10:33 AM EDT, 08/14/2025 (MT Newswires) -- Tapestry (TPR) issued a full-year earnings outlook below Wall Street's estimates on Thursday amid tariff-related impact, even though the luxury fashion company's fiscal fourth-quarter results beat expectations.

The operator of luxury brands Coach and Kate Spade anticipates adjusted earnings to be in a range of $5.30 to $5.45 per share for fiscal 2026, including a negative impact of incremental tariffs and duties of more than $0.60. The current consensus on FactSet is for non-GAAP EPS of $5.49. In the previous fiscal year, adjusted EPS increased to $5.10 from $4.29.

The stock fell 16% in Thursday trade.

"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," Chief Financial Officer Scott Roe said during an earnings call, according to a FactSet transcript. "In aggregate, the total expected impact on profitability this year from tariffs is $160 million, representing approximately 230 basis points of margin headwind."

US President Donald Trump's sweeping new tariffs on imports from several trading partners went into effect last week. Last month, the White House announced that it is suspending duty-free "de minimis" exemption for low-value commercial shipments, effective Aug. 29.

Tapestry is "taking thoughtful actions" to mitigate tariff impacts, Roe said on the call. The company is leveraging its supply chain to optimize its global manufacturing presence and is minimizing its tariff exposure "where possible," the CFO added.

Revenue is pegged to be at $7.2 billion for the ongoing fiscal year, reflecting low-single-digit annual growth on a reported basis, while the Street is looking for $7.12 billion. Foreign exchange is projected to be a tailwind of 80 basis points to the topline, the company said.

Adjusted EPS came in at $1.04 for the three months through June 28, up from $0.92 the year before, ahead of the average analyst estimate of $1.02. Sales improved 8% to $1.72 billion, topping the Street's view for $1.68 billion.

"Our strong growth, capped by our fourth-quarter outperformance, reinforces that our strategies are working," Chief Executive Joanne Crevoiserat said in the earnings release. "Importantly, we achieved bold targets we set three years ago in a dynamic landscape, delivering over $5 in adjusted earnings per share and returning more than $3 billion cumulatively to shareholders."

Revenue in the Coach brand climbed 14% to $1.43 billion, while Kate Spade slipped 13% to $252.6 million. Stuart Weitzman decreased to $45.5 million from $50.6 million in the 2024 quarter, according to Tapestry.

Sales in North America inclined 8%, while Greater China climbed 18% buoyed by "growth across all channels, including notable strength in digital," Roe told analysts. Europe recorded a gain of 13% while Japan fell 7% amid a challenging consumer backdrop, Roe said on the call.

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