Tapestry, Inc. ( TPR ) shares are trading lower on Thursday. The company reported first-quarter financial results before the market opened.

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What To Know: Tapestry reported adjusted earnings per share of $1.38, beating the consensus estimate of $1.26. The Coach and Kate Spade parent company reported sales of $1.71 billion, beating the consensus estimate of $1.64 billion.

Revenue rose 13% year-over-year, or 12% on a constant-currency basis, led by a 22% increase at the Coach brand. Gross margin expanded 120 basis points to 76.5%, while operating margin improved 200 basis points to 20.9%.

The company said it acquired more than 2.2 million new customers globally during the quarter, with Gen Z shoppers making up about 35% of those additions. Direct-to-consumer sales climbed 16%, supported by mid-teens growth across both digital and brick-and-mortar channels.

Tapestry highlighted strong regional momentum, including constant-currency gains of 18% in North America, 32% in Europe and 8% in Asia Pacific, with Greater China up 19%. The company's gross debt to adjusted EBITDA leverage ratio stood at 1.5 times, supported by $743 million in cash and short-term investments.

“At our investor day in September, we introduced our Amplify plan – a bold vision to bring Tapestry’s iconic brands to new generations of consumers and drive durable growth. Our first quarter outperformance marked a powerful start to this next chapter,” the company said.

FY26 Outlook: Tapestry raised its adjusted earnings per share guidance from a range of $5.30 to $5.45 to a new range of $5.45 to $5.60, versus the consensus estimate of $5.49. Furthermore, the company raised its sales guidance from $7.20 billion to $7.30 billion, versus the consensus estimate of $7.22 billion.

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TPR Price Action: At the time of writing on Thursday, Tapestry shares are trading 10.3% lower at $98.02, according to data from Benzinga Pro.

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