stockrowWhat it does
Tapestry is a global house of accessories and lifestyle brands built around Coach and Kate Spade. It sells primarily handbags, small leather goods and other accessories, with footwear, ready-to-wear, jewelry, watches, eyewear, fragrance and other categories extending the assortment.
Coach is a fashion house selling accessories and lifestyle collections. Kate Spade sells handbags, ready-to-wear, jewelry, footwear, gifts, home décor and related seasonal collections. Each brand has its own design and merchandising team, while Tapestry provides shared corporate functions, technology, sourcing oversight and distribution infrastructure.
The company reaches consumers through retail and outlet stores, brand e-commerce sites and concession shop-in-shops. It also sells to department stores, specialty stores and third-party digital partners, and licenses selected categories to partners. Its direct-to-consumer channels provide controlled access to customers, while wholesale and licensing extend distribution beyond its own stores and websites.
Coach was 86.2% of revenue in FY2026, and Kate Spade was 13.4%. The company sold the Stuart Weitzman business on August 4, 2025 and has two reportable segments: Coach and Kate Spade.
How it makes money
Tapestry earns most of its revenue by selling branded products directly to consumers. Direct-to-consumer revenue was approximately 87% of FY2026 net sales, through stores, outlets, e-commerce sites and concession locations. Wholesale represented approximately 12% of net sales, with products sold through department stores, specialty stores and third-party digital partners. Licensing royalties were approximately 1% of net sales; licensees generally pay royalties on their sales of branded products.
The business is centered on accessories. Handbags generated $4.6 billion in FY2026, or 57.6% of revenue, and accessories generated $2.2 billion, or 27.9%. Handbags include bags, business cases, computer bags, backpacks and totes. Accessories include small leather goods, travel and technology accessories, belts, charms and gifting products. Footwear, apparel, jewelry, eyewear, fragrance and licensing royalties sit in the remaining categories.
Fiscal 2026 revenue was $8 billion; fourth-quarter sales increased 11% from the prior year. Coach revenue was $6.9 billion in FY2026, while Kate Spade revenue was $1.1 billion. The company’s 2027 outlook incorporates high-single-digit growth at Coach and a high-single-digit decline at Kate Spade.
The company uses price, product mix, unit sales and promotional activity to manage sales. Coach reported mid-teens growth in handbag average unit revenue for FY2026, alongside low-double-digit unit growth. Its One Coach approach places collection product in outlet stores and uses one Coach website, aligning retail, outlet and digital channels.
| Product or service | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Handbags | $4.6 billion | 57.6% | 19.9% |
| Accessories | $2.2 billion | 27.9% | 23.4% |
| Other | $688.9 million | 8.61% | −7.19% |
| Footwear | $471.2 million | 5.89% | −23.1% |
Customers and how it sells
Tapestry targets consumers of Coach and Kate Spade products across age groups and geographies, with its strategy emphasizing acquisition of Gen Z consumers entering the market. The company welcomed 11,000,000 new customers to its brands in FY2026, led by Gen Z. Coach welcomed 9,000,000 new consumers and Kate Spade welcomed 2,000,000.
Tapestry serves customers through its own stores, outlets, e-commerce sites and concession shop-in-shops, as well as wholesale partners and marketplaces. Coach had 973 stores at fiscal year-end, including 336 in North America and 637 internationally. Kate Spade had 326 stores, including 178 in North America and 148 internationally. Its e-commerce sites operate in major markets including the United States, Canada, Japan, Greater China, Europe, Australia and other Asian regions.
North America revenue was $5.0 billion in FY2026, or 31.5% of revenue. Greater China revenue was $1.4 billion, or 8.74%, and Other Asia revenue was $907.3 million, or 5.67%. No individual customer accounted for more than 10% of either segment’s total net sales as of June 27, 2026.
| Region | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| North America | $5.0 billion | 31.5% | 11.7% |
| United States | $4.7 billion | 29.3% | 11.6% |
| Other | $1.4 billion | 9.01% | 17.4% |
| Greater China | $1.4 billion | 8.74% | 32.0% |
| China | $1.4 billion | 8.74% | 32.0% |
| Other Asia | $907.3 million | 5.67% | 1.36% |
| Other | $654.7 million | 9.01% | 17.4% |
| Japan | $465.7 million | 2.91% | −9.54% |
Suppliers and costs
Tapestry designs and manages its brands’ products but uses independent manufacturers for finished goods. Coach products were manufactured primarily in Vietnam, Cambodia, the Philippines and India in FY2026; Kate Spade products were manufactured primarily in Vietnam, Cambodia, the Philippines and Bangladesh. No individual vendor provided 10% or more of either brand’s inventory purchases.
The company oversees key raw-material selection and quality control, operates sourcing offices in Vietnam, mainland China, the Philippines and Cambodia, and audits manufacturers for quality, business practices and social compliance. It maintains fulfillment centers or third-party facilities across North America, mainland China, Europe, the United Kingdom, Singapore, Japan, parts of Greater China, South Korea, Malaysia and Australia.
Product cost is affected by materials, manufacturing, freight, duties and tariffs. Marketing-related expense was $962.5 million in FY2026, representing 12% of net sales. Tariffs reduced FY2026 adjusted gross margin by approximately 130 basis points. The company expects a mid-20s percent tariff rate on U.S. imports in FY2027 and a roughly net-neutral year-over-year profit-and-loss impact after mitigating actions.
- Revenue$8.0B
- Cost of revenue−$1.8B
- Selling, general and administrative−$4.3B
- Operating income$1.9B
Competitive position
Tapestry faces competition in accessories, footwear, apparel and adjacent lifestyle categories. It competes on style, price, customer service, quality, brand recognition and prestige, as well as digital commerce, product availability, marketing and responsiveness to changing shopping preferences. It was reported on 21 October 2026 that Deckers Outdoor and Urban Outfitters compete with Tapestry in brand innovation in retail footwear and apparel.
The company identifies customer relationships, data-driven decision-making, direct-to-consumer distribution, global scale, an agile operating model and information technology as elements of its operating approach. Its cloud-based platform connects shopping sites, order management, point-of-sale, customer service, enterprise resource planning and product-management systems. The company also owns Coach and Kate Spade trademarks and related intellectual-property rights in its principal markets.
Our reading: Brand recognition and customer relationships are a meaningful moat source because the company sells discretionary branded products through controlled direct channels, but consumer preferences can change and competition is intense (item1; item1a).
Our reading: Its unified data and commerce platform is a moderate moat source because it supports customer targeting and omnichannel operations, but competitors can also invest in digital tools and AI (item1; item1a).
Our reading: The global store, e-commerce, sourcing and fulfillment network is a moderate moat source, though it depends on third-party manufacturers, logistics and continued demand in local markets (item1; item1a).
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Deckers Outdoor | retail footwear and apparel brand innovation | Medium |
| Urban Outfitters | retail footwear and apparel brand innovation | Medium |
Growth opportunities
The company’s Amplify strategy focuses on acquiring consumers, especially Gen Z; leading with handbags and leathergoods; expanding selectively in footwear; sustaining North American growth; and accelerating international momentum, with Greater China and Europe prioritized. It aims to build brand love and lifetime value through product, marketing, stores and digital experiences.
Coach is the principal growth engine. The company expects Coach to become a $10.0 billion brand over time. It sizes its annual addressable market as 25,000,000 women turning 18 in the markets where it operates who can afford its bags, and says Coach has 1.00% share of that market. Coach is also rolling out its expressive luxury store concept, with a plan for the concept to affect approximately 80% of its traffic by fiscal 2030.
International expansion is another stated vector. FY2026 Greater China revenue rose 32.0% to $1.4 billion, while North America revenue rose 11.7% to $5.0 billion. Management expects FY2027 revenue of $8.4 billion to $8.5 billion, including high-single-digit Coach growth, mid-teens growth in Europe and Greater China, and a return to growth in Japan. It expects Kate Spade to decline at a high-single-digit rate in FY2027 while it continues investing in brand awareness, product and omnichannel experiences.
The company is also investing in data, predictive, generative and agentic AI, machine learning, personalization, pricing and product creation. It secured its first AI patent in FY2026.
- $6.7BFY2022
- $6.7BFY2023
- $6.7BFY2024
- $7.0BFY2025
- $8.0BFY2026
- $8.4BFY2027 guidance
Structural risks
-
Economic conditions, including recession, inflation and uncertainty, could adversely affect consumer purchases of discretionary items and the company’s financial condition and operating results.
-
International operations expose the company to political and economic instability, foreign-exchange movements, changes in tourist shopping and Chinese consumer behavior, geopolitical instability, and changes in trade, tax, product and environmental regulation.
-
Global sourcing can be disrupted by port congestion, carrier disruption, labor disputes, shipping constraints, loss of manufacturing or fulfillment sites, tariffs, raw-material cost swings, labor and fuel costs, and manufacturers’ compliance failures.
-
Competition may reduce demand or pressure pricing. Competitors can introduce more popular products, while the company must respond to changing preferences, digital and cross-channel shopping, social media, AI-enabled shopping tools and product availability requirements.
-
Tariff policy remains uncertain. The majority of products sold in the United States are imported from countries affected by announced tariffs, and the company’s FY2027 outlook assumes a mid-20s percent tariff rate on U.S. imports.
-
Sales, operating income and cash flow are seasonal. The company builds winter and holiday inventory in the first fiscal quarter and typically generates higher sales and operating income in the second fiscal quarter.
Bottom line
Our reading
Our reading: Tapestry is a consumer-brand business whose revenue is concentrated in Coach, handbags and direct-to-consumer sales, with a smaller Kate Spade business being repositioned (item1; call_prepared). Its operating model combines brand design, controlled customer channels and outsourced production, leaving it exposed to discretionary demand, fashion shifts, international conditions and trade costs (item1; item1a; item7). The company’s stated growth plan rests on new-customer acquisition, international expansion and higher-value product and channel mix, while its FY2027 outlook includes continued Coach growth and a Kate Spade decline (call_prepared; facts).