughly 30 basis points of gross-margin improvement and 20 basis points of leverage from selling, general and administrative expenses.That follows fourth-quarter fiscal 2026 adjusted operating-margin expansion of 250 basis points to 19.3%. For the full year, adjusted gross margin improved 120 basis points despite a 130-basis-point tariff and duty headwind. The fiscal 2027 outlook embeds a mid-20% tariff rate on U.S. inventory receipts and assumes mitigation will make the year-over-year profit impact roughly neutral. Tariffs are expected to provide a modest first-half benefit before becoming a second-half headwind.Sourcing, product mix and operational offsets therefore matter to the margin target. Levi Strauss & Co. LEVI faced similar pressure in its second quarter of 2026, when gross margin rose 10 basis points despite tariff and foreign-exchange headwinds. Coach represented 86.4% of fiscal 2026 revenues, giving the brand substantial influence over consolidated results. Management expects Coach to maintain an operating margin of nearly 36% in fiscal 2027.Kate Spade remains the counterweight. The brand posted a $27.2 million adjusted operating loss in fiscal 2026, and management expects another modest operating loss in fiscal 2027. Tapestry expects fiscal 2027 adjusted earnings of $7.80-$7.90 per share, representing low-double-digit growth. Adjusted free cash flow is projected to approach $1.7 billion as capital expenditures and cloud-computing costs rise to about $300 million.First-quarter adjusted earnings are expected at about $1.55 per share, up by low teens. Gross margin is projected to expand roughly 120 basis points, but higher marketing spending is expected to keep operating margin in line with the prior-year quarter. Image Source: Zacks Investment Research The fiscal 2027 setup combines a credible margin plan with execution risk. Tariff mitigation, elevated marketing and continued Kate Spade losses leave less room for shortfalls even with Coach providing strong profitability.TPR currently carries a Zacks Rank #3 (Hold), which supports a measured stance rather than a clear near-term buy signal. A Zacks Rank #3 can still be appropriate for holding shares while investors monitor execution and estimate trends. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The stock also has a Growth Score of A, Momentum Score of A and VGM Score of A, alongside a Value Score of C. The stronger Growth and Momentum Scores point to favorable characteristics in those styles, while the VGM Score reflects the combined weighted style picture and the Value Score is less supportive. Because the Style Scores complement the Zacks Rank, the combined picture argues for patience. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tapestry, Inc. (TPR) : Free Stock Analysis Report Ralph Lauren Corporation (RL) : Free Stock Analysis Report Levi Strauss & Co. (LEVI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. Tapestry (NYSE: TPR) announced a 16% increase to its quarterly dividend. The company also reported the completion of a sizable share repurchase program. Both moves signal the board's focus on returning cash to shareholders. For investors watching how companies use dividends and buybacks to return cash, it can be useful to compare Tapestry with a wider group of income focused stocks through 12 dividend fortresses. Tapestry is a US based luxury accessories and lifestyle company with a reported market value of about $26.0b, so changes to its dividend and buyback policy can matter for investors who follow larger global brands with broad exposure across North America and Asia. Is Tapestry's dividend sustainable? Check out what every dividend investor needs to know in our dividend analysis. The new quarterly dividend of $0.4625 per share points to an anticipated annual rate of $1.85 per share. How attractive that is for income investors depends on the share price and therefore the yield, which will move with the stock rather than the board's stated per share amount. Tapestry reported full year 2026 net income of $1.5b, with basic earnings per share from continuing operations of $7.49. Against that earnings base, an annual dividend of $1.85 per share implies a payout well below total earnings, although the flagged concerns about an unstable dividend track record and a high level of debt still matter for long term reliability. The combination of a higher dividend and completion of a $1.1b buyback fits with the Narrative that Tapestry is using cash flow from margin improvement and earnings growth to return capital, while still investing in digital, AI and Gen Z customer expansion. It does not remove the longer term risks around tariffs, Kate Spade and reliance on Coach, but it signals management confidence in the current earnings profile. If we take a look at the community Narrative for Tapestry, we can see how this news fits into the bigger investment story. The clearest test will be whether Tapestry can keep earnings per share growing while maintaining or increasing this dividend and continuing some level of buybacks through the 2027 fiscal year. The next few earnings reports and any updates to capital return plans will show if this balance is holding. For the full picture including more risks and rewards, check out the complete Tapestry analysis. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include TPR. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Joanne C. Crevoiserat, chief executive officer of Tapestry, Inc. (NYSE:TPR), reported a sale of 72,573 shares of common stock on August 19, according toa n SEC Form 4 filing. Transaction value based on SEC Form 4 weighted average sale price ($132.40); post-transaction value based on the August 19 market close ($131.72). What was the primary driver of this transaction?The disposition was non-discretionary in nature, consisting of shares withheld for tax obligations upon vesting and shares sold to cover costs associated with exercising stock options. How does this impact the CEO's total economic interest in the company?Despite the 10% reduction in direct common stock, the executive maintains a significant position of 627,849 direct shares and additional derivative securities, including vested and unvested awards. What is the recent performance context for the stock?The transaction occurred with the stock priced at $132.40 per share, following a one-year total return of 35% as of the August 19 transaction date. Does the company's financial profile support the current valuation?Tapestry reported trailing twelve-month revenue of $7.9 billion and net income of $662.8 million, supporting a market capitalization of $26.6 billion as of the August 19 market close. Tapestry, Inc. operates a diversified portfolio of premium lifestyle brands--Coach, Kate Spade, and Stuart Weitzman--offering luxury accessories, apparel, and home goods across women's, men's, and children's categories, with revenue primarily generated through direct-to-consumer channels and wholesale partnerships. The company employs a multi-brand, geographically diversified business model that leverages distinct brand identities and positioning to capture market share across premium and accessible luxury segments, generating profitability through product design, manufacturing, and global distribution networks. Tapestry's primary customer base comprises affluent consumers in developed markets, particularly in the United States, Japan, and Greater China, with a strategic focus on female consumers while expanding male and children's product categories to broaden the addressable market opportunity. Tapestry, Inc. represents a scaled global luxury conglomerate with $8 billion in TTM revenue and a market capitalization of $26.6 billion, positioning it as a significant player in the accessible-to-premium luxury goods sector. The company's competitive advantage derives from its portfolio of established, heritage brands with distinct market positioning, coupled with sophisticated omnichannel distribution capabilities and strong international presence across key growth markets. The organization's operational scale, brand equity, and demonstrated ability to drive profitability--evidenced by $1.5 billion in TTM net income--underscore its strategic positioning within the global luxury goods market. This filing is basically just tax withholding and housekeeping, but it's worth looking at for a few reasons: 72,573 shares are roughly 10% of Crevoiserat's direct stake, and the move landed six days after Tapestry stock dropped about 16% on an earnings reaction, even though the quarter itself beat guidance.In the earnings report and the call that followed, Tapestry reported hitting its three-year revenue, margin, and EPS targets two years early, with fiscal 2026 revenue up 14% to $8 billion and non-GAAP EPS up 38% to $7.05. What spooked the market wasn't the year that just ended, it was the year ahead. Fiscal 2027 guidance calls for mid-single-digit revenue growth and low-double-digit EPS growth, a deceleration from what Tapestry just delivered, and Kate Spade is expected to post a modest operating loss as the brand keeps investing through a turnaround. Crevoiserat summed up her view of the business simply: "Our success is by design." Whether the market agrees with that framing next quarter is the real question here, not this filing. Before you buy stock in Tapestry, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Tapestry wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $432,189!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,330,956!* Now, it’s worth noting Stock Advisor’s total average return is 967% — a market-crushing outperformance compared to 212% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 22, 2026. Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool recommends Tapestry. The Motley Fool has a disclosure policy. Tapestry's CEO Gave Up Stock Right After a Rough Earnings Reaction. Here's What to Know was originally published by The Motley Fool

Image source: The Motley Fool. Thursday, Aug. 13, 2026 at 8:00 a.m. ET Global Head of Investor Relations - Christina Colone Chief Executive Officer - Joanne Crevoiserat Chief Financial Officer and Chief Operating Officer - Scott Roe CEO and Brand President of Coach - Todd Kahn Operator: Good day, and welcome to this Tapestry conference call. Today's call is being recorded. [Operator Instructions] At this time, for opening remarks and introductions, I would like to turn the call over to the Global Head of Investor Relations, Christina Colone. Christina Colone: Good morning. Thank you for joining us. With me today to discuss our fourth quarter and full year results, our strategies and our outlook are Joanne Crevoiserat, Tapestry's Chief Executive Officer; and Scott Roe, Tapestry's Chief Financial Officer and Chief Operating Officer. Before we begin, we must point out that this conference call will involve certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. This includes projections for our business in the current or future quarters or fiscal years. Forward-looking statements are not guarantees, and our actual results may differ materially from those expressed or implied in the forward-looking statements. Please refer to our annual report on Form 10-K, the press release we issued this morning and our other filings with the Securities and Exchange Commission for a complete list of risks and other important factors that could impact our future results and performance. Non-GAAP financial measures are included in our comments today and in our presentation slides. For a full reconciliation to corresponding GAAP financial information, please visit our website, www.tapestry.com/investors, and then view the earnings release and the presentation posted today. Now let me outline the speakers and topics for this conference call. Joanne will begin with highlights for Tapestry and our brands. Scott will continue with our financial results, capital allocation priorities and our outlook going forward. Following that, we will hold a question-and-answer session where we will be joined by Todd Kahn, CEO and Brand President of Coach. After Q&A, Joanne will conclude with brief closing remarks. I'd now like to turn it over to Joanne Crevoiserat, Tapestry's CEO. Joanne Crevoiserat: Good morning. Thank you, Christina, and welcome, everyone. Fiscal 2026 was a defining year for Tapestry. We meaningfully exceeded expectations, achieving the 3-year revenue, operating margin and earnings per share commitments we established at our Investor Day 2 years ahead of plan. We delivered strong growth and record results while continuing to invest in our brands, our people and the capabilities that will shape our future. More important than what we accomplished is what we've built. Through intentional choices, disciplined execution and a deep understanding of the consumer, we have built a stronger, more focused organization who every day bring our Amplify strategy to life, delivering creativity, value and relevance at scale, strengthening our connections with consumers. These efforts continue to compound, extending our competitive advantage while driving durable growth and long-term shareholder value. In a world where consumer expectations, technology and competitive dynamics continue to evolve, the combination of our direct consumer relationships, data-driven decision-making, global scale and agile operating model has become increasingly valuable and differentiated. With that, let me touch on some highlights for the year. We achieved revenue of $8 billion, growing 17% on a pro forma constant currency basis, expanded operating margin by 340 basis points to over 23% and increased earnings per share by 38% to $7.05. Growth was fueled by customer acquisition as we welcomed 11 million new customers to our brands, led by Gen Z. Importantly, we accelerated growth in our core leather goods category with AUR and unit growth. Luxury leather goods remains one of the most attractive categories within the consumer space because of its enduring demand, compelling economics and significant runway for growth. In addition, we delivered broad-based double-digit growth across key regions, gaining share and expanding the market. Our agile direct-to-consumer-led operating model drove double-digit revenue growth and increasing profitability across both digital and stores. Further, Tapestry is committed to embracing AI to enhance the magic of our people and our brands. To that end, we continue to build proprietary technology and AI capabilities that differentiate how we operate and empower our teams. During the year, we secured our first AI patent, building on our previously patented data fabric technology. Together, they reflect our culture of innovation and more than a decade of investment in data, decision intelligence and enterprise technology. Overall, our fiscal year '26 results demonstrate the power of our approach to brand building. We continue to win with consumers at the point of market entry, welcoming younger customers who transact at higher AURs, have stronger retention and influence purchasing behavior across generations. This reinforces our confidence that our greatest opportunities lie ahead. Now moving to our results by brand. Coach delivered another strong quarter with constant currency revenue growth of 14% and increasing profitability. This capped an exceptional year and reinforced the enduring strength of our iconic 85-year-old brand. Several factors underscore the durability of our growth. We drove new customer acquisition around the world, welcoming over 2 million new consumers in the quarter and nearly 9 million for the full year. Growth was led by Gen Z, whose influence extended across generations. At the same time, existing customers continue to drive strong sales. Underpinning these results is Coach's consumer-led approach, consistently translating deep consumer insights into action to build lasting emotional connections with the brand. Our core leather goods assortment continued to lead in Q4, with handbag AUR increasing at a mid-teens rate and unit volumes roughly in line with the prior year, both consistent with expectations and our deliberate strategy to prioritize brand health and reduce promotions. For the year, handbag AUR rose mid-teens and units increased low double digits, demonstrating the multifaceted nature of our growth. Looking ahead, we continue to see opportunity to grow both AUR and units while staying true to the values and the value proposition that define Coach. Further, our strong results continued across key geographies in the fourth quarter, including North America up 10%, Greater China rising 30% and Europe increasing 25%, highlighting the global resonance of the brand. Coach is bringing new consumers into the category and growing the market. Given the strength of the brand and our large addressable market, we continue to see a clear path to Coach becoming a $10 billion brand. Now to cover our fourth quarter results in more detail. Our creative teams continue to execute with clarity and purpose, delivering product innovation that is resonating with consumers. Our icons continued to outperform, consistent with our strategy with broad-based strength across the assortment. The New York family, including Brooklyn, Empire and Chelsea, along with the Tabby and Teri families, drove strong Gen Z acquisition and reinforced Coach's leadership in its core category with a robust innovation pipeline ahead. Structurally, we concentrate product innovation behind core families that build over time while remaining disciplined in our pursuit of growth. More broadly, our results reflect the strategic choices we've made to strengthen the brand. Perhaps the most significant has been our One Coach strategy. By deliberately blurring the traditional industry lines between retail and outlet channels, bringing collection product at full price into outlet and unifying our digital experience through a single coach.com, we've aligned our approach with how consumers shop today, creating a stronger, more consistent global expression of the brand. This has driven customer acquisition, higher AURs and growth around the world. Next, turning to footwear. We delivered high teens growth in the quarter with increasing demand from Gen Z. Sneakers continued to fuel the growth driven by the success of the Soho family, along with continued strength of Margot. Footwear remains a long-term growth opportunity for Coach, given our brand strength, low share of the market and the category's relevance to our target consumer. Turning to marketing. Our strategic investments continue to generate compounding benefits this quarter. We increased marketing spend by approximately 20% versus the prior year with a continued shift toward top-of-funnel brand building to support sustained customer acquisition. Coach's Explore Your Story campaign continued to resonate, supporting increased unaided awareness and reinforcing Coach's top-of-mind presence among Gen Z. Building on this momentum, we launched &Coach, a campaign co-created with Gen Z that celebrates moments of becoming and the confidence a Coach bag can champion along the way. Additionally, our partnerships extended Coach's reach into new communities and cultural conversations as we launched the second season of our WNBA partnership, strengthening the brand's connection at the intersection of fashion, sports and culture. Collectively, these actions are reinforcing Coach's cultural relevance and driving customer acquisition. More importantly, they strengthen a competitive advantage, a deep understanding of the consumer and an ability to consistently translate those insights into demand creation at scale. And finally, we deepen consumer engagement through distinctive brand experiences. We continue to roll out our expressive luxury store concept globally. These stores are driving higher traffic and longer dwell times, particularly among Gen Z consumers, supporting our plan to expand the concept to impact approximately 80% of our traffic by fiscal year '30. In addition, Coach Play continues to serve as both a destination for consumers and a source of inspiration for our broader store strategy. New Coach Play locations in Chicago, Atlanta and Le Marais in Paris are helping build brand desire with our target consumers. Together, these investments reflect our conviction that physical retail remains one of our most powerful opportunities to express the brand as consumers invite us into their world to share important moments in their life, extending the connection well beyond a transaction. In closing, my confidence in the future of Coach is grounded in the combination of an iconic brand, a deep understanding of today's consumer and an organization that continues to thoughtfully steward and evolve the brand, preserving what makes it distinctive while ensuring it remains relevant for new generations of consumers. I believe that combination positions Coach for continued leadership, meaningful growth and long-term value creation. Turning to Kate Spade. Our strategy for Kate Spade has been deliberate and phased: streamlining the business, solidifying the foundation and positioning the brand to scale. At its core, that means building greater brand desire and relevance to drive sustainable, profitable growth. In fiscal year '26, we remain disciplined in executing that strategy, making choices that improve the quality of the business. Although top line progress was more gradual than we planned, our experience has given us greater clarity on where consumers are responding, where our investments are driving results and where we need to focus going forward. Now turning to our strategic pillars and fourth quarter results. First, we are committed to fueling brand desirability supported by marketing. During the fourth quarter, we focused on increasing the reach and relevance of our full funnel marketing activities, which resulted in higher brand consideration among Gen Z in our latest U.S. Brand Health Tracker. In addition, our first creator-led YouTube campaign drove an increase in purchase intent well ahead of the platform benchmark, showing traction in our work. We also know that we need more consumers to engage with our content as unaided brand awareness more broadly has not yet improved, and this is a key part of driving acquisition and ultimately growth. As we enter fiscal year '27, we'll build on these learnings through creator partnerships and activations that drive brand awareness and desire. We're also pleased to welcome Allison Badea as Chief Marketing Officer, who brings deep brand-building experience from the luxury and beauty industries. Next, we continue to build a more focused assortment grounded in consumer insights. Our handbag blockbusters, led by the Margot, 454 and Duo families, contributed to continued improvement in handbags and drove customer acquisition, particularly among Gen Z consumers. We welcomed over 450,000 new customers during the quarter and approximately 2 million for the full year, with these consumers transacting at higher AURs than the balance of the customer base, a foundational element of our strategy. Finally, we continue to focus on creating compelling omnichannel experiences. Our light-touch renovation program, designed to bring more color and emotion to our stores, continued to drive a lift in sales through improvements in conversion and average transaction value, and we're expanding those learnings across additional locations. Looking ahead, as we move from streamlining to solidifying our foundation and preparing to scale, we're focused on further strengthening our creative execution and product and storytelling. The appointment of Jonathan Saunders as Executive Creative Director, working alongside Eva, will advance our efforts to bring uplifting luxury to life for a new generation of consumers with the distinctiveness of joy and femininity inherent in this iconic brand. To close, Kate Spade has significant long-term potential, and our conviction in that opportunity remains unchanged. We'll continue focusing our efforts and investment behind the initiatives that are strengthening the brand and positioning it for sustainable, profitable growth over time. Before turning it over to Scott, I'd like to come back to Tapestry's vision: to give more people the power to bring their own style and story into the world. Throughout fiscal 2026, we realized that vision by welcoming millions of new consumers to our brands, deepening our relationships with existing consumers and delivering the creativity, value and relevance that inspire self-expression across generations and geographies. Our success is by design. We will continue to stay curious, remain focused and earn the trust of consumers every day. This is how we will continue to build advantages that compound, delivering durable growth and long-term shareholder value. With that, I'll now hand it to Scott. Scott Roe: Thanks, Joanne, and good morning, everyone. As Joanne highlighted, we achieved the financial commitments we established at Investor Day 2 years ahead of plan, driving a step change in our earnings power and cash flow generation. From this stronger foundation, we enter fiscal 2027 confident in our ability to deliver mid-single-digit annual revenue growth, continued operating margin expansion and low double-digit EPS growth, consistent with our long-term commitments. Importantly, our competitive advantages translate into a differentiated financial model. We operate in an attractive category with durable demand and compelling margin characteristics. As we continue to welcome new customers to our brands and category, we generate higher quality growth and strong cash flow, supported by disciplined capital allocation. That combination gives us the power and flexibility to consistently invest in the business while returning meaningful capital to shareholders. With that, let me walk through our fourth quarter results in more detail, starting with revenue trends on a pro forma constant currency basis. Sales increased 11% compared to the prior year, highlighted by strong global momentum. North America sales rose 7% compared to the prior year, driven by a 10% increase at Coach, where we continue to drive healthy growth at expanding gross margins. In Europe, revenue grew 19% versus last year, fueled by continued strength in our direct business and robust new customer acquisition, particularly among Gen Z. Local consumers continue to drive growth, contributing to meaningful market share gains in the region. Given our relatively low penetration, we believe Europe remains a compelling long-term growth opportunity. Now turning to Greater China. Revenue rose 28%, driven by broad-based growth across channels, led by digital and strong customer acquisition. We are winning with Gen Z consumers through compelling creativity and relevant activations, contributing to significant market share gains. Given the size of the opportunity and the momentum we're seeing in the business, we're continuing to make strategic investments in the region, positioning us for long-term growth in this important market. In Other Asia, revenue increased 22%, led by growth in South Korea and Australia. And in Japan, sales declined 4%, as expected, reflecting our intentional pullback in promotions. Now touching on revenue by channel for the quarter. Our D2C-led model continued to drive strong results, with direct-to-consumer revenue increasing 11%. Digital sales grew approximately mid-single digits, while global brick-and-mortar sales increased in the mid-teens. Importantly, all channels delivered strong and increasing profitability. Moving down the P&L, we continue to drive healthy gross margin expansion, delivering a fourth quarter gross margin of 78.1%, up 180 basis points versus last year. This was driven by an operational increase of 170 basis points as well as a favorable 60 basis point impact from the divestiture of Stuart Weitzman. These benefits more than offset a tariff and duty headwind of approximately 60 basis points, including approximately 30 basis points at Coach and approximately 250 basis points at Kate Spade. Overall, our strong gross margin remains a core element of our value creation model, supported by an agile supply chain that enables us to deliver craftsmanship at scale, one of Tapestry's key competitive advantages. Turning to SG&A. Expenses increased 8%, while leveraging 80 basis points versus last year. This was inclusive of a 130 basis point increase in marketing, which represented 14% of sales in the quarter. Together, this reflects strong operational discipline and our continued ability to invest behind growth while expanding profitability. Overall, operating margin expanded 250 basis points in the quarter, driving a 25% increase in operating income and exceeding our expectations. Fourth quarter EPS of $1.32 increased 28% versus last year, also exceeding our guidance despite a headwind of more than $0.05 from a higher tax rate versus plan due to a number of discrete items. Now turning to shareholder returns. In fiscal '26, we returned $1.7 billion to shareholders. This included $326 million in dividends and $1.35 billion in share repurchases, representing approximately 11.5 million shares at an average price of $118 per share. Turning to fiscal '27, we expect to return another $1.7 billion to shareholders. Our Board approved a 16% increase in the dividend to an annualized rate of $1.85 per share, and we expect to repurchase approximately $1.35 billion of shares, underscoring our confidence in the future. Our ability to return significant capital to shareholders while continuing to invest for growth reflects the strength of our business and the consistency of our free cash flow. And now, before turning to the details of our balance sheet and cash flows, I'd like to reiterate our capital allocation priorities, which are unchanged. We have 2 foundational commitments: first, to invest in our brands and business to support long-term sustainable growth; and to return capital to shareholders via our dividend, with the goal over time to increase the dividend at least in line with earnings growth. Beyond these 2 foundational commitments, our robust cash flow generation provides us with balance sheet flexibility for value creation. This includes the opportunity for share repurchase activity under our previously announced share repurchase authorization. And finally, utilizing our rigorous 4-lens framework, we consistently evaluate opportunities for strategic portfolio management. Importantly, and as previously communicated, before moving forward with any acquisitions, we will ensure Coach remains strong and Kate Spade has returned to sustainable top line growth. These clear capital allocation priorities are underpinned by our firm commitment to a solid investment-grade rating and maintaining our long-term gross leverage target of below 2.5x. Now turning to the details of our balance sheet and cash flows. We ended the year with nearly $1.2 billion in cash and short-term investments and total borrowings of $2.4 billion, representing net debt of $1.2 billion. Our gross debt to adjusted EBITDA leverage ratio was 1.1x, more than a full turn below our long-term target. Adjusted free cash flow totaled $1.86 billion for the year, and CapEx and cloud computing costs were $217 million. Inventory levels at year-end were 4% below prior year, slightly below expectations due to a shift in receipt timing into Q1. For fiscal '27, we expect inventory levels to increase year-over-year in support of our growth ambition. Now moving to our guidance for fiscal '27, which is provided on a non-GAAP and comparable 52-week versus 52-week basis. Our full year guidance remains consistent with the long-term financial algorithm we established at Investor Day. Now turning to the details. For the fiscal year, we expect revenue of $8.4 billion to $8.5 billion, representing mid-single-digit growth on a nominal and constant currency basis. FX is expected to be a 40 basis point tailwind for the year. Touching on sales details by region on a constant currency basis. As we've previously discussed, our long-term algorithm contemplates disciplined growth in North America and an increasing contribution from international markets, where our brands remain underpenetrated and we see substantial opportunity over time. In North America, we expect revenue to increase low single digits. In both Europe and Greater China, we expect growth of mid-teens. In Japan, we're forecasting a return to growth. And in Other Asia, we anticipate high single-digit gains. By brand, this guidance incorporates high single-digit growth at Coach and a high single-digit decline at Kate Spade. In addition, our outlook assumes operating margin expansion of 50 basis points to nearly 24%, driven by both an increase in gross margin and SG&A leverage. This reflects our continued ability to invest behind our brands while expanding profitability. We expect gross margin to increase by approximately 30 basis points, driven by operational improvements and favorable geographic and brand mix. Embedded in our outlook is the assumption for a mid-20s percent tariff rate on U.S. imports for fiscal '27, resulting in a roughly net neutral P&L impact year-over-year, including mitigating actions. On SG&A, we expect approximately 20 basis points of leverage, reflecting disciplined expense management while continuing to invest behind brand growth. For some texture on operating profit by brand, we expect Coach to maintain its best-in-class operating margin of nearly 36%. At Kate Spade, we expect a modest operating loss, reflecting continued investment in the brand. Corporate expenses are expected to leverage for the year, a trend we expect to continue. Moving to below-the-line expectations for the year. Net interest expense is expected to be approximately $55 million. The tax rate is expected to be approximately 18.5%, and our weighted average diluted share count for the year is expected to be approximately 203 million shares. Taken together, we expect EPS of $7.80 to $7.90, representing low double-digit growth versus the prior year. As a reminder, our guidance is provided on a comparable 52-week basis. Fiscal 2027 includes a 53rd week, which is expected to contribute approximately 1 percentage point of annual revenue growth and have neutral impact on operating margin. Moving on, we anticipate adjusted free cash flow to approach $1.7 billion. And finally, we expect CapEx and cloud computing costs to be in the area of $300 million or 3% to 4% of revenue. This reflects a step-up in investment to support future growth, including incremental investment in Coach's store fleet through new openings and renovations. Approximately 70% of our spend will be related to growing and enhancing our fleet, with the balance primarily supporting our ongoing technology and digital investments. Before turning to the first quarter, let me briefly comment on our approach to guidance and the shape of the year. Our current quarter guidance reflects our latest thinking, while the balance of the year embeds in aggregate the long-term financial algorithm we've established. On the phasing of the year, keep in mind that we continue to operate in an environment of macro uncertainty and evolving tariff dynamics alongside shifts in the cadence of our marketing investments. As a result, quarterly profitability will be uneven, with tariffs providing a modest benefit in the first half of the year before becoming a headwind in the second half. Generally, revenue is forecasted to grow high single digits in the first half of the year and mid-single digits in the second half, with Q4 above Q3 given prior year compares. From an EPS standpoint, we're incorporating low double-digit growth in both the first and second half. Touching on Q1 guidance specifically. We expect revenue growth of high single digits on both a nominal and constant currency basis versus prior year pro forma revenue. This includes low teens growth at Coach, which represents mid-30s growth on a 2-year stack basis. And at Kate Spade, we've embedded a low double-digit decline. Turning to margins. We expect gross margin to increase by 120 basis points in Q1, offset by higher SG&A due entirely to continued increases in marketing, resulting in operating margin in line with prior year. Taken together, Q1 EPS is forecasted to be approximately $1.55, a low teens increase. In closing, fiscal 2026 demonstrated both the quality and potential of our business. We achieved Tapestry's revenue, operating margin and EPS commitments established at our Investor Day 2 years ahead of plan while continuing to invest in our brands, capabilities and future growth and returning $1.7 billion to shareholders. We enter fiscal 2027 with confidence. Our outlook is consistent with the long-term financial algorithm we established at Investor Day, reflecting the durability of our model and the quality of our growth. The strength of our category, our brands and our operating model gives us the power and flexibility to consistently invest for growth while returning meaningful capital to shareholders. These advantages continue to compound, driving durable growth and long-term shareholder value. I'd now like to open it up for your questions. Operator: [Operator Instructions] We'll take our first question from Matthew Boss with JPMorgan. Matthew Boss: Congrats on a nice quarter. So Joanne, you delivered a very strong fiscal '26 and are guiding the first quarter to continued strong growth, particularly at Coach. But the full year outlook does embed some moderation as the year progresses. Could you just walk us through how you're thinking about the setup for fiscal '27, including current demand at the Coach brand relative to that low teens guide for the first quarter? And what gives you confidence in the durability of growth in the back half and beyond from here? Joanne Crevoiserat: Matt, we're incredibly confident in the durability of our growth. And as we think about the setup for fiscal '27, I'll just step back and provide a little context. As you mentioned, we had a strong fiscal '26, where we achieved our Investor Day commitments 2 years ahead of plan while strengthening the company for the long term. And this is a critical point because we see that our greatest opportunities are still ahead of us. In fiscal '27 and beyond, we're growing from a higher base while maintaining our algorithm. The algorithm that we rolled out at our Investor Day, we're maintaining that algorithm for durable growth into the future. And more important than the results we delivered last year, which are incredible, it's the business we built to deliver them. Over the last several years, we've strengthened our brands, we've deepened our direct-to-consumer relationships, and we've expanded our global reach and built differentiated capabilities, as I said in my prepared remarks, in data, decision intelligence and AI. We also meaningfully improved profitability and cash generation, which increases our capacity to invest behind future growth. These are the capabilities that matter because they extend beyond a single quarter. They help us translate those consumer insights to action at scale and deliver that creativity, the value and the relevance to consumers around the world. So as we enter fiscal '27, we see that strength continuing, led by Coach, where our performance remains strong across new and existing customers and in our core category, our core leather goods category. So the takeaway is that fiscal '26 demonstrated the power of our strategy and our Q1 and fiscal '27 outlook reinforces our confidence in the durability of what we've built into the future. But I'll turn it over to Scott to cover the details and the cadence of our guidance. Scott Roe: Just building on what Joanne just said, we had a great '26, and we're a bigger business, we're more profitable, we're generating more cash, which really puts us in a position of strength as we think about our entry into '27 in the guide. And our outlook reflects that confidence, but also discipline in how we give guidance and how we plan. Q1 does capture our current estimates for the business. We expect low teens revenue growth at Coach. That's consistent with what we delivered in Q4. So the momentum continues. And importantly, our full year guide doesn't require us to keep that same level of growth at Coach for the balance of the year. So we believe, as we sit here today, that's a prudent approach. For fiscal '27, we expect mid-single-digit revenue growth, continued operating margin expansion and low double-digit EPS growth. At Tapestry, that's consistent with the long-term framework we established at our Investor Day from a meaningfully higher base. At Coach, we continue to expect growth above our brand's Investor Day framework at best-in-class margins. So we're comping the comp. So put simply, Q1 reinforces our confidence. We've built the full year outlook to reflect the breadth, flexibility and discipline of the model that we built. Operator: We'll move on now to Alex Straton with Morgan Stanley. Alexandra Straton: Congrats on a great quarter. I wanted to focus from a guidance perspective on what you're assuming from a unit versus AUR perspective after such strong AUR growth in recent years. And can you also just dive into -- in the fourth quarter, if units were flat and kind of what was driving that? Todd Kahn: I'll start and participate with Scott. We love the mix on AUR and units that we delivered in the fourth quarter. And I think, again, what's important is the quality of our sales. We are very focused on durability and quality. And what you saw in the fourth quarter is a lot of our growth came from AUR, and we were in line on units, which was by design. We had fewer promotion days in the fourth quarter. And one of our strategies that we talk a lot about, you heard it in Joanne's prepared remarks, is our One Coach strategy. Remember what One Coach allows us to do. It recognizes the consumer sees brands and not channels. So that has allowed us to put our collection product in our outlet stores, attaining higher AURs and full price. And you're going to continue to see that. So throughout the year ahead, we'll see AUR gains across the globe, and you'll also see unit gains. But what we're not going to do, we have no need to do is churn units to make our numbers. And you see that in this world-class gross margin that we're maintaining. So I feel very good about our mix. And ultimately, as we continue to bring new customers into the category because remember, Coach is growing the category globally. That will, over time, increase our unit counts as well. Scott Roe: Yes. And I'll just make a quick build on Todd's comment, Alex. First of all, Q4 came exactly like we expected as it relates to units. Remember, we had some shifting of timing of promotional events and also we had exceptional sell-through in Q3, which took some of those units from Q4 to Q3. So as it relates to the unit dynamic, it occurred exactly as we expected. Actually, we beat the guide in total and actually did a little bit better on an overall basis for Coach. And I just want to reiterate going forward, our expectation, what's embedded in our guidance assumes both unit and AUR growth in '27 and beyond. Operator: We'll move on now to Ike Boruchow with Wells Fargo. Irwin Boruchow: A couple of questions. I'll fit into one question on North America. So basically, at Coach North America, you guys have been moderating off of the big growth rates that you put up pretty smoothly. I think it was mid-20s in the first half, mid-teens in the back half. I'm just curious how you're thinking about the normalization of domestic growth at Coach. And to that point, up 10% in the fourth quarter, how much of a headwind was there to North America growth on some of the shifts you had called out last quarter? And then what kind of North America growth underpins that first quarter low teens global Coach guide you guys gave? Todd Kahn: Yes. We love the position we have at Coach in North America. And again, when -- Scott just indicated, some of the North America foundational, we had an outstanding third quarter and took a lot of units. And then in the fourth quarter, we intentionally reduced our promotion days. So we feel very good about our North America growth. We're going to -- you're going to see us grow. We grew beyond the category in the fourth quarter. So that's an important milestone. And what we love is what we said we were going to do. We're 2 years ahead of our plan. We are delivering something on a much higher base. We took the global floor up from mid-single digits to high single digits for this year. And remember what we told you we would do: 70% of our growth is coming internationally. That said, we love our North America position, and you're going to continue to see us grow in North America. But we're going to -- we're growing on a very large base, and we're going to grow very intentionally, not degrading the brand, not degrading our margin and continuing to focus on bringing new customers into the category. Scott Roe: Yes. And a quick build on the numbers, Ike. If you look at the Coach guide for North America, again, as Todd said, it's really above our Investor Day expectations for '27. And a little bit more on that. If you look at the 2-year stack for North America Coach in both Q4, Q1 and the full year guide, it's about 30%, right? So we're comping the comp. We're consolidating the exceptional growth from last year and compounding that as we look forward into '27, and that's embedded in our guide here. So the strong momentum in Coach continues, and we have a lot of confidence in our growth, not only in Coach overall, but in Coach North America specifically. Operator: We'll move on now to Michael Binetti with Evercore. Michael Binetti: First off, let me just say thanks for bringing us out to headquarters tomorrow. Look forward to seeing you guys learning about AI. Scott, can I just ask a little clarification on Ike's question? Should we think about a 30% 2-year stack on the North America Coach business in the first quarter and then we just kind of pencil that through the rest of the year to kind of hold that stability against those tough compares that continue through the year? And then maybe just a little bit on the gross margin bridge. I think it implies almost no expansion after first quarter despite, I think, a lot of the growth coming from the Coach brand, from China, from the high gross margin categories. Maybe just a bit of a bridge on the growth throughout the year. Scott Roe: Yes. So we can't wait for you guys to come. A couple of dozen of our closest friends going to see what we're doing in the AI world and really talk about how this is really a competitive advantage for Tapestry. Joanne mentioned it, and we're excited to talk about it because we think it's truly part of the moat of what makes Tapestry special. Yes. So for gross margins, listen, it's going to be a little lumpy through the year. We also talked in my prepared remarks about the impacts of tariffs, which are a net benefit in the first half and that tailwind in the second half, kind of a push on a year-on-year basis. I think the important thing to take away here is we are growing gross margin about 30 bps for the year. It's implied in our guidance. And the structural drivers of gross margin, which we've talked about over and over, the strength of our brands, AUR, AUC, the fact that international margins are higher and we're growing more outside the U.S., all those structural drivers are unchanged and remain just as true today as they have been. As we sit here today, we think the guidance we've given is prudent looking how much real estate we have. But don't take away from that any change in terms of those structural growth drivers. They're still in place. Michael Binetti: Okay. And then the North America? Scott Roe: In terms of North America, well, I think you reiterated what I said in terms of -- we see low single-digit growth in North America, overall, that's consistent with our long-term algorithm. But as I said earlier, Coach at mid-single digit in both Q1 and for the full year is really above our expectations and really continues the momentum that we've seen in North America specifically. Operator: We'll move on now to Bob Drbul with BTIG. Robert Drbul: I was just wondering if we could shift a bit and spend some time just expanding on the international growth, I guess, specifically in Europe and in China, sort of what you're seeing in both markets and just the expectations on how to drive those businesses forward in fiscal '27 and beyond. Joanne Crevoiserat: Thanks, Bob. Maybe I'll start and then toss it to Todd for some color. We just reported a strong fourth quarter and an amazing fiscal year. Our business was strong around the world, and we're seeing broad-based strength. We just talked a lot about the strength we're seeing in North America, and we see that continuing for Coach with further growth ahead. But as we look forward, international does become a larger contributor to our growth, and we see continued opportunity. So in China, as an example, we delivered over 30% growth on the year in China. We're driving that through new customer acquisition. That growth is broad-based across the market. And we are well outpacing the industry in China, and we see tremendous opportunity as we move forward in China to continue to drive growth just based on our relatively low brand awareness in the market and the opportunity that we see for further penetration, more new customer acquisition and the traction that we have, particularly with this young consumer. And if I shift to Europe, the opportunity is the same. We have relatively low penetration in the market. We are gaining traction with a local and younger consumer, and we have an opportunity to continue to drive growth in Europe as well. But maybe, Todd, I send it to you for a little bit more color on how you're thinking about that growth. Todd Kahn: Thanks, Joanne. Let's -- I'll kick off where you left off Europe. I mean we've had multiple years of double-digit growth, and we truly early innings. When we even talk about Europe, we're only penetrated in any material way into the U.K. and some wholesale and some marketplace. We now are taking France. We opened a new store in Le Marais, a Coach Play store, which is the heart of where young people shop. It's a good beacon for our brand. But the 35, 40 countries that we can still tackle in Europe gives us a huge runway. And what's important about the Coach brand positioning in Europe and in China is the value and value proposition. The absolute underlying value of our product, our bags is cutting through, and it's clear. That's why we're winning, and that's why we're competing. And we're supporting that by incredible storytelling and marketing. And if I go to China now, we underinvested in China over the years. Today, we're trying to bring our marketing in line with our overall marketing expense. And that is the fuel that creates demand in the market. So our marketing is a driver of business. And what I love is our position in China. Again, I'll remind everybody, we've been there for 25 years. We have deep roots in China. We have rich teams in China who understand the culture. We make sure that our brand, our product offering resonates with that customer. And we're also not limited because of our expressive luxury position to simply go where traditional European luxury goes. We go where the Gen Z customers want to shop. That's a huge unlock for us, and you're going to see us grow materially in China, in Europe and continue to grow in rest of Asia as well. Operator: We'll move on now to Jay Sole with UBS. Jay Sole: You talked a lot about your confidence in maintaining the momentum at Coach brand. Can you talk a little bit more about product? I'd say the Brooklyn family has been such a great product franchise for the brand. Can you talk about some of the ideas you have that you have confidence in, in the future and what we're going to see from a product standpoint that give you that confidence that the momentum can continue? Todd Kahn: Sure. I'll even open the aperture up just a little bit about my confidence because I want to remind everybody, we're an 85-year-old brand. And even as an 85-year-old brand, this last year, we recruited 9 million new customers. That's powerful. But we're not resting on our history or relying on our momentum. What gives me confidence overall is the clarity that we bring to all facets of our business, the clarity on our purpose, our customers, our product, our marketing, our people and our culture. And I will say that clarity is greater today than any time in my 19 years here at Coach and quite honestly, greater than anything I've seen in 30 years in this industry. And it does start with our purpose. And I know sometimes, with this crowd, in the investment crowd, talking about purpose, your eyes sometimes glaze over, but it matters. Our purpose and our courage to be real and our aspiration of being the most inclusive, authentic and loved fashion brand matters to our people, and it is a rallying cry, and it drives outcomes. That leads to our customers. We have clarity of who we are designing for this point of market entry, what you heard Joanne and Scott talk about, which is a large TAM that we can go after, 25 million women turning 18 every year in the markets we play that can afford our bags, which leads back to your -- the essence of your question, which is our product. And what Stuart Vevers and our design teams and our merchant teams are doing is phenomenal. We are building on diverse yet very clear platforms of product. We talk about our icon, Tabby. We have a lot of runway to continue to evolve Tabby, and we have not seen any slowdown in Tabby. Similarly, our New York family, Brooklyn, is doing extraordinarily well. And again, it's a multichannel concept that we sell at full price across many different -- frankly, all of our different avenues of sale. And even under the New York family, we've expanded ideas like our Chelsea bag, which all of a sudden was only a year old and is now appearing on the top 10. So these very large platforms, as well as Teri, we sometimes refer to them as TNT here, which has led to this explosive growth. We feel very good about our product offering and our assortment backed by our marketing stories. So net-net, the product is strong. The clarity of our messaging is strong. And I think we have an incredible setup, not just for the year ahead, but for our aspirations of $10 billion. And I'm starting to think about how much further we go beyond $10. Operator: We'll move on now to Adrienne Yih with Barclays. Adrienne Yih-Tennant: Congrats. Very nicely done. Todd and/or Joanne, I'm going to stay on that topic. When I look at the metrics that you reported, I expected the ones on the P&L, the one that really surprised -- was nicely to -- surprising was the customer acquisition. To me, that represents sort of future demand and kind of gives me some confidence about this flywheel. So that being said, can you talk about just the white space in pricing, entry level pricing, the Gen Z that you're going after and then geographies? Because when I look at it, I just don't -- I can't come up with a really good competitor on any of those fronts. So can you talk about how you think? Who do you look over your shoulder and you're worried about, just to talk about that? And then also, for Scott, what's the implied advertising as a percent of sales for the FY '27 because that's kind of also helping the flywheel. And then also on the guidance, is Coach North America for mid-single digit, is that for Q1? Or is that for the year? Or for both Q1 and the year? Joanne Crevoiserat: You've got a lot in there, Adrienne. I'm going to kick it off. I think this will be a 3-part. I'll kick it off, and I'll toss it to Todd for a little bit of color if there's anything left after I talk, and then Scott will clean it up with some of your guidance questions. You're hitting on the kernel that is driving our growth, and that is new customer acquisition. We have become just obsessed with our customer. This customer obsession starts with understanding them and then delivering product and marketing and storytelling and experiences that are relevant to our target customer. And that muscle -- that brand-building muscle that we're building at Tapestry, it's a playbook that is repeatable. We continue to invest in the capabilities to deepen our understanding of the consumer and then move from insight to action. And that's where it matters for our customers, to deliver something that our customers -- that resonates with them, that they fall in love with. And these new customers who we're acquiring, we talked about 11 million new customers in the last fiscal year, are joining at higher-than-average AUR. They're a younger consumer base. This point of market entry strategy that we have not only is an opportunity to retain these customers and drive lifetime value, but what we're finding and what we know, I think we all know that the young consumer, the youngest generation influences all generations, and we're seeing that play out in our business because our existing customer base is also growing. So this flywheel of driving new customer acquisition and then giving them such a terrific experience that they come back. We're seeing those retention rates among the highest retention rates in our customer file. So they're loving our brands. They're staying with our brands, and they're influencing all generations. And we're continuing to invest behind those capabilities so that we can continue to drive that flywheel. It's happening in North America. We spent a lot of time talking about North America growth today, but we also see a tremendous opportunity in international markets to drive new customer acquisition. We're bringing more customers into the market. So we're growing the market, and we're growing our share. And that's a phenomenal place to be. Todd, I don't know if there's anything you want to add from a color perspective. Todd Kahn: You touched on so many good things, but I do want to tackle the one thing you didn't talk about, which is competition. And for me, there are no barriers of entry in our space. That's just the truism that we recognize every day. It almost doesn't matter. What we -- the moats we are building are about that connective tissue to our customer. When we spend 12% on advertising -- and I think my marketing team will be mad at me because I use the word advertising. It's not advertising. It's story building. It's brand driving. It's not just go buy our bag. It's a richness that makes it compelling. When we say we're going to invest in our store fleet and refurbish, we are going to tackle 80% by traffic of our store fleet between now and FY '30. That's an investment into the future that makes us relevant and continues to attract that younger consumer globally. And that's why we're so excited about this rollout of expressive luxury. So couple that with the fact that we are an 85-year-old brand. September, Stuart is going to a fashion show, celebrating our 85th anniversary. Those are things that are hard to replicate. And that's why finally, I go back and talk to a lot about our culture. Our winning culture, a team that understands, a team that's been together. We have stability of leadership. We have stability of design. Those are important drivers of long-term profitability. So I love our setup. We are going to be very focused on that $200 to $500 space. Yes, we have some amazing bags above that, but that clarity of brand positioning is what is driving our customer acquisition and retention. Scott, I don't know if I left you anything. Scott Roe: All right. You left me a little bit. There was a spoiler alert. He threw out the 12% is indeed percent of demand creation that's both in -- we hit that in '26, and we're building upon that. It's the flywheel we talked about, right? We grow gross margins. We have discipline across the rest of the business so we can invest back in things like demand creation, which are the engine that drive our new customer acquisition, doing all of that with 50 basis points of operating margin expansion. So 12%, another data point there. It's about $1 billion in advertising. So you think about where we were 5 years ago versus today in terms of demand creation, that's a big number because, to Todd's point, while there's no barriers to entry, there are barriers to scale, and those barriers are getting higher. And companies who have a business model that can reinvest and create demand in the way that we can, well, this is the moment we prepared for, for a long time, really sets us apart and is a competitive advantage. And I'm glad you asked for clarification on Coach. I want to try to be very clear here. So Coach, we expect in Q1 to grow mid-single digits. We also expect full year Coach to grow at mid-single digits. And the point I made earlier is we're comping the comp or compounding on the growth. So whether we look at North America Q4 last year, Q1 this year or full year this year, that's about a 30% 2-year comp for North America. So not only are we a much bigger business, we're growing significantly on top of that big business. And when you think about, Todd, you got a huge North American business, over $4 billion, we can talk about percentages. This is real growth. And at our margins and at the flow-through that we have based on the efficiency of the model, it's a really important part of our financial story. And one of the reasons we have confidence is our North American Coach business. Todd Kahn: And just to be abundantly clear because I want to make sure we're talking mid-single digits in North America for the Coach brand. We're talking in the first quarter, low teens. And for the full year, for the Coach brand overall, we are talking high single digits. I didn't want any of my BU heads to think they got off the hook on this phone call. So those are the floors that we've set for this year. And I think our track record of beating out the floors are quite substantial. Adrienne Yih-Tennant: Your track record is great indeed. Operator: We'll move on now to Mark Altschwager with Baird. Mark Altschwager: Just first on marketing, it did not delever as much as you had guided in the fourth quarter. Could you just clarify how much of that is a shift in timing versus realizing some greater efficiencies and how that then plays into fiscal '27? And then separately, the CapEx step-up, the reinvestment in the fleet, how should we be modeling or thinking about net door growth for Coach in fiscal '27? And how does that play out by region? Scott Roe: Yes. So I'll take the first part of that, Mark. Yes, listen, with marketing, there's always a little bit of timing. And we've created a model, I'll go back to the flywheel, that allows us the flexibility to be opportunistic and lean in when the data tells us we have opportunities, but we don't just spend to spend. Also timing of things like production and whatnot can be a little bit different on a quarter-by-quarter basis. So you're right, we came in with a little more leverage in marketing. We still spend a lot of money, and I'll remind you, we spent 12% of sales in 2026. I think the much bigger issue as you look going forward is we are and will continue to invest in marketing as a key part of our demand creation, and it's a key part of driving unaided brand awareness, which is a key to new customer acquisition. So the flywheel is intact, and we will continue to invest in marketing. And I think Todd is going to want to say something about the fleet, but just to give you some numbers, between 40 and 50 doors is our expectation on a net basis at Coach. And you're right, we have stepped up a bit our CapEx, but still, as we look at our overall guidance or our overall expectations from Investor Day, still very much in line as we look at our forward CapEx spending. And I'll remind you, we've got a lot more cash, too. So our free cash flow is significantly higher even with these investments. But Todd, to you, maybe a little color on what you're doing. Todd Kahn: Yes. I love that this year, we will go over the 1,000 door count for Coach globally. And 75% of those 50 doors that Scott talked about will be international, 25% will be domestic. But remember what we're doing, we are elevating the fleet with our expressive luxury design. We started a design that we introduced in the first 6 months of last year. We paused, which was really smart. What we did was we listened to the consumer, we evolved our thinking. And now based on that data and that input, we're able to go roll it out, sometimes slow to smooth, smooth to fast. We're going to be able to go much faster now that we have clarity of what the design looks like, how it operates and how the consumer responds. In addition, we're adding one per MSA, no more than one per MSA, what we call our Play concepts. And you'll see the most recent version of that was in Paris. You have a new one that we did in Chicago, one in Atlanta. So again, these beacons of Coach, which allows the consumer to interact, some of those Play ideas then evolve into expressive luxury. So I feel very good about investing in the fleet. One of the things we know, Gen Z love being in the real world. And if our stores -- and I want our stores to be as engaging as the product, and that's what the expressive luxury design is doing for us. So I'm very excited about the future growth of being a direct-to-retailer and seeing our stores, and I hope you get to visit many of them in the upcoming year. Operator: Thank you. That concludes our Q&A. I will now turn it over to Joanne Crevoiserat for some concluding remarks. Joanne Crevoiserat: Thanks, Leo. I want to close by reiterating my confidence in the future. The strength of our results and more importantly, the strength of our organization are driving durable growth and long-term shareholder value. Our advantages continue to compound, and I believe our greatest opportunities are ahead of us. To our global teams, thank you for the creativity, focus and commitment you bring every day. Your work is reflected in everything we've accomplished and in the opportunities we're creating for the future. And to everyone who joined us today, thank you for your interest in Tapestry. Have a great day. Operator: This concludes Tapestry's earnings conference call. We thank you for your participation. Before you buy stock in Tapestry, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Tapestry wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $432,621!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,314!* That performance is why people listen. 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Tapestry (TPR) Q4 2026 Earnings Call Transcript was originally published by The Motley Fool

Tapestry, Inc. TPR used its fiscal fourth-quarter call to emphasize that Coach can sustain growth in fiscal 2027 despite a more measured second-half cadence. TPR reported adjusted earnings of $1.32 per share, which beat the Zacks Consensus Estimate of $1.26. Revenues of $1,876.6 million missed the $1,877.4 million consensus mark. Tapestry, Inc. price-consensus-eps-surprise-chart | Tapestry, Inc. Quote CFO and COO Scott Roe said fiscal 2027 guidance reflects confidence while remaining disciplined. Tapestry expects revenues of $8.4-$8.5 billion and about 50 basis points of operating margin expansion. Roe forecast first-quarter revenue growth in the high single digits and EPS of about $1.55. Full-year EPS is expected at $7.80 to $7.90, with revenue growth moderating in the second half. A JPMorgan analyst questioned that moderation. CEO Joanne Crevoiserat said Coach remains strong with customers, while Roe said the full-year outlook does not require first-quarter growth rates to continue. Coach CEO and brand president Todd Kahn said fourth-quarter handbag units were roughly flat by design as promotions declined, while handbag average unit retail (AUR) increased at a mid-teens rate. A Morgan Stanley analyst asked about the growth mix. Kahn said fiscal 2027 guidance assumes both AUR and unit gains without using promotions to force volume. In a Barclays exchange, Kahn clarified that global Coach revenues are expected to rise low teens in the first quarter and high single digits for fiscal 2027. North America Coach is expected to grow in mid-single digits. CEO Crevoiserat said international markets should contribute more to growth. Fiscal fourth-quarter pro forma constant-currency revenue rose 28% in Greater China and 19% in Europe. A BTIG analyst asked about sustaining that growth. Crevoiserat cited younger local customers and further penetration, while Kahn said Europe offers white space and China is receiving more marketing support. Kahn said the brand can follow Gen Z shopping patterns. Management expects mid-teens fiscal 2027 growth in both Greater China and Europe. Crevoiserat said Coach increased quarterly marketing spending about 20%, emphasizing brand building and acquisition. CFO and COO Roe said demand-creation spending reached about 12% of sales in fiscal 2026. A Baird analyst asked about marketing timing. Roe said quarterly timing varies, but Tapestry will keep investing where data supports demand creation. Roe expects 40 to 50 net Coach store additions in fiscal 2027. Kahn said about 75% should be international as the expressive luxury format expands. Crevoiserat said Kate Spade remains in a phased turnaround centered on brand desirability, a tighter assortment and omnichannel execution. She said fiscal 2026 top-line progress was more gradual than planned. Crevoiserat said the Margot, 454 and Duo handbag families supported customer acquisition, while store renovations improved conversion and average transaction value. Broader unaided brand awareness has not yet improved. Roe said fiscal 2027 guidance assumes a high-single-digit Kate Spade revenue decline and a modest operating loss as investment continues. First-quarter revenues are expected to fall at a low-double-digit rate. Roe said Tapestry expects to return about $1.7 billion to shareholders in fiscal 2027, including roughly $1.35 billion of repurchases and a 16% dividend increase. Crevoiserat closed with a confident focus on customer relationships, global expansion and operating discipline. Management's priorities remain sustaining Coach, rebuilding Kate Spade and expanding margins despite uneven tariff and marketing effects. TPR carries a Zacks Rank #3 (Hold), with a Value Score of D, Growth Score of A, Momentum Score of A and VGM Score of A. Under the Zacks framework, Hold-rated stocks can be retained, with A and B Style Scores more favorable than lower grades. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The Growth, Momentum and VGM Scores of A indicate stronger characteristics in those styles, while a Value Score of D is weaker. The Zacks Rank can change as estimates are revised after the just-reported results, so the current combination is not a fixed signal. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tapestry, Inc. (TPR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Tapestry, Inc. TPR reported fourth-quarter fiscal 2026 results, with adjusted earnings beating the Zacks Consensus Estimate while revenues met expectations. The company's bottom line benefited from robust Coach brand momentum, broad-based geographic growth, higher margins and disciplined cost management. Tapestry achieved its Investor Day revenues, operating margin and earnings targets two years ahead of schedule.TPR posted adjusted earnings of $1.32 per share, which surpassed the Zacks Consensus Estimate of $1.26 by 4.8%. The bottom line increased 26.9% from adjusted earnings of $1.04 reported in the year-ago quarter. Revenues of $1.88 billion matched the Zacks Consensus Estimate and increased 9% year over year. Excluding the Stuart Weitzman business, pro forma revenues increased 12% year over year on a reported basis and 11% on a constant-currency basis.The company added more than 2.5 million new consumers globally during the quarter, with approximately 35% of new customers coming from Gen Z. Tapestry continued to benefit from strength in its core leathergoods business. Coach handbag average unit retail (“AUR”) increased at a mid-teens percentage rate during the quarter, reflecting continued pricing and product momentum. Tapestry, Inc. price-consensus-eps-surprise-chart | Tapestry, Inc. Quote Coach revenues reached $1.64 billion, met the Zacks Consensus Estimate and rose 15% year over year and 14% in constant currency. Handbag unit volumes were roughly flat, while footwear delivered high-teens growth. The brand also acquired more than 2 million new customers during the quarter.Kate Spade sales declined 7% to $235.1 million, surpassing the consensus estimate of $232 million. The brand added more than 450,000 new customers, who transacted at higher AURs than the broader customer base. Management cited improving handbag performance and better conversion and average transaction value at lightly renovated stores. Regional performance was broad-based. North America revenues increased 7% on a constant-currency basis, while Greater China revenues increased 28%. Europe revenues advanced 19% and Other Asia increased 22%. Japan remained a weak spot, with revenues declining 4% on a constant-currency basis. Coach delivered double-digit revenue growth in every quarter of fiscal 2026, including 14% in the fiscal fourth quarter.Direct-to-consumer revenues increased 11% on a pro forma constant-currency basis in the quarter. Digital revenues grew at a mid-single-digit rate, while store revenues increased at a mid-teens rate, highlighting continued strength across Tapestry's consumer-facing channels. Adjusted gross profit increased 11% year over year to $1.47 billion. The adjusted gross margin expanded 180 basis points to 78.1%, supported by roughly 170 basis points of operational improvement and a 60-basis-point benefit from the Stuart Weitzman divestiture. Tariffs and duties created a 60-basis-point headwind.Adjusted operating income increased 25% year over year to $362 million. Meanwhile, the adjusted operating margin expanded 250 basis points to 19.3%.Adjusted SG&A expenses totaled $1.05 billion. As a percentage of sales, adjusted SG&A expenses leveraged 80 basis points year over year. The quarter included a 130-basis-point increase in marketing investment. As of the end of the fiscal fourth quarter, the company operated 336 Coach stores and 178 Kate Spade stores in North America. Internationally, the store count stood at 637 for Coach and 148 for Kate Spade stores. Cash generation strengthened, supported by higher profitability and working-capital discipline. The operating cash flow was $522.2 million in the fiscal fourth quarter. The adjusted free cash flow totaled $492.6 million in the quarter, while capital expenditures amounted to $53.2 million.At fiscal year-end, cash, cash equivalents and short-term investments totaled $1.15 billion, compared with total borrowings of $2.38 billion. Inventory ended fiscal 2026 at $826.2 million compared with $860.7 million a year earlier. Tapestry's gross-debt-to-adjusted-EBITDA leverage ratio was 1.1X, reflecting its balance-sheet position following a year of stronger earnings and cash generation.Tapestry returned $1.7 billion to its shareholders during fiscal 2026 through dividends and share repurchases. The company paid $326 million in dividends and repurchased $1.35 billion of common stock, buying back about 11.5 million shares at an average price of approximately $118.The board approved a 16% dividend increase, lifting the quarterly payout to 46.25 cents per share and the anticipated annual rate to $1.85. TPR expects to repurchase another $1.35 billion of common stock in fiscal 2027. For the first quarter of fiscal 2027, Tapestry expects revenues to grow at a high-single-digit rate on both a nominal and constant-currency basis compared with the prior-year pro forma revenues. Foreign currency is expected to provide a 30-basis-point tailwind to revenue growth. By brand, Coach revenues are expected to increase at a low-teens rate, while Kate Spade revenues are projected to decline at a low-double-digit rate.Gross margin is expected to expand approximately 120 basis points, while operating margin is expected to remain in line with the prior-year period. SG&A expense deleverage is expected to be entirely attributable to increased marketing investments. Adjusted EPS is expected to be approximately $1.55, representing a low-teens increase compared with the prior year. For fiscal 2027, Tapestry expects revenues to be in the range of $8.4-$8.5 billion, representing mid-single-digit growth on a nominal and constant-currency basis. Foreign currency is expected to provide a 40-basis-point tailwind to revenue growth.By brand, Coach revenues are expected to grow at a high-single-digit rate, while Kate Spade revenues are projected to decline at a high-single-digit rate. Gross margin is expected to increase approximately 30 basis points, while SG&A is projected to provide approximately 20 basis points of leverage. As a result, operating margin is expected to expand 50 basis points. At the brand level, Coach is expected to maintain an operating margin of nearly 36%, while Kate Spade is projected to report a modest operating loss. Tapestry expects adjusted EPS of $7.80-$7.90, representing low-double-digit growth compared with the prior year. Adjusted free cash flow is expected to approach $1.7 billion, with CapEx and cloud computing costs in the area of $300 million, or approximately 3% to 4% of revenues.The outlook excludes the impact of the 53rd week, which is expected to contribute an additional percentage point to annual revenue growth while having a neutral impact on operating margin for the full fiscal year. It embeds a mid-20% tariff rate on U.S. inventory receipts, resulting in a neutral net impact from tariffs year over year. Tapestry assumes no material worsening of inflationary pressures or consumer confidence. The fiscal 2027 outlook remains consistent with the company’s long-term commitment to deliver mid-single-digit revenue growth and low-double-digit EPS growth. TPR Stock Past Three-Month Performance Image Source: Zacks Investment Research Shares of the company have gained 18.3% over the past three months compared with the industry’s 8.6% growth. The company currently has a Zacks Rank of 3 (Hold).FIGS, Inc. FIGS is an apparel company focused on the healthcare industry. Its offerings include lab coats, jackets, footwear, bags, socks and other accessories used by healthcare professionals. The company carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The Zacks Consensus Estimate for FIGS’ current financial-year earnings and sales indicates growth of 57.9% and 18.2%, respectively, from the year-ago actuals. FIGS delivered a trailing four-quarter average earnings surprise of 201.8%.Boot Barn Holdings, Inc. BOOT is the largest lifestyle retailer in the United States, specializing in western and work-related footwear, apparel and accessories. The company also holds a Zacks Rank #2 at present. The Zacks Consensus Estimate for Boot Barn’s current fiscal-year earnings and sales implies growth of 22.6% and 15.7%, respectively, from the year-ago actuals. BOOT delivered a trailing four-quarter average earnings surprise of 11.4%.The Gap, Inc. GAP is a premier international specialty retailer offering a diverse range of clothing, accessories and personal care products. It carries a Zacks Rank #2.The Zacks Consensus Estimate for Gap’s current fiscal-year earnings and sales indicates growth of 9.9% and 1.1%, respectively, from the year-ago actuals. GAP delivered a trailing four-quarter average earnings surprise of 2%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tapestry, Inc. (TPR) : Free Stock Analysis Report Boot Barn Holdings, Inc. (BOOT) : Free Stock Analysis Report The Gap, Inc. (GAP) : Free Stock Analysis Report FIGS, Inc. (FIGS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Tapestry (TPR) came out with quarterly earnings of $1.32 per share, beating the Zacks Consensus Estimate of $1.26 per share. This compares to earnings of $1.04 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +4.76%. A quarter ago, it was expected that this maker of high-end shoes and handbags would post earnings of $1.31 per share when it actually produced earnings of $1.66, delivering a surprise of +26.72%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Tapestry, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $1.88 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 0.04%. This compares to year-ago revenues of $1.72 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Tapestry shares have added about 20.3% since the beginning of the year versus the S&P 500's gain of 13.2%. While Tapestry has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Tapestry was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.51 on $1.85 billion in revenues for the coming quarter and $7.78 on $8.55 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Apparel and Shoes is currently in the top 39% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, J.Jill (JILL), is yet to report results for the quarter ended July 2026. This retailer of women's clothes, shoes and accessories is expected to post quarterly earnings of $0.59 per share in its upcoming report, which represents a year-over-year change of -27.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. J.Jill's revenues are expected to be $150.8 million, down 2.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tapestry, Inc. (TPR) : Free Stock Analysis Report J.Jill, Inc. (JILL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: Fiscal 2026 revenue reached $8 billion, growing 17% on a pro forma constant currency basis. Operating Margin: Expanded by 340 basis points to over 23%. Earnings Per Share (EPS): Increased 38% to $7.05. Customer Acquisition: Welcomed 11 million new customers, led by Gen Z. Coach Revenue Growth: Fourth quarter constant currency revenue growth of 14%. Coach Handbag AUR: Increased at a mid-teens rate in Q4; for the year, rose mid-teens with units up low double digits. Coach Regional Performance (Q4): North America up 10%, Greater China up 30%, Europe up 25%. Coach Footwear: Delivered high teens growth in the quarter. Coach Marketing Spend: Increased approximately 20% versus the prior year. Kate Spade Customer Acquisition: Welcomed over 450,000 new customers in Q4 and approximately 2 million for the full year. Fourth Quarter Revenue Growth: Sales increased 11% on a pro forma constant currency basis. Fourth Quarter Regional Performance: North America sales rose 7%, Europe grew 19%, Greater China rose 28%, other Asia increased 22%, Japan declined 4%. Fourth Quarter Gross Margin: 78.1%, up 180 basis points versus last year. Fourth Quarter SG&A: Expenses increased 8% while leveraging 80 basis points versus last year. Fourth Quarter Operating Margin: Expanded 250 basis points, driving a 25% increase in operating income. Fourth Quarter EPS: $1.32, increased 28% versus last year. Shareholder Returns (Fiscal 2026): Returned $1.7 billion, including $326 million in dividends and $1.35 billion in share repurchases. Free Cash Flow: Adjusted free cash flow totaled $1.86 billion for the year. Inventory: Year-end inventory levels were 4% below prior year. Fiscal 2027 Guidance: Revenue of $8.4 billion to $8.5 billion, operating margin expansion of 50 basis points to nearly 24%, EPS of $7.80 to $7.90. Fiscal 2027 Shareholder Returns: Expects to return another $1.7 billion, including a 16% increase in the dividend to an annualized rate of $1.85 per share and approximately $1.35 billion in share repurchases. Fiscal 2027 Free Cash Flow: Adjusted free cash flow expected to approach $1.7 billion. Fiscal 2027 CapEx: Expected to be in the area of $300 million or 3% to 4% of revenue. Warning! GuruFocus has detected 5 Warning Sign with TPR. Is TPR fairly valued? Test your thesis with our free DCF calculator. Release Date: August 13, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Tapestry Inc (NYSE:TPR) exceeded its 3-year revenue, operating margin, and EPS commitments from Investor Day 2 years ahead of plan, delivering record results. The company achieved strong revenue growth of 17% on a pro forma constant currency basis, with broad-based double-digit growth across key regions including North America, Europe, and Greater China. Coach brand demonstrated exceptional performance with high single-digit growth, strong customer acquisition (9 million new customers), and a clear path to becoming a $10 billion brand. Gross margin expanded by 180 basis points in Q4, driven by operational improvements and favorable mix, despite tariff headwinds. The company returned $1.7 billion to shareholders in fiscal 2026 and plans to return another $1.7 billion in fiscal 2027, including a 16% dividend increase. Tapestry Inc (NYSE:TPR) continues to invest in AI and data capabilities, securing its first AI patent, which enhances its competitive advantage and operational efficiency. Kate Spade brand continues to struggle, with a high single-digit decline expected in fiscal 2027 and a modest operating loss, indicating ongoing challenges in turning the brand around. The company faces tariff and duty headwinds, with a mid-20s percent tariff rate on U.S. imports expected in fiscal 2027, which could impact profitability. Japan sales declined 4% in Q4 due to an intentional pullback in promotions, and the company expects a return to growth only in fiscal 2027. Inventory levels are expected to increase in fiscal 2027 to support growth, which could pose a risk if demand softens. The company's guidance for fiscal 2027 implies a moderation in growth from the exceptional levels seen in fiscal 2026, with revenue growth expected to slow to mid-single digits. Kate Spade's unaided brand awareness has not yet improved, indicating that marketing investments have not fully translated into broader brand recognition. Q: Can you walk us through the setup for fiscal 2027, including current demand at the Coach brand relative to the low-teens guide for the first quarter, and what gives you confidence in the durability of growth in the back half and beyond?A: Joanne Crevoiserat (CEO) expressed strong confidence in the durability of growth, noting that fiscal 2026 results demonstrated the power of the strategy and that the company is growing from a higher base while maintaining its long-term algorithm. Scott Roe (CFO) added that Q1 guidance captures current estimates, with low-teens revenue growth at Coach consistent with Q4 momentum, while the full-year guide does not require maintaining that same level of growth for the balance of the year, reflecting a prudent approach. The full-year outlook includes mid-single-digit revenue growth, continued operating margin expansion, and low double-digit EPS growth, consistent with the long-term framework from a meaningfully higher base. Q: What are you assuming from a unit versus AUR perspective after such strong AUR growth in recent years, and what drove the flat units in the fourth quarter?A: Todd Kahn (CEO and Brand President of Coach) explained that the Q4 mix of AUR and units was by design, with growth coming from AUR while units were in line due to fewer promotion days. The One Coach strategy, which brings collection product into outlet stores, has driven higher AURs. Scott Roe (CFO) added that Q4 units came in exactly as expected, with some shifting of promotional events and exceptional Q3 sell-through pulling units forward. Going forward, the guidance assumes both unit and AUR growth in fiscal 2027 and beyond. Q: How are you thinking about the normalization of domestic growth at Coach, and what North America growth underpins the first quarter low-teens global Coach guide?A: Todd Kahn stated that Coach's North America position is strong, with growth beyond the category in Q4. The company is growing on a very large base intentionally, without degrading the brand or margins. Scott Roe provided specifics, noting that the 2-year stack for North America Coach in Q4, Q1, and the full-year guide is approximately 30%, meaning the company is comping the comp and compounding exceptional growth from last year. Coach North America is expected to grow mid-single digits in both Q1 and the full year, which is above Investor Day expectations. Q: Can you provide a bit of a bridge on the gross margin growth throughout the year, given the implied minimal expansion after the first quarter despite growth coming from Coach, China, and high gross margin categories?A: Scott Roe explained that gross margins will be lumpy through the year, with tariffs benefiting the first half and becoming a headwind in the second half, resulting in a net neutral impact year-over-year. The guidance implies approximately 30 basis points of gross margin growth for the year, and the structural driversbrand strength, AUR, AUC, and higher international marginsremain unchanged. The company believes the guidance is prudent given the current environment, but the structural growth drivers are still in place. Q: Can you expand on the international growth, specifically in Europe and China, and the expectations for driving those businesses in fiscal 2027 and beyond?A: Joanne Crevoiserat highlighted broad-based strength globally, with international becoming a larger contributor to growth. In China, the company delivered over 30% growth driven by new customer acquisition and is well outpacing the industry, with significant opportunity due to relatively low brand awareness. In Europe, the company has low penetration and is gaining traction with local and younger consumers. Todd Kahn added that Europe is in early innings, with material penetration only in the U.K., and the company is now expanding in France with new Coach Play stores. The value proposition of the brand is cutting through in both markets, supported by increased marketing investment. Q: Can you talk about the product ideas that give you confidence that the momentum at Coach can continue, particularly after the success of the Brooklyn family?A: Todd Kahn emphasized the clarity across all facets of the business, including purpose, customers, product, marketing, and culture. He noted that Coach recruited 9 million new customers last year and is building on diverse yet clear product platforms. The Tabby family continues to perform well with no slowdown, and the New York family, including Brooklyn and the newer Chelsea bag, is expanding. The company is focused on the $200 to $500 price point, which is driving customer acquisition and retention, and has an incredible setup for the year ahead and the aspiration of becoming a $10 billion brand. Q: Can you talk about the white space in pricing, entry-level pricing, and the Gen Z customer you're going after, and who you view as competition?A: Joanne Crevoiserat highlighted the focus on new customer acquisition, with 11 million new customers welcomed last year at higher-than-average AURs. These younger customers influence all generations, and retention rates are among the highest in the customer file. Todd Kahn noted that while there are no barriers to entry in the space, the company is building connective tissue with customers through 12% of sales invested in demand creation and store fleet investments. The company is focused on the $200 to $500 space and has an 85-year-old brand with a winning culture and stability of leadership and design, which are hard to replicate. Q: What is the implied advertising as a percent of sales for fiscal 2027, and is Coach North America mid-single-digit growth for Q1 or the full year?A: Scott Roe confirmed that demand creation was 12% of sales in fiscal 2026, approximately $1 billion, and the company is building upon that in fiscal 2027. He clarified that Coach North America is expected to grow mid-single digits in both Q1 and the full year, with a 2-year stack of about 30%. Todd Kahn added that Coach overall is expected to grow low teens in Q1 and high single digits for the full year, with North America mid-single digits, and emphasized the company's track record of beating its floors. Q: Can you clarify how much of the fourth quarter marketing deleverage was due to timing versus efficiencies, and how should we model net door growth for Coach in fiscal 2027?A: Scott Roe explained that marketing timing always plays a role, and the company has the flexibility to be opportunistic and lean in when data indicates opportunities. The company spent 12% of sales on marketing in 2026 and will continue to invest as a key part of demand creation. Regarding For the complete transcript of the earnings call, please refer to the full earnings call transcript.