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International trade disputes, including U.S. trade tariffs and retaliatory tariffs, could adversely impact our business.
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Embeds the expectation for tariffs on goods imported into the United States in accordance with the latest trade policies as of April 10, 2025. This includes an anticipated additional 145% tariff on imports from China and an additional 10% tariff on all other global imports. These tariffs are expected to have an immaterial impact on • Fiscal 2025 results due to the timing of sell-throughs and in-transits; ──────────────────────────────────────────────────────────────────────────────
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• IEEPA Tariff Refund - The Company recognized refunds of IEEPA tariffs which were related to products sold in fiscal 2026 net of estimated liabilities.
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• Embeds a mid-20% tariff rate on U.S. inventory receipts in Fiscal 2027, resulting in a neutral net impact from tariffs year-over-year;
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• changes to U.S. participation in, withdrawal from, or renegotiation of certain international trade agreements or other major trade-related issues, including the non-renewal of expiring favorable tariffs granted to developing countries, tariff quotas and retaliatory tariffs, trade sanctions, new or onerous trade restrictions, embargoes and other stringent government controls;
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The U.S. Supreme Court’s ruling did not impact any of the recently imposed tariffs, under either Section 122, Section 301, or Section 338 of the various trade statutes, nor does it prohibit the imposition of future tariffs through alternative trade authorities available to the U.S. administration. Accordingly, uncertainty with respect to tariffs remains ongoing, and U.S. import tariffs and international trade arrangements will continue to change, potentially without warning and to an extent or duration that is difficult to predict. Changing tariff rates and shifting trade policies have created significant uncertainty for suppliers, consumers, and us, and our efforts to mitigate the impacts of tariffs are time-consuming and costly and may not be effective. Our ability to navigate any uncertainty, changes or expansion in tariffs or other trade restrictions could have a material negative impact on our business, financial condition and results of operations. In addition, any negative perception of or sentiment towards the U.S., whether in response to changes in tariffs, trade policy or otherwise, could impact the perception of our Company.
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• changes to the U.S.'s participation in, withdrawal out of, renegotiation of certain international trade agreements or other major trade related issues, including the non-renewal of expiring favorable tariffs granted to developing countries, tariff quotas and retaliatory tariffs, trade sanctions, new or onerous trade restrictions, embargoes and other stringent government controls;
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• IEEPA Tariff Refund - Total pre-tax income of $98.3 million related to recognized IEEPA tariff refunds which were related to products sold in fiscal 2026 net of estimated liabilities.
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the Section 301 investigations relating to forced labor practices, imposing new tariff rates ranging from 10% to 12.5% on most imports from certain countries, effective upon the expiration of the temporary Section 122 tariffs.
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On February 20, 2026, the U.S. Supreme Court ruled that tariffs collected under the International Emergency Economic Powers Act ("IEEPA") were invalid. The U.S. Court of International Trade subsequently ordered refunds for qualifying customs entries. CBP has established a phased administrative process for submitting refund claims for certain IEEPA tariffs. The Company paid approximately $117 million in IEEPA tariffs. During the fourth quarter of fiscal 2026, we received cash refunds related to the previously paid IEEPA tariffs of $2.1 million. In addition, as of June 27, 2026, we determined that the receipt of the remaining refunds of the previously paid IEEPA tariffs was probable. We estimate the amount of the probable refund to be $114.7 million, which was recorded as a receivable. Although the Company believes collection of the IEEPA tariffs is probable based on currently available information, the timing of cash receipts is dependent upon the execution of the refund process by the CBP and the U.S. Treasury Department.
Read in the filing ↗ Also in 10-Q of May 7, 2026, 10-K of Aug 13, 2026, 10-Q of Nov 5, 2026, 10-K of Aug 13, 2026
Operating marginabove prior year, which reflects more than 250 basis points of underlying margin expansion, offset by a negative tariff and duty impact of approximately 230 basis points. The projected negative tariff and duty headwind of approximately • 230 basis points or $160 million incorporated in this outlook reflects the timing of policy implementation, product sell-through, and mitigating actions underway. The Company expects to offset the impact of these incremental tariffs and duties over time;
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On February 20, 2026, the U.S. Supreme Court ruled that tariffs collected under the IEEPA were invalid. The CIT subsequently ordered refunds for qualifying customs entries, including applicable interest. CBP established a phased administrative process for submitting refund claims for certain IEEPA tariffs.
Read in the filing ↗ Also in 10-Q of Nov 5, 2026
During the fourth quarter of fiscal 2026, the Company received cash refunds related to the previously paid IEEPA tariffs of $2 million which was recognized as a reduction to Cost of sales. In addition, as of June 27, 2026, the Company applied the loss recovery model and determined that the receipt of the remaining refunds of the previously paid IEEPA tariffs was probable. The Company estimated the amount of the probable refund to be $115 million, of which $96 million was recognized as a reduction to Cost of sales, $10 million was recorded as Accrued liabilities and $9 million was applied as a reduction to tariffs that remained in Inventory. During the first quarter of fiscal 2027, the Company collected substantially all the cash related to the tariff refund.
Read in the filing ↗ Also in 10-K of Aug 13, 2026
◦ Gross margin, remained even mainly due to net pricing improvements, offset by the impact of higher tariffs;
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◦ Gross margin, increased 170 basis points mainly due to net pricing improvements and favorable net tariff impacts;
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◦ Gross margin, increased 190 basis points mainly due to favorable net tariff impacts and net pricing improvements;
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… Increased tariffs or other trade restrictions against these countries, as well as any tariffs or other trade restrictions implemented by these countries in retaliation, could limit our ability to manufacture products in countries that have the labor and technical expertise needed. Further, such tariffs or other trade restrictions could require us to absorb costs or try to pass costs onto …
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… Increased tariffs or other trade restrictions against these countries, as well as any tariffs or other trade restrictions implemented by these countries in retaliation, could limit our ability to manufacture products in countries that have the labor and technical expertise needed. Further, such tariffs or other trade restrictions could require us to absorb costs or try to pass costs onto …
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• Initiates Fiscal Year 2026 Outlook for Continued Revenue, Operating Margin, and Earnings Growth Inclusive of Tariff and Trade Policy Impacts
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◦ Gross margin, increased 80 basis points mainly due to net pricing improvements, partially offset by the impact of higher tariffs;
Read in the filing ↗ Also in 10-Q of May 7, 2026, 10-K of Aug 13, 2026
Following the Supreme Court's decision, the U.S. Administration announced a 10% global tariff under Section 122 of the Trade Act of 1974 which became effective February 24, 2026, for a period of up to 150 days, which expired on July 24, 2026. On May 7, 2026, the CIT ruled the Section 122 tariffs were invalid. The government has appealed the ruling and the Company is awaiting a decision from the U.S. Court of Appeals. On July 23, 2026, the U.S. Administration announced the final remedy in the Section 301 investigations relating to forced labor practices, imposing new tariff rates ranging from 10% to 12.5% on most imports from certain countries, effective upon the expiration of the temporary Section 122 tariffs. The outlook for future trade policy remains uncertain. The Company continues to monitor these developments, assess their potential impact on its business and implement mitigation strategies where possible.
Read in the filing ↗ Also in 10-Q of Nov 5, 2026, 10-K of Aug 13, 2026
During the second half of fiscal 2025, the U.S. Government announced tariffs on imports from select countries. The majority of the Company's products sold in the U.S. are imported from countries in which these tariffs were announced. At the time of this report, the long-term impact which the tariffs or other trade policies may have on our business is uncertain as the outcome is dependent on global trade negotiations. As a result of the Company's actions to accelerate inventory purchases and based on current trends of the business, we do not expect a meaningful negative impact to our results of operations in fiscal 2025.
Read in the filing ↗ Also in 10-K of Aug 13, 2026, 10-Q of May 7, 2026, 10-K of Aug 14, 2025, 10-K of Aug 13, 2026, 10-Q of Nov 5, 2026, 10-Q of Nov 6, 2025, 10-Q of Feb 5, 2026
We face risks associated with potential changes to international trade agreements and the imposition of additional tariffs on importing our products.
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International trade disputes as well as changes and uncertainty regarding international trade and trade policies, including the imposition or threat of the imposition of new or increased tariffs or other trade restrictions on goods from the countries where our manufacturers are located, could result in a materially adverse impact to our business. During fiscal 2026, the primary manufacturers of Coach products were located in Vietnam, Cambodia, the Philippines and India, and the primary manufacturers of Kate Spade products were located in Vietnam, Cambodia, the Philippines, and Bangladesh. Increased tariffs or other trade restrictions against these countries, as well as any tariffs or other trade restrictions implemented by these countries in retaliation, could limit our ability to manufacture products in countries that have the labor and technical expertise needed. Further, we have developed strategies to mitigate the impact of additional tariffs; however, these strategies may not be effective, which could adversely affect our business, financial condition and results of operations.
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We face risks associated with potential changes to international trade and policy agreements and the imposition of additional tariffs on importing our products.
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◦ Gross margin, increased 50 basis points mainly due to net pricing improvements, partially offset by unfavorable currency impacts and the impact of higher tariffs;
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◦ Gross margin, decreased 290 basis points mainly due to the impact of higher tariffs and unfavorable channel mix, partially offset by net pricing improvements;
Read in the filing ↗ Also in 10-Q of Feb 5, 2026, 10-Q of Feb 5, 2026, 10-Q of May 7, 2026, 10-K of Aug 13, 2026
◦ Gross margin, increased approximately 60 basis points mainly due to net pricing improvements, partially offset by the impact of higher tariffs and unfavorable currency impacts;
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◦ Gross margin, decreased approximately 390 basis points mainly due to the impact of higher tariffs and unfavorable channel mix, partially offset by net pricing improvements;
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1 Primarily relates to the cash collection of the IEEPA tariff refund. 18 Schedule 8: Adjusted EBITDA and Leverage Ratio GAAP to Non-GAAP Reconciliation
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Earnings per diluted shareof $5.30 to $5.45, • representing 4% to 7% growth compared to the prior year. This includes the negative impact of incremental tariffs and duties of over $0.60;
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intangible asset did not exceed their respective carrying values due to a reduction in both current and future expected cash flows, which includes an estimated impact of cost increases due to changes in tariff and trade policies.
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Operating marginexpansion in the area of 50 basis points versus prior year, compared to prior guidance for an increase above prior • year. This outlook now reflects roughly 280 basis points of underlying margin expansion, while continuing to incorporate a negative tariff and duty impact of approximately 230 basis points;
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Company estimates the amount of the probable refund to be $114.7 million, of which $96.2 million was recognized as a reduction to Cost of sales, $9.5 million was recorded as Accrued liabilities and $9.0 million was applied as a reduction to tariffs that remained in Inventory.
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• Other assets were a use of cash of $141.5 million in fiscal 2026 compared to a source of cash of $15.2 million in fiscal 2025, primarily driven by the IEEPA tariff refund receivable recorded in the current year and higher prepaid assets when compared to the prior year.
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No impact related to any future policy changes resulting from the U.S. Presidential Administration change. The Company’s outlook embeds the expectation for an additional 10% tariff on goods imported from China into the U.S. beginning February 4, 2025, which is expected to • have an immaterial impact on Fiscal 2025 results. ──────────────────────────────────────────────────────────────────────────────
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Most of our imported products are subject to tariffs, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products. To maximize opportunities, we rely on free trade agreements and other supply chain initiatives and, as a result, we are subject to government regulations and restrictions with respect to our cross-border activity. Additionally, we are subject to government regulations relating to importation activities, including related to U.S. Customs and Border Protection ("CBP") enforcement actions. The imposition of taxes, duties and quotas, the withdrawal from or material modification to trade agreements, and/or the detention of our goods by CBP for any reason, could have a material adverse effect on our business, results of operations and financial condition.
Read in the filing ↗ Also in 10-K of Aug 13, 2026
• Accrued liabilities were a use of cash of $71.1 million in the first quarter of fiscal 2026 compared to a source of cash of $32.0 million in the first quarter of fiscal 2025, primarily driven by a decrease in accrued interest due to repayment of the Capri Acquisition Senior Notes, partially offset by an increase in accrued duty driven by higher tariffs.
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Operating marginexpansion of approximately 180 basis points versus prior year, compared to previous guidance for an increase in the area of 50 basis points versus • prior year. Based on the strength of the underlying business, the Company expects to more than offset a negative tariff and duty headwind of nearly 200 basis points, resulting in both gross margin expansion and SG&A leverage anticipated for Fiscal 2026;
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Operating marginof approximately 23%, representing expansion of approximately 300 basis points versus prior year. This is above previous guidance for an increase of approximately 180 basis points • versus prior year. Based on the strength of the underlying business, the Company expects to more than offset a negative tariff and duty headwind of approximately 120 basis points, resulting in both gross margin expansion and SG&A leverage anticipated for Fiscal 2026;
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Our results can be impacted by a number of macroeconomic factors, including but not limited to: consumer confidence and spending levels, tax rates, levels of unemployment, consumer credit availability, tariffs and trade restrictions, pandemics, natural disasters, raw material costs, fuel and energy costs, bank failures, market volatility, global factory production, supply chain operations, commercial real estate market conditions, credit market conditions and the level of customer traffic in malls, shopping centers and online.
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Gross profittotaled$1.48 billion, while gross margin was76.9%.This compared to prior year gross profit of$1.21 billion, representing a gross margin of 76.1%. The 80 basis point increase in gross margin was driven • by operational improvements of approximately 190 basis points as well as a favorable impact from the divestiture of Stuart Weitzman of 70 basis points, partially offset by a negative tariff and duty impact of 180 basis points.
Read in the filing ↗ Also in 8-K of Feb 5, 2026
Most of the Company's imported products are subject to tariffs, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products. The Company is not materially restricted by quotas or other government restrictions in the operation of its business; however, customs duties do represent a component of total product cost. To maximize opportunities, the Company operates complex supply chains through foreign trade zones, bonded logistic parks and other strategic initiatives such as free trade agreements. Additionally, the Company operates a direct import business in many countries worldwide. As a result, the Company is subject to stringent government regulations and restrictions, adding significant complexity with respect to its cross-border activity either by the various customs and border protection agencies or by other government agencies which control the quality, safety and sustainability of the Company’s products. The Company maintains an internal global trade, customs and product compliance organization to help manage its import/export and regulatory affairs activity.
Read in the filing ↗ Also in 10-K of Aug 13, 2026
At the time of this report, the Company estimates a projected tariff and trade policy impact of approximately 230 basis points to operating margin in fiscal 2026 after consideration of mitigating actions. In addition, there could be further impact to our results of operations in fiscal 2026 and beyond depending on the outcome of trade negotiations. The Company is prepared to take actions to mitigate this negative impact as changes in trade relations, economic and monetary policies are made clear.
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• Accrued liabilities were a source of cash of $63.5 million in the first six months of fiscal 2026 compared to a use of cash of $11.7 million in the first six months of fiscal 2025, primarily driven by an increase in accrued duty due to higher tariffs, increase in senior notes accrued interest due to timing of payments, partially offset by a decrease in other tax liabilities and higher Annual Incentive Plan payments compared to the prior year.
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Gross profittotaled $1.56 billion on a GAAP basis compared to $1.32 billion in the prior year. On a non-GAAP basis, gross profit totaled $1.47 billion, while gross margin was 78.1%, • representing an expansion of 180 basis points versus prior year, driven by operational improvements of approximately 170 basis points as well as a favorable impact from the divestiture of Stuart Weitzman of 60 basis points, partially offset by a negative tariff and duty impact of 60 basis points.
Read in the filing ↗ Also in 8-K of Aug 13, 2026
(*) Adjusted EBITDA is calculated as Net Income (Loss), excluding Interest expense, net; Provision for income taxes; Depreciation and amortization; Cloud computing amortization; Share-based compensation; Items affecting comparability including Acquisition and Divestiture Costs, Organizational Efficiency Costs, IEEPA Tariff Refund and Distribution Network Optimization Costs. (**) Total Debt Includes Current debt and Long-term debt as of June 27, 2026 (***) Leverage Ratio is calculated as Total Debt as of June 27, 2026 divided by Adjusted EBITDA for the trailing twelve months ended June 27, 2026 19 Schedule 9: Store Count by Brand TAPESTRY, INC. STORE COUNT At March 28, 2026 and June 27, 2026 (unaudited)
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Adjusted Free Cash Flow is calculated as Net cash provided by (used in) operating activities less Purchases of property and equipment, adjusted for the cash impacts of Items affecting comparability included in operating cash flows related to Acquisition and Divestiture Costs, Organizational Efficiency Costs, IEEPA Tariff Refund, and Distribution Network Optimization Costs, and Changes in operating assets and liabilities of items affecting comparability. Schedule 8: Adjusted EBITDA and Leverage Ratio GAAP to Non-GAAP Reconciliation TAPESTRY, INC. ADJUSTED EBITDA for the Trailing Twelve Months (“TTM”) ended on June 27, 2026, and LEVERAGE RATIO as of June 27, 2026 GAAP TO NON-GAAP RECONCILIATION (in millions) (unaudited)
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Gross profit increased 15.6% or $255.3 million to $1.89 billion in the second quarter of fiscal 2026 from $1.63 billion in the second quarter of fiscal 2025. Gross margin increased 110 basis points to 75.5% in the second quarter of fiscal 2026 from 74.4% in the second quarter of fiscal 2025, which includes a 50 basis point benefit from the divestiture of Stuart Weitzman. The remaining 60 basis point increase in Gross margin was primarily attributed to net pricing improvements, favorable brand mix, partially offset by the impact of higher tariffs. Refer to "Current Macroeconomic Conditions and Outlook" for further information.
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Gross profit increased 22.4% or $270.7 million to $1.48 billion in the third quarter of fiscal 2026 from $1.21 billion in the third quarter of fiscal 2025. Gross margin increased 80 basis points to 76.9% in the third quarter of fiscal 2026 from 76.1% in the third quarter of fiscal 2025, which includes a 70 basis point benefit from the divestiture of Stuart Weitzman. The remaining 10 basis point increase in Gross margin was primarily attributed to net pricing improvements and favorable brand mix, substantially offset by the impact of higher tariffs. Refer to "Global Economic Conditions and Industry Trends" for further information.
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Gross profit increased 14.4% or $187 million to $1.49 billion in the first quarter of fiscal 2027 from $1.30 billion in the first quarter of fiscal 2026. Gross margin increased to 78.6% in the first quarter of fiscal 2027 from 76.3% in the first quarter of fiscal 2026. Excluding items affecting comparability, Gross margin increased 220 basis points to 78.7% in the first quarter of fiscal 2027 from 76.5% in the first quarter of fiscal 2026. The increase in Gross margin was primarily attributed to net pricing improvements, favorable net tariff impacts and favorable brand mix. Refer to "Global Economic Conditions and Industry Trends" for further information.
Read in the filing ↗ Also in 10-Q of Nov 6, 2025
The Company also presents Leverage Ratio, which is a non-GAAP metric, and is calculated as total debt, which includes Current debt and Long-term debt, divided by Adjusted EBITDA for the trailing twelve months. Adjusted EBITDA is calculated as Net Income (Loss), excluding: Interest expense, net; Provision for income taxes; Depreciation and amortization; Cloud Computing amortization; Share-based compensation; and Items affecting comparability including Distribution Network Optimization Costs, Acquisition and Divestiture Costs, Organizational Efficiency Costs and IEEPA tariff refunds. The Company believes that the Leverage Ratio is an important metric to assess the strength of our balance sheet and credit quality and demonstrates our commitment to maintaining an investment-grade credit rating. 11
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Gross profittotaled $1.30 billion, while gross margin was 76.3% on a GAAP basis. On a non-GAAP basis, gross profit was $1.29 billion, while gross margin was 76.5%. This compared to prior year gross profit of $1.13 billion, representing a gross margin of 75.3% on both a GAAP and non-GAAP basis. • The 120 basis point increase in non-GAAP gross margin was driven by operational improvements of approximately 170 basis points as well as a favorable impact from the divestiture of Stuart Weitzman of 70 basis points, partially offset by a negative tariff and duty impact of 70 basis points and a currency headwind of 60 basis points.
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1For the year ended June 27, 2026, prior to the completion of the sale on August 4, 2025, Stuart Weitzman Net sales were $14.6 million and Cost of sales were $6.9 million. (*) Relates to costs incurred by the Company in connection with the divestiture of the Stuart Weitzman Business. (**) Relates to organizational efficiency costs, primarily related to technology costs and severance costs. (***) Relates to recognized refunds of IEEPA tariffs which were related to products sold in fiscal 2026 net of estimated liabilities. (****) Relates primarily to costs to transition from our Ohio fulfillment center to a third- party facility in Pennsylvania. TAPESTRY, INC. GAAP TO NON-GAAP RECONCILIATION (in millions, except per share data) (unaudited)
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Gross profit increased 17.8% or $940.1 million to $6.23 billion in fiscal 2026 from $5.29 billion in fiscal 2025. Gross margin in fiscal 2026 increased 240 basis points to 77.8% as compared to 75.4% in fiscal 2025. Excluding items affecting comparability, gross margin increased 120 basis points to 76.6% in fiscal 2026 from 75.4% in fiscal 2025, which includes a 60 basis point benefit from the divestiture of Stuart Weitzman. The remaining 60 basis point increase in Gross margin was primarily attributed to net pricing improvements and favorable brand mix, partially offset by the impact of higher tariffs. Refer to "Global Economic Conditions and Industry Trends" for further information.
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Non-GAAP Reconciliation During the fiscal fourth quarter of 2026, Tapestry recorded certain items that increased operating income by $80 million, net income by $74 million, and diluted earnings per share by $0.36. For the full year, Tapestry recorded certain items that increased operating income by $49 million, net income by $46 million, and diluted earnings per share by $0.22. These items included International Emergency Economic Powers Act (“IEEPA”) tariff refunds, distribution network optimization initiatives, Organization Efficiency costs, and the divestiture of Stuart Weitzman. Please refer to the Financial Schedules included herein for a full reconciliation of the Company’s reported GAAP to non-GAAP results. 5 Overview of Fiscal 2026 Fourth Quarter Financial Results
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During the fourth quarter of fiscal 2025, the Company performed its annual goodwill and indefinite-lived intangible assets impairment analysis. The assessment concluded that the fair values of the Kate Spade reporting unit and indefinite-lived brand intangible asset did not exceed their respective carrying values due to a reduction in both current and future expected cash flows, which includes an estimated impact of cost increases due to changes in tariff and trade policies. As a result, the Company recorded $244.1 million of impairment charges to goodwill for the Kate Spade reporting unit and $610.7 million of impairment charges to indefinite-lived brand intangible assets during the fourth quarter of fiscal 2025. Refer to "Critical Accounting Policies and Estimates," herein, for further information.
Read in the filing ↗ Also in 10-K of Aug 13, 2026
Gross profit increased 15.2% or $420.9 million to $3.19 billion in the first six months of fiscal 2026 from $2.77 billion in the first six months of fiscal 2025. Gross margin increased 100 basis points to 75.8% in the first six months of fiscal 2026 from 74.8% in the first six months of fiscal 2025. Excluding items affecting comparability, gross margin increased 110 basis points to 75.9% in the first six months of fiscal 2026 from 74.8% in the first six months of fiscal 2025, which includes a 60 basis point benefit from the divestiture of Stuart Weitzman. The remaining 50 basis point increase in gross margin was primarily attributed to net pricing improvements, partially offset by the impact of higher tariffs. Refer to "Current Macroeconomic Conditions and Outlook" for further information.
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Gross profit increased 17.4% or $691.6 million to $4.67 billion in the first nine months of fiscal 2026 from $3.97 billion in the first nine months of fiscal 2025. Gross margin increased 90 basis points to 76.1% in the first nine months of fiscal 2026 from 75.2% in the first nine months of fiscal 2025. Excluding items affecting comparability, gross margin increased 100 basis points to 76.2% in the first nine months of fiscal 2026 from 75.2% in the first nine months of fiscal 2025, which includes a 60 basis point benefit from the divestiture of Stuart Weitzman. The remaining 40 basis point increase in gross margin was primarily attributed to net pricing improvements and favorable brand mix, partially offset by the impact of higher tariffs. Refer to "Global Economic Conditions and Industry Trends" for further information.
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The Company performs its annual impairment assessment of goodwill as well as brand intangibles at the beginning of the fourth quarter of each fiscal year. During the fourth quarter of fiscal 2025, the Company performed its annual goodwill and indefinite-lived intangible assets impairment analysis. The assessment concluded that the fair values of the Kate Spade reporting unit and indefinite-lived brand intangible asset did not exceed their respective carrying values due to a reduction in both current and future expected cash flows, which includes an estimated impact of cost increases due to changes in tariff and trade policies. Accordingly, the Company recorded $244.1 million of impairment charges to goodwill for the Kate Spade reporting unit during the fourth quarter of the fiscal year. The Company also recorded an impairment charge of $610.7 million related to the Kate Spade indefinite-lived brand intangible. The Company determined that there was no impairment in fiscal 2024 or fiscal 2023.
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… the impact of international trade disputes and the risks associated with potential changes to international trade agreements, including the imposition or threat of imposition of new or increased tariffs or retaliatory tariffs implemented by countries where our manufacturers are located as well as the imposition of additional duties on the products we import; (ii) the impact of economic conditions, recession …
Read in the filing ↗ Also in 10-Q of Feb 5, 2026, 10-Q of May 7, 2026, 10-Q of May 8, 2025, 10-Q of Nov 6, 2025, 10-Q of Nov 5, 2026, 10-K of Aug 13, 2026
Non-GAAP Reconciliation During the fiscal fourth quarter of 2025, Tapestry recorded certain items that decreased the Company’s pre-tax income by $872 million, net income by $740 million, and earnings per diluted share by $3.53. On a full year basis, these charges lowered the Company’s reported pre-tax income by $1.16 billion, net income by $951 million, and earnings per diluted share by $4.28. This was related to $855 million in impairment charges on the indefinite- lived brand intangible asset and goodwill for Kate Spade. These charges resulted from a decline in both current and future expected cash flows, which included an estimated impact of cost increases due to changes in tariff and trade policies. In addition, the Company recorded non-recurring Organizational efficiency costs, and Acquisition and Divestiture costs resulting from the sale of the Stuart Weitzman brand. Finally, the Company also recorded certain non-recurring fees in the first half of the fiscal yearassociated with the terminated acquisition of Capri Holdings Limited. Please refer to the Financial Schedules included herein for a full reconciliation of the Company’s reported GAAP to non-GAAP results. Overview of Fiscal 2025 Fourth Quarter Financial Results
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The Company performs its annual impairment assessment of goodwill as well as brand intangibles during the fourth quarter of each fiscal year or if an event occurs that would more likely than not reduce the fair value below its carrying amount. The Company determined that there was no impairment in fiscal 2026 or fiscal 2024. During the fourth quarter of fiscal 2025, the Company performed its annual goodwill and indefinite-lived intangible assets impairment analysis. The assessment concluded that the fair values of the Kate Spade reporting unit and indefinite-lived brand intangible asset did not exceed their respective carrying values due to a reduction in both current and future expected cash flows, which includes an estimated impact of cost increases due to changes in tariff and trade policies. Accordingly, during the fourth quarter of fiscal year 2025, the Company recorded $244.1 million of impairment charges related to goodwill for the Kate Spade reporting unit and $610.7 million of impairment charges related to the Kate Spade indefinite-lived brand intangible. Based on the annual assessment in fiscal 2026, the fair values of our Kate Spade brand reporting unit and brand intangibles exceeded their respective carrying values by approximately 30%.
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… Future results may differ materially from management's current expectations, based upon a number of important factors, including risks and uncertainties such as the impact of international trade disputes and the risks associated with potential changes to international trade agreements, including the imposition or threat of imposition of new or increased tariffs or retaliatory tariffs implemented by countries where our …
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… Future results may differ materially from management's current expectations, based upon a number of important factors, including risks and uncertainties such as economic conditions, recession and inflationary measures, the impact of international trade disputes and the risks associated with potential changes to international trade and policy agreements, including the imposition or threat of imposition of new or increased tariffs …
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… Future results may differ materially from management's current expectations, based upon a number of important factors, including risks and uncertainties such as economic conditions, recession and inflationary measures, the impact of international trade disputes and the risks associated with potential changes to international trade and policy agreements, including the imposition or threat of imposition of new or increased tariffs …
Read in the filing ↗ Also in 8-K of May 7, 2026