{"id":49888,"date":"2023-08-18T00:53:35","date_gmt":"2023-08-18T04:53:35","guid":{"rendered":"https:\/\/ifintechworld.com\/uncategorized\/coach-parent-tapestry-forecasts-weak-2024-on-soft-u-s-demand\/"},"modified":"2023-08-18T00:53:37","modified_gmt":"2023-08-18T04:53:37","slug":"coach-parent-tapestry-forecasts-weak-2024-on-soft-u-s-demand","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=49888","title":{"rendered":"Coach parent Tapestry forecasts weak 2024 on soft U.S. demand"},"content":{"rendered":"
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\u00a9 Reuters. FILE PHOTO: A view of a Coach store, a brand owned by Tapestry, Inc., in Manhattan, New York, U.S., November 15, 2021. REUTERS\/Andrew Kelly\/File Photo<\/span>
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By Savyata Mishra, Juveria Tabassum and Katherine Masters<\/p>\n

(Reuters) -Coach parent Tapestry (NYSE:), which agreed to buy Capri last week, forecast fiscal 2024 profit and sales below estimates on Thursday after waning U.S. demand for its luxury handbags hurt fourth-quarter results. <\/p>\n

The company also joined luxury rivals Ralph Lauren (NYSE:), LVMH, Gucci-owner Kering <\/span><\/span> (EPA:) and Canada Goose in pointing to a challenging consumer backdrop in North America.<\/p>\n

Increased cost of living and still-high inflation has pressured American budgets, affecting companies such as Tapestry in the “accessible luxury” segment – where customers occasionally buy goods priced between $300 and $800, but are more sensitive to the cost of essentials. <\/p>\n

Coach <\/span><\/span>‘s best-selling Tabby handbag sells for $450 on the company’s U.S. site, while a comparable product from Dior sells for $3,800.<\/p>\n

“The lower income cohort is under pressure,” and is being more choosy, CEO Joanne Crevoiserat said on a post-earnings call.<\/p>\n

However, Tapestry said it expects to benefit from a recovery in demand from the “highly profitable region” of China this fiscal year.<\/p>\n

In the reported quarter, revenues from its Kate Spade and Stuart Weitzman brands dropped 10% and 13% over the last year. TD Cowen analyst Oliver Chen attributed the weakness at Kate Spade partly to its higher exposure in North America.<\/p>\n

Sales of Coach, which has less exposure to the volatile North American market, grew 5% over the quarter. Executives said the company would focus marketing and inventory in the key holiday season on core products such as the Tabby handbag.<\/p>\n

“Managing the amount of evergreen or never out-of-stock iconic product — that’s where you get efficiency, that’s where you get deeper engagement with customers, and that’s our strategy,” CFO Scott Roe said in a post-conference interview.<\/p>\n

Last week, Tapestry said it would buy its rival, Michael Kors owner Capri, in a deal valued at $8.5 billion, in a bid to challenge larger European competitors for a bigger share of the global luxury market.<\/p>\n

Tapestry expects adjusted earnings of $4.10 to $4.15 per share in fiscal 2024, compared with Refinitiv IBES estimates of $4.24.<\/p>\n

Its net sales forecast was a touch shy of estimates.<\/p>\n

The company’s adjusted per-share profit was 78 cents for the fourth quarter ended July 1, missing expectations of 97 cents.<\/p>\n

“With more growth coming from overseas, Tapestry’s profitability was hurt somewhat by the strong dollar – an issue that continues to affect many U.S.-based brands and retailers,” Insider Intelligence analyst Rachel Wolff said.<\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. FILE PHOTO: A view of a Coach store, a brand owned by Tapestry, Inc., in Manhattan, New York, U.S., November 15, 2021. REUTERS\/Andrew Kelly\/File Photo By Savyata Mishra, Juveria Tabassum and Katherine Masters (Reuters) -Coach parent Tapestry (NYSE:), which agreed to buy Capri last week, forecast fiscal 2024 profit and sales below estimates […]<\/p>\n","protected":false},"author":1,"featured_media":7482,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[1],"tags":[83],"class_list":["post-49888","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-uncategorized","tag-featured","post_format-post-format-video"],"yoast_head":"\nCoach parent Tapestry forecasts weak 2024 on soft U.S. demand | iFintechWorld<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. 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