Tapestry Beats Estimates with Gen Z and Millennials Driving Demand — Retail Bum

Tapestry raised its annual profit outlook after the company beat quarterly estimates thanks to strong demand for Coach handbags.

The New York-based company saw an uptick in demand from Gen Z and millennial shoppers, who accounted for nearly half of the 2.6 million customers that were added in North America. Demand for handbags from the Tabby and Willow collection, which retail for anywhere between $300 to $600, was exceptionally high among younger shoppers.

While Tapestry enjoyed robust demand, its rival Capri Holdings, which is the parent company of brands such as Michael Kors, Jimmy Choo, and Versace, missed estimates as it saw sales plunge across all its portfolio. As a result, the company cut its annual forecast, leading to a 23% decline in its share value on Wednesday.

“The Coach brand has done a lot of work to reposition itself as a premium brand that appeals to a younger consumer,” Raymond James analyst Rick Patel told Reuters.

“Tapestry appears to be executing better for its Coach brand than Capri is for Michael Kors,” he added.

Tapestry, for one, has been successful in partly shielding its business by focusing on selling its products through its own retail channels. Capri Holdings, on the other hand, has been more reliant on distribution through department stores, which are experiencing a slowdown in demand across North America.

Photo credit: Coach

Originally published at https://retailbum.com on February 10, 2023.