Q4 2025 Tapestry Inc Earnings Call

Over to the global head of Investor Relations Christina Cologne.

Good morning, Thank you for joining us with me today to discuss our fourth quarter and full year results as well as our strategies and outlook, our Joanne <unk> <unk>, Chief Executive Officer, and Scott Rowe <unk>, Chief Financial Officer, and Chief operating Officer before we begin we must point out that this conference call will involve certain forward looking.

<unk> 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 dot tapestry dot com forward Slash investors and then view the earnings release and the presentation posted today.

Speaker #4: Please stand by. Your program is about to begin. If you need assistance on today's conference, please press star zero. Good day and welcome to this Tapestry conference call.

Operator: Please stand by. Your program is about to begin. If you need assistance on today's conference, please press star zero. Good day, and welcome to this Tapestry conference call. Today's call is being recorded. 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.

Speaker #4: Today's call is being recorded. 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.

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.

Speaker #5: Good morning. Thank you for joining us. With me today to discuss our fourth quarter and full-year results, as well as our strategies and outlook, are Joanne Crevoiserat, Tapestry's chief executive officer, and Scott Roe, Tapestry's chief financial officer and chief operating officer.

Christina Colone: Good morning. Thank you for joining us. With me today to discuss our fourth quarter and full-year results, as well as our strategies and 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.

Joanne will conclude with brief closing remarks, I'd now like to turn it over to Joanne for voice or at tapestry CEO.

Speaker #5: 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.

Good morning, Thank you Christina and welcome everyone fiscal 2025 was truly a breakout year for tapestry we.

Speaker #5: This includes projections for our business and 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.

We delivered $7 billion in revenue and operating margin of 20% and $5 <unk> and adjusted EPS, all growing meaningfully versus prior year.

Speaker #5: 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.

Notably we also achieved key targets, we set at our Investor day, three years ago, namely to achieve over $5 in earnings return more than $3 billion cumulatively to shareholders and drive best in class total returns.

Speaker #5: 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 at www.tapestry.com/investors and then view the earnings release and the presentation posted today.

Christina Colone: 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 brand. 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.

We delivered these results in the context of a rapidly evolving and uncertain macroeconomic landscape reinforcing that our business and our exceptional teams are resilient agile and built for growth. Our record results are more than numbers. Our success showcases that our strategies are working and that our systemic <unk>.

Speaker #5: 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.

Approach to brand building is capturing a new generation of consumers around the world.

Touching on the strategic highlights of the quarter and year.

Speaker #5: Following that, we will hold a question and answer session where we will be joined by Todd Khan, CEO and brand president of COACH. After Q&A, Joanne will conclude with brief closing remarks.

We powered global growth delivering accelerated gains in outpacing the industry in our key regions of North America, China and Europe.

We did this by building lasting customer relationships highlighted by strong new customer acquisition.

Speaker #5: I’d now like to turn it over to Joanne Crevoiserat, Tapestry CEO.

Speaker #6: Good morning. Thank you, Christina, and welcome, everyone. Fiscal 2025 was truly a breakout year for Tapestry. We delivered $7 billion in revenue, an operating margin of 20%, and $5 in 10 cents in adjusted EPS.

Joanne Crevoiserat: Good morning. Thank you, Christina, and welcome, everyone. Fiscal 2025 was truly a breakout year for Tapestry Inc. We delivered $7 billion in revenue, an operating margin of 20%, and $5.10 in adjusted EPS, all growing meaningfully versus prior year. Notably, we also achieved key targets we set at our Investor Day three years ago, namely to achieve over $5 in earnings, return more than $3 billion cumulatively to shareholders, and drive best-in-class total returns. We delivered these results in the context of a rapidly evolving and uncertain macroeconomic landscape, reinforcing that our business and our exceptional teams are resilient, agile, and built for growth. Our record results are more than numbers. Our success showcases that our strategies are working and that our systemic approach to brand building is capturing a new generation of consumers around the world.

During the year, we acquired over $6 8 million new customers in North America alone fueled by growth of Gen Z and millennial cohorts.

We are creating emotional connections and reaching new young consumers as they enter our category key to driving lifetime value and healthy durable growth.

Speaker #6: All growing meaningfully versus prior year. Notably, we also achieved key targets we set at our investor day three years ago. Namely, to achieve over $5 in earnings, return more than $3 billion cumulatively to shareholders, and drive best-in-class total returns.

We also delivered compelling omnichannel experiences engaging with consumers wherever they interact with our brands to drive direct to consumer growth across channels.

Our modern technology platform allows us to bring data driven insights to our work and in a world that is increasingly powered by digital our human connections have never been more important together. They are the foundation of our proven and profitable direct to consumer business model that is a core competitive advantage.

Speaker #6: We delivered these results in the context of a rapidly evolving and uncertain macroeconomic landscape, reinforcing that our business and our exceptional teams are resilient, agile, and built for growth.

Speaker #6: Our record results are more than numbers. Our success showcases that our strategies are working, and that our systemic approach to brand building is capturing a new generation of consumers around the world.

<unk>.

And finally, we brought fashion innovation and product excellence to customers throughout the year fueling brand relevance and desire led by coach where our brand heat and momentum our strong and growing.

Speaker #6: Touching on the strategic highlights of the quarter and year, we powered global growth, delivering accelerated gains and outpacing the industry in our key regions of North America, China, and Europe.

Joanne Crevoiserat: Touching on the strategic highlights of the quarter and year, we powered global growth, delivering accelerated gains and outpacing the industry in our key regions of North America, China, and Europe. We did this by building lasting customer relationships, highlighted by strong new customer acquisition. During the year, we acquired over 6.8 million new customers in North America alone, fueled by growth of Gen Z and Millennial cohorts. We are creating emotional connections and reaching new young consumers as they enter our category, key to driving lifetime value and healthy, durable growth. We also delivered compelling omnichannel experiences, engaging with consumers wherever they interact with our brands to drive direct-to-consumer growth across channels. Our modern technology platform allows us to bring data-driven insights to our work. In a world that is increasingly powered by digital, our human connections have never been more important.

This is evident in our continued gains in AUR and gross margin.

The creativity craftsmanship and value we offer to consumers at scale have been and will continue to be differentiators of our brands and business.

Speaker #6: We did this by building lasting customer relationships, highlighted by strong new customer acquisition. During the year, we acquired over $6.8 million new customers in North America alone, fueled by growth among Gen Z and Millennial cohorts.

As we look forward, we have proven our ability to navigate a complex and dynamic external backdrop and.

And we will continue to execute leveraging the power of our competitive and structural advantages our global scale, our compelling value proposition and the strong fundamentals of our business.

Speaker #6: We are creating emotional connections and reaching new young consumers as they enter our category, key to driving lifetime value and healthy, durable growth. We also delivered compelling omnichannel experiences, engaging with consumers wherever they interact with our brands to drive direct-to-consumer growth across channels.

Now moving to our results and strategies by brand starting with coach.

Coach is a storied 85 year old brand and this fiscal year was the strongest in history.

Speaker #6: Our modern technology platform allows us to bring data-driven insights to our work. And in a world that is increasingly powered by digital, our human connections have never been more important.

Our success is rooted in our brand building capabilities, we've been intensely focused on understanding our target Gen Z consumer and creating emotional connections that fuel brand desire, which have allowed us to re imagine our heritage brand for modern consumers.

Speaker #6: Together, they are the foundation of our proven and profitable direct-to-consumer business model, which is a core competitive advantage. Finally, we brought fashion innovation and product excellence to customers throughout the year, fueling brand relevance and desire, led by COACH, where our brand heat and momentum are strong and growing.

Joanne Crevoiserat: Together, they are the foundation of our proven and profitable direct-to-consumer business model that is a core competitive advantage. Finally, we brought fashion innovation and product excellence to customers throughout the year, fueling brand relevance and desire led by Coach, where our brand heat and momentum are strong and growing. This is evident in our continued gains in AUR and gross margin. The creativity, craftsmanship, and value we offer to consumers at scale have been and will continue to be differentiators of our brands and business. As we look forward, we have proven our ability to navigate a complex and dynamic external backdrop, and we will continue to execute, leveraging the power of our competitive and structural advantages, our global scale, our compelling value proposition, and the strong fundamentals of our business. Now, moving to our results and strategies by brand, starting with Coach.

Coach is redefining what is possible when you blend consumer obsession with disciplined brand building and creativity.

And this is translating into compounding and durable growth for the year coach delivered a 10% increase in revenue at strong margins capped by 13% constant currency top line gains in the fourth quarter.

Speaker #6: This is evident in our continued gains in AUR and gross margin. The creativity, craftsmanship, and value we offer to consumers at scale have been and will continue to be differentiators of our brands and business.

With double digit growth across our key markets with North America up, 16%, China up 22% and Europe up 12%.

Speaker #6: As we look forward, we have proven our ability to navigate a complex and dynamic external backdrop. And we will continue to execute. Leveraging the power of our competitive and structural advantages, our global scale, our compelling value proposition, and the strong fundamentals of our business, now moving to our results and strategies by brand, starting with COACH.

Our global growth led by outperformance in our core leather goods offering highlights that our unique expressive luxury positioning is resonating around the world.

This is evident in our strong customer acquisition results as we welcomed over $4 6 million new customers to coach in North America. This year with over 1 million new customers in the fourth quarter.

Speaker #6: COACH is a storied 85-year-old brand. And this fiscal year, it was the strongest in history. Our success is rooted in our brand-building capabilities. We've been intensely focused on understanding our target Gen Z consumer and creating emotional connections that fuel brand desire. This focus has allowed us to reimagine a heritage brand for modern consumers.

Joanne Crevoiserat: Coach is a storied 85-year-old brand, and this fiscal year was the strongest in history. Our success is rooted in our brand-building capabilities. We have been intensely focused on understanding our target Gen Z consumer and creating emotional connections that fuel brand desire, which have allowed us to reimagine a heritage brand for modern consumers. Coach is redefining what is possible when you blend consumer obsession with disciplined brand building and creativity. This is translating into compounding and durable growth. For the year, Coach delivered a 10% increase in revenue at strong margins, capped by 13% constant currency top-line gains in the fourth quarter, with double-digit growth across our key markets, with North America up 16%, China up 22%, and Europe up 12%. Our global growth, led by outperformance in our core leather goods offering, highlights that our unique, expressive luxury positioning is resonating around the world.

Of which nearly 70% were gen Z and millennials.

<unk>. These customers are transacting at higher AUR and have a higher retention rate than the balance of our client base demonstrating that these relationships are healthy and sticky.

Now touching on our fourth quarter results in more detail.

First we drove double digit gains in leather goods with broad based growth across our offering.

Speaker #6: COACH is redefining what's possible when you blend consumer obsession with disciplined brand building and creativity. This is translating into compounding and durable growth.

The iconic tabby family continues to outperform and resonate with new and younger consumers.

Our core tabby shoulder bag twenty-six continue to anchor the offering while chain tabby and quilted tabby remained global successes.

Speaker #6: For the year, COACH delivered a 10% increase in revenue at strong margins, capped by 13% constant currency top-line gains in the fourth quarter. We experienced double-digit growth across our key markets, with North America up 16%, China up 22%, and Europe up 12%.

Additionally, our New York family once again significantly exceeded expectations proving to be a new and durable growth driver for the brand.

Building on the strength of the New York platform in its first year post launch, we're continuing to expand the Brooklyn and Empire collections, while introducing new styles within the New York family driving innovation and relevancy with our target consumer further we grew our archival inspired coach original collection with a large.

Speaker #6: Our global growth, led by outperformance in our core leather goods offering, highlights that our unique expressive luxury positioning is resonating around the world. This is evident in our strong customer acquisition results, as we welcomed over 4.6 million new customers to COACH in North America this year.

Joanne Crevoiserat: This is evident in our strong customer acquisition results, as we welcomed over 4.6 million new customers to Coach in North America this year, with over 1 million new customers in the fourth quarter, of which nearly 70% were Gen Z and Millennials. Importantly, these customers are transacting at higher AUR and have a higher retention rate than the balance of our client base, demonstrating that these relationships are healthy and sticky. Now, touching on our fourth quarter results in more detail. First, we drove double-digit gains in leather goods, with broad-based growth across our offering. The iconic Tabby family continues to outperform and resonate with new and younger consumers. Our core Tabby shoulder bag 26 continued to anchor the offering, while chain Tabby and quilted Tabby remained global successes.

Kiss locked bag at $695, which in July once again sold out within minutes of launching online and within a day its stores showcasing coaches creativity and brand heat.

Speaker #6: With over 1 million new customers in the fourth quarter, of which nearly 70% were Gen Z and Millennials. Importantly, these customers are transacting at higher AUR, and have a higher retention rate than the balance of our client base, demonstrating that these relationships are healthy and sticky.

And finally, our bag charms and straps also contributed to our momentum providing consumers with further opportunities for personalization and customization with the Cherry bag charm remaining a particular gen Z favorite as a way to enhance self expression overall coach's growth in handbags and accessories continued to outperform the industry.

Speaker #6: Now, touching on our fourth quarter results in more detail, first, we drove double-digit gains in leather goods, with broad-based growth across our offering. The iconic tabby family continues to outperform and resonate with new and younger consumers.

Demonstrating our innovation pipeline and the compelling value and craftsmanship, we offer in the luxury market.

With these advantages we drove mid teens handbag AUR growth for the quarter led by North America.

Speaker #6: Our core Tabby Shoulder Bag 26 continued to anchor the offering, while Chain Tabby and Quilted Tabby remain global successes. Additionally, our New York family once again significantly exceeded expectations, proving to be a new and durable growth driver for the brand.

Further handbag units also rose in the quarter globally and in North America, Despite lower promotional activity at the brand.

Joanne Crevoiserat: Additionally, our New York family once again significantly exceeded expectations, proving to be a new and durable growth driver for the brand. Building on the strength of the New York platform in its first year post-launch, we are continuing to expand the Brooklyn and Empire collections while introducing new styles within the New York family, driving innovation and relevancy with our target consumer. Further, we grew our archival-inspired Coach Originals collection with a large Kiss Lock bag at $695, which in July once again sold out within minutes of launching online and within a day at stores, showcasing Coach's creativity and brand heat. Finally, our bag charms and straps also contributed to our momentum, providing consumers with further opportunities for personalization and customization, with the cherry bag charm remaining a particular Gen Z favorite as a way to enhance self-expression.

Looking forward, we expect gains in both AUR and units to drive our growth next we grew our footwear business with a focus on sneakers, which drives lifetime value with our target Gen Z consumer.

Speaker #6: Building on the strength of the New York platform in its first year post-launch, we're continuing to expand the Brooklyn and Empire collections, while introducing new styles within the New York family, driving innovation and relevancy with our target consumer.

In the quarter Sneakers grew mid single digits led by the high line in Soho Sneaker families, which are driving momentum and selling at one compelling price point across all channels. Another clear indicator that our one coach strategy is working.

Speaker #6: Further, we grew our archival-inspired COACH Originals collection, with a large KISS lock bag at $695, which in July once again sold out within minutes of launching online and within a day at stores.

Turning to marketing, we continue to drive cultural relevance through emotional storytelling that highlights our brand purpose and product offering.

Speaker #6: Showcasing COACH's creativity and brand heat, our bag charms and straps also contributed to our momentum. They provide consumers with further opportunities for personalization and customization, with the cherry bag charm remaining a particular Gen Z favorite as a way to enhance self-expression.

Coaches on your own time campaign, featuring the spring 2025 collection and starring global Ambassadors Elle Fanning nausea, Cocchi and young <unk> Li continued to drive brand momentum across markets.

Our sustained investment behind this campaign is in keeping with our strategy to deliver cut through and continuous brand and product stories to consumers. We also added a second purpose campaign during the quarter not just for walking in support of our Soho Sneaker launch the.

Speaker #6: Overall, COACH's growth in handbags and accessories continued to outperform the industry, demonstrating our innovation pipeline and the compelling value and craftsmanship we offer in the luxury market.

Joanne Crevoiserat: Overall, Coach's growth in handbags and accessories continued to outperform the industry, demonstrating our innovation pipeline and the compelling value and craftsmanship we offer in the luxury market. With these advantages, we drove mid-teens handbag AUR growth for the quarter, led by North America. Further, handbag units also rose in the quarter globally and in North America, despite lower promotional activity at the brand. Looking forward, we expect gains in both AUR and units to drive our growth. Next, we grew our footwear business with a focus on sneakers, which drives lifetime value with our target Gen Z consumer. In the quarter, sneakers grew mid-single digits, led by the Highline and Soho sneaker families, which are driving momentum and selling at one compelling price point across all channels, another clear indicator that our One Coach strategy is working.

Speaker #6: With these advantages, we drove mid-teens handbag AUR growth for the quarter, led by North America. Further, handbag units also rose in the quarter globally and in North America, despite lower promotional activity at the brand.

The campaign was inspired by our consumer insights showcasing what consumers want from a sneaker today in the many facets of their lives.

And finally, we cultivated disaster for coach through unique authentic and immersive retail experiences. This is another example of how our teams are successfully turning insights into action. Our data continues to highlight the gen Z consumers like to shop in the real world and in person with engaging.

Speaker #6: Looking forward, we expect gains in both AUR and units to drive our growth. Next, we grew our footwear business with a focus on sneakers, which drives lifetime value with our target Gen Z consumer.

Speaker #6: In the quarter, sneakers grew mid-single digits, led by the highline and SOHO sneaker families, which are driving momentum and selling at one compelling price point across all channels.

<unk>.

As a result, we brought new store concepts pop ups, and food and beverage to consumers across the globe expanding into non traditional formats and locations to delight consumers and build interest for the brand.

Speaker #6: Another clear indicator that our one COACH strategy is working. Turning to marketing, we continued to drive cultural relevance through emotional storytelling that highlights our brand purpose and product offering.

Joanne Crevoiserat: Turning to marketing, we continued to drive cultural relevance through emotional storytelling that highlights our brand purpose and product offering. Coach's On Your Own Time campaign, featuring the spring 2025 collection and starring global ambassadors Elle Fanning, Naja, Koki, and Youngji Lee, continued to drive brand momentum across markets. Our sustained investment behind this campaign is in keeping with our strategy to deliver cut-through and continuous brand and product stories to consumers. We also added a second purpose campaign during the quarter, Not Just for Walking, in support of our Soho sneaker launch. The campaign was inspired by our consumer insights, showcasing what consumers want from a sneaker today in the many facets of their lives. Finally, we cultivated desire for Coach through unique, authentic, and immersive retail experiences. This is another example of how our teams are successfully turning insights into action.

In addition, the learnings from this work will enable us to move with greater impact as we expand our store footprint and deliver new brand experiences in the future in closing coaches driving standout results guided by a clear brand vision to be the world's most inclusive genuine and loved fashion brand.

Speaker #6: COACH's "On-Your-Own-Time" campaign featuring the Spring 2025 collection and starring global ambassadors Elle Fanning, Naja, Koki, and Young G Lee continued to drive brand momentum across markets.

Our fiscal year 'twenty five results highlight that we are building strong brand and cultural relevance fostering emotional connections driven by product innovation and the creativity of our talented global teams, who are operating with excellence focus and intention.

Speaker #6: Our sustained investment behind this campaign is in keeping with our strategy to deliver cut-through and continuous brand and product stories to consumers. We also added a second-purpose campaign during the quarter, not just for walking.

Speaker #6: In support of our SOHO sneaker launch, the campaign was inspired by our consumer insights, showcasing what consumers want from a sneaker today in the many facets of their lives.

From these exceptional results and this position of strength, we are confident in the future for this powerful iconic brand.

Now moving to Kate Spade.

Our actions to reset the brand for durable growth are underway in the fourth quarter performance was pressured as expected revenue decreased 13%, while bottomline results reflected continued gross margin expansion as well as strategic reinvestment in brand marketing as we shared we are in the early stages of this turnaround and will be <unk>.

Speaker #6: And finally, we cultivated desire for COACH through unique, authentic, and immersive retail experiences. This is another example of how our teams are successfully turning insights into action.

Speaker #6: Our data continues to highlight that Gen Z consumers like to shop in the real world and in person, with engaging experiences. As a result, we've brought new store concepts, pop-ups, and food and beverage to consumers across the globe, expanding into non-traditional formats and locations to delight consumers and build interest for the brand.

Joanne Crevoiserat: Our data continues to highlight that Gen Z consumers like to shop in the real world and in person, with engaging experiences. As a result, we have brought new store concepts, pop-ups, and food and beverage to consumers across the globe, expanding into non-traditional formats and locations to delight consumers and build interest for the brand. In addition, the learnings from this work will enable us to move with greater impact as we expand our store footprint and deliver new brand experiences in the future. In closing, Coach is driving standout results, guided by a clear brand vision to be the world's most inclusive, genuine, and loved fashion brand. Our fiscal year 2025 results highlight that we are building strong brand and cultural relevance, fostering emotional connections driven by product innovation and the creativity of our talented global teams, who are operating with excellence, focus, and intention.

Focus on key leading indicators of progress informed by our experience at coach.

These include increasing unaided brand awareness in search interest followed by an improvement in traffic and customer acquisition, which will ultimately compound to drive topline growth.

Speaker #6: In addition, the learnings from this work will enable us to move with greater impact as we expand our store footprint and deliver new brand experiences in the future.

We are tracking these kpis with consistency and rigor leaning in where we see traction in pivoting if necessary to ensure our success overall.

Speaker #6: In closing, COACH is driving standout results, guided by a clear brand vision, to be the world's most inclusive genuine and loved fashion brand. Our fiscal year 25 results highlight that we are building strong brand and cultural relevance, fostering emotional connections driven by product innovation and the creativity of our talented global teams.

Overall, we are deliberately resetting the brand and backing it with disciplined investments. While these actions will pressure revenue and profitability in fiscal year 'twenty six they are essential to strengthening the brands foundation and unlocking sustainable profitable growth for the long term now, let's touch on the quarter.

Our first strategic priority is to fuel brand heat and relevancy by investing in marketing focused on our target Gen Z consumer.

Speaker #6: Who are operating with excellence, focus, and intention. From these exceptional results and this position of strength, we are confident in the future for this powerful iconic brand.

Joanne Crevoiserat: From these exceptional results and this position of strength, we are confident in the future for this powerful, iconic brand. Now, moving to Kate Spade. Our actions to reset the brand for durable growth are underway. In the fourth quarter, performance was pressured, as expected. Revenue decreased 13%, while bottom-line results reflected continued gross margin expansion, as well as strategic reinvestment in brand marketing. As we have shared, we are in the early stages of this turnaround and will be focused on key leading indicators of progress, informed by our experience at Coach. These include increasing unaided brand awareness and search interest, followed by an improvement in traffic and customer acquisition, which will ultimately compound to drive top-line growth. We are tracking these KPIs with consistency and rigor, leaning in where we see traction and pivoting, if necessary, to ensure our success.

And we took a step forward in the quarter with the launch of our spring campaign, featuring influential Gen Z celebrities ice Spice and Charlie Damelio.

Speaker #6: Now, moving to Kate Spade. Our actions to reset the brand for durable growth are underway. In the fourth quarter, performance was pressured, as expected.

Initial reads were positive with strong organic engagement and a lift in consideration consistent with our goal to reestablish Kate Spade is a top of mind brand for our target consumer our second key strategy is to strengthen our handbag offering simplifying and elevating our assortment anchored in blockbuster families.

Speaker #6: Revenue decreased 13%, while bottom-line results reflected continued gross margin expansion, as well as strategic reinvestment in brand marketing. As we've shared, we are in the early stages of this turnaround and will be focused on key leading indicators of progress, informed by our experience at Coach.

During the quarter, we amplify the Deco collection in retail and the Kayla and outlet in outlet, which were featured as the heroes of our marketing campaign campaign. As a result, both families were the top selling bags in their respective channels over indexing with new younger consumers at strong AUR.

Speaker #6: These include increasing unaided brand awareness and search interest, followed by an improvement in traffic and customer acquisition, which will ultimately compound to drive top-line growth.

Speaker #6: We are tracking these KPIs with consistency and rigor, leaning in where we see traction and pivoting if necessary to ensure our success. Overall, we are deliberately resetting the brand and backing it with disciplined investments.

And we're bringing more innovation to the assortment, while we streamline our offering reducing handbag styles by over 30% by fall, allowing us to stand behind our big ideas with clarity and intention importantly, we're bringing deeper consumer insights and methodical consumer testing to all aspects of this work to ensure greater ROI.

Joanne Crevoiserat: Overall, we are deliberately resetting the brand and backing it with disciplined investments. While these actions will pressure revenue and profitability in fiscal year 2026, they are essential to strengthening the brand's foundation and unlocking sustainable, profitable growth for the long term. Now, let's touch on the quarter. Our first strategic priority is to fuel brand heat and relevancy by investing in marketing focused on our target Gen Z consumer. We took a step forward in the quarter with the launch of our spring campaign, featuring influential Gen Z celebrities Ice Spice and Charli D'Amelio. Initial reads were positive, with strong organic engagement and a lift in consideration, consistent with our goal to reestablish Kate Spade as a top-of-mind brand for our target consumer. Our second key strategy is to strengthen our handbag offering, simplifying and elevating our assortment anchored in blockbuster families.

Speaker #6: While these actions will pressure revenue and profitability in fiscal year 26, they are essential to strengthening the brand's foundation and unlocking sustainable, profitable growth for the long term.

Elegancy throughout our assortment.

Next we are focused on maximizing omnichannel cohesiveness with a compelling consistent brand message across all consumer touch points.

Speaker #6: Now, let's touch on the quarter. Our first strategic priority is to fuel brand heat and relevancy by investing in marketing focused on our target Gen Z consumer.

Alongside efforts to create a more compelling consumer journey, we remain focused on driving higher full price selling a building block to scale in a healthy way.

Speaker #6: And we took a step forward in the quarter with the launch of our spring campaign, featuring influential Gen Z celebrities Ice Spice and Charli D'Amelio.

Speaker #6: Initial reads were positive, with strong organic engagement and a lift in consideration, consistent with our goal to reestablish Kate Spade as a top-of-mind brand for our target consumer.

In closing fiscal year 'twenty six is a year of investment for Kate Spade, we are taking strategic and financial steps to reset Kate spade for long term growth applying our brand building learnings from coach and aggressively leaning into action to turn around the brand.

Speaker #6: Our second key strategy is to strengthen our handbag offering, simplifying and elevating our assortment, anchored in blockbuster families. During the quarter, we amplified the Deco collection in retail and the Kayla in outlet.

While it turnaround takes time, we are confident in our path forward in the brand's opportunity for healthy and profitable growth.

Joanne Crevoiserat: During the quarter, we amplified the Deco collection in retail and the Kayla in Outlet, which were featured as the heroes of our marketing campaign. As a result, both families were the top-selling bags in their respective channels, over-indexing with new, younger consumers at strong AUR. We are bringing more innovation to the assortment while we streamline our offering, reducing handbag styles by over 30% by fall, allowing us to stand behind our big ideas with clarity and intention. Importantly, we are bringing deeper consumer insights and methodical consumer testing to all aspects of this work to ensure greater relevancy throughout our assortment. Next, we are focused on maximizing omnichannel cohesiveness with a compelling, consistent brand message across all consumer touchpoints. Alongside efforts to create a more compelling consumer journey, we remain focused on driving higher full-price selling, a building block to scale in a healthy way.

Now turning briefly to Stuart Weitzman as previously announced we completed the sale of the brand to Claris on August 4th.

Speaker #6: Which were featured as the heroes of our marketing campaign. As a result, both families were the top-selling bags in their respective channels, over-indexing with new, younger consumers at a strong AUR.

This action was consistent with our commitment to be diligent stewards of our portfolio and disciplined allocators of capital.

Speaker #6: And we're bringing more innovation to the assortment while we streamline our offering. Reducing handbag styles by over 30% by fall, allowing us to stand behind our big ideas with clarity and intention.

I want to thank the Stuart Weitzman teams for their work to support the brand and customers. During this transition and wish them success as they build their next chapter of growth with Claris.

Speaker #6: Importantly, we are bringing deeper consumer insights and methodical consumer testing to all aspects of this work to ensure greater relevancy throughout our assortment. Next, we are focused on maximizing omnichannel cohesiveness with a compelling, consistent brand message across all consumer touchpoints.

In closing tapestry achieved a record year as we are successfully connecting with a new generation of consumers around the world.

Importantly, we kept our future speed agenda exceeding earnings targets with our strongest growth year and momentum building in our business.

And while the external backdrop is increasingly complex our growth proves that our competitive advantages enable us to adapt and thrive in any environment.

Speaker #6: Alongside efforts to create a more compelling consumer journey, we remain focused on driving higher full-price selling—a building block to scale in a healthy way.

Our foundation is strong and our focus is clear.

Speaker #6: In closing, fiscal year 2026 is a year of investment for Kate Spade. We are taking strategic and financial steps to reset Kate Spade for long-term growth.

Joanne Crevoiserat: In closing, fiscal year 2026 is a year of investment for Kate Spade. We are taking strategic and financial steps to reset Kate Spade for long-term growth, applying our brand-building learnings from Coach and aggressively leaning into action to turn around the brand. While a turnaround takes time, we are confident in our path forward and the brand's opportunity for healthy and profitable growth. Now, turning briefly to Stuart Weitzman. As previously announced, we completed the sale of the brand to Caleres on August 4th. This action was consistent with our commitment to be diligent stewards of our portfolio and disciplined allocators of capital. I want to thank the Stuart Weitzman teams for their work to support the brand and customers during this transition and wish them success as they build their next chapter of growth with Caleres. In closing, Tapestry Inc.

Our performance underpins our confidence that we have the strategy capabilities and team in place to scale and win with significant runway for growth and value creation I look forward to sharing our roadmap for continued growth at our Investor Day next month I'll now turn it over to Scott.

Speaker #6: Applying our brand-building learnings from Coach and aggressively leaning into action to turn around the brand. While a turnaround takes time, we are confident in our path forward and the brand's opportunity for healthy and profitable growth.

Thanks, Joanne and good morning, everyone.

Looking back at our results for the fiscal year, we exceeded our outlook. Additionally, we delivered our earnings and capital return targets at our last Investor Day three years ago. This is a testament to our disciplined execution and financial agility, reinforcing our strong foundation and commitment to durable long term value creation.

Speaker #6: Now, turning briefly to Stuart Weitzman. As previously announced, we completed the sale of the brand to Coleras on August 4th. This action was consistent with our commitment to be diligent stewards of our portfolio and disciplined allocators of capital.

Speaker #6: I want to thank the Stuart Weitzman team for their work to support the brand and customers during this transition, and I wish them success as they build their next chapter of growth with Coleras.

In the year, we delivered revenue growth of 5% with 10% growth at coach we increased gross margins by 210 basis points and we grew earnings per share by 19% versus last year, while accelerating investments into our brands.

Speaker #6: In closing, Tapestry achieved a record year as we are successfully connecting with a new generation of consumers around the world. Importantly, we capped our future speed agenda, exceeding earnings targets with our strongest growth year, and momentum-building in our business.

Joanne Crevoiserat: achieved a record year as we are successfully connecting with a new generation of consumers around the world. Importantly, we capped our future speed agenda, exceeding earnings targets with our strongest growth year and momentum building in our business. While the external backdrop is increasingly complex, our growth proves that our competitive advantages enable us to adapt and thrive in any environment. Our foundation is strong and our focus is clear. Our performance underpins our confidence that we have the strategy, capabilities, and team in place to scale and win, with significant runway for growth and value creation. I look forward to sharing our roadmap for continued growth at our Investor Day next month. I will now turn it over to Scott.

Turning to the details of the fourth quarter I'll begin with a discussion of revenue trends on a constant currency basis sales increased 8% compared to the prior year and outperformed our expectations.

Speaker #6: And while the external backdrop is increasingly complex, our growth proves that our competitive advantages enable us to adapt and thrive in any environment. Our foundation is strong and our focus is clear.

These results reflect gains in North America, and internationally by region, North America sales increased 8% compared to the prior year led by 16% growth at coach importantly, both gross and operating margin in the region rose versus last year.

Speaker #6: Our performance underpins our confidence that we have the strategy, capabilities, and team in place to scale and win, with significant runway for growth and value creation.

In Europe revenue grew 10% above last year driven by growth in our direct channels with increased local consumer spend and strong new customer acquisition, notably with Gen Z.

Speaker #6: I look forward to sharing our roadmap for continued growth at our investor day next month. I'll now turn it over to Scott.

Speaker #7: Thanks, Joanne, and good morning, everyone. Looking back at our results for the fiscal year, we exceeded our outlook. Additionally, we delivered our earnings and capital return targets set at our last Investor Day three years ago.

Scott Roe: Thanks, Joanne, and good morning, everyone. Looking back at our results for the fiscal year, we exceeded our outlook. Additionally, we delivered our earnings and capital return targets set at our last Investor Day three years ago. This is a testament to our disciplined execution and financial agility, reinforcing our strong foundation and commitment to durable long-term value creation. In the year, we delivered revenue growth of 5%, with 10% growth at Coach. We increased gross margins by 210 basis points, and we grew earnings per share by 19% versus last year, while accelerating investments into our brands. Turning to the details of the fourth quarter, I will begin with a discussion of revenue trends on a constant currency basis. Sales increased 8% compared to the prior year and outperformed our expectations. These results reflect gains in North America and internationally.

We continue to see significant opportunities to grow in the region, given our positioning momentum and low penetration in this large market.

In greater China revenue growth accelerated ahead of our expectations, increasing to 18% with growth across all channels, including notable strength in digital our strong performance in China underscores our strategic initiatives and investments are working and our business remains well positioned for long term sustainable growth.

Speaker #7: This is a testament to our disciplined execution and financial agility, reinforcing our strong foundation and commitment to durable long-term value creation. In the year, we delivered revenue growth of 5%, with 10% growth at Coach.

Speaker #7: We increased gross margins by 210 basis points and grew earnings per share by 19% compared to last year, while accelerating investments in our brands.

In Japan sales declined 11% amid a challenging consumer backdrop and in other Asia revenue decreased 1% as growth in Australia, New Zealand and South Korea was offset primarily by a decline in Malaysia.

Speaker #7: Turning to the details of the fourth quarter, I'll begin with a discussion of revenue trends on a constant currency basis. Sales increased 8% compared to the prior year and outperformed our expectations.

Now touching on revenue by channel for the quarter, we grew in each channel, while achieving strong and increasing profitability our direct to consumer business grew 6% compared to the prior year, which included a mid teens percentage increase in digital revenue and a low single digit increase in global brick and mortar sales.

Speaker #7: These results reflect gains in North America and internationally. By region, North America's sales increased 8% compared to the prior year, led by 16% growth at Coach.

Scott Roe: By region, North America sales increased 8% compared to the prior year, led by 16% growth at Coach. Importantly, both gross and operating margin in the region rose versus last year. In Europe, revenue grew 10% above last year, driven by growth in our direct channels with increased local consumer spend and strong new customer acquisition, notably with Gen Z. We continue to see significant opportunities to grow in the region, given our positioning, momentum, and low penetration in this large market. In greater China, revenue growth accelerated ahead of our expectations, increasing 18% with growth across all channels, including notable strength in digital. Our strong performance in China underscores our strategic initiatives and investments are working, and our business remains well-positioned for long-term sustainable growth.

Speaker #7: Importantly, both gross and operating margins in the region rose versus last year. In Europe, revenue grew 10% above last year, driven by growth in our direct channels with increased local consumer spend and strong new customer acquisition, notably with Gen Z.

In wholesale revenue grew in the quarter in keeping with our expectations and strategy to find targeted opportunities to expand our brands reach with consumers.

Moving down the P&L, we delivered a record fourth quarter gross margin of 76, 3%, a 140 basis points above prior year, driven by operational outperformance our strong gross margin as a core element of our value creation model, providing us with flexibility and fuel to drive sustainable growth.

Speaker #7: We continue to see significant opportunities to grow in the region, given our positioning, momentum, and low penetration in this large market. In Greater China, revenue growth accelerated ahead of our expectations, increasing 18% with growth across all channels, including notable strength in digital.

As we've seen in the year AUR growth is driving roughly two thirds of our margin improvement with the balance coming from AUC and we see both levers contributing to operational gross margin gains into the future.

Speaker #7: Our strong performance in China underscores that our strategic initiatives and investments are working, and our business remains well-positioned for long-term sustainable growth. In Japan, sales declined 11% amid a challenging consumer backdrop, and in other Asia, revenue decreased 1% as growth in Australia, New Zealand, and South Korea was offset primarily by a decline in Malaysia.

Turning to SG&A expenses rose, 10% driven by an increase in marketing expense, which was 13% of sales in the quarter, while we drove 120 basis points of leverage in the balance of the business. So.

Scott Roe: In Japan, sales declined 11% amid a challenging consumer backdrop, and in other Asia, revenue decreased 1% as growth in Australia, New Zealand, and South Korea was offset primarily by a decline in Malaysia. Now, touching on revenue by channel for the quarter, we grew in each channel while achieving strong and increasing profitability. Our direct-to-consumer business grew 6% compared to the prior year, which included a mid-teens percentage increase in digital revenue and a low single-digit increase in global brick-and-mortar sales. In wholesale, revenue grew in the quarter, in keeping with our expectations and strategy to find targeted opportunities to expand our brand's reach with consumers. Moving down the P&L, we delivered a record fourth-quarter gross margin of 76.3%, 140 basis points above prior year, driven by operational outperformance.

So taken together operating margin increased 30 basis points in the quarter driving profit expansion of 10% over the prior year, which was ahead of expectations and our fourth quarter EPS of $1 four grew 12% over the prior year and exceeded our guidance.

Speaker #7: Now, touching on revenue by channel for the quarter, we grew in each channel while achieving strong and increasing profitability. Our direct-to-consumer business grew 6% compared to the prior year, which included a mid-teens percentage increase in digital revenue and a low single-digit increase in global brick-and-mortar sales.

Now turning to our shareholder return programs in fiscal 'twenty, five we returned $2 $3 billion to shareholders, a testament to our strong organic business and robust cash flow generation. This includes $300 million in dividend payments and $2 billion and an accelerated share repurchase.

Speaker #7: In wholesale, revenue grew in the quarter, in keeping with our expectations and strategy to find targeted opportunities to expand our brand's reach with consumers.

Speaker #7: Moving down the P&L, we delivered a record fourth-quarter gross margin of 76.3%, 140 basis points above the prior year, driven by operational outperformance. Our strong gross margin is a core element of our value creation model, providing us with the flexibility and fuel to drive sustainable growth.

This program is expected to result in an average purchase price of about $78 per share.

Scott Roe: Our strong gross margin is a core element of our value creation model, providing us with flexibility and fuel to drive sustainable growth. As we have seen in the year, AUR growth is driving roughly two-thirds of our margin improvement, with the balance coming from AUC, and we see both levers contributing to operational gross margin gains into the future. Turning to SG&A, expenses rose 10%, driven by an increase in marketing expense, which was 13% of sales in the quarter, while we drove 120 basis points of leverage in the balance of the business. Taken together, operating margin increased 30 basis points in the quarter, driving profit expansion of 10% over the prior year, which was ahead of expectations. Our fourth-quarter EPS of $1.4 grew 12% over the prior year and exceeded our guidance.

And now before turning to the details of our balance sheet and cash flows I'd like to reiterate our capital allocation priorities.

We have two foundational commitments.

Speaker #7: As we've seen in the year, AUR growth is driving roughly two-thirds of our margin improvement, with the balance coming from AUC. We see both levers contributing to operational gross margin gains and into the future.

First to invest in our brands and business to support long term sustainable growth and second to return capital to shareholders via our dividend with the goal over time to increase the dividend at least in line with earnings consistent with this the board authorized a 14% quarterly dividend increase for an anticipated annual rate.

Speaker #7: Turning to SG&A, expenses rose 10%, driven by an increase in marketing expense, which was 13% of sales in the quarter, while we drove 120 basis points of leverage in the balance of the business.

In fiscal 'twenty six of $1 60 per share.

Beyond these two foundational commitments our robust cash flow generation provides us with balance sheet flexibility for value creation. This includes the opportunity for share repurchase activity, which was on display in fiscal 'twenty five and remains of value creation driver going forward and finally utilizing our rigorous for Lindsay.

Speaker #7: So, taken together, operating margin increased 30 basis points in the quarter, driving profit expansion of 10% over the prior year, which was ahead of expectations.

Speaker #7: And our fourth quarter EPS of $1.04 grew 12% over the prior year and exceeded our guidance. Now, turning to our shareholder return programs, in fiscal 2025, we returned $2.3 billion to shareholders, a testament to our strong organic business and robust cash flow generation.

Scott Roe: Turning to our shareholder return programs, in fiscal 2025, we returned $2.3 billion to shareholders, a testament to our strong organic business and robust cash flow generation. This includes $300 million in dividend payments and $2 billion in an accelerated share repurchase program. This program is expected to result in an average purchase price of about $78 per share. Before turning to the details of our balance sheet and cash flows, I would like to reiterate our capital allocation priorities. We have two foundational commitments. First, to invest in our brands and business to support long-term sustainable growth, and second, to return capital to shareholders via our dividend, with the goal over time to increase the dividend at least in line with earnings. Consistent with this, the board authorized a 14% quarterly dividend increase for an anticipated annual rate in fiscal 2026 of $1.60 per share.

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.

Speaker #7: This includes $300 million in dividend payments and $2 billion in an accelerated share repurchase program. This program is expected to result in an average purchase price of about $78 per share.

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 two five times.

Speaker #7: And now, before turning to the details of our balance sheet and cash flows, I'd like to reiterate our capital allocation priorities. We have two foundational commitments.

Now turning to the details of our balance sheet and cash flows we ended the quarter with $1 $1 billion in cash and investments and total borrowings of $2 $4 billion.

Speaker #7: First, to invest in our brands and business to support long-term sustainable growth. And second, to return capital to shareholders via our dividend, with the goal over time to increase the dividend at least in line with earnings.

Representing net debt of $1 $3 billion. This incorporated the paydown of bonds totaling approximately $300 million in April.

Speaker #7: Consistent with this, the board authorized a 14% quarterly dividend increase, for an anticipated annual rate in fiscal 26 of $1.60 per share. Beyond these two foundational commitments, our robust cash flow generation provides us with balance sheet flexibility for value creation.

Year end, our gross debt to adjusted EBITDA was a full turn below our leverage target at one four times.

Adjusted free cash flow for the year was an inflow of $1.35 billion in Capex in cloud computing costs were $153 million inventory levels at year end were 4% above prior year, excluding $92 million of Stuart Weitzman inventory reflected in assets held for sale on our balance sheet.

Scott Roe: Beyond these two foundational commitments, our robust cash flow generation provides us with balance sheet flexibility for value creation. This includes the opportunity for share repurchase activity, which was on display in fiscal 2025 and remains a value creation driver going forward. Finally, utilizing our rigorous four 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 2.5 times. Turning to the details of our balance sheet and cash flows, we ended the quarter with $1.1 billion in cash and investments and total borrowings of $2.4 billion, representing net debt of $1.3 billion.

Speaker #7: This includes the opportunity for share repurchase activity, which was on display in fiscal 25 and remains a value creation driver going forward. And finally, utilizing our rigorous four lens framework, we consistently evaluate opportunities for strategic portfolio management.

This included the strategic pull forward of receipts in light of the current trade landscape. Our inventory continues to be current and well positioned globally and by brand for fiscal 'twenty six we expect inventory levels to be modestly down year over year on a reported basis now before turning to our guidance as you saw in our press.

Speaker #7: 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.

Release, we recorded a noncash impairment charge of over $850 million related to Kate Spade.

Speaker #7: 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 2.5 times.

This was based upon the current business trends, the outsized impact of tariffs, which disproportionately affects Kate spade is the vast majority of its businesses in the U S and the incremental investments, we're making in support of profitable long term growth now moving to our guidance for fiscal 'twenty, six which is provided on a non-GAAP basis.

Speaker #7: Now, turning to the details of our balance sheet and cash flows, we ended the quarter with $1.1 billion in cash and investments, and total borrowings of $2.4 billion, representing net debt of $1.3 billion.

Speaker #7: This incorporated the paydown of bonds totaling approximately $300 million in April. That year-end, our gross debt to adjusted EBITDA was a full turn below our leverage target at $1.4 times.

Scott Roe: This incorporated the paydown of bonds totaling approximately $300 million in April. At year-end, our gross debt to adjusted EBITDA was a full turn below our leverage target at 1.4 times. Adjusted free cash flow for the year was an inflow of $1.35 billion, and CapEx and cloud computing costs were $153 million. Inventory levels at year-end were 4% above prior year, excluding $92 million of Stuart Weitzman inventory reflected in assets held for sale on our balance sheet. This included the strategic pull forward of receipts in light of the current trade landscape. Our inventory continues to be current and well-positioned globally and by brand. For fiscal 2026, we expect inventory levels to be modestly down year over year on a reported basis. Before turning to our guidance, as you saw in our press release, we recorded a non-cash impairment charge of over $850 million related to Kate Spade.

Start I'd like to give some context by dis aggregating the topline momentum we're seeing in the business and our focus on supporting revenue growth from the current dynamics impacting our profitability in the fiscal year.

Speaker #7: Adjusted free cash flow for the year was an inflow of $1.35 billion, and CapEx and cloud computing costs were $153 million. Inventory levels at year-end were 4% above the prior year, excluding $92 million of Stuart Weitzman inventory, reflected in assets held for sale on our balance sheet.

First on sales or trends in the first quarter are strong and in fact, we've accelerated into the new year led by coach was stronger full price selling we are building the brand for continued healthy gains well into the future. This is our priority and we're executing behind it having said that we are facing greater than previously expected profit headwinds.

From tariffs and duties with the earlier than expected ending of de Minimis exemptions being a meaningful factor in aggregate. The total expected impact on profitability. This year from tariffs is $160 million representing.

Speaker #7: This included the strategic pull-forward of receipts in light of the current trade landscape. Our inventory continues to be current and well-positioned globally, and by brand.

Speaker #7: For fiscal 26, we expect inventory levels to be modestly down year-over-year on a reported basis. Now, before turning to our guidance, as you saw in our press release, we recorded a non-cash impairment charge of over $850 million related to Kate Spade.

Approximately 230 basis points of margin headwind, we're taking thoughtful actions to mitigate these impacts while continuing to deliver the compelling value quality and innovation that is foundational to our brands.

Speaker #7: This was based upon the current business trends, the outsized impact of tariffs, which disproportionately affects Kate Spade, as the vast majority of its business is in the U.S., and the incremental investments we're making in support of profitable long-term growth.

We're leveraging our agile supply chain to optimize our global manufacturing footprint, minimizing our tariff exposure where possible.

Scott Roe: This was based upon the current business trends, the outsized impact of tariffs, which disproportionately affects Kate Spade as the vast majority of its business is in the U.S., and the incremental investments we're making in support of profitable long-term growth. Moving to our guidance for fiscal 2026, which is provided on a non-GAAP basis. To start, I'd like to give some context by disaggregating the top-line momentum we're seeing in the business and our focus on supporting revenue growth from the current dynamics impacting our profitability in the fiscal year. First, on sales, our trends in the first quarter are strong, and in fact, we've accelerated into the new year, led by Coach, with stronger full-price selling. We are building the brand for continued healthy gains well into the future. This is our priority, and we're executing behind it.

We're also working closely with our longstanding service providers to drive efficiencies I remain confident in our ability to address these headwinds fully overtime, given the strength of our business and the agility of our supply chain overall, we view our guidance is prudent and achievable.

Speaker #7: Now, moving to our guidance for fiscal 2026, which is provided on a non-GAAP basis. To start, I'd like to give some context by disaggregating the top-line momentum we're seeing in the business and our focus on supporting revenue growth from the current dynamics impacting our profitability in the fiscal year.

All in we expect to drive continued mid single digit revenue growth on a pro forma basis deliver strong operating margins above prior year and returned over $1 billion in capital to shareholders in the fiscal year.

Speaker #7: First on sales, our trends in the first quarter are strong. In fact, we've accelerated into the new year, led by COACH with stronger full-price selling.

And as we action our mitigation strategies on tariffs, we believe our longer term earnings growth delivery will accelerate now turning to the details. This guidance excludes Stuart weitzman from fiscal 'twenty six expectations for the fiscal year, we expect revenue to approach seven $2 billion. This represents pro forma.

Speaker #7: We are building the brand for continued healthy gains well into the future. This is our priority, and we're executing behind it. Having said that, we are facing greater than previously expected profit headwinds from tariffs and duties, with the earlier-than-expected ending of de minimis exemptions being a meaningful factor.

Scott Roe: Having said that, we are facing greater than previously expected profit headwinds from tariffs and duties, with the earlier-than-expected ending of de minimis exemptions being a meaningful factor. In aggregate, the total expected impact on profitability this year from tariffs is $160 million, representing approximately 230 basis points of margin headwind. We are taking thoughtful actions to mitigate these impacts while continuing to deliver the compelling value, quality, and innovation that is foundational to our brands. We are leveraging our agile supply chain to optimize our global manufacturing footprint, minimizing our tariff exposure where possible. We are also working closely with our longstanding service providers to drive efficiencies. I remain confident in our ability to address these headwinds fully over time, given the strength of our business and the agility of our supply chain. Overall, we view our guidance as prudent and achievable.

Speaker #7: In aggregate, the total expected impact on profitability this year from tariffs is $160 million representing approximately $230 basis points of margin headwind. We're taking thoughtful actions to mitigate these impacts while continuing to deliver the compelling value, quality, and innovation that is foundational to our brands.

To grow at a mid single digit rate on both a nominal and constant currency basis with FX plan to be an 80 basis point tailwind touching on sales details by region at constant currency on a pro forma basis in North America, we expect revenue to increase mid single digits.

In addition, we expect growth in Europe in the area of 20% and.

Speaker #7: We're leveraging our agile supply chain to optimize our global manufacturing footprint, minimizing our tariff exposure where possible, we're also working closely with our longstanding service providers to drive efficiencies.

In greater China, we expect to achieve high single digit growth over the prior year.

In Japan, we're forecasting a high single digit decline and in other Asia, We anticipate high single digit gains and by brand. This guidance incorporates high single digit growth at coach at constant currency.

Speaker #7: I remain confident in our ability to address these headwinds fully over time, given the strength of our business and the agility of our supply chain.

At Kate Spade, we're embedding a high single digit decline in revenue with sequential improvement planned in the second half of the year.

Speaker #7: Overall, we view our guidance as prudent and achievable. All in, we expect to drive continued mid-single-digit revenue growth on a pro forma basis, deliver strong operating margins above prior year, and return over $1 billion in capital to shareholders in the fiscal year.

Scott Roe: All in, we expect to drive continued mid-single-digit revenue growth on a pro forma basis, deliver strong operating margins above prior year, and return over $1 billion in capital to shareholders in the fiscal year. As we action our mitigation strategies on tariffs, we believe our longer-term earnings growth delivery will accelerate. Now, turning to the details, this guidance excludes Stuart Weitzman from fiscal 2026 expectations. For the fiscal year, we expect revenue to approach $7.2 billion. This represents pro forma revenue to grow at a mid-single-digit rate on both a nominal and constant currency basis, with FX planned to be an 80 basis point tailwind. Touching on sales details by region at constant currency on a pro forma basis, in North America, we expect revenue to increase mid-single digits. In addition, we expect growth in Europe in the area of 20%.

In addition, our outlook assumes operating margin expansion.

We anticipate gross margin to decline in the area of 70 basis points. This assumes operational gross margin expansion of 120 basis points due primarily to improvements in AUR slightly offset by an FX headwind of 20 basis points.

Speaker #7: And as we action our mitigation strategies on tariffs, we believe our longer-term earnings growth delivery will accelerate. Now, turning to the details, this guidance excludes Stuart Weitzman from fiscal 2026 expectations.

Further we expect to realize a 60 basis point structural tailwind to gross margin from the disposition of Stuart Weitzman offsetting these planned margin drivers is a 230 basis points headwind from incremental tariffs and duties, which incorporates the timing of policy implementation product sell through and mitigating.

Speaker #7: For the fiscal year, we expect revenue to approach $7.2 billion. This represents pro forma revenue growth at a mid-single-digit rate on both a nominal and constant currency basis, with FX planned to be an 80 basis point tailwind.

Speaker #7: Touching on sales details by region at constant currency on a pro forma basis, in North America, we expect revenue to increase mid-single digits. In addition, we expect growth in Europe, in the area of 20%.

<unk> underway for context. This is a headwind of $160 million in the fiscal year, which assumes we mitigate 30% of the annualized run rate of $235 million.

On SG&A, we expect expenses to be approximately even with prior year, resulting in at least 100 basis points of expense leverage. This reflects our diligent expense control, partially offset by ongoing growth focused investments in our strategic priorities to this end, we expect marketing as a percentage of sales to increase.

Speaker #7: In Greater China, we expect to achieve high single-digit growth over the prior year. In Japan, we're forecasting a high single-digit decline, and in other Asia, we anticipate high single-digit gains.

Scott Roe: In greater China, we expect to achieve high single-digit growth over the prior year. In Japan, we are forecasting a high single-digit decline, and in other Asia, we anticipate high single-digit gains. By brand, this guidance incorporates high single-digit growth at Coach at constant currency. At Kate Spade, we are embedding a high single-digit decline in revenue with sequential improvement planned in the second half of the year. In addition, our outlook assumes operating margin expansion. We anticipate gross margin to decline in the area of 70 basis points. This assumes operational gross margin expansion of 120 basis points, due primarily to improvements in AUR, slightly offset by an FX headwind of 20 basis points. Further, we expect to realize a 60 basis point structural tailwind to gross margin from the disposition of Stuart Weitzman.

Speaker #7: And by brand, this guidance incorporates high single-digit growth at Coach at constant currency. At Kate Spade, we're embedding a high single-digit decline in revenue, with sequential improvement planned in the second half of the year.

Around 80 basis points versus last year, reaching over 11% of revenue. We also realized a 20 basis point benefit to expenses from the sale of Stuart Weitzman I'll end. This means operational SG&A leverage is expected to be at least a 160 basis points for some texture on the operating profit <unk>.

Speaker #7: In addition, our outlook assumes operating margin expansion. We anticipate gross margin to decline in the area of 70 basis points. This assumes operational gross margin expansion of $120 basis points, due primarily to improvements in AUR.

Brad we anticipate coach will maintain its operating margin, even with tariff pressure and continued brand investments.

Speaker #7: Slightly offset by an FX headwind of 20 basis points. Further, we expect to realize a 60 basis point structural tailwind to gross margin from the disposition of Stuart Weitzman.

At Kate Spade, we expect a modest profit loss given the outsized tariff impacts and brand investments has mentioned.

Speaker #7: Offsetting these planned margin drivers is a 230 basis point headwind from incremental tariffs and duties, which incorporates the timing of policy implementation, product sell-through, and mitigating actions underway.

Scott Roe: Offsetting these planned margin drivers is a 230 basis point headwind from incremental tariffs and duties, which incorporates the timing of policy implementation, product sell-through, and mitigating actions underway. For context, this is a headwind of $160 million in the fiscal year, which assumes we mitigate 30% of the annualized run rate of $235 million. On SG&A, we expect expenses to be approximately even with prior year, resulting in at least 100 basis points of expense leverage. This reflects our diligent expense control, partially offset by ongoing growth-focused investments in our strategic priorities. To this end, we expect marketing as a percentage of sales to increase around 80 basis points versus last year, reaching over 11% of revenue. We also realize a 20 basis point benefit to expenses from the sale of Stuart Weitzman. All in, this means operational SG&A leverage is expected to be at least 160 basis points.

Moving to below the line expectations for the year net interest expense is expected to be approximately $65 million. The tax rate is expected to be approximately 18% and our weighted average diluted share count for the year is forecasted to be approximately 213 million shares which includes the expectation for 800.

Speaker #7: For context, this is a headwind of $160 million in the fiscal year, which assumes we mitigate 30% of the annualized run rate of $235 million.

And share repurchases taken together, we expect EPS to be $5 30 to $5 45.

Speaker #7: On SG&A, we expect expenses to be approximately even with prior year, resulting in at least 100 basis points of expense leverage. This reflects our diligent expense control, partially offset by ongoing growth-focused investments in our strategic priorities.

Representing 4% to 7% growth compared to last year, including over 60.

Tariff and duty headwinds.

Moving on we anticipate adjusted free cash flow to approach $1 $3 billion and finally, we expect capex in cloud computing costs to be in the area of $200 million, we anticipate about 60% of the spend to be related to store openings renovations and relocations with the balance primarily related to our <unk>.

Speaker #7: To this end, we expect marketing as a percentage of sales to increase by approximately 80 basis points versus last year, reaching over 11% of revenue.

Speaker #7: We also realize a 20-basis point benefit to expenses from the sale of Stuart Weitzman. All in, this means operational SG&A leverage is expected to be at least 160 basis points.

Ongoing it and digital investments.

Touching on the shaping for the year.

Speaker #7: For some texture on operating profit by brand, we anticipate COACH will maintain its operating margin even with tariff pressure and continued brand investments. At Kate Spade, we expect a modest profit loss, given the outsized tariff impacts and brand investments, as mentioned.

Scott Roe: For some texture on operating profit by brand, we anticipate Coach will maintain its operating margin even with tariff pressure and continued brand investments. At Kate Spade, we expect a modest profit loss given the outsized tariff impacts and brand investments, as mentioned. Moving to below-the-line expectations for the year, net interest expense is expected to be approximately $65 million. The tax rate is expected to be approximately 18%, and our weighted average diluted share count for the year is forecasted to be approximately 213 million shares, which includes the expectation for $800 million in share repurchases. Taken together, we expect EPS to be $5.30 to $5.45, representing 4% to 7% growth compared to last year, including over $0.60 of tariff and duty headwinds.

To start given the dynamic nature of the rapidly shifting market. It's important to note, we could experience volatility by quarter, notably within profit as tariff and duty impacts work their way through the P&L.

Now to our current assumptions, we expect pro forma constant currency revenue to increase high single digits in the first half and low single digits in the back half.

Speaker #7: Moving to below-the-line expectations for the year, net interest expense is expected to be approximately $65 million. The tax rate is expected to be approximately 18%, and our weighted average diluted share count for the year is forecasted to be approximately 213 million shares, which includes the expectation for $800 million in share repurchases.

For Q1, specifically as mentioned we started the year strong with revenue trends accelerating at coach as a result, we are anticipating a low double digit total sales gain in the quarter. This includes a 70 basis point tailwind from FX.

Turning to margin as we mentioned, we expect gross margin pressure for the year due entirely to tariff and duty headwinds primarily in the second half in Q1, we anticipate reported gross margins to increase by approximately 100 basis points.

Speaker #7: Taken together, we expect EPS to be between $5.30 and $5.45, representing 4% to 7% growth compared to last year, including over $0.60 of tariff and duty headwinds.

Speaker #7: Moving on, we anticipate adjusted free cash flow to approach $1.3 billion. Finally, we expect CapEx and cloud computing costs to be in the area of $200 million.

SG&A is expected to leverage both in the first and second halves, while in Q1, specifically, we expect slight deleverage on higher marketing expense.

Scott Roe: Moving on, we anticipate adjusted free cash flow to approach $1.3 billion, and finally, we expect CapEx and cloud computing costs to be in the area of $200 million. We anticipate about 60% of the spend to be related to store openings, renovations, and relocations, with the balance primarily related to our ongoing IT and digital investments. Touching on the shaping for the year, to start, given the dynamic nature of the rapidly shifting market, it's important to note we could experience volatility by quarter, notably within profit, as tariff and duty impacts work their way through the P&L. Now, to our current assumptions, we expect pro forma constant currency revenue to increase high single digits in the first half and low single digits in the back half. For Q1 specifically, as mentioned, we have started the year strong with revenue trends accelerating at Coach.

We expect operating margin expansion in the first half driven by a Q1 increase of roughly 80 basis points in the second half operating margins are planned in line with prior year, despite tariff and duty pressure.

Speaker #7: We anticipate about 60% of the spend to be related to store openings, renovations, and relocations, with the balance primarily related to our ongoing IT and digital investments.

Speaker #7: Touching on the shaping for the year, to start, given the dynamic nature of the rapidly shifting market, it's important to note we could experience volatility by quarter, notably within profit as tariff and duty impacts work their way through the P&L.

Taking a prudent approach to our guidance, we expect EPS growth for the year to be led by the first half with Q1 forecasted to grow by more than 20% to approximately $1 25.

So in closing we delivered a another record breaking quarter and year highlighted by strong top and bottom line growth, we achieved over $5 in EPS and returned more than $3 billion to shareholders over the last three years consistent with the targets we outlined at our last Investor day.

Speaker #7: Now, to our current assumptions, we expect pro forma constant currency revenue to increase high single digits in the first half and low single digits in the back half.

Speaker #7: For Q1 specifically, as mentioned, we've started the year strong with revenue trends accelerating at COACH. As a result, we're anticipating a low double-digit total sales gain in the quarter.

This showcases our differentiated and highly cash generative business model that is proven agile resilient and adaptive to change.

Scott Roe: As a result, we are anticipating a low double-digit total sales gain in the quarter. This includes a 70 basis point tailwind from FX. Turning to margin, as we mentioned, we expect gross margin pressure for the year due entirely to tariff and duty headwinds, primarily in the second half. In Q1, we anticipate reported gross margins to increase by approximately 100 basis points. SG&A is expected to leverage both in the first and second halves, while in Q1 specifically, we expect slight deleverage on higher marketing expense. We expect operating margin expansion in the first half, driven by a Q1 increase of roughly 80 basis points. In the second half, operating margins are planned in line with prior year, despite tariff and duty pressure.

Speaker #7: This includes a 70 basis point tailwind from FX. Turning to margin, as we mentioned, we expect gross margin pressure for the year due entirely to tariff and duty headwinds, primarily in the second half.

Moving forward, we are confident in our brands our people and our strategy. Our fundamentals are strong and we are competitive and structural advantages that position us to drive durable growth and shareholder value in both the year ahead and for years to come.

Speaker #7: In Q1, we anticipate reported gross margins to increase by approximately 100 basis points. SG&A is expected to leverage both in the first and second halves, while in Q1 specifically, we expect slightly leverage on higher marketing expense.

I'd now like to open it up and take your questions.

Thank you at this time, if you would like to ask a question. Please press star one now on your telephone keypad to withdraw yourself from the queue you May press star two.

Speaker #7: We expect operating margin expansion in the first half, driven by a Q1 increase of roughly 80 basis points. In the second half, operating margins are planned in line with the prior year, despite tariff and duty pressure.

Our first question is from Brooke Roach of Goldman Sachs. Please go ahead.

Good morning, Joanne Scott and Todd and thank you for taking our question can you help us unpack your outlook for fiscal 2006, and what Youre seeing in the business right. Now specifically can you talk about the strength that coach and your strategies to mitigate the impacts of tariffs over time. Thank you.

Speaker #7: Taking a prudent approach to our guidance, we expect EPS growth for the year to be led by the first half, with Q1 forecasted to grow by more than 20% to approximately $1 and 25 cents.

Scott Roe: Taking a prudent approach to our guidance, we expect EPS growth for the year to be led by the first half, with Q1 forecasted to grow by more than 20% to approximately $1.25. In closing, we delivered another record-breaking quarter and year, highlighted by strong top and bottom line growth. We achieved over $5 in EPS and returned more than $3 billion to shareholders over the last three years, consistent with the targets we outlined at our last Investor Day. This showcases our differentiated and highly cash-generative business model that has proven agile, resilient, and adaptive to change. Moving forward, we are confident in our brands, our people, and our strategy.

Speaker #7: Showing closing, we delivered another record-breaking quarter-end-year highlighted by strong top and bottom-line growth. We achieved over $5 in EPS and returned more than $3 billion to shareholders over the last three years, consistent with the targets we outlined at our last investor day.

Thanks Brook and good morning all.

Kick us off and <unk>.

Start with the breakout year, we just delivered which I think illustrates the power of our business model and our strategies and just to recap. This year, we delivered strong topline results with an inflection to mid single digit growth well ahead of the industry and we capped the year with an even stronger fourth quarter and importantly, we did this it.

Speaker #7: This showcases our differentiated and highly cash-generative business model that has proven agile, resilient, and adaptive to change. Moving forward, we're confident in our brands, our people, and our strategy.

Increasing margins, meaning that we're growing in a healthy way and in a durable way.

Speaker #7: Our fundamentals are strong, and we have competitive and structural advantages that position us to drive durable growth and shareholder value in both the year ahead and for years to come.

Scott Roe: Our fundamentals are strong, and we have competitive and structural advantages that position us to drive durable growth and shareholder value in both the year ahead and for years to come. I would now like to open it up and take your questions.

We delivered earnings per share above $5, which is what our commitment three years ago amid an incredibly complex environment, which showcases the agility of our teams.

Speaker #7: I'd now like to open it up and take your questions.

Importantly, our momentum continued the coach business accelerated into the first quarter is all point to the fact that we're driving durable growth. This is our focus and we are executing.

Speaker #8: Thank you. At this time, if you would like to ask a question, please press star one now on your telephone keypad. To withdraw yourself from the queue, you may press star two.

Operator: Thank you. At this time, if you would like to ask a question, please press star one now on your telephone keypad. To withdraw yourself from the queue, you may press star two. Our first question is from Brooke Roach of Goldman Sachs. Please go ahead.

And in terms of fiscal 'twenty six we expect continued growth our guidance calls for mid single digit top line growth and mid to high single digit earnings growth inclusive of tariffs.

Speaker #8: Our first question is from Brooke Roach of Goldman Sachs. Please go ahead.

Speaker #2: Good morning, Joanne, Scott, and Todd. And thank you for taking our question. Can you help us unpack your outlook for fiscal 26 and what you're seeing in the business right now?

Joanne Crevoiserat: Good morning, Joanne, Scott, and Todd. Thank you for taking our question. Can you help us unpack your outlook for fiscal 2026 and what you are seeing in the business right now? Specifically, can you talk about the strength at Coach and your strategies to mitigate the impacts of tariffs over time? Thank you.

And we're clear eyed about the environment, we're incorporating the latest news on tariffs, both and how it could pressure consumers as well as the impact on our business and even with tariffs, we're continuing to expand our operating margin this year and we're well positioned to fully offset the impact of tariffs over time.

Speaker #2: Specifically, can you talk about the strength at Coach and your strategies to mitigate the impacts of tariffs over time? Thank you.

Speaker #9: Well, thanks, Brooke, and good morning. I'll kick us off and start with the breakout year we just delivered, which I think illustrates the power of our business model and our strategies.

Unidentified Analyst: Well, thanks, Brooke, and good morning. I will kick us off and start with the breakout year we just delivered, which I think illustrates the power of our business model and our strategies. Just to recap, this year we delivered strong top-line results with an inflection to mid-single-digit growth well ahead of the industry, and we capped the year with an even stronger fourth quarter. Importantly, we did this at increasing margins, meaning that we are growing in a healthy way and in a durable way. We delivered earnings per share above $5, which was our commitment three years ago, amid an incredibly complex environment, which showcases the agility of our teams. Importantly, our momentum continued. The Coach business accelerated into the first quarter. This all points to the fact that we are driving durable growth. This is our focus, and we are executing.

So we have momentum and we see tremendous runway ahead, and I'll turn it to Todd to talk about the strength you're seeing in coach.

Speaker #9: And just to recap, this year we delivered strong top-line results with an inflection to mid-single-digit growth well ahead of the industry and we capped the year with an even stronger fourth quarter.

Thanks, Joanne and good morning.

As we noted in the fourth quarter, we grew 13%.

Important about our growth was it was broad based in leather goods and we grew in the key markets that we focused on North America, China, and Europe, and we delivered a 10% total year.

Speaker #9: An importantly, we did this at increasing margins, meaning that we're growing in a healthy way and in a durable way. And we delivered earnings per share above $5 which is what our commitment three years ago amid an incredibly complex environment, which showcases the agility of our teams.

Both well ahead of the industry.

What is even more impressive I think is where we're at right now are quarter to date as Julian mentioned, we've seen an acceleration from our exit rate in Q4.

Speaker #9: And importantly, our momentum continued; the COACH business accelerated into the first quarter. This all points to the fact that we're driving durable growth. This is our focus and we are executing.

That acceleration is coming with lower promotions year on year.

In the quarter last quarter, we added 1 million new customers in North America, 70% with Gen Z and millennials.

Speaker #9: And in terms of fiscal 26, we expect continued growth. Our guidance calls for mid-single-digit top-line growth and mid to high single-digit earnings growth, inclusive of tariffs.

Unidentified Analyst: In terms of fiscal 2026, we expect continued growth. Our guidance calls for mid-single-digit top-line growth and mid to high single-digit earnings growth, inclusive of tariffs. We are clear-eyed about the environment. We are incorporating the latest news on tariffs, both in how it could pressure consumers as well as the impact on our business. Even with tariffs, we are continuing to expand our operating margin this year, and we are well-positioned to fully offset the impact of tariffs over time. We have momentum, and we see tremendous runway ahead. I will turn it to Todd to talk about the strength he is seeing at Coach.

Italy, we added one 7 million customers globally, and this strong traction with younger consumers is our future.

Speaker #9: And we're clear-eyed about the environment. We're incorporating the latest news on tariffs, both in how it could pressure consumers as well as the impact on our business.

We then turn to innovation.

Speaker #9: And even with tariffs, we're continuing to expand our operating margin this year and we're well-positioned to fully offset the impact of tariffs over time.

And the value we offer our customers.

And let me talk about one specific.

That was mentioned in our prepared remarks.

Speaker #9: So we have momentum, and we see tremendous runway ahead. I'll turn it to Todd to talk about the strength he's seeing at COACH.

Our kids locked back that bag was launched by our creative director at LASA Timbers run ratio. We've done two drops of that back in last one sold out within hours.

Speaker #3: Thanks, Joanne. Good morning. As we noted, in the fourth quarter, we grew 13%. What was important about our growth was that it was broad-based, especially in leather goods.

Michael Binetti: Thanks, Joanne. Good morning. As we noted, in the fourth quarter, we grew 13%. What was important about our growth was it was broad-based in leather goods. We grew in the key markets that we focused on: North America, China, and Europe. We delivered a 10% total year-to-year growth, well ahead of the industry. What is even more impressive, I think, is where we are at right now. Our quarter to date, as Joanne Crevoiserat mentioned, we have seen an acceleration from our exit rate in Q4. That acceleration is coming with lower promotions year on year. In the last quarter, we added 1 million new customers in North America. 70% were Gen Z and Millennials. Additionally, we added 1.7 million customers globally. This strong traction with younger consumers is our future. We then turn to innovation and the value we offer our customers.

Since that last drop.

81000 customers just in the United States, who have registered to be notified when we're going to do another drop and in fact last week. We added another 4000 customers with Sarah Jessica Parker was featured carrying the bag and just like that that's an example of the brand heat we're talking.

Speaker #3: And we grew in the key markets that we focused on: North America, China, and Europe. And we delivered a 10% total year-end growth well ahead of the industry.

Speaker #3: What is even more impressive, I think, is where we're at right now. Our quarter-to-date as Joanne mentioned, we've seen an acceleration from our exit rate in Q4 and that acceleration is coming with lower promotions year-on-year.

That's the example of the momentum.

Uh huh.

So when I look at that.

Looking at our investment in the brand, particularly over the last three years and the resulting brand heat and this places us in the best position to continue to grow AUR and mitigate duties and tariffs. Thank you.

Speaker #3: In the last quarter, we added 1 million new customers in North America, with 70% being Gen Z and Millennials. Additionally, we added $1.7 billion in customers globally.

Thank you both I'll pass it on.

Speaker #3: And this strong traction with younger consumers is our future. We then turned to innovation and the value we offer our customers. And let me talk about one specific bag that was mentioned in our prepared remarks.

Our next question is from Ike <unk> of Wells Fargo. Please go ahead.

Hey, everyone, let me add my congrats.

One for Joanne when for Scott I believe just again back to the accelerate I mean, clearly theres an acceleration in the business you're guiding <unk> above what you reported for <unk> Todd.

Michael Binetti: Let me talk about one specific bag that was mentioned in our prepared remarks, our Kiss Lock bag. That bag was launched by our Creative Director at last September's runway show. We have done two drops of that bag, and the last one sold out within hours. Since that last drop, we have 81,000 customers just in the United States who have registered to be notified when we are going to do another drop. In fact, last week, we added another 4,000 customers when Sarah Jessica Parker was featured carrying the bag in Just Like That. That is an example of the brand heat we are talking about. That is an example of the momentum that Coach has. When I look at that, I look at our investment in the brand, particularly over the last three years, and the resulting brand heat.

Speaker #3: Our our KISS lock bag. That bag was launched by our creative director at last September's runway show. We've done two drops of that bag, and last one sold out within hours.

Todd gave some helpful comments, but maybe Joanne can you help us with the data or the new customer growth and even anything you'd look at that gives you confidence and an ability to kind of lap the robust comps that really began during last holiday. Just curious how you kind of frame that and then Scott I just wanted to ask about tariff. So I think three months ago.

Speaker #3: Since that last drop, we have 81,000 customers just in the United States, who have registered to be notified when we're going to do another drop.

You gave.

Some confidence in maintaining margin when you had about $90 million of headwind now it sounds like you've got more like $1 60, with the new tariffs, but you also kind of not guiding to mitigate any of that in your guidance. So I guess. The question is is that is that highly conservative do you still view and ability to maintain the margins is on the table has anything changed.

Speaker #3: And, in fact, last week, we added another 4,000 customers when Sarah Jessica Parker was featured carrying the bag in "And Just Like That..." That's an example of the brand heat we're talking about.

Speaker #3: That's an example of the momentum that COACH has. So when I look at that, I look at our investment in the brand, particularly over the last three years.

Just curious your thoughts thank you.

Speaker #3: And the resulting brand heat. And this places us in the best position to continue to grow AURs and mitigate duties and tariffs. Thank you.

Well, thanks, and let me kick it off with your question around the consumer and new customer acquisition.

Michael Binetti: This places us in the best position to continue to grow AURs and mitigate duties and tariffs. Thank you.

Which is a really important question and it is the foundation of our growth and it is the focus of our brands is to make sure that we're continually acquiring new customers to our brands and that focused in those brand building capabilities. We've been building those for years.

Speaker #2: Thank you both. I'll pass it on.

Joanne Crevoiserat: Thank you both. I will pass it on.

Speaker #8: Our next question is from Ike Borashow of Wells Fargo. Please go ahead.

Operator: Our next question is from Ike Boruchow of Wells Fargo. Please go ahead.

Speaker #10: Hey, everyone. Let me add my congrats. One for Joanne, one for Scott, I believe. Just again, back to the accelerate. I mean, clearly there's an acceleration in the business.

Ike Boruchow: Hey, everyone. Let me add my congrats. One for Joanne Crevoiserat, one for Scott Roe, I believe. Just again, back to the accelerate. I mean, clearly, there is an acceleration in the business. You are guiding Q1 above what you reported for Q4. Todd Kahn gave some helpful comments, but maybe, Joanne Crevoiserat, can you help us with the data or the new customer growth, anything you look at that gives you confidence in an ability to kind of lap the robust comps that really began during the last holiday? Just curious how you kind of frame that. Scott Roe, I just wanted to ask about tariffs. I think three months ago, you gave some confidence in maintaining margin when you had about $90 million of headwind.

And we're investing behind those capabilities, both in our technology infrastructure, but most importantly, the marketing investments that we're making and you see us continue to grow those investments we expect to continue to acquire new customers to our brand that is our focus and what is important is that we're seeing this young consumer.

Speaker #10: You're guiding one queue above what you reported for four queue. Todd gave some helpful comments, but maybe Joanne can you help us with the data or the new customer growth?

Speaker #10: Anything you look at that gives you confidence and an ability to kind of lap the robust comps that really began during the last holiday?

Sure.

Gravitate to our brands so the execution, particularly at coach is at a very high level that the young consumer see coach as a brand for them in everything we do at every touch point. So that is what's driving the customer acquisition and importantly, we're seeing these customers come back with.

Speaker #10: Just curious how you kind of frame that. And then Scott, I just want to ask about tariffs. So I think three months ago you gave some confidence in maintaining margin when you had about $90 million of headwind.

Speaker #10: Now it sounds like you've got more like $160 with the new tariffs. But you're also kind of not guiding to mitigate any of that in your guide.

Ike Boruchow: Now, it sounds like you have more like $160 million with the new tariffs, but you are also kind of not guiding to mitigate any of that in your guide. I guess the question is, is that highly conservative? Do you still view an ability to maintain the margins as on the table? Has anything changed? Just curious your thoughts. Thank you.

More frequency so our retention rates on these young customers are actually higher than our other cohorts, which I think bodes well for the durability of our growth we're going to capture these young customers at the point of market entry and we're going to keep them and drive lifetime value. So that is fuel for our future growth is the foundation that we will continue.

Speaker #10: So I guess the question is, is that highly conservative? Do you still view an ability to maintain the margins is on the table? Has anything changed?

Speaker #10: Just curious your thoughts. Thank you.

Speaker #9: Well, thanks, Ike. And let me kick it off with your question around the consumer and new customer acquisition. Which is a really important question, and it is the foundation of our growth, and it is the focus of our brands is to make sure that we're continually acquiring new customers to our brands.

Unidentified Analyst: Thanks, Ike. Let me kick it off with your question around the consumer and new customer acquisition.

To build on with more new customer acquisition and that's how we're thinking about comping. The comp. We're just building a foundation and getting stronger from here.

Christina Colone: is a really important question, and it is the foundation of our growth. It is the focus of our brands to make sure that we are continually acquiring new customers to our brands. That focus and those brand-building capabilities, we have been building those for years. We are investing behind those capabilities, both in our technology infrastructure, but most importantly, the marketing investments that we are making. You see us continue to grow those investments. We expect to continue to acquire new customers to our brands. That is our focus. What is important is that we are seeing this young consumer gravitate to our brands. The execution, particularly at Coach, is at a very high level, that the young consumer sees Coach as a brand for them in everything we do at every touchpoint. That is what is driving the customer acquisition.

And Schon quarter, Scott answered, yes, sorry, just wanted to give you one little tidbit that maybe helps demonstrate this.

Speaker #9: And that focus on those brand-building capabilities has been a priority for years. We are investing in those capabilities, both in our technology infrastructure and, most importantly, in the marketing investments we are making.

We are killing it with bank charters and one of my questions was I haven't seen a material move in.

But what we found out that we dug and looked at the data coming back more frequently a young customer made by the bag and then come back a week or two weeks later to actually buy a bag chart. So that gives us two opportunities to interact with them and as Julian and I have talked about in many calls we have the best sales team in la.

Speaker #9: And you see us continue to grow those investments. We expect to continue to acquire new customers to our brands. That is our focus. And what is important is that we're seeing this young consumer gravitate to our brands so that the execution, particularly at COACH, is at a very high level, that the young consumer sees COACH as a brand for them.

Their ability to get them back in the store and sell them is so powerful.

In terms of our special sauce.

Just wanted to throw that tidbit I know Scott you want to talk about tariffs and what we're going to do about them.

Christina Colone: Importantly, we are seeing these customers come back with more frequency. Our retention rates on these young customers are actually higher than our other cohorts, which I think bodes well for the durability of our growth. We are going to capture these young customers at the point of market entry, and we are going to keep them and drive lifetime value. That is fuel for our future growth. It is a foundation that we will continue to build on with more new customer acquisition. That is how we are thinking about comping the comp. We are just building a foundation and getting stronger from here.

I can't weigh Todd Thanks for the past often appreciate the way.

I appreciate the way you asked the question by the way because youre exactly right I mean of the 60 that impacted.

It is impacting our guidance two thirds of that if we just went back one quarter, we're not in effect right and in fact, just a couple of weeks ago.

Early termination of the de Minimis came into came in divisions. So.

You think about that 60, Thats, a one time increase in cost, which is impacting our gross margins, but we have massive underlying strength, even in our gross margins and I'll just remind you our operating margins are guided to expand even with this 60. So I guess you could say, it's if not for <unk>.

Todd Kahn: Just before Scott answers, I just want to give you one little tidbit that maybe helps demonstrate this. We are killing it with bag charms. One of my questions was, I haven't seen a material move in UPT. What we found out when we dug and looked at the data, they are coming back more frequently. A young customer may buy the bag and then come back a week or two weeks later to actually buy a bag charm. That gives us two opportunities to interact with them. As Joanne Crevoiserat and I have talked about in many calls, we have the best sales team in the world. Their ability to get them back in the store and sell them is so powerful in terms of our special sauce. I just want to throw that tidbit.

<unk> 62. This guide that's not the reality, though right I mean.

The tariffs are real and we're going to fight our way through it one other perspective.

I would give you is listen we have momentum in the first word and supply chain of supply, we're not going to sacrifice service to our business. We have great momentum, we're taking share we want to feed that momentum and we don't want to take any knee jerk reactions based on.

Todd Kahn: I know, Scott Roe, you want to talk about tariffs and what we are going to do about them.

Frankly dynamic and ever changing.

Environment here as it relates to tariffs.

Scott Roe: I cannot wait, Todd. Thanks for the pass off. I appreciate the way you asked the question, by the way, because you are exactly right. I mean, of the $0.60 that impacted or is impacting our guidance, two-thirds of that, if we just went back one quarter, were not in effect. In fact, just a couple of weeks ago, the early termination of the de minimis exemptions came into vision. You think about that $0.60. That is a one-time increase in cost, which is impacting our gross margins. We have massive underlying strength, even in our gross margins. I will just remind you, our operating margins are guided to expand even with this $0.60. I guess you could say, if not for tariffs, add $0.60 to this guide. That is not the reality, though. The tariffs are real, and we are going to fight our way through it.

And duties in the landscape. So as we start to understand the rules of the game I've never seen an organization, that's better at playing that game and getting after it.

Every bit of confidence that our gross margins and operating margins will continue to expand as we move into next year and beyond and I can't wait.

You can see the model and get them up and in our Investor day in about three weeks or so and well give you more illumination into what that long term guide class Guy.

Path looks like.

Thanks, guys.

Our next question is from Matthew Boss of Jpmorgan. Please go ahead.

Great. Thanks.

Joanne at the coach brand and the continued strength of the business how best to think about the inflection in units that youre seeing despite the impact of lower promotions and maybe how do you see the go forward interplay between AUR and units both contributors to the revenue build and then Scott just a.

Scott Roe: One other perspective I would give you is, listen, we have momentum. The first word in supply chain is supply. We are not going to sacrifice service to our business. We have great momentum. We are taking share. We want to feed that momentum. We do not want to take any knee-jerk reactions based on a, frankly, dynamic and ever-changing environment here as it relates to tariffs and duties and the landscape. As we start to understand the rules of the game, I have never seen an organization that is better at playing that game and getting after it. I have every bit of confidence that our gross margins and operating margins will continue to expand as we move into next year and beyond. I cannot wait to hopefully you will come and see the model and get a muffin in our Investor Day in about three weeks or so.

Gross margin is maybe could you give any elaboration on the phasing of gross margin for fiscal 'twenty, six or just any front half versus back half assumptions to consider.

Thanks, Matt I'm going to kick it off briefly but then turn it to Todd because I'd like him to talk about the coach brand and our unit growth, but we have effectively reached the tipping point at coach where we've done the work to build the brand and we're acquiring new and younger customers, who are transacting at high AUR.

We've cut the tail that long tail of Skus and step away from promotional activity that had a drain on units over the last few years.

Scott Roe: We will give you more illumination into what that long-term guide path looks like.

But our business is incredibly healthy and maybe with that Pat I'll, let you finish the sentence.

Todd Kahn: Thanks, guys.

Thanks Joanne.

Operator: Our next question is from Matthew Boss of JPMorgan. Please go ahead.

Not only did we cut the tail, but we're constantly improving it so.

It wasn't a one and done exercise that we did four years ago or five years ago now she's a little bit longer we're constantly looking at our product offering focusing and focusing it one of the things about telling deeper and richer story is doing it on fewer big ideas and Thats whats cutting through.

Joanne Crevoiserat: Great, thanks. Joanne, at the Coach brand and the continued strength of the business, how best to think about the inflection in units that you are seeing despite the impact of lower promotions? Maybe how do you see the go-forward interplay between AUR and units as both contributors to the revenue build? Then, Scott, just on gross margin, could you give any elaboration on the phasing of gross margin for fiscal 2026, or just any front half versus back half assumptions to consider?

So.

Our guidance for the year has most of our growth coming through AUR growth.

We believe units will continue to grow as well so.

Very powerful for us.

I'm not interested in ensuring we are interested in building long term sustainable growth.

Christina Colone: Thanks, Matt. I am going to kick it off briefly, but then turn it to Todd because I would like him to talk about the Coach brand and our unit growth. We have effectively reached a tipping point at Coach where we have done the work to build the brand. We are acquiring new and younger customers who are transacting at high AUR. We have cut the tail, the long tail of SKUs, and stepped away from promotional activity that had a drain on units over the last few years. Our business is incredibly healthy. With that, Todd, I will let you finish the sentence.

Over the many years to come and that's how we're doing it and we're going to continue to do it that way and then one thing Youll hear us talk about at our Investor Day, we're going to see we're back in the business of growing stores.

Particularly in North America, Youre going to see is talked about.

Our growth in physical locations because one of the things are data points to is this younger consumer the like being in the real world. They.

They like shopping they like interacting thats, how we can win so I'm excited by you'll see us grow continue to grow AUR.

Todd Kahn: Thanks, Joanne. I mean, not only did we cut the tail, but we are constantly improving it. So it was not a one-and-done exercise that we did four years ago or five years ago. Actually, a little bit longer. We are constantly looking at our product offering, focusing and focusing. One of the things about telling deeper and richer stories is doing it on fewer big ideas. That is what is cutting through. So our guidance for the year has most of our growth coming through AUR growth. We believe units will continue to grow as well. So it is very powerful for us. I am not interested in churn. We are interested in building long-term, sustainable growth over the many years to come. That is how we are doing it. We are going to continue to do it that way.

From Don but you'll start seeing us grow units as well.

Yeah, and a nice a nice tie in is.

Give you a little elimination on the gross margin phasing just picking up where Todd last.

The advantage of our structurally high gross margins and the fact that we have.

We have a history of and our confidence in continuing to grow them as one of the things that makes our D to C work right is the profitability of our stores continues to increase and Thats really whats unlocking the opportunity for expansion.

Thank thanks, Joan. Yeah, I I mean not only did we cut the tail but we're constantly improving it. So I I I it wasn't a 1 and done Exercise that we did 4 years ago or 5 years ago now actually a little bit longer. We're constantly looking at our product offering focusing and focusing it, you know, 1 of the things about telling deeper and richer stories is doing it, on fewer Big Ideas and that's what's cutting through. So our our guidance for the year, has most of our growth coming through Aur growth,

And yet another growth factor as we look forward.

I think we said a little bit of this in terms of the phasing, but so I think again about the impact of tariffs we got underlying <unk>.

Operational gross margin strength led by the AUR that Todd just talked about that happens throughout the year remember I also said in the prepared remarks that we brought a little inventory and it had so it'll take a while for that rebate to work through the snake right. So as the tariffs became effective and we sell through the lower tariff goods.

Todd Kahn: One thing you will hear us talk about at our Investor Day, we are going to see we are back in the business of growing stores. Particularly in North America, you are going to see us talk about a growth in physical locations because one of the things our data points to is this younger consumer, they like being in the real world. They like shopping. They like interacting. That is how we can win. So I am excited by you will see us grow, continue to grow AUR. We are far from done, but you will start seeing us grow units as well.

In the first half and then in the second half Youll start to see those higher tariff goods start to hit the P&L, you're going to see stronger gross margins in the first half I think we guided to a little over 100 basis points. In Q1 for example, that's really driven by operational.

The operational strength.

Structural and ongoing and then youll see some of those.

We Believe units will continue to grow as well. So it's very powerful for us. I am not interested insurance. We are interested in building long-term sustainable growth over the many years to come. And that's how we're doing it. We're going to continue to do it that way and then 1 thing you'll hear us talk about at our investor day we're going to see we're back in the business of growing Stores. Um particularly in North America you're going to see us talk about uh a growth in physical locations. Because 1 of the things, our data points to is this younger consumer. They like being in the real world. Um they like shopping they like interacting, that's how we can win. So I'm excited by. You'll see us grow. Continue to grow Aur. We're far from done, but you'll start seeing us grow units as well.

Scott Roe: Yeah, and a nice tie-in, as I give you a little illumination on the gross margin phasing, just picking up where Todd Kahn left. You know, the advantage of our structurally high gross margins and the fact that we have a history of and a confidence in continuing to grow them is one of the things that makes that direct-to-consumer model work, right? The profitability of our stores continues to increase. That is really what is unlocking the opportunity for expansion and yet another growth factor as we look forward. I think we said a little bit of this in terms of the phasing. Think again about the impact of tariffs. We have underlying operational gross margin strength led by the AUR that Todd Kahn just talked about. That happens throughout the year. Remember, I also said in the prepared remarks that we brought a little inventory in ahead.

Tariffs starting to hit in the second.

In the second half so your gross margins would be a little lower in the second half.

The other thing I would say is as it relates to mitigation as I said in my earlier comments.

We've got a lot of plans in place and now that we understand better the game the game Board and what we're shooting for those mitigation plans are well underway. Some of those are quick a lot of them take a little longer so as we get into next year and beyond.

You'll start to see more of those mitigation coming into effect.

And the gross margin line in 2007 and 28.

Yeah. And a nice, a nice tie-in. As I uh give you a little elimination on the gross margin phasing. Just picking up where Todd last, you know, the the advantage of our structurally, high gross margins and the fact that we have a history of and a confidence in continuing to grow, is 1 of the things that makes D Toc work. Right? Is the profitability of our stores continues to increase and that's really what's unlocking the opportunity for expansion uh and yet another growth factor as we look forward. Um uh I think we said a little bit of this in terms of the phasing, but so think again.

That's great color best of luck.

Yes. Thanks.

Our next question is from Adrian <unk> of.

Barclays. Please go ahead.

Scott Roe: So it will take a while for that rabbit to work through the snake, right? As the tariffs become effective and we sell through the lower tariff goods in the first half, and then in the second half, you will start to see those higher tariff goods start to hit the P&L. You are going to see stronger gross margins in the first half. I think we guided to a little over 100 basis points in Q1, for example. That is really driven by the operational strength that is structural and ongoing. Then you will see some of those tariffs start to hit in the second half. So your gross margins will be a little lower in the second half. The other thing I would say is, as it relates to mitigation, as I said in my earlier comment to Ike Boruchow, we have a lot of plans in place.

Great. Good morning, let me add my congratulations.

I guess I'll start with kind of from a just a structural modeling question last time that coach brand without these types of gross margins in north of 30% operating margins with <unk>.

<unk> 2005, 2006, so and I know that the wholesale was a bigger portion of the business, but Joanna and Scott can you talk about and Todd can you talk about structurally what is different today and what enables coach to continue to expand on those.

Line items.

And then can you also Todd talk about kind of pricing as a mechanism to mitigate.

The tariffs haven't had heard a lot of discussion about that I know you did take some pricing earlier in the year is their plan for the fall season and is there another plan perhaps for spring of next year. Thank you very much.

About the impact of tariffs. So we got underlined operational, gross margin strength, led by the Aur that Todd. Just talked about that happens throughout the year. Remember I also said, in the prepared remarks that we brought a little inventory in ahead, so it'll take a while for that rabbit to work through the snake, right? So, as the tariffs become effective and we sell through the lower tariff Goods in the first half, and then in the second half, you'll start to see those higher tariff Goods. Start to hit the p&l, you're going to see stronger, gross margins and the first half, I think we guided to a little over 100 basis points, in q1. For example, that's really driven by operational. Uh, the operational strength. That's, you know, structural and ongoing, and then you'll see some of those, um, uh, tariffs starting to hit in the second, uh, in the second half. So, your gross margins will be a little lower in the second half. But, you know, the other thing I would say is, uh, as it relates to mitigation, as I said, in my earlier, comment to Ike,

Scott Roe: Now that we understand better the game board and what we are shooting for, those mitigation plans are well underway. Some of those are quick. A lot of them take a little longer. As we get into next year and beyond, you will start to see more of those mitigations coming into effect in the gross margin line in 2027 and 2028.

Yes.

I will go ahead as it gets as it was mostly all coach.

While I wasn't here in 2005.

What's your just shortly thereafter, we are a different company.

We are more directly.

Consumer than in 2005.

You know, we've got a lot of plans in place and now that we understand better, the game, the game board and and what we're shooting for, those mitigation plans are well underway, some of those are are quick, a lot of them. Take a little longer. So as we get into next year and Beyond, uh, you know, you'll start to see more of those mitigations coming into effect, um, in in the gross margin, uh, line uh, in 27 and 28.

Operator: is a great color. Best of luck.

We have more geographic diversification than 2005 again back in that era. If you go pre 2010 through June 2012.

It's a great color, festive block.

Todd Kahn: Yeah, thanks.

Operator: Our next question is from Adrienne Yee of Barclays. Please go ahead.

Yeah, thanks.

Our next question is from Adrian, ye of Barkley. Please go ahead.

Unidentified Analyst: Great. Good morning. Let me add my congratulations. I guess I will start with kind of from just a structural modeling question. The last time that Coach brand was at these types of gross margins and north of 30% operating margins was sort of about 2005, 2006. I know that the wholesale was a bigger portion of the business. Joanne, Scott, and Todd, can you talk about structurally what is different today and what enables Coach to continue to kind of expand on both those line items? Todd, can you also talk about kind of pricing as a mechanism to mitigate the tariffs? I have not heard a lot of discussion about that. I know you did take some pricing earlier in the year. Is there a plan for the fall season? Is there another plan, perhaps, for spring of next year? Thank you very much.

We really had we were Japan and the U S. Today, we have giant pillars of growth in China in Asia.

Now most recently you see us do tremendous growth in Europe.

Greg good morning, let me add my congratulations. Um I guess I'll start with kind of from a just a structural modeling question the last time that coach brand was at these types of gross margins in north of 30% operating margins was

So I think structurally we're in far better place to deal with that.

And it's a different kind of company.

The innovation that we're bringing to the table in terms of product offering.

Stuart.

He's been with us for.

About 11 plus years.

I feel in some ways and he and I just walked through the showroom I get that.

Benefit of seeing the showroom.

Many seasons ahead of what you get to see and we both left there and saying this is the best we've seen the brand ever.

Again, the consumer will vote, hopefully there'll be as enthusiastic, but we feel very good about that and then in our history in our DNA coach we always talked about blending magic in logic today under the tapestry.

Different today. And what enables Coach to continue to kind of expand on both those line items? Um, and then can you also, Todd talked about kind of pricing as a mechanism to mitigate. Um, there hasn't been a lot of discussion about that. I know you did take some pricing earlier in the year. Is there a plan for the fall season? And is there another plan perhaps for spring of next year? Thank you very much.

Todd Kahn: Yeah, I will go ahead. I think it was mostly all Coach. While I was not here in 2005, I was here just shortly thereafter. We are a different company. We are more direct-to-consumer than in 2005. We have more geographic diversification than 2005. Back in that era, if you go pre-2010 through 2012, we really had, we were Japan and the U.S. Today, we have giant pillars of growth in China, in Asia. And now, most recently, you see us do tremendous growth in Europe. So I think structurally, we are in a far better place to deal with that. It is a different kind of company. Second, the innovation that we are bringing to the table in terms of product offering, Todd Kahn has been with us for about 11-plus years.

Yeah.

Engine.

We took that and put it on steroids, where more data driven we have more insight again, we don't lose sight of the magic, but the magic is inform magic. So I feel very good on price overall, we're going to continue to use our data in.

Inform our pricing and Thats important those.

Opportunities geography channel product mix is all working in our favor and examples of the one coat strategy, where we're bringing our collection product Brooklyn tabby other products like that into outlet stores selling at full price.

That gives you the actual AUR growth and it enhances what's already in the outlets because at the end of the day the consumer sees.

<unk> not channels. So we're winning across a multitude of dimensions that will continue to allow us to take price focused on the customer and grow from here.

I'll go ahead. I think it's since it was mostly all coach. Um, you know, while I wasn't here in 2005, I was, I was here, uh, just shortly thereafter. We are a different company. Um, we we are more direct to, uh, consumer than in 2005. We have more Geographic diversification than 2005. Uh, again, back in that era if you go free 2010 through 20 2012, um, we really had, we were Japan and the us today, we have giant pillars of growth in China in Asia. And now most recently, you see us do tremendous growth in Europe. Um, so I think structurally, we're in far better place to deal with that. Uh, and it's a different kind of company. Second, The Innovation that we're bringing to the table in terms of product offering, you know, Stuart, uh, has been with us,

Todd Kahn: I feel in some ways, and he and I just walked through the showroom, I get the benefit of seeing the showroom many seasons ahead of what you get to see. We both left there saying, this is the best we have seen the brand ever. Again, the consumer will vote. Hopefully, they will be as enthusiastic. But we feel very good about that. In our history, in our DNA at Coach, we always talked about blending magic and logic. Today, under the Tapestry Inc. engine, we took that and put it on steroids. We are more data-driven. We have more insight. Again, we do not lose sight of the magic, but the magic is informed magic. So I feel very good. On price overall, we are going to continue to use our data to inform our pricing. That is important.

Great Fantastic Scott one quick question on the 800 million that Youre now targeting for our share repurchase activity should we assume or think about that is this sort of new repo run rate I know in the 2022 analyst day. So there was this notion of a consistent $700 million.

Annually.

For, uh, about 11 plus years. Uh, I feel in some ways and he, and I just walked through the showroom, you know, I get the benefit of seeing the showroom, uh, many seasons ahead of what you get to see. And we both left there saying, this is the best we've seen the brand ever. Um, again the consumer will vote, hopefully they'll be as enthusiastic, but we feel very good about that. And then in our history, in our DNA, I coach, we always talked about blending magic and logic today under the tapestry, uh,

Jim.

Yes so.

You know I can't really go beyond what we've said right now which is $800 million. This year, here's what I would ask you to takeaway, we got a really strong profitability and cash flow profile. We are a full turn below our leverage target. We've got a lot of firepower right and so we know that our repurchases have been.

Todd Kahn: Those opportunities, geography, channel, product mix is all working in our favor. Examples of the One Coach strategy, where we are bringing our collection product, Brooklyn, Tabby, other products like that into outlet stores, selling at full price. That gives you natural AUR growth. It enhances what is already in the outlets because at the end of the day, the consumer sees brands, not channels. So we are winning across a multitude of dimensions that will continue to allow us to take price, focus on the customer, and grow from here.

And we will continue to be part of the value creation equation.

<unk> million dollars this year and we'll be happy to give you an update in a few in a few weeks at our Investor day about a longer term perspective, but I hope you take away Adrienne that we got we got.

We are in a strong position and we've got what I would argue as a shareholder friendly capital allocation.

Engine. We took that and put it on steroids, we are more data driven. We have more insight. Again, we don't lose sight of the magic but the magic is in for magic. So I feel very good on price overall. We're going to continue to use our data to inform our pricing and that's important. Those um, opportunities. Geography Channel product, mix is all working, in our favor and examples of the 1 coats collection product Brooklyn. Tabby other products like that into outlet stores, selling at full price, that gives you natural Aur growth and it enhances what's already in the outlets. Because at the end of the day, the consumer sees

Positioning here and a history of returning that cash to shareholders.

Absolutely congratulations to you in a month.

Yeah. Thanks Peter.

Due to the interest of time callers need to limit themselves to one question.

France, not channels. So we're winning across a multitude of dimensions that will continue to allow us to take price, focus on the customer, and grow from here.

Unidentified Analyst: Great, fantastic. Scott, one quick question. The $800 million that you are now targeting for share repurchase activity, should we assume or think about that as the new repo run rate? I know in the 2022 Analyst Day, there was this notion of a consistent $700 million annually. Thank you.

Our next question is from Lorraine Hutchinson of Bank of America. Please go ahead.

Thanks, Good morning.

Okay.

To ask for more details on the drivers of the 160 basis points of operating SG&A leverage this year and then your thoughts on the longer term opportunities to maintain that leverage or if the store rollout might offset some of this in the out years.

Great fantastic. Scott 1 quick question. Um the 800 million that you're now targeting for a share rate, purchase activity. Should we assume or think about that as the sort of new repo run rate? I know in the 2022 analyst day so there was this notion of a, a consistent 700 million, um, annually.

Thank you.

Scott Roe: Yeah, so I cannot really go beyond what we have said right now, which is $800 million is this year. Here is what I would ask you to take away. We got a really strong profitability and cash flow profile. We are a full term below our leverage target. We got a lot of firepower, right? So we know that our repurchases have been and will continue to be part of the value creation equation. $800 million is this year. We will be happy to give you an update in a few weeks at our Investor Day about a longer-term perspective. I hope you take away, Adrienne, that we have got a strong position. We have got what I would argue is a shareholder-friendly capital allocation positioning here and a history of returning that cash to shareholders.

Yes.

Sounds like a <unk> question.

So a couple of things we did get a small benefit just foundation really from the Stuart Weitzman disposition, so roughly 20 basis points and I'll also tell you we are increasing our investment in map spending or marketing write off an already record high base were continuing.

To invest in even with that we're signing leverage across the SG&A line and that's one of the reasons why we can talk about margin expansion for the year. So a lot of it has to do with the.

The productivity of the fleet that Todd just mentioned right as we sell through and we're increasing our full price sales were increasing sales across all D to C channels and when you do that you get leverage in your four wall cost. The profitability is up as we said and that's a great driver of cost and I would say on the if you want to say.

Unidentified Analyst: Absolutely. Congratulations. See you in a month.

Yeah, so um you know, I can't really go beyond what we've said right now which is 800 million. Is this year, here's what I'd ask you to take away, we got a really strong uh profitability and cash flow profile. We're a full term below our leverage Target. We got a lot of Firepower, right? And so, uh, we know that are repurchases have been and will continue to be part of the value creation equation. You know, 800 million is this year and we'll be happy to give you an update and a few in a few weeks at our investor day about a longer term perspective, but I hope you take away Adrian that we got. We've got uh, uh, strong. We're in a strong position. And and we've got what I would argue is a shareholder friendly Capital allocation uh, positioning here in a history of returning that cash to shareholders.

Absolutely. Congratulations. See you in a month.

Todd Kahn: Yeah, thanks, Adrienne.

Yeah, thanks Adrian.

Operator: Due to the interest of time, callers need to limit themselves to one question. Our next question is from Lorraine Hutchinson of Bank of America. Please go ahead.

Due to the interest of time, callers need to limit themselves to one question.

<unk> corporate costs were also being very diligent and we're investing in those things, we think that matters and those would be things like understanding that consumer on a deeper level things like.

Our next question is from Lorraine Hutchinson of Bank of America. Please go ahead.

Unidentified Analyst: Thanks. Good morning. I was hoping to ask for more details on the drivers of the 160 basis points of operating SG&A leverage this year. Then your thoughts on the longer-term opportunities to maintain that leverage or if the store rollout might offset some of this in the out years.

Morning.

I was hoping to.

Our customer data our data fabric, our AI initiatives.

Some of the things, we're doing around data and analytics and everything else, we're taking a pretty hard view and looking for efficiencies. So that's the model right invest in things that are difference, making and world set up growth in the future find efficiencies across the rest of the P&L and that coupled with a nice acceleration in growth.

Drivers of the 160 basis points of operating sgna leverage this year and then your thoughts on the longer term opportunities to maintain that leverage, or if the store roll out, might offset some of this, in the out years.

Scott Roe: Yeah, so that sounds like a me question. A couple of things. We did get a small benefit just foundationally from the Stuart Weitzman disposition, so roughly 20 basis points. I will also tell you, we are increasing our investment in MAP spending or marketing, right? Off an already record high base, we are continuing to invest. Even with that, we are finding leverage across the SG&A line. That is one of the reasons why we can talk about margin expansion for the year. A lot of it has to do with the productivity of the fleet that Todd just mentioned, right? As we sell through and we are increasing our full-price sales, we are increasing sales across all D2C channels. When you do that, you get leverage in your four-wall costs. The profitability is up, as we said. That is a great driver of cost.

Top line growth to mid single digits.

Sets up that flywheel that we've been talking about.

Thank you.

Yeah.

Thank you. Our next question is from Michael Binetti of Evercore. Your line is open.

Hey, guys. Thanks for taking our question here and for all the detail today.

I guess first one we'll go to you Scott So could you just unpack the commentary on de Minimis.

Think about our conversations through the quarter I know you guys are doing some scenario.

Scenario planning around tariffs tariff rates changing but how are you guys leveraging de minimis in the past and how does that change maybe how much of the 230 basis point.

Is from de Minimis, I think thats kind of the surprise me I'm guessing that means perhaps that some warehousing capacity needs to move back into the U S or maybe just a thought on what that means operationally.

Scott Roe: I would say on the, if you want to say, air quotes, corporate costs, we are also being very diligent. We are investing in those things we think that matters. Those would be things like understanding the consumer on a deeper level, things like our customer data, our data fabric, our AI initiatives, some of the things we are doing around data and analytics, and everything else. We are taking a pretty hard view and looking for efficiencies. So that is the model, right? Invest in things that are difference-making. We will set up growth in the future, find efficiencies across the rest of the P&L. That coupled with a nice acceleration in top line growth to mid-single digits, that sets up that flywheel that we have been talking about.

Yeah, so that that sounds like a me question. Um, so a couple things, uh, we did get a small benefit, just foundationally from the steuart whitesman disposition. So you know, roughly 20 basis points and I'll, I'll also tell you. We, we are increasing our investment in in map, spending or or marketing. Right often already, uh, record high base. We're continuing uh to invest, and even with that we're finding leverage across the sgna line, and that's 1 of the reasons why we can talk about margin expansion uh, for the year. So a lot of it has to do with, you know, the the productivity of the fleet that Todd just mentioned right as we sell through and we're increasing our full price sales, we're increasing sales across all deed to see channels and when you do that, you get leverage in your 4 wall costs. The profitability is up, as we said and that's a great driver of cost. And I would say, on the, if you want to say, you know, air quotes corporate costs, we're also being very diligent and we're in

Following especially maybe.

Just Europe the growth rate a little slower in the fourth quarter relative to the first nine months, maybe just context on that and then the reacceleration to 'twenty.

Okay.

So without going too much into rabbit hole, so de Minimis as probably you are well aware.

Is is really the ability to ship duty free on ecommerce from outside of the U S into the U S market and with the recent tax Bill that was passed it was scheduled to expire in 2027, which was our expectation until a couple of weeks ago.

Investing in those things, we think that matters and those would be things like understanding the consumer on a deeper level things like uh, you know, our customer or data, our data fabric, our AI initiatives. Uh, some of the things we're doing around data and analytics and everything else, we're taking a pretty hard View and, and looking for efficiencies. So that's the model, right? Invest in things that are different to making. And will set up growth in the future, find efficiencies across the

There was an <unk>.

The rest of the p&l and that coupled with a nice acceleration and gross uh, Topline growth to Mid single digits that sets up that flywheel that we've been talking about.

<unk> order, which which accelerated the removal of de Minimis and that was about a third of the 60 that.

Unidentified Analyst: Thank you.

Thank you.

Operator: Thank you. Our next question is from Michael Binetti of Evercore. Your line is open.

We talked about so what does that mean that $900 million that we talked about before now is bigger right. Because you had goods coming into the U S. That we are duty free now theyre subject to duty and they get the full impact of that.

Michael Binetti: Hey, guys. Thanks for taking our question here and for all the detail today. I am guessing this one will go to you, Scott. Could you just unpack the commentary on de minimis as I think about our conversations through the quarter? I know you guys are doing some scenario planning around tariffs or tariff rates changing. How are you guys leveraging de minimis in the past? How does that change maybe how much of the 230 basis points is from de minimis? I think that is kind of the surprise here. I am guessing that means perhaps that some warehousing capacity needs to move back into the U.S. or maybe just a thought on what that means operationally. I will follow it just by saying maybe just Europe, the growth rate a little slower in Q4 relative to the first nine months.

Thank you. Our next question, is from Michael benetti of evercore. Your line is open.

The reciprocal tariffs that are now in effect at least as we understand them at this point in time.

So that probably is a surprise to many I don't know how many people are paying attention to de minimis, but that was an opportunity that we had taken advantage of it was a lot of the time and now that law has changed so we have to we have to address that the good news is as it relates to capacity and whatnot as we think about our network, it's pretty agile in.

<unk> and <unk>, so I'm, not saying, it's nothing but our ability to manage within that is not as significant.

Michael Binetti: Maybe just context on that and then the reacceleration to 20.

Hey guys, thanks for taking our question here and for all the detailed say, um, I'm guessing this 1 will go to you Scott. So could you just unpack the commentary on de minimis? Um, because I think about our conversation through the quarter, I know you guys are doing some, some scenario planning around tariffs, right? Tariff rates changing, but how are you guys leveraging? The Minimus in the past, and how does that change? Maybe how much of the 230 basis point is from Dominus? I think that's kind of the the surprise here I'm guessing that means perhaps that some warehousing capacity needs to move back into the us or maybe just a thought on what that means operationally and I'll follow it just by saying maybe um just Europe the growth rate a little slower and fourth quarter relative to the first 9 months, maybe just context on that and then the re acceleration to 20

Scott Roe: Without going too much in a rabbit hole, de minimis, as probably you are well aware, is really the ability to ship duty-free on e-commerce from outside of the U.S. and into the U.S. market. With the recent tax bill that was passed, it was scheduled to expire in 2027, which was our expectation until a couple of weeks ago when there was an executive order which accelerated the removal of de minimis. That was about a third of the $0.60 that we talked about. What does that mean? That $900 million that we talked about before now is bigger, right? Because you had goods coming into the U.S. that were duty-free. Now they are subject to duty. They get the full impact of that, you know, the reciprocal tariffs that are now in effect, at least as we understand them at this point in time.

Disruptor, and we have plans underway to.

Take advantage of that Thats, not going to be a significant cost or interruption of service issue. As we go forward is just more work for our supply chain team.

As it relates to the guide this is a little different than we have typically guided in terms of philosophy, because usually what we do is we just say we're going to take the rates that we see and simply project. Those forward, we feel like as we're entering a new year.

Okay. Um, so without going too much into a rabbit hole. So, do minimally you're well aware, is really the ability to ship duty-free on e-commerce from outside of the U.S. and into the U.S. market. With the recent tax bill that was passed, it was scheduled to expire in 2027, which was our expectation until a...

We have great momentum as evidenced by our Q1.

Our Q1 guide we think it's prudent at this point in the year with the real estate of the entire year ahead of us in the full impact of tariffs in a dynamic environment out there to be prudent in our second half assumptions.

We have done that right.

We've been a little conservative in the second half in light of the overall consumer backdrop I want to be clear has nothing to do with the trajectory of our business, we're not seeing any change in the consumer.

Scott Roe: That probably is a surprise to many. I do not know how many people are paying attention to de minimis. But that was an opportunity that we had taken advantage of. It was the law at the time. Now the law has changed. So we have to address that. The good news is, as it relates to capacity and whatnot, as we think about our network, it is pretty agile and a combination of owned and 3PL. I am not saying it is nothing. But our ability to manage within that is not a significant disruptor. We have plans underway to take advantage of that. That is not going to be a significant cost or interruption of service issue as we go forward. It is just more work for our supply chain team.

Reaction in fact, we've seen an acceleration in Q1, so could we do better in the second half, but let's see but we feel like being prudent at this early stage in our full year guidance is the right position.

Yes, and just to jump in just the specific Mike.

On Europe.

Couple weeks ago when uh, there was um, an executive order which, which accelerated the removal of de minimis and that was about a third of the 60 cents that we talked about. So what does that mean? That 900 million that we talked about before now is bigger? Right? Because you had uh, Goods coming into the US that were duty-free. Now they're subject to duty and they get the full impact of that, you know. Um, the, uh, reciprocal tariffs that are now in effect, at least as we understand them at this point in time. So, um, that probably is a surprise to many. I don't know how many people are paying attention to Minimus, but that was an opportunity that we had taken advantage of. It was the law of the time and now the law has changed. So we have to, we have to address that. The good news is as it relates to the capacity and whatnot. You know, as we think about our Network, it's pretty agile and combination of owned and 3pl. So uh, I'm not saying it's nothing, but our ability to manage within that is not a significant.

A slight reduction in Q4 versus the.

What we were achieving before that that is all intentional on our part that is.

Making sure that the wholesale accounts that we deal with are appropriate for the brand so that us being very intentional it doesn't indicate any kind of slowed a slowdown in consumer demand.

Scott Roe: As it relates to the guide, this is a little different than we have typically guided in terms of philosophy. Usually what we do is we just say we are going to take the rates that we see and simply project those forward. We feel like as we are entering a new year and we have great momentum, as evidenced by our Q1 guide, we think it is prudent at this point in the year with the real estate of the entire year ahead of us and the full impact of tariffs and the dynamic environment out there to be prudent in our second half assumptions. So we have done that, right? We have been a little conservative in the second half in light of the overall consumer backdrop.

Okay. Thanks for the help.

Yes.

Our next question is from Paul those way of Citigroup. Your line is open.

Disruptor and and we have plans underway to uh take advantage of that. That's not a going to be a significant cost or or Interruption of service issue as we go forward. It's just more work for our supply chain team. Um as it relates to, you know, the the guy this is a little different than we have typically guided and in terms of philosophy because usually what we do is we just say, we're going to take the rates that we see and simply project those forward. We feel like as we're entering a new year

Hey, Thanks, It's Tracy Kogan filling in for Paul.

What is the acceleration you mentioned that's happening in <unk> I was wondering if you could give a little more detail by region on that.

And then secondly, what does your guidance assume in terms of on the.

<unk> price increases at the coach brand. Thank you.

Scott Roe: I want to be clear, it has nothing to do with the trajectory of our business. We are not seeing any change in the consumer reaction. In fact, we have seen an acceleration in Q1. So could we do better in the second half? Let us see. But we feel like being prudent at this early stage in our full-year guidance is the right position.

Well maybe.

I'll, just kind of an acceleration.

Yes go ahead go ahead go ahead.

No I haven't.

Celebration right.

The acceleration, we're seeing as widespread as Scott was saying we.

We both want to jump in on this because it's a fun party.

The overall consumer backdrop. I want to be clear, has nothing to do with the trajectory of our business. We're not seeing any change in the consumer reaction. In fact, we've seen an acceleration in q1, so could we do better in the second half? Let's let's see. But we feel like being prudent at this early stage in our full year. Guidance is the right position.

Todd Kahn: Yeah, and just to jump in, a specific question on Europe, a slight reduction in Q4 versus what we were achieving before that. That is all intentional on our part. That is making sure that the wholesale accounts that we deal with are appropriate for the brand. So that is us being very intentional. It does not indicate any kind of slowdown in consumer demand.

Yes. The acceleration we are seeing is widespread the coach strategies are working globally, and we're driving our business globally, we're seeing nice customer response, and it's been very very consistent in terms of acceleration.

In terms of price increase maybe Todd I'll, let you talk about how what youre assuming for AUR growth in the in the year.

Yes again.

Yeah, and just to jump in, just the specific question on, uh, Europe. Uh, uh, a slight reduction in Q4 versus the, um, what we were achieving before, that, that is all intentional on our part that is, um, making sure that the wholesale accounts that we deal with, are appropriate for the brand. So that's us being very intentional. It doesn't indicate at any kind of slowdown slowdown in consumer demand.

Michael Binetti: OK, thanks for the help.

Our growth is projected to be mid <unk>.

Okay, thanks for the help.

Todd Kahn: Yep.

High single digits throughout the year, so we feel and we feel very good about that growth.

Yep.

Operator: Our next question is from Paul Lejuez of Citigroup. Your line is open.

What we really look at it by the bag.

Hey, our next question is from Paul Leger of Citigroup. Your line is open.

Unidentified Analyst: Hey, thanks. It is Tracy Kogan filling in for Paul. As far as the acceleration you mentioned that is happening in Q1, I was wondering if you could give a little more detail by region on that. Secondly, what does your guidance assume in terms of the magnitude of price increases at the Coach brand? Thank you.

Hey, thanks.

Got style by the silhouette and again, putting more full priced product into outlet automatically lists our AUR as well. So we feel very good about the mix and where we can take AUR.

Great. Thank you.

Yes.

Tuning in for Paul. Um as far as the acceleration you mentioned that's happening in 1 Q. I was wondering if you could give a little more detail by region on that. Um, and then, secondly what, what is your guidance with zoom in terms of um the magnitude of price increases uh at the coach brand, thank you.

Thank you that concludes our Q&A I will now turn it over to Joanne for some concluding remarks.

Scott Roe: Well, maybe I will just comment on.

Christina Colone: The acceleration. Go ahead, go ahead, Scott.

Well, maybe I'll just kind of acceleration.

Scott Roe: Yeah, go ahead. Go ahead. No, I was just going to say.

Thank you Leah.

Yeah, go ahead.

I want to close by thanking our exceptional teams for delivering another record year and share three important takeaways from our results first we deliver on our commitments. This is on display with our fiscal 'twenty five EPS of over $5, which we outlined three years ago, our strategies are working our businesses.

Christina Colone: The acceleration we are seeing is widespread, as Scott Roe was saying. We both want to jump in on this because it is a fun party. The acceleration we are seeing is widespread. The Coach strategies are working globally. We are driving our business globally. We are seeing nice customer response. It has been very, very consistent in terms of acceleration. In terms of price increase, maybe, Todd Kahn, I will let you talk about what you are assuming for AUR growth in the year.

<unk> and poised for growth and we know this is key as we continue to build connections with consumers and execute with discipline in a dynamic landscape.

Second we have strong fundamentals and momentum highlighted by the double digit growth we're seeing at coach.

No, I was just gonna say acceleration. Write the acceleration. We're seeing is widespread. As Scott was saying, um, we both want to jump in on this because it's uh it's a fun party. Um yeah the acceleration we are seeing is widespread the coach uh strategies are working globally. And and we're driving our business globally. We're seeing nice customer response and it's been very, very consistent in terms of um, acceleration. Um, in terms of price increase, maybe Todd. I'll let you talk about how you what you're assuming for Aur growth in the in the year.

Todd Kahn: Again, our AUR growth is projected to be mid to high single digit throughout the year. We feel very good about that growth when we really look at buy the bag, buy the style, buy the silhouettes. Putting more first full-price product into outlet automatically lifts our AUR as well. We feel very good about the mix and where we can take AUR.

Which accelerated at the start of this year and third we have unique competitive and structural advantages to drive durable growth and shareholder value into the future I want to thank you everyone, who joined US today for your interest in our story, thanks and have a great day.

This concludes <unk> conference call. We thank you for your participation.

Yeah. Again our our awe, our growth is projected to be mid to high single digit throughout the year. So we feel and we feel very good about that growth. Uh, when we we we really look at by the bag, by the Style by the Silhouettes and again putting more First full price product into Outlet automatically lists, our Aur as well. So we feel very good about the mix and where we can take Aur.

Unidentified Analyst: Great, thank you.

Great. Thank you.

Operator: Thank you. That concludes our Q&A. I will now turn it over to Joanne Crevoiserat for some concluding remarks.

Thank you, that concludes our Q&A. I will now turn it over to Joanne Croix of our Surat for some concluding remarks.

Christina Colone: Thank you, Leo. I want to close by thanking our exceptional teams for delivering another record year and share three important takeaways from our results. First, we deliver on our commitments. This is on display with our fiscal 2025 adjusted EPS of over $5, which we outlined three years ago. Our strategies are working. Our business is agile and poised for growth. We know this is key as we continue to build connections with consumers and execute with discipline in a dynamic landscape. Second, we have strong fundamentals and momentum highlighted by the double-digit growth we are seeing at Coach, which accelerated at the start of this year. Third, we have unique competitive and structural advantages to drive durable growth and shareholder value into the future. I want to thank everyone who joined us today, for your interest in our story. Thanks, and have a great day.

Thank you, Leo.

I want to close by thanking our exceptional teams for delivering another record year and share three important takeaways from our results. First, we deliver on our commitments. This is on display with our fiscal 2025 EPS of over $5, which we outlined three years ago. Our strategies are working. Our business is agile and poised for growth. And we know this is key as we continue to build connections with consumers and execute with discipline in a dynamic landscape.

Second, we have strong fundamentals and momentum highlighted by the double digit growth. We're seeing it coach.

Uh, which accelerated at the start of this year and third we have unique competitive and structural advantages to drive durable growth and shareholder value into the future. I want to thank you. Uh, everyone who joined us today for your interest in our story. Thank you. And have a great day.

Operator: This concludes Tapestry Inc.'s conference call. We thank you for your participation.

This concludes tapestries conferences. Call we thank you for your participation.