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The owner of Coach and Kate Spade approached $2 billion in revenue after reporting strong sales, expanding margins, and earnings growth.
Financials
05 August, 2026
Table of contents
Tapestry Inc. released its third-quarter of the year 2026 results on 7 May 2026, with reports noting stronger-than-expected performance in revenue, profitability, and earnings. This prompted the company to raise its full-year outlook. The quarter showcased great performance behind Coach, improved consumer demand across major markets, and execution of the Group's long-term Amplify growth strategy.
Revenue reached almost $2 billion with an increase of more than 20% year-on-year, while operating profit and diluted earnings per share outpaced sales growth. Apart from the headline figures, the results reflected stronger pricing power, higher digital productivity, faster Gen Z customer acquisition and expanded direct-to-consumer performance.
| Metric | Q3 FY2026 | Q3 FY2025 | YoY |
|---|---|---|---|
| Total Revenue (US$ billion) | 1,92 | 1,58 | +21% |
| Cost of Sales (US$ million) | 444,1 | 378,8 | +17% |
| Gross Profit (US$ billion) | 1,47 | 1,20 | +22% |
| Operating Income (US$ million) | 427,5 | 253,7 | +69% |
| Net Income (US$ million) | 343,8 | 203,3 | +69% |
Third-quarter performance of Tapestry Inc. highlights that earnings grew faster than revenue, displaying an improved operational efficiency. While total revenue increased by 21%, both operating income and net income increased by 69%. Gross profit also rose by 22%, supported by favourable product mix, pricing strength and operational improvements. The cost of sales increased at a slower pace than revenue.
The stronger earnings profile was supported by higher gross and operating margins, driven by operational efficiencies, SG&A leverage and the impact of the Stuart Weitzman sell-off, despite tariff-related cost pressures. The company also generated strong cash flow and maintained a healthy balance sheet. This enabled it to increase planned shareholder returns to $1,6 billion through dividends and share repurchases.
| Brand | Q3 FY2026 (US$ million) | Q3 FY2025 (US$ million) | YoY |
|---|---|---|---|
| Coach | 1.701,0 | 1.293,5 | +31% |
| Kate Spade | 219,6 | 244,9 | -10% |
| Stuart Weitzman* | – | 46,2 | NM |
| Total Tapestry | 1.920,6 | 1.584,6 | +21% |
*Stuart Weitzman was divested on 4 August 2025 and is excluded from Q3 FY2026 results.
The quarter demonstrated that Coach has become Tapestry Inc.'s primary growth engine.
Brand revenue increased by 31% year-on-year, surpassing $1,7 billion due to broad demand across handbags, higher average unit retail prices, and strong performance across both established and younger consumer segments. Over 2,4 million new customers were acquired globally during this quarter, with Gen Z representing more than 35% of it.
Digital plays an important role within this system, with online sales growing by around 25%, combined with more than 20% growth across physical retail stores. Together, these results show the effectiveness of Tapestry Inc.'s data-driven omnichannel model, where digital engagement and physical retail leverage one another.
Kate Spade, however, remained the weaker performer within the portfolio, with revenue declining 10% year-on-year. While the brand continues to undergo repositioning, its performance reflects the competitive nature of the accessible luxury market, where unique product positioning and brand desirability remain important drivers of consumer demand.
| Region | Q3 FY2026 (US$ million) | Constant Currency YoY |
|---|---|---|
| North America | 1.101,7 | +20% |
| Greater China | 432,2 | +55% |
| Japan | 123,9 | -10% |
| Other Asia | 116,3 | +16% |
| Europe | 118,6 | +21% |
| Other | 27,9 | -3% |
| Total | 1.920,6 | +23% |
The company’s growth was geographically diversified, reducing dependence on any single market.
Greater China delivered the strongest performance, with revenue increasing 61% on a reported basis (55% constant currency), displaying renewed consumer demand and continued growth momentum for the Coach brand. North America also remained resilient, growing 20%. Europe recorded a 31% hike with international expansion. Japan was the only major region to decline as a result of softer local market conditions during the quarter.
Across the wider Asia-Pacific region, Other Asia grew 24% on a reported basis, with robust demand across markets such as South Korea, Singapore, Malaysia and Australia. Japan was the only major region to report a decline, with revenue decreasing 10%, showing softer local market conditions during the quarter.
Operationally, Tapestry Inc. is executing its Amplify strategy across four priorities: fortifying emotional consumer connections, speeding product innovation, expanding global consumer experiences and investing in organisational capabilities. During the quarter, the company built customer acquisition, increased direct-to-consumer penetration and maintained good inventory management while generating stronger profitability across channels.
The successful sell-off of Stuart Weitzman has simplified the Group's portfolio, allowing it to concentrate resources behind its two highest-potential brands while improving overall margin quality. Combined with share repurchases and dividend growth, these actions reflect a balanced strategy that supports operational investment and shareholder value creation.
Following a stronger-than-expected third quarter, Tapestry raised its fiscal 2026 guidance across revenue, operating margin, earnings per share and adjusted free cash flow. The Group now expects full-year revenue to reach approximately $7,95 billion, with reported growth of around 14%, while operating margin is projected to expand to around 23%. Diluted earnings per share are expected to reach approximately $6,95, with adjusted free cash flow approaching US$1,6 billion, supported by revenue growth, cost management and cash generation.
Looking ahead, Coach is expected to remain the primary brand in revenue growth, driven by sustained demand for handbags, international expansion and engagement from younger consumers. At the same time, the company will focus on strengthening Kate Spade, while expanding its direct-to-consumer ecosystem and enhancing operational efficiency. Despite ongoing macroeconomic uncertainties and tariff-related pressures, the company's ability to expand margins while accelerating top-line growth shows its competitive position within the global accessible luxury market.
Cover Image: RUSSH.
Read the full Tapestry Inc. report Here,
The full Coach report Here, and
The full Kate Spade report Here.
For a deeper dive into the financial performance of other top luxury brands, explore the
Capri Holdings Limited FY 2026 Financial Report here,
Ralph Lauren FY 2026 Financial Report here, and
Longchamp FY 2024 Financial Report here.
Find more financial analysis here.