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What changed in Tapestry, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Tapestry, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+358 added−329 removedSource: 10-K (2025-08-14) vs 10-K (2024-08-15)

Top changes in Tapestry, Inc.'s 2025 10-K

358 paragraphs added · 329 removed · 257 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

63 edited+12 added−15 removed37 unchanged
Biggest changeThe Fabric of Change focuses on four pillars: Power of Our People, Sustain the Planet, Uplift Our Communities and Create Products with Care. • Power of Our People: ◦ We aim to foster a culture of purpose and fulfillment at Tapestry by embedding Equity, Inclusion and Diversity (“EI&D") throughout our organization and attracting and retaining talent with a compelling and engaging employee experience. ◦ We have set goals focused on building diversity in our leadership team, reducing differences in our employee survey results based on gender and ethnicity, focusing on progression and establishing core wellness standards to enable our employees to manage their work and personal lives. ◦ We tie 10% of leadership annual incentive plan compensation to EI&D goals on a global basis level. • Sustain the Planet: ◦ We aim to sustain and restore our planet through continuous innovation in solutions that improve biodiversity and reduce our impact on climate change with a focus on renewable energy, increased use of environmentally preferred materials and production methods and circular business models that design out waste and pollution, keep products in use and restore natural systems. ◦ We have set goals focused on utilizing 100% renewable energy in our own operations globally, reducing waste in our corporate and fulfillment centers and minimizing water use across our company and supply chain.
Biggest changeThe Fabric of Change focuses on four pillars: Power of Our People, Sustain the Planet, Uplift Our Communities and Create Products with Care. • Power of Our People: ◦ As our company name suggests, we believe in the intertwining of a broad mix of people who bring a variety of perspectives, unleashing the power of innovation and self-expression in our products and experiences. ◦ As a global employer, we work to continuously expand our aperture as wide as possible to acquire, retain and grow the best talent. • Sustain the Planet: ◦ We aim to preserve and restore our planet through investments in solutions that improve biodiversity and reduce the impacts of climate change. ◦ We have set goals focused on utilizing 100% renewable energy in our own operations globally, reducing waste in our corporate and fulfillment centers and minimizing water use across our company and supply chain.
OUR STRATEGY In the first quarter of fiscal 2023, the Company introduced the 2025 growth strategy, future speed, designed to amplify and extend the competitive advantages of its brands, with a focus on four strategic priorities: • Building Lasting Customer Relationships: The Company's brands aim to leverage Tapestry’s transformed business model to drive customer lifetime value through a combination of increased customer acquisition, retention and reactivation. • Fueling Fashion Innovation & Product Excellence: The Company aims to drive sustained growth in core handbags and small leathergoods, while accelerating gains in footwear and lifestyle products. 2 • Delivering Compelling Omni-Channel Experiences: The Company aims to extend its omni-channel leadership to meet the customer wherever they shop, delivering growth online and in stores. • Powering Global Growth: The Company aims to support balanced growth across regions, prioritizing North America and China, its largest markets, while capitalizing on opportunities in under-penetrated geographies such as Southeast Asia and Europe.
OUR STRATEGY In the first quarter of fiscal 2023, the Company introduced the 2025 growth strategy, future speed, designed to amplify and extend the competitive advantages of its brands, with a focus on four strategic priorities: • Building Lasting Customer Relationships: The Company's brands aim to leverage Tapestry’s transformed business model to drive customer lifetime value through a combination of increased customer acquisition, retention and reactivation. 2 • Fueling Fashion Innovation & Product Excellence: The Company aims to drive sustained growth in core handbags and small leathergoods, while accelerating gains in footwear and lifestyle products. • Delivering Compelling Omni-Channel Experiences: The Company aims to extend its omni-channel leadership to meet the customer wherever they shop, delivering growth online and in stores. • Powering Global Growth: The Company aims to support balanced growth across regions, prioritizing North America and China, its largest markets, while capitalizing on opportunities in under-penetrated geographies such as Southeast Asia and Europe.
Tapestry's primary compensation principle is to "pay for performance." Tapestry's practice is to pay a competitive base salary and to provide corporate employees with the opportunity to earn an annual bonus tied to Tapestry's and its brands' financial performance, and to provide store employees with the opportunity to earn sales incentives.
Tapestry's primary compensation principle is to "pay for performance." Tapestry's practice is to pay a competitive base salary and provide corporate employees with the opportunity to earn an annual bonus tied to Tapestry's and its brands' financial performance, and provide store employees with the opportunity to earn sales incentives.
At Tapestry, each brand has a dedicated design and merchandising team; this ensures that Coach, Kate Spade and Stuart Weitzman speak to their customers with a voice and positioning unique to their brand. Designers have access to the brands' extensive archives of product designs, which are a valuable resource for product concepts.
At Tapestry, each brand has a dedicated design and merchandising team; this ensures that Coach, Kate Spade and Stuart Weitzman speak to their customers with a voice and positioning unique to 6 their brand. Designers have access to the brands' extensive archives of product designs, which are a valuable resource for product concepts.
We are able to do this by maintaining sourcing management offices in Vietnam, mainland China, the Philippines, Cambodia and Spain that work closely with our independent manufacturers. This broad-based, global manufacturing strategy is designed to optimize the mix of cost, lead times and construction capabilities.
We are able to do this by maintaining sourcing management offices in Vietnam, mainland China, the Philippines, Cambodia and 7 Spain that work closely with our independent manufacturers. This broad-based, global manufacturing strategy is designed to optimize the mix of cost, lead times and construction capabilities.
The Company pursues counterfeiters through leads generated internally, as well as through its network of investigators, law enforcement and customs officials, the respective online reporting form for each brand, the Tapestry hotline and business partners around the world. SEASONALITY The Company's results are typically affected by seasonal trends.
The Company pursues counterfeiters through leads generated internally, as well as through its network of investigators, law enforcement and customs officials, the respective online reporting form for each brand, the Tapestry hotline and business partners around the world. 8 SEASONALITY The Company's results are typically affected by seasonal trends.
Additionally, on an annual basis, our foundations match up to $10,000, per eligible employee, in donations to eligible non-profits in North America. FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS Refer to Note 4, "Revenue," and Note 17, "Segment Information," presented in the Notes to the Consolidated Financial Statements for geographic information.
Additionally, on an annual basis, our foundations match up to $10,000, per eligible employee, in donations to eligible non-profits in North America. 12 FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS Refer to Note 4, "Revenue," and Note 17, "Segment Information," presented in the Notes to the Consolidated Financial Statements for geographic information.
MARKETING We use a 360-degree approach to marketing for each of our brands, synchronizing our efforts across all business channels to ensure consistency at every touchpoint. Our global marketing strategy is to deliver a consistent, relevant and multi-layered message every time the consumer comes in contact with our brands through our communications and visual merchandising.
We use a 360-degree approach to marketing for each of our brands, synchronizing our efforts across all business channels to ensure consistency at every touchpoint. Our global marketing strategy is to deliver a consistent, relevant and multi-layered message every time the consumer comes in contact with our brands through our communications, visual merchandising and customer experiences.
Additional information on the Fabric of Change and ESG Goals can be found at www.tapestry.com/responsibility. The content on this website and the content in our corporate responsibility reports are not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC.
Additional information on the Fabric of Change and CR Goals can be found at www.tapestry.com/responsibility. The content on this website and the content in our corporate responsibility reports are not incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC.
We also have greenhouse gas (“GHG”) emissions reduction targets for Scope 1, 2, 3 and Scope 3 Forest, Land and Agriculture that have been validated by Science Based Targets initiative. • Uplift Our Communities: ◦ We aim to empower the communities where our employees live and work, and provide the resources and capacity needed to support supply chain partners in the regions where we operate. ◦ We have set goals focused on volunteer service hours completed by our employees around the world, financial and product donations to nonprofit organizations globally, and ensuring people working in the factories crafting our products will have access to empowerment programs during the workday. • Create Products with Care: ◦ We aim to increase the use of innovative materials and focus on production methods that design out waste and pollution, keep products in use and restore natural systems. ◦ We have set goals focused on tracing and mapping our raw materials, increasing the recycled content in our consumer packaging and targets to increase the uptake of sourcing environmentally preferred materials.
We also have greenhouse gas (“GHG”) emissions reduction targets for Scope 1, 2, 3 and Scope 3 Forest, Land and Agriculture that have been validated by Science Based Targets initiative. • Uplift Our Communities: ◦ We aim to empower the communities where our employees live and work, and provide the resources and capacity needed to support supply chain partners in the regions where we operate. ◦ We have set goals focused on volunteer service hours completed by our employees around the world, financial and product donations to nonprofit organizations globally, and ensuring people working in the factories crafting our products will have access to empowerment programs during the workday. • Create Products with Care: ◦ We aim to increase the use of innovative materials and focus on production methods that design out waste and pollution, keep products in use and restore natural systems. ◦ We have set goals focused on tracing and mapping our raw materials, and targets to increase the uptake of sourcing environmentally preferred materials.
The Board approves long-term sustainability goals, strategic moves or major plans of action and receives updates at least annually. Tapestry's Governance and Nominations Committee of the Board receives quarterly updates on sustainability strategy, including climate-related topics, progress towards the ESG goals and other ESG related initiatives.
The Board approves long-term sustainability goals, strategic moves or major plans of action and receives updates at least annually. Tapestry's Governance and Nominations Committee of the Board receives quarterly updates on sustainability strategy, including climate-related topics, progress towards the CR goals and other CR related initiatives.
GOVERNMENT REGULATION Most of the Company's imported products are subject to duties, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products.
GOVERNMENT REGULATION Most of the Company's imported products are subject to tariffs, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products.
As a company, performance management is critical to our ability to reach our goals and foster a culture of success. By having a dynamic, performance-driven culture, we can achieve greater results, maximize employee, manager and team performance and offer exciting development and career opportunities.
Performance management is critical to our ability to reach our goals and foster a culture of success. By having a dynamic, performance-driven culture, we can achieve greater results, maximize employee, manager and team performance and offer exciting development and career opportunities.
During fiscal 2024, manufacturers of Coach products were primarily located in Vietnam, Cambodia, the Philippines and India and no individual vendor provided 10% or more of the brand's total inventory purchases.
During fiscal 2025, manufacturers of Coach products were primarily located in Vietnam, Cambodia, the Philippines and India and no individual vendor provided 10% or more of the brand's total inventory purchases.
Of these employees, approximately 14,700 employees worked in retail locations, of which 6,100 were part-time employees. This total excludes seasonal and temporary employees that the Company employs, particularly during the second quarter due to the holiday season. The Company believes that its relations with its employees are good and has never encountered a strike or work stoppage.
Of these employees, approximately 15,100 employees worked in retail locations, of which 6,500 were part-time employees. This total excludes seasonal and temporary employees that the Company employs, particularly during the second quarter due to the holiday season. The Company believes that its relations with its employees are good and has never encountered a strike or work stoppage.
During fiscal 2024, Kate Spade products were manufactured primarily in Vietnam, Cambodia, mainland China, and the Philippines and no individual vendor provided 10% or more of the brand's total inventory purchases. Stuart Weitzman products were primarily manufactured in 7 Spain.
During fiscal 2025, Kate Spade products were manufactured primarily in Vietnam, Cambodia, mainland China, and the Philippines and no individual vendor provided 10% or more of the brand's total inventory purchases. Stuart Weitzman products were primarily manufactured in Spain.
Approximately 2,400 of our employees, including nearly all of our store managers, received an annual long-term equity award in 2024, which aligns employee interests with those of our stockholders, rewards employees for enhancing stockholder value and supports retention of key employees. Our benefits package is designed to be competitive and comprehensive, which varies by location and jurisdiction.
Approximately 2,400 of our employees, including nearly all of our store managers, received an annual long-term equity award in 2025, which aligns employee interests with those of our stockholders, rewards employees for enhancing stockholder value and supports retention of key employees. Our benefits package, which varies by country, is designed to be competitive and comprehensive.
Having perfected the art of shoemaking for over 35 years, the brand continues to expand its assortment to feature handbags and men's footwear, all the while staying true to its ethos of inspiring strength and confidence with every step. Stuart Weitzman includes global sales of primarily Stuart Weitzman brand products to customers through our DTC and wholesale businesses.
Having perfected the art of shoemaking for nearly 40 years, the brand continues to expand its assortment to feature handbags and men's footwear, all the while staying true to its ethos of inspiring strength and confidence with every step. Stuart Weitzman includes global sales of primarily Stuart Weitzman brand products to customers through our DTC, wholesale and licensing businesses.
The Company’s ESG and corporate responsibility strategy, including oversight, management and identification of risks, is ultimately governed by the Board of Directors (the "Board") and overseen by an ESG Steering Committee, which is comprised of members of our executive leadership team, and driven by an ESG Task Force, comprised of senior leaders and cross-functional members from major business functions.
The Company’s CR strategy, including oversight, management and identification of risks, is ultimately governed by the Board of Directors (the "Board") and overseen by an Executive Steering Committee, which is comprised of members of our executive leadership team, and driven by a Task Force, comprised of senior leaders and cross-functional members from major business functions.
Our key licensing relationships and their fiscal year expirations as of June 29, 2024 are as follows: Brand Category Partner Fiscal Year Expiration Coach Watches Movado 2025 Coach Eyewear Luxottica 2026 Coach Fragrance Interparfums 2026 Kate Spade Tableware and Housewares Lenox 2025 Kate Spade Sleepwear Komar 2025 Kate Spade Stationery and Gift Lifeguard Press 2026 Kate Spade Tech Accessories Case-Mate 2027 Kate Spade Fragrance Interparfums 2030 Kate Spade Eyewear Safilo 2031 Products made under license are, in most cases, sold through stores and wholesale business channels and, with the Company's approval, the licensees have the right to distribute products selectively through other venues, which provide additional, yet controlled, exposure of our brands.
Our key licensing relationships and their fiscal year expirations as of June 28, 2025 are as follows: Brand Category Partner Fiscal Year Expiration Coach Eyewear Luxottica 2026 Coach Watches Movado 2028 Coach Fragrance Interparfums 2031 Kate Spade Tech Accessories Case-Mate 2027 Kate Spade Sleepwear Komar 2028 Kate Spade Fashion Bedding Live Comfortably 2028 Kate Spade Stationery and Gift Lifeguard Press 2030 Kate Spade Fragrance Interparfums 2030 Kate Spade Eyewear Safilo 2031 Products made under license are, in most cases, sold through stores and wholesale business channels and, with the Company's approval, the licensees have the right to distribute products selectively through other venues, which provide additional, yet controlled, exposure of our brands.
We continue to closely monitor inventories held by our wholesale customers in an effort to optimize inventory levels across wholesale doors. Wholesale represented approximately 12% of our total net sales for fiscal 2024. As of June 29, 2024, there were no customers who individually accounted for more than 10% of each segment’s total net sales.
We continue to closely monitor inventories held by our wholesale customers in an effort to optimize inventory levels across wholesale doors. Wholesale represented approximately 13% of our total net sales for fiscal 2025. As of June 28, 2025, there were no customers who individually accounted for more than 10% of each segment’s total net sales.
This segment represented 20.0% of total net sales in fiscal 2024. • Stuart Weitzman - Since 1986, New York City based global luxury footwear brand Stuart Weitzman has combined its signature artisanal craftsmanship and precise engineering to empower women to stand strong.
This segment represented 17.1% of total net sales in fiscal 2025. • Stuart Weitzman - Since 1986, New York City based global luxury footwear brand Stuart Weitzman has combined its signature artisanal craftsmanship and precise engineering to empower women to stand strong.
Our Environmental, Social and Corporate Governance (“ESG”) strategy, the Fabric of Change , aims to unite teams across the Company’s business to work to meet our Corporate Responsibility Goals ("ESG Goals") and a shared objective: to create a company of the future that balances true fashion authority with meaningful, positive change.
Our Corporate Responsibility (“CR”) strategy, the Fabric of Change , aims to unite teams across the Company’s business to work to meet our Corporate Responsibility Goals and a shared objective: to create a company of the future that balances true fashion authority with meaningful, positive change.
Unlocking the power of our people is a key strategic focus area for the Company, supported by significant engagement from the Company’s senior leadership on talent development and human capital management, as reflected in the key programs and focus areas described below. Employees As of June 29, 2024, the Company employed approximately 18,600 employees globally.
Unlocking the power of our people is a key strategic focus area for the Company, supported by significant engagement from the Company’s senior leadership on talent development and human capital management, as reflected in the key programs and focus areas described below. Employees As of June 28, 2025, the Company employed approximately 19,000 employees globally.
Our benefits, along with competitive pay, include medical benefits and paid wellness days for directly hired full-time and part-time employees. Additionally, we offer parental leave for directly hired full-time employees. The Company also offers retirement benefits for all employees.
Our benefits, along with competitive pay, include health benefits, vacation time, and paid Company holidays for directly hired full-time and qualifying part-time employees. Additionally, we offer parental leave for directly hired full-time employees. The Company also offers retirement benefits and paid wellness days for full-time and part-time employees.
Our development programs enable individual and team success through targeted initiatives and resources, offering a wide-ranging curriculum focused on professional and leadership development for leaders, managers and individual contributors, including through our People Management Program, Emerging Leaders High-Potential Program, Leader Transition Acceleration Program and third-party learning platforms, in addition to other trainings and education facilitated through the Company for all employees.
Our development programs enable individual and team success through targeted initiatives and resources, offering a wide-ranging curriculum focused on professional and leadership development for leaders, managers and individual contributors, including through our Manager Effectiveness Program, Better Conversations Everyday Program, Leader Transition Acceleration Program and third-party learning platforms, in addition to other trainings and education facilitated through the Company for all employees.
The Board has designated the Human Resources Committee of the Board (the “HR Committee”) as the primary committee responsible for the Company’s human capital strategy, overseeing executive compensation programs, performance and talent development, succession planning, engagement and regular review of employee benefits and well-being strategies. Together with the Board, the HR Committee also provides oversight of the Company’s EI&D strategies.
The Board has designated the Human Resources Committee of the Board (the “HR Committee”) as the primary committee responsible for the Company’s human capital strategy, overseeing executive compensation programs, performance and talent development, succession planning, engagement and regular review of employee benefits and well-being strategies.
This segment represented 3.6% of total net sales in fiscal 2024. In addition to these reportable segments, the Company has certain corporate costs that are not directly attributable to its brands; therefore, they are not allocated to its segments.
This segment represented 3.0% of total net sales in fiscal 2025. In addition to these reportable segments, the Company has certain corporate expenses that are not directly attributable to its brands ("Unallocated corporate expenses"); therefore, they are not allocated to its segments.
Direct-to-consumer revenues were approximately 87% of total net sales in fiscal 2024. • Stores - Our brands operate freestanding retail stores, outlet stores, as well as concession shop-in-shop locations. These stores are located in regional shopping centers, metropolitan areas throughout the world and established outlet centers.
DTC revenues were approximately 86% of total net sales in fiscal 2025. • Stores - Our brands operate freestanding retail stores, outlet stores, as well as concession shop-in-shop locations. These stores are located in regional shopping centers, metropolitan areas throughout the world and established outlet centers.
We also utilize local fulfillment centers, through third-parties in Japan, parts of Greater China, South Korea, Malaysia, Spain, the U.K., Canada and Australia. INFORMATION SYSTEMS The Company’s information systems are integral in supporting the Company’s long-term strategies. Our information technology platform is a key capability used to support digital growth and drive consumer centricity and data-driven decision making.
We also utilize local fulfillment centers, through third parties in Japan, parts of Greater China, South Korea, Malaysia and Australia. INFORMATION SYSTEMS The Company’s information systems are integral in supporting the Company’s long-term strategies. Our robust information technology platform serves as a foundation to drive growth and enhance consumer centricity initiatives, and enable data-driven decision making.
Our recruitment and sourcing strategy focuses on tapping diverse sources to attract the best talent to our organization and then retaining them through our continued investments in resources that provide our employees with the tools for career advancement. Our internal opportunity program encourages employees to stretch themselves in their career development, aligning their capabilities with career interests and goals.
Our recruitment and sourcing strategy focuses on tapping many sources to attract the best talent to our organization and then retaining them through our continued investments in resources that provide our employees with the tools for development and career advancement.
The Company has several regional informational websites for locations where we have not established an e-commerce presence. The Company utilizes and continues to explore digital technologies such as social media websites as a cost-effective consumer communication opportunity to increase on-line and store sales, acquire new customers and build brand awareness.
The Company has several regional informational websites for locations where we have not established an e-commerce presence. The Company utilizes social media and continues to explore digital technologies to create emotional connections with consumers, acquire new customers and build brand awareness, in addition to increasing on-line and store sales.
During fiscal 2024, Stuart Weitzman had two vendors, both located in Spain, who individually provided over 10% of the brand's total units (approximately 23% across both, in the aggregate). FULFILLMENT The Company’s distribution network is designed to support the movement of each brand's products from our manufacturers to fulfillment centers around the world.
During fiscal 2025, Stuart Weitzman had one vendor, located in Spain, who individually provided approximately 11% of the brand's total inventory purchases. FULFILLMENT The Company’s distribution network is designed to support the movement of each brand's products from our manufacturers to fulfillment centers around the world.
This network includes our six employee business resource groups, three task forces and regional inclusion councils to support and engage our employees. Additionally, we believe educating our employees is crucial in achieving our EI&D goals. We have curated a catalogue of learning and development content, tools and resources, including bespoke skill-building programs to accommodate our dynamic employee population.
Additionally, we believe educating our employees is crucial in achieving our goals. We have curated a catalogue of learning and development content, tools and resources, including bespoke skill-building programs to accommodate our dynamic employee population.
We strive to provide a working environment where our people can grow and progress their careers within the Company. We are committed to helping our employees develop the knowledge, skills and abilities needed for continued success and encourage employee development at all levels and every career stage.
We are committed to helping our employees develop the knowledge, skills and abilities needed for continued success and encourage employee development at all levels and every career stage.
Furthermore, the Company has focused on providing employees with resources to foster continuing education and conversation on EI&D through 'Tapestry UNSCRIPTED', which is an internal speaker series for our employees designed to bring our values to life.
Furthermore, the Company has focused on providing employees with resources to foster continuing education and conversation through 'Tapestry UNSCRIPTED', which is an internal speaker series for our employees designed to bring our values to life. We feel hosting bold conversations about our values provides an opportunity for us to be inspired, discover ideas and ignite personal passions.
DIRECT TO CONSUMER BUSINESS Our DTC business consists of channels that provide us with immediate, controlled access to consumers. This includes retail and outlet stores, brand e-commerce sites as well as concession shop-in-shops.
The Company's next investor day will be held in September 2025, during which the Company will present its latest long-term growth strategy. DIRECT TO CONSUMER BUSINESS Our DTC business consists of channels that provide us with immediate, controlled access to consumers. This includes retail and outlet stores, brand e-commerce sites as well as concession shop-in-shops.
We provide our employees with supplemental resources to achieve wellness such as access to our Employee Assistance Program, regular employee programming and subscriptions to Headspace, a smartphone application dedicated to meditation and mindfulness.
We provide our employees with supplemental resources to achieve wellness such as access to our Employee Assistance Program, regular employee programming and subscriptions to Headspace, a smartphone application dedicated to meditation and mindfulness. In addition, the Company maintains an Associate Relief Fund, which provides emergency assistance for events considered a disaster or hardship.
Coach includes global sales of primarily Coach brand products to customers through our direct-to-consumer ("DTC"), wholesale and licensing businesses. This segment represented 76.4% of total net sales in fiscal 2024. • Kate Spade - Since its launch in 1993 with a collection of six essential handbags, kate spade new york has always been colorful, bold and optimistic.
This segment represented 79.9% of total net sales in fiscal 2025. • Kate Spade - Since its launch in 1993 with a collection of six essential handbags, kate spade new york has always been colorful, bold and optimistic.
The product category teams, each comprised of design, merchandising, product development and sourcing specialists, help each brand execute design concepts that are consistent with the brand's strategic direction. 6 Our design and merchandising teams also work in close collaboration with all of our licensing partners to ensure that the licensed products are conceptualized and designed to address the intended market opportunity and convey the distinctive perspective and lifestyle associated with our brands.
Our design and merchandising teams also work in close collaboration with all of our licensing partners to ensure that the licensed products are conceptualized and designed to address the intended market opportunity and convey the distinctive perspective and lifestyle associated with our brands. MARKETING Our marketing objective is to build emotional connections with consumers to drive acquisition.
Email contacts are an important part of our communication and are sent to selected consumers to stimulate consumer purchases and build brand awareness. Visitors to our e-commerce sites provide an opportunity to increase the size of these consumer databases, in addition to serving as a point of transactions globally, except where restricted.
As part of our direct marketing strategy, we use databases of consumers to generate personalized communications in direct channels such as email and text messages to drive engagement. Visitors to our e-commerce sites provide an opportunity to increase the size of these consumer databases, in addition to serving as a point of transactions globally, except where restricted.
We provide all employees with supplemental time-off to perform community service through nonprofits of their personal choice and through team and Company sponsored volunteering events. In our commitment to supporting our communities, we have three foundations which provide monetary support to nonprofit organizations across communities that we are a part of.
At Tapestry, we believe in encouraging and empowering our employees to take part in building a welcoming and inclusive community. We provide all employees with supplemental time-off to perform community service through nonprofits of their personal choice and through team and Company sponsored volunteering events.
Each brand's distinctive positioning is communicated by our creative marketing, visual merchandising and public relations teams, as well as outside creative agencies. We also have a sophisticated consumer and market research capability, which helps us assess consumer attitudes and trends. We engage in several consumer communication initiatives globally, including direct marketing activities at a national, regional and local level.
Each brand's distinctive positioning is communicated by our creative marketing, visual merchandising and public relations teams, as well as outside creative agencies. We also have a sophisticated consumer and market research capability and leverage third-party experts to gain insights into consumer attitudes and trends.
In addition, Kate Spade brand housewares and home accessories, such as fashion bedding and tableware, and stationery and gifts are included in this category. DESIGN AND MERCHANDISING Our creative leaders are responsible for conceptualizing and implementing the design direction for our brands across the consumer touchpoints of product, stores and marketing.
DESIGN AND MERCHANDISING Our creative leaders are responsible for conceptualizing and implementing the design direction for our brands across the consumer touchpoints of product, stores and marketing.
HUMAN CAPITAL At Tapestry, being true to yourself is core to who we are. When each of us brings our individuality to our collective ambition, our creativity is unleashed.
HUMAN CAPITAL At Tapestry, being true to yourself is core to who we are. When each of us brings our individuality to our collective ambition, our creativity is unleashed. This global house of brands was built by unconventional entrepreneurs and unexpected solutions, so when we say we believe in dreams, we mean we believe in making them happen.
ITEM 1. BUSINESS Tapestry, Inc. (the "Company") is a house of iconic accessories and lifestyle brands. Our global house of brands unites the magic of Coach, kate spade new york and Stuart Weitzman.
ITEM 1. BUSINESS Tapestry, Inc. (the "Company") is a house of iconic accessories and lifestyle brands. Our global house of brands unites the magic of Coach and kate spade new york. Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across channels and geographies.
Square Footage 2024 2023 2022 Amount % Amount % Coach North America 4,905 4,904 4,839 1 — % 65 1.3 % International 2,342 2,294 2,257 48 2.1 % 37 1.6 % Total Coach 3,235 3,211 3,194 24 0.7 % 17 0.5 % Kate Spade North America 2,949 2,876 2,863 73 2.5 % 13 0.5 % International 1,439 1,446 1,441 (7) (0.5) % 5 0.3 % Total Kate Spade 2,226 2,185 2,181 41 1.9 % 4 0.2 % Stuart Weitzman North America 1,938 1,905 1,919 33 1.7 % (14) (0.7) % International 1,338 1,371 1,378 (33) (2.4) % (7) (0.5) % Total Stuart Weitzman 1,555 1,578 1,589 (23) (1.5) % (11) (0.7) % Tapestry North America 4,029 3,987 3,951 42 1.1 % 36 0.9 % International 2,078 2,043 2,012 35 1.7 % 31 1.5 % Total Tapestry 2,850 2,820 2,804 30 1.1 % 16 0.6 % • Digital - We view our digital platform as an instrument to deliver our products to customers directly with the benefit of added accessibility as consumers can purchase our products wherever they choose.
Square Footage 2025 2024 2023 Coach North America 4,907 4,905 4,904 International 2,388 2,342 2,294 Total Coach 3,265 3,235 3,211 Kate Spade North America 3,023 2,949 2,876 International 1,502 1,439 1,446 Total Kate Spade 2,301 2,226 2,185 Stuart Weitzman North America 1,927 1,938 1,905 International 1,371 1,338 1,371 Total Stuart Weitzman 1,566 1,555 1,578 Tapestry North America 4,095 4,029 3,987 International 2,142 2,078 2,043 Total Tapestry 2,912 2,850 2,820 • Digital - We view our digital platform as an instrument to deliver our products to customers directly with the benefit of added accessibility as consumers can purchase our products beyond where our physical locations are based.
Inspired by the vision of Expressive Luxury and the inclusive and courageous spirit of its hometown, the brand makes beautiful things, crafted to last – for you to be yourself in. Coach has built a legacy of craftsmanship and a community that champions the courage to be real.
OUR BRANDS The Company has three reportable segments: • Coach - Coach is a global fashion house of accessories and lifestyle collections, founded in New York City in 1941. Inspired by the vision of Expressive Luxury and the inclusive and courageous spirit of its hometown, the brand makes beautiful things, crafted to last – for you to be yourself in.
Our merchandising teams are committed to managing the product life cycle to maximize sales and profitability across all business channels.
Our merchandising teams are committed to managing the product life cycle to maximize sales and profitability across all business channels. The product category teams, each comprised of design, merchandising, product development and sourcing specialists, help each brand execute design concepts that are consistent with the brand's strategic direction.
We cultivate a place for people who are both warm and rigorous, work that is both challenging and fun and a culture led by both head and heart. Most of all, we bring together the unique spirits of our people and our brands and give them a place to move their work and our industry forward.
Where differences intersect, new thinking emerges. We cultivate a place for people who are both warm and rigorous, work that is both challenging and fun and a culture led by both head and heart.
Variance 2024 vs 2023 2023 vs 2022 Store Count 2024 2023 2022 Amount % Amount % Coach North America 324 330 343 (6) (1.8) % (13) (3.8) % International 606 609 602 (3) (0.5) % 7 1.2 % Total Coach 930 939 945 (9) (1.0) % (6) (0.6) % Kate Spade North America 197 205 207 (8) (3.9) % (2) (1.0) % International 181 192 191 (11) (5.7) % 1 0.5 % Total Kate Spade 378 397 398 (19) (4.8) % (1) (0.3) % Stuart Weitzman North America 34 36 39 (2) (5.6) % (3) (7.7) % International 60 57 61 3 5.3 % (4) (6.6) % Total Stuart Weitzman 94 93 100 1 1.1 % (7) (7.0) % Tapestry North America 555 571 589 (16) (2.8) % (18) (3.1) % International 847 858 854 (11) (1.3) % 4 0.5 % Total Tapestry 1,402 1,429 1,443 (27) (1.9) % (14) (1.0) % 3 Variance 2024 vs 2023 2023 vs 2022 Avg.
Store Count 2025 2024 2023 Coach North America 324 324 330 International 607 606 609 Total Coach 931 930 939 Kate Spade North America 189 197 205 International 171 181 192 Total Kate Spade 360 378 397 Stuart Weitzman North America 28 34 36 International 52 60 57 Total Stuart Weitzman 80 94 93 Tapestry North America 541 555 571 International 830 847 858 Total Tapestry 1,371 1,402 1,429 3 Avg.
Fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including weather and macroeconomic events, such as pandemic diseases. 8 COVID-19 PANDEMIC The Covid-19 pandemic has resulted in varying degrees of business disruption for the Company since it began in fiscal 2020 and has impacted all regions around the world, resulting in restrictions and shutdowns implemented by national, state and local authorities.
Fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including weather and macroeconomic events.
Also included in this category are novelty accessories (including address books, time management accessories, travel accessories, sketchbooks and portfolios), belts, key rings and charms. • Men’s — Men’s includes bag collections (including business cases, computer bags, messenger-style bags, backpacks and totes), small leather goods (including wallets, card cases, travel organizers and belts), footwear, watches, fragrances, sunglasses, novelty accessories and ready-to-wear items. • Other Products — These products primarily include women's footwear, eyewear (such as sunglasses), jewelry (including bracelets, necklaces, rings and earrings), women's fragrances, watches, certain women's seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves and hats.
Also included in this category are novelty accessories (including address books, time management accessories, travel accessories, sketchbooks and portfolios), belts, key rings, technology accessories, gifting, straps and charms. • Footwear — This category primarily includes women's and men's footwear, including casual shoes, dress shoes, boots, sneakers and sandals. • Other — This category primarily includes outerwear, ready-to-wear, jewelry, watches, eyewear, fragrance, scarves, hats, gloves, other products, as well as royalties earned from the Company's licensing partners.
Total expenses attributable to the Company's marketing-related activities in fiscal 2024 were $616.8 million, representing over 9% of net sales, compared to $570.7 million in fiscal 2023, representing less than 9% of net sales. Our wide range of marketing activities utilize a variety of media, including digital, social, print and out-of-home.
We engage in many consumer communication initiatives globally, including activities at a national, regional and local level. Total expenses attributable to the Company's marketing-related activities in fiscal 2025 were $744.5 million, representing nearly 11% of net sales, compared to $616.8 million in fiscal 2024, representing over 9% of net sales.
The Company utilizes a cloud based digital platform which connects our customer shopping sites, Order Management Systems, Point of Sale systems, and product management systems into one platform with a shared codebase. This platform allows us to be a more dynamic and responsive company providing best-in-class service to our customers from all brands across North America, Europe and Japan.
The Company utilizes a cloud-based digital platform which integrates critical components of our businesses including our customer shopping sites, Order Management Systems, Point of Sale systems, Customer Services, Enterprise Resource Planning systems and product management systems into one cohesive platform with a shared codebase.
We are continually enhancing our digital technology platforms to elevate our e-commerce capabilities, direct-to-consumer functionalities, and overall omni-channel experience, by utilizing cloud-based technology infrastructure. For example, we will continue to enhance certain of our machine learning models to improve our customer capture and segmentation capabilities.
We are continually enhancing our digital technology platforms to elevate our e-commerce capabilities, strengthen DTC functionalities, and deliver a seamless overall omni-channel experience leveraging modern and cloud-based technologies.
Equity, Inclusion and Diversity Our company name Tapestry, represents the diversity of our brands and the diversity of our people. We believe that having a diverse range of perspectives, backgrounds and experiences makes us more innovative and successful and brings us closer to our consumer.
Embracing Difference by Design We believe that having a variety of perspectives, backgrounds and experiences makes us more innovative and successful and brings us closer to our consumer. We believe that difference sparks brilliance, so we welcome people and ideas from everywhere to join us in stretching what's possible.
Refer to Part I, Item 1C, "Cybersecurity" for further information on our cybersecurity risk management, strategy and governance.
This unified platform allows us to be a more dynamic and responsive company providing best-in-class service to our customers across all brands in North America, Europe and Japan. Refer to Part I, Item 1C, "Cybersecurity" for further information on our cybersecurity risk management, strategy and governance.
Such costs primarily include certain overhead expenses related to corporate functions as well as certain administration, corporate occupancy, information technology, and depreciation costs. Refer to Note 17, "Segment Information," for further information about the Company's segments.
Refer to Note 17, "Segment Information," for further information about the Company's segments.
Our respective brand websites serve as effective communication vehicles by providing an immersive brand experience, showcasing the fullest expression across all product categories. As part of our direct marketing strategy, we use databases of consumers to generate personalized communications in direct channels such as email and text messages to drive engagement and build awareness.
Our wide range of marketing activities utilize a variety of media, including digital, social, television, print and out-of-home. Our respective brand websites serve as effective communication vehicles by providing an immersive brand experience, showcasing the fullest expression across product categories.
We believe that difference sparks brilliance, so we welcome people and ideas from everywhere to join us in stretching what’s possible. Governance and Oversight Our Board and its committees provide governance and oversight of the Company's strategy, including over issues of human capital management.
Most of all, we bring together the unique spirits of our people and our brands and give them a place to move their work and our industry forward. 10 Governance and Oversight Our Board and its committees provide governance and oversight of the Company's strategy, including over issues of human capital management.
To support these actions, we are guided by four interconnected principles: • Talent: Attracting, retaining and growing top talent - making us an employer of choice in a rapidly evolving talent marketplace. • Culture: Fostering a culture of inclusion and belonging, where people and ideas from everywhere are welcomed. • Community: Nurturing the vibrancy of the communities in which we live and work to advance equity, opportunity and dignity for all. • Marketplace: Embracing our responsibility in the marketplace as a global fashion company.
To support these actions, we are guided by four interconnected principles: • Talent: Identify, retain and grow the best talent – making us an employer of choice in a rapidly evolving talent marketplace. • Culture: Cultivate a workplace culture where everyone can fully contribute and reach their potential by feeling included, that they belong and that they matter. • Community: Amplify our brands and support the communities in which our employees live and work. • Marketplace: Growing our customer base in line with the market and shifting dynamics.
Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across business channels and geographies. We use our collective strengths to move our customers and empower our communities, to make the fashion industry more sustainable and to build a company that’s equitable, inclusive and diverse.
We use our collective strengths to move our customers and empower our communities, to make the fashion industry more sustainable, and to harness the power of an inclusive culture. Individually, our brands are iconic. Together, we can stretch what’s possible.
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Individually, our brands are iconic. Together, we can stretch what’s possible. Founded in 1941, Coach, Inc., the predecessor to Tapestry, Inc., was incorporated in the state of Maryland in 2000. During fiscal 2015, the Company acquired Stuart Weitzman Holdings LLC, a luxury women's footwear company.
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Coach has built a legacy of craftsmanship and a community that champions the courage to be real. Coach includes global sales of primarily Coach brand products to customers through our direct-to-consumer ("DTC"), wholesale and licensing businesses.
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During fiscal 2018, the Company acquired Kate Spade & Company, a lifestyle accessories and ready-to-wear company. Later in fiscal 2018, the Company changed its name to Tapestry, Inc. OUR BRANDS The Company has three reportable segments: • Coach - Coach is a global fashion house of accessories and lifestyle collections, founded in New York City in 1941.
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Such costs primarily include certain overhead expenses related to corporate functions as well as certain administration, corporate occupancy, information technology and depreciation costs. On February 16, 2025, the Company entered into a sale and purchase agreement (the “Purchase Agreement”) with Caleres, Inc. (the “Purchaser”) to sell the Stuart Weitzman Business (as defined below).
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The licensing agreements generally give our brands the right to terminate the license if specified sales targets are not achieved. 5 PRODUCTS The following table shows Net sales for each of our product categories by segment: Fiscal Year Ended June 29, 2024 July 1, 2023 July 2, 2022 Amount % of total net sales Amount % of total net sales Amount % of total net sales (millions) Coach Women's Handbags $ 2,495.7 37.5 % $ 2,450.7 36.8 % $ 2,574.8 38.5 % Women's Accessories 1,079.6 16.2 1,024.8 15.4 942.5 14.1 Men's 983.9 14.7 947.1 14.2 904.8 13.5 Other Products 536.1 8.0 537.8 8.1 499.2 7.5 Total Coach $ 5,095.3 76.4 % $ 4,960.4 74.5 % $ 4,921.3 73.6 % Kate Spade Women's Handbags $ 721.0 10.9 % $ 779.6 11.7 % $ 819.5 12.2 % Women's Accessories 316.8 4.7 306.9 4.6 307.0 4.6 Other Products 296.6 4.4 332.4 5.0 319.0 4.8 Total Kate Spade $ 1,334.4 20.0 % $ 1,418.9 21.3 % $ 1,445.5 21.6 % Stuart Weitzman (1) $ 241.5 3.6 % $ 281.6 4.2 % $ 317.7 4.8 % Total Net sales $ 6,671.2 100.0 % $ 6,660.9 100.0 % $ 6,684.5 100.0 % (1) The significant majority of sales for Stuart Weitzman is attributable to women's footwear. • Women’s Handbags — Women’s handbag collections feature classically inspired as well as fashion designs.
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The Purchaser acquired certain assets and liabilities of the Company's global business of designing, manufacturing, promotion, marketing, production, distribution, sales and licensing of Stuart Weitzman branded products (the "Stuart Weitzman Business"). The sale was completed on August 4, 2025 (the "Stuart Weitzman Business Divestiture"). Refer to Note 5, "Acquisitions and Divestitures," and Note 21, "Subsequent Events," for further information.
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These collections are designed to meet the fashion and functional requirements of our broad and diverse consumer base. • Women’s Accessories — Women’s accessories include small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches and cosmetic cases.
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The licensing agreements generally give our brands the right to terminate the license if specified sales targets are not achieved. 5 PRODUCTS The following table shows Net sales for each of our product categories by segment.
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Such disruptions persisted into the beginning of fiscal 2023, and the Company's results in Greater China (mainland China, Hong Kong SAR, Macao SAR and Taiwan) were adversely impacted as a result of the Covid-19 pandemic. Towards the end of the first half of fiscal 2023, certain government restrictions were lifted in the region and business trends improved.
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Fiscal Year Ended June 28, 2025 June 29, 2024 July 1, 2023 Amount % of Total segment net sales Amount % of Total segment net sales Amount % of Total segment net sales (millions) Coach Handbags $ 3,223.3 57.6 % $ 2,889.9 56.7 % $ 2,847.1 57.4 % Accessories 1,539.5 27.5 1,407.9 27.6 1,325.7 26.7 Footwear 342.5 6.1 326.0 6.4 311.5 6.3 Other 493.2 8.8 471.5 9.3 476.1 9.6 Total Coach $ 5,598.5 100.0 % $ 5,095.3 100.0 % $ 4,960.4 100.0 % Kate Spade Handbags $ 623.0 52.1 % $ 721.0 54.0 % $ 779.7 54.9 % Accessories 269.8 22.5 307.0 23.0 324.8 22.9 Footwear 55.2 4.6 57.4 4.3 57.8 4.1 Other 249.1 20.8 249.0 18.7 256.6 18.1 Total Kate Spade $ 1,197.1 100.0 % $ 1,334.4 100.0 % $ 1,418.9 100.0 % Stuart Weitzman (1) $ 215.1 100.0 % $ 241.5 100.0 % $ 281.6 100.0 % Tapestry Handbags $ 3,846.3 54.9 % $ 3,610.9 54.1 % $ 3,626.8 54.4 % Accessories 1,809.3 25.8 1,714.9 25.7 1,650.5 24.8 Footwear 612.8 8.7 624.9 9.4 650.9 9.8 Other 742.3 10.6 720.5 10.8 732.7 11.0 Total Tapestry $ 7,010.7 100.0 % $ 6,671.2 100.0 % $ 6,660.9 100.0 % (1) The significant majority of sales for Stuart Weitzman is attributable to footwear and therefore all of Stuart Weitzman net sales are within the Tapestry Footwear category. • Handbags — This category primarily includes handbags classically inspired as well as fashion designs, business cases, computer bags, messenger-style bags, backpacks, travel bags and totes. • Accessories — This category primarily includes small leather goods, such as mini and micro handbags, money pieces, wristlets, pouches and cosmetic cases.
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During fiscal 2024, the Covid-19 pandemic did not materially impact our business or operating results. The Company continues to monitor the latest developments regarding the Covid-19 pandemic and potential impacts on our business, operating results and outlook.
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During fiscal 2025, we continued to enhance our artificial intelligence, both predictive and generative, and machine learning models for areas such as data analytics, planning, marketing, customer journey personalization, pricing and product creation, to improve our customer capture and segmentation capabilities for more tailored and effective engagement.
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This global house of brands was built by unconventional entrepreneurs and unexpected solutions, so when we say we believe in dreams, we mean we believe in making them happen. 10 Where differences intersect, new thinking emerges.
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Our core values of ‘Embracing Difference by Design’ and ‘Stand Taller Together’ are non-negotiable, it is who we are. They are the bedrock of the kind of ingenuity that turns heads, turns objects into icons and comes only from the places few have looked before.
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Our goal is to create a culture that is equitable, inclusive and diverse, where all of our employees, customers and stakeholders thrive. Our EI&D strategy is grounded in our purpose and values and is a core element to unlocking the power of our people.
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Tapestry is committed to inclusion and opportunity for all through our corporate partnerships and best practice benchmarking groups through our corporate efforts.
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We are committed to affecting positive change for our industry and deliver on our value proposition to stakeholders - consumers, investors and vendor partners. Our global EI&D Champion Network supports and engages our professional community by creating an environment where all are welcomed.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changePresidential, congressional, and state elections and policy shifts resulting from those elections, and (3) sanctions and related activities by the United States, European Union (“E.U.”) and others; • public health crises, such as pandemics and epidemic diseases; • changes to the U.S.'s participation in, withdrawal out of, renegotiation of certain international trade agreements or other major trade related issues, including the non-renewal of expiring favorable tariffs granted to developing countries, tariff quotas and retaliatory tariffs, trade sanctions, new or onerous trade restrictions, embargoes and other stringent government controls; • changes in exchange rates for foreign currencies, which may adversely affect the retail prices of our products, result in decreased international consumer demand, or increase our supply costs in those markets, with a corresponding negative impact on our gross margin rates; • compliance with laws relating to foreign operations, including the Foreign Corrupt Practices Act ("FCPA"), the U.K.
Biggest changeWhile geographic diversity helps to reduce the Company’s exposure to risks in any one country, we are subject to risks associated with international operations, including, but not limited to: 14 • political or economic instability or changing macroeconomic conditions in our major markets, including the potential impact of new policies that may be implemented by the U.S. or other jurisdictions, particularly with respect to tax and trade policies; • public health crises, such as pandemics and epidemic diseases; • changes to the U.S.'s participation in, withdrawal out of, renegotiation of certain international trade agreements or other major trade related issues, including the non-renewal of expiring favorable tariffs granted to developing countries, tariff quotas and retaliatory tariffs, trade sanctions, new or onerous trade restrictions, embargoes and other stringent government controls; • changes in exchange rates for foreign currencies, which may adversely affect the retail prices of our products, result in decreased international consumer demand, or increase our supply costs in those markets, with a corresponding negative impact on our gross margin rates; • compliance with laws relating to foreign operations, including the Foreign Corrupt Practices Act ("FCPA"), the U.K.
Under Maryland law, business combinations, including mergers, consolidations, share exchanges or, in circumstances specified in the statute, asset transfers or issuances or reclassifications of equity securities, between the Company and any interested stockholder, generally defined as any person who beneficially owns, directly or indirectly, 10% or more of the Company’s common stock, or any affiliate of an interested stockholder are prohibited for a five-year period, beginning on the most recent date such person became an interested stockholder.
Under Maryland law, business combinations, including mergers, consolidations, share exchanges and, in circumstances specified in the statute, asset transfers and issuances or reclassifications of equity securities, between the Company and any interested stockholder, generally defined as any person who beneficially owns, directly or indirectly, 10% or more of the Company’s common stock, or any affiliate of an interested stockholder are prohibited for a five-year period, beginning on the most recent date such person became an interested stockholder.
As a Company engaged in sourcing on a global scale, we are subject to the risks inherent in such activities, including, but not limited to: • continued disruptions or delays in shipments whether due to port congestion, logistics carrier disruption (including as a result of labor disputes), militant attacks on commercial shipping vessels in the Red Sea, other shipping capacity constraints or other factors, which has and may continue to result in significantly increased inbound freight costs and increased in-transit times; • loss or disruption of key manufacturing or fulfillment sites or extended closure of such sites due to unexpected factors; • imposition of additional duties, taxes and other charges or restrictions on imports or exports; • unavailability, or significant fluctuations in the cost, of raw materials; • compliance by us and our independent manufacturers and suppliers with labor laws and other foreign governmental regulations; • increases in the cost of labor, fuel (including volatility in the price of oil), travel and transportation; • compliance with our Global Business Integrity Program; • compliance by our independent manufacturers and suppliers with our Supplier Code of Conduct, social auditing procedures and requirements and other applicable compliance policies; • compliance with applicable laws and regulations, including U.S. laws regarding the identification and reporting on the use of “conflict minerals” sourced from the Democratic Republic of the Congo in the Company’s products, other laws and regulations regarding the sourcing of materials in the Company’s products, the FCPA, U.K.
As a Company engaged in sourcing on a global scale, we are subject to the risks inherent in such activities, including, but not limited to: • disruptions or delays in shipments whether due to port congestion, logistics carrier disruption (including as a result of labor disputes), militant attacks on commercial shipping vessels in the Red Sea, other shipping capacity constraints or other factors, which has and may continue to result in significantly increased inbound freight costs and increased in-transit times; • loss or disruption of key manufacturing or fulfillment sites or extended closure of such sites due to unexpected factors; • imposition of additional duties, taxes and other charges or restrictions on imports or exports; • unavailability, or significant fluctuations in the cost, of raw materials; • compliance by us and our independent manufacturers and suppliers with labor laws and other foreign governmental regulations; • increases in the cost of labor, fuel (including volatility in the price of oil), travel and transportation; • compliance with our Global Business Integrity Program; • compliance by our independent manufacturers and suppliers with our Supplier Code of Conduct, social auditing procedures and requirements and other applicable compliance policies; • compliance with applicable laws and regulations, including U.S. laws regarding the identification and reporting on the use of “conflict minerals” sourced from the Democratic Republic of the Congo in the Company’s products, other laws and regulations regarding the sourcing of materials in the Company’s products, the FCPA, U.K.
We have been incurring and expect that we will continue to incur significant costs implementing additional security measures to protect against new or enhanced data security or privacy threats, or to comply with current and new international, federal and state laws governing the unauthorized disclosure, access to, loss, alteration or exfiltration of confidential and personal information which are continuously being enacted and proposed such as the General Data Protection Regulation ("GDPR") in the E.U. the UK GDPR, the American Privacy Rights Act (bill), the California Consumer Privacy Act ("CCPA") as amended by the California Privacy Rights Act ("CPRA"), the Virginia Consumer Data Protection Act ("VCDPA"), the Colorado Privacy Act ("CPA"), the Utah Consumer Privacy Act ("UCPA"), the Connecticut Data Privacy Act ("CTDPA"), the Montana Consumer Data Privacy Act ("MCDPA"), the Washington My Health My Data Act ("WMHMDA"), the Florida Digital Bill of Rights ("FDBR"), the Texas Data Privacy and Security Act ("TDPSA") and other comprehensive and sectoral state privacy laws in the U.S., as well as increased cyber security and privacy protection costs such as organizational changes, deploying additional personnel and protection technologies, training employees and contractors, engaging outside counsel, third-party experts and consultants.
We have been incurring and expect that we will continue to incur significant costs implementing additional security measures to protect against new or enhanced data security or privacy threats, or to comply with current and new international, federal and state laws governing the unauthorized disclosure, access to, loss, alteration or exfiltration of confidential and personal information which are continuously being enacted and proposed such as the General Data Protection Regulation ("GDPR") in the E.U., the UK GDPR, the California Consumer Privacy Act ("CCPA") as amended by the California Privacy Rights Act ("CPRA"), the Virginia Consumer Data Protection Act ("VCDPA"), the Colorado Privacy Act ("CPA"), the Utah Consumer Privacy Act ("UCPA"), the Connecticut Data Privacy Act ("CTDPA"), the Montana Consumer Data Privacy Act ("MCDPA"), the Washington My Health My Data Act ("WMHMDA"), the Florida Digital Bill of Rights ("FDBR"), the Texas Data Privacy and Security Act ("TDPSA") and other comprehensive and sectoral state privacy laws in the U.S., as well as increased cyber security and privacy protection costs such as organizational changes, deploying additional personnel and protection technologies, training employees and contractors, engaging outside counsel, third-party experts and consultants.
Competition is based on a number of factors, including, without limitation, the following: • our competitors may develop new products or product categories that are more popular with our customers; • anticipating and responding in a timely fashion to changing consumer demands and shopping preferences, including the ever-increasing shift to digital brand engagement, social media communications, and online and cross-channel shopping; • maintaining strong brand recognition, loyalty, and a reputation for quality, including through digital brand engagement and online and social media presence; • recruiting and retaining key talent; • developing and producing innovative, high-quality products in sizes, colors, and styles that appeal to a diverse group of consumers; • competitively pricing our products and creating an acceptable value proposition for consumers, including price increases to mitigate inflationary pressures while simultaneously balancing the risk of lower consumer demand in response to any such price increases; • providing strong and effective marketing support in several diverse demographic markets, including through digital and social media platforms in order to stay better connected to consumers; • providing attractive, reliable, secure, and user-friendly digital commerce sites; • sourcing sustainable raw materials at cost-effective prices; • ensuring product availability and optimizing supply chain efficiencies with third-party suppliers and retailers; • protecting our trademarks and design patents; • adapting to changes in technology, including the successful utilization of data analytics, artificial intelligence, and machine learning; and • the ability to withstand prolonged periods of adverse economic conditions or business disruptions.
Competition is based on a number of factors, including, without limitation, the following: • our competitors may develop new products or product categories that are more popular with our customers; • anticipating and responding in a timely fashion to changing consumer demands and shopping preferences, including the ever-increasing shift to digital brand engagement, social media communications, and online and cross-channel shopping; • maintaining strong brand recognition, loyalty, and a reputation for quality, including through digital brand engagement and online and social media presence; • recruiting and retaining key talent; • developing and producing innovative, high-quality products in sizes, colors, and styles that appeal to a diverse group of consumers; • competitively pricing our products and creating an acceptable value proposition for consumers, including price increases to mitigate inflationary pressures while simultaneously balancing the risk of lower consumer demand in response to any such price increases; • providing strong and effective marketing support in several diverse demographic markets, including through digital and social media platforms in order to stay better connected to consumers; • providing attractive, reliable, secure, and user-friendly digital commerce sites; • sourcing sustainable raw materials at cost-effective prices; • ensuring product availability and optimizing supply chain efficiencies with third-party suppliers and retailers; • protecting our trademarks and design patents; 17 • identifying and adapting to changes in technology, including the successful utilization of data analytics, artificial intelligence, and machine learning; and • the ability to withstand prolonged periods of adverse economic conditions or business disruptions.
Unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of the Company, (b) any action asserting a claim of breach of any duty owed by any director or officer or other employee of the Company to the Company or to the stockholders of the Company, (c) any action asserting a claim against the Company or any director or officer or other employee of the Company arising pursuant to any provision of the Maryland General Corporation Law, the charter or the bylaws of the Company or (d) any action asserting a claim against the Company or any director or officer or other employee of the Company that is governed by the internal affairs doctrine, shall, to the fullest extent permitted by law, be the Circuit Court for Baltimore City, Maryland (or, if that Court does not have jurisdiction, the United States District court for the District of Maryland, Baltimore Division).
Unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of the Company, (b) any action asserting a claim of breach of any duty owed by any director or officer or other employee of the Company to the Company or to the stockholders of the Company, (c) any action asserting a claim against the Company or any director or officer or other employee of the Company arising pursuant to any provision of the Maryland General Corporation Law, the charter or the bylaws of the Company or (d) any action asserting a claim against the Company or any director or officer or other employee of the Company that is governed by the internal affairs doctrine, shall, to the fullest extent permitted by law, be the Circuit Court for Baltimore City, Maryland (or, if that court does 26 not have jurisdiction, the United States District court for the District of Maryland, Baltimore Division).
Bribery Act and other global anti-corruption laws, which in general concern the bribery of foreign public officials and other regulations and requirements; • changes in tourist shopping patterns and consumer behavior, particularly that of the Chinese consumer; • geopolitical instability (such as the uncertainty in U.S.-China relations); • natural and other disasters; • political, civil and social unrest; and 14 • changes in legal and regulatory requirements, including, but not limited to safeguard measures, anti-dumping duties, cargo restrictions to prevent terrorism, restrictions on the transfer of currency, climate change and other environmental legislation, product safety regulations or other charges or restrictions.
Bribery Act and other global anti-corruption laws, which in general concern the bribery of foreign public officials and other regulations and requirements; • changes in tourist shopping patterns and consumer behavior, particularly that of the Chinese consumer; • geopolitical instability (such as the uncertainty in U.S.-China relations); • natural and other disasters; • political, civil and social unrest; and • changes in legal and regulatory requirements, including, but not limited to safeguard measures, anti-dumping duties, cargo restrictions to prevent terrorism, restrictions on the transfer of currency, climate change and other environmental legislation, product safety regulations or other charges or restrictions.
The potential difficulties of integrating the operations of an acquired business and realizing our expectations for an acquisition, including the benefits that may be realized, include, among other things: • failure of the business to perform as planned following the acquisition or achieve anticipated revenue, cash flow or profitability targets; • delays, unexpected costs or difficulties in completing the acquisition or integration of acquired companies or assets, including as a result of regulatory challenges; • higher than expected costs, lower than expected cost savings or synergies and/or a need to allocate resources to manage unexpected operating difficulties; • difficulties assimilating the operations and personnel of acquired companies into our operations; • diversion of the attention and resources of management or other disruptions to current operations; • the impact on our or an acquired business’ internal controls and compliance with the requirements under the Sarbanes-Oxley Act of 2002; • changes in applicable laws and regulations or the application of new laws and regulations; • changes in the combined business due to potential divestitures or other requirements imposed by antitrust regulators; • failures or delays in receiving the necessary approvals by the relevant regulators and authorities; • retaining key customers, suppliers and employees; • retaining and obtaining required regulatory approvals, licenses and permits; • operating risks inherent in the acquired business and our business; 19 • lower than anticipated demand for product offerings by us or our licensees; • assumption of liabilities not identified in due diligence; and • other unanticipated issues, expenses and liabilities.
The potential difficulties of integrating the operations of an acquired business and realizing our expectations for an acquisition, including the benefits that may be realized, include, among other things: • failure of the business to perform as planned following the acquisition or achieve anticipated revenue, cash flow or profitability targets; • delays, unexpected costs or difficulties in completing the acquisition or integration of acquired companies or assets, including as a result of regulatory challenges; • higher than expected costs, lower than expected cost savings or synergies and/or a need to allocate resources to manage unexpected operating difficulties; • difficulties assimilating the operations and personnel of acquired companies into our operations; • diversion of the attention and resources of management or other disruptions to current operations; • the impact on our or an acquired business’ internal controls and compliance with the requirements under the Sarbanes-Oxley Act of 2002; • changes in applicable laws and regulations or the application of new laws and regulations; • changes in the combined business due to potential divestitures or other requirements imposed by antitrust regulators; • failures or delays in receiving the necessary approvals by the relevant regulators and authorities; • retaining key customers, suppliers and employees; 18 • retaining and obtaining required regulatory approvals, licenses and permits; • operating risks inherent in the acquired business and our business; • lower than anticipated demand for product offerings by us or our licensees; • assumption of liabilities not identified in due diligence; and • other unanticipated issues, expenses and liabilities.
We depend on digital technologies for the successful operation of our business, including corporate email communications to and from employees, customers, stores and vendors, the design, manufacture and distribution of our finished goods, digital and local marketing and clienteling efforts, data analytics, collection, use and retention of customer data, employee, vendor and partner information, the processing of credit card transactions, online e-commerce activities and our interaction with the public in the social media space.
We depend on digital technologies for the successful operation of our business, including corporate email and chat communications to and from employees, customers, stores and vendors, the design, manufacture and distribution of our finished goods, digital and local marketing and clienteling efforts, data analytics, collection, use and retention of customer, employee, vendor and partner information, the processing of credit card transactions, online e-commerce activities and our interaction with the public in the social media space.
We may also experience loss of revenues resulting from unauthorized use of proprietary information including our intellectual property. Lastly, we could face sizable fines, significant breach containment and notification costs to supervisory authorities 22 and the affected data subjects, and increased litigation and customer claims, as a result of cyber security or personal data breaches.
We may also experience loss of revenues resulting from unauthorized use of proprietary information including our intellectual property. Lastly, we could face sizable fines, significant breach containment and notification costs to supervisory authorities and the affected data subjects, and increased litigation and customer claims, as a result of cyber security or personal data breaches.
If, or when, we announce actual results that differ from those that have been predicted by us, outside investment analysts or others, our stock price could be adversely affected. Investors who rely on these predictions when making investment decisions with respect to our securities do so at their own risk.
If, or when, we announce actual results that differ from those that have been predicted by us, outside investment analysts or others, our stock price could be adversely affected. Investors who rely on these predictions when making investment 25 decisions with respect to our securities do so at their own risk.
Globally we utilize fulfillment centers in mainland China, the Netherlands, the U.K. and Spain, owned and operated by third parties, allowing us to better manage the logistics in these regions while reducing costs. We also utilize local fulfillment centers, through third-parties, in Japan, parts of Greater China, South Korea, Singapore, Malaysia, Spain, the U.K., Canada, Australia, and Mexico.
Globally we utilize fulfillment centers in mainland China, the Netherlands, the U.K. and Spain, owned and operated by third parties, allowing us to better manage the logistics in these regions while reducing costs. We also utilize local fulfillment 19 centers, through third parties, in Japan, parts of Greater China, South Korea, Singapore, Malaysia, Canada, Australia, and Mexico.
Further, like other companies in the retail industry, during the ordinary course of business, we and our vendors have in the past experienced, and we expect to continue to experience, cyber-attacks of varying degrees and types, including phishing and other attempts to breach or gain unauthorized access to our systems.
Further, like other companies in the retail industry, during the ordinary course of business, we and our vendors have in the past experienced, and we expect to continue to experience, cyber-attacks of varying degrees and 21 types, including phishing and other attempts to breach or gain unauthorized access to our systems.
In addition, fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including adverse weather conditions or other macroeconomic events.
In 20 addition, fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including adverse weather conditions or other macroeconomic events.
Furthermore, failure of our computer systems due to inadequate system capacity, computer viruses, human error, changes in programming, security and personal data breaches, system upgrades or migration of these services, as well as employee, vendor and consumer privacy concerns and new privacy and security laws and global government regulations, individually or in accumulation, could have a material effect on our business, financial condition or results of operations and cash flow.
Furthermore, failure of our computer systems due to inadequate system capacity, computer viruses, human error, changes in programming, security and personal data breaches, system upgrades or migration of these services, as well as employee, vendor and consumer privacy concerns and new privacy and security and artificial intelligence laws and global government regulations, individually or in accumulation, could have a material effect on our business, financial condition or results of operations and cash flow.
Generally, our leases are “net” leases, which require us to pay our proportionate share of the cost of insurance, taxes, 21 maintenance and utilities. We generally cannot cancel these leases at our option.
Generally, our leases are “net” leases, which require us to pay our proportionate share of the cost of insurance, taxes, maintenance and utilities. We generally cannot cancel these leases at our option.
While we maintain significant control over the products produced for us by our licensing partners, any of the foregoing risks, or the inability of any of our licensing partners to execute on the expected design and quality of the licensed products or otherwise exercise operational and financial control over its business, may result in loss of revenue and competitive harm to our operations in the licensed product categories.
While we maintain significant approval rights over the products produced for us by our licensing partners, any of the foregoing risks, or the inability of any of our licensing partners to execute on the expected design and quality of the licensed products or otherwise exercise operational and financial control over its business, may result in loss of revenue and competitive harm to our operations in the licensed product categories.
We rely heavily on various information and other business systems, including data analytics and machine learning, to manage our operations, including management of our supply chain, point-of-sale processing in our brands’ stores, our online businesses associated with each brand and various other processes and metrics. We are continually evaluating and implementing upgrades and changes to our systems.
We rely heavily on various information and other business systems, including data analytics and machine learning, and artificial intelligence, to manage our operations, including management of our supply chain, point-of-sale processing in our brands’ stores, our online businesses associated with each brand and various other processes and metrics. We are continually evaluating and implementing upgrades and changes to our systems.
We face intense competition from many other brands in the product lines and markets that we participate, which include the Company's wholesale customers.
We face intense competition from many other brands in the product lines and markets we participate in, which include the Company's wholesale customers.
Furthermore, consumer demand and behavior, as well as tastes and purchasing trends may differ in these countries, and as a result, sales of our product may not be successful, or the margins on those sales may not be in line with those we currently anticipate.
Furthermore, consumer demand and behavior, as well as tastes and purchasing trends, may differ across countries, and as a result, sales of our product may not be successful, or the margins on those sales may not be in line with those we currently anticipate.
Most of our imported products are subject to duties, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products.
Most of our imported products are subject to tariffs, indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that we may import into the U.S. and other countries or may impact the cost of such products.
The Company's bylaws provide that nominations of persons for election to the Company's Board and the proposal of business to be considered at an annual meeting of stockholders may be made only in the notice of the meeting, by the Company's Board, by a stockholder who is a stockholder of record as of the record date set by the Company's Board for purposes of determining stockholders entitled to vote at the meeting, at the time of the giving of the notice by the stockholder pursuant to the Company's bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each individual so nominated or on any such other business and has complied with the advance notice procedures of the Company's bylaws or by qualifying stockholders that satisfy the proxy access provisions of the Company’s bylaws.
The Company's bylaws provide that nominations of persons for election to the Company's Board and the proposal of business to be considered at an annual meeting of stockholders may be made only in the notice of the meeting, by or at the direction of the Company's Board, by a stockholder who is a stockholder of record as of the record date set by the Company's Board for purposes of determining stockholders entitled to vote at the meeting, at the time of the giving of the notice by the stockholder pursuant to the Company's bylaws and at the time of the meeting (and any postponement or adjournment thereof), who is entitled to vote at the meeting in the election of each individual so nominated or on any such other business and has complied with the advance notice procedures of the Company's bylaws or by qualifying stockholders that satisfy the proxy access provisions of the Company’s bylaws.
If we do not anticipate and respond promptly to changing customer preferences and fashion trends in the design, production, and styling of our products, as well as create compelling marketing campaigns that appeal to our customers, our sales and results of operations may be negatively impacted.
If we do not anticipate and respond promptly to changing customer preferences and fashion trends in the design, production, and styling of our products, as well as create compelling marketing campaigns that appeal to our target consumers, our sales and results of operations may be negatively impacted.
Furthermore, we may be unable to provide these services or implement substitute arrangements on a timely and cost-effective basis on terms favorable to us. Our wholesale business could suffer as a result of consolidations, liquidations, restructurings and other ownership changes in the wholesale industry. Our wholesale business comprised approximately 12% of total net sales for fiscal 2024.
Furthermore, we may be unable to provide these services or implement substitute arrangements on a timely and cost-effective basis on terms favorable to us. Our wholesale business could suffer as a result of consolidations, liquidations, restructurings and other ownership changes in the wholesale industry. Our wholesale business comprised approximately 13% of total net sales for fiscal 2025.
Business underperformance in the Company's second fiscal quarter would have a material adverse effect on its full year operating results and result in higher inventories.
Business underperformance in the Company's second fiscal quarter could have a material adverse effect on its full year operating results and result in higher inventories.
Further, while we believe that we could replace our existing licensing partners if required, any delay in doing so could adversely affect our revenues and harm our business. We are subject to risks associated with leasing retail space subject to non-cancelable leases. We may be unable to renew leases at the end of their terms.
Further, while we believe that we could engage with new licensing partners if required, any delay in doing so could adversely affect our revenues and harm our business. We are subject to risks associated with leasing retail space subject to non-cancelable leases. We may be unable to renew leases at the end of their terms.
On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law by the Biden Administration, with tax provisions primarily focused on implementing a 15% CAMT on global adjusted financial statement income and a 1% excise tax on share repurchases.
On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law, with tax provisions primarily focused on implementing a 15% CAMT on global adjusted financial statement income and a 1% excise tax on share repurchases.
Any ESG report that we publish or other sustainability disclosure we make may include our policies and practices on a variety of social and ethical matters, including corporate governance, environmental compliance, employee health and safety practices, human capital management, product quality, supply chain management and workforce inclusion and diversity.
Any Corporate Responsibility report that we publish or other sustainability disclosure we make may include our policies and practices on a variety of social and ethical matters, including corporate governance, environmental compliance, employee health and safety practices, human capital management, product quality, supply chain management and our workforce.
It is possible that stakeholders may not be satisfied with our ESG practices or the speed of our adoption of these practices. We could 24 also incur additional costs and require additional resources to monitor, report and comply with various ESG practices and various legal, legislative and regulatory requirements.
It is possible that stakeholders may not be satisfied with our Corporate Responsibility practices or the speed of our adoption of these practices. We could also incur additional costs and require additional resources to monitor, report and comply with various Corporate Responsibility practices and various legal, legislative and regulatory requirements.
Department of the Treasury’s Office of Foreign Assets Control and Uyghur Forced Labor Prevention Act (“UFLPA”); • inability to engage new independent manufacturers that meet the Company’s cost-effective sourcing model; • product quality issues; • political unrest, protests and other civil disruption; • public health crises, such as pandemic and epidemic diseases, and other unforeseen outbreaks; • natural disasters or other extreme weather events, whether as a result of climate change or otherwise; and • acts of war or terrorism and other external factors over which we have no control.
Department of the Treasury’s Office of Foreign Assets Control or other sanctions regimes; • inability to engage new independent manufacturers that meet the Company’s cost-effective sourcing model; • product quality issues; 15 • political unrest, protests and other civil disruption; • public health crises, such as pandemic and epidemic diseases, and other unforeseen outbreaks; • natural disasters or other extreme weather events, whether as a result of climate change or otherwise; and • acts of war or terrorism and other external factors over which we have no control.
We operate on a global basis, with approximately 40.8% of our net sales coming from operations outside of United States for fiscal year 2024.
We operate on a global basis, with approximately 40.0% of our net sales coming from operations outside of United States for fiscal year 2025.
Because our fulfillment centers include automated and computer-controlled equipment, they are susceptible to risks including power interruptions, system failures, software viruses, configuration errors and security breaches. In North America we maintain fulfillment centers in Florida, Ohio and Nevada, operated by Tapestry. Our multi-brand Nevada fulfillment center began operations in May 2023.
Because our fulfillment centers include automated and computer-controlled equipment, they are susceptible to risks including power interruptions, system failures, software viruses, configuration errors and security breaches. In North America we maintain fulfillment centers in Florida, Ohio and Nevada, operated by Tapestry.
In addition, the remaining impacts of the pandemic, political instability, trade relations, sanctions, price inflationary pressure, or other 20 geopolitical or economic conditions could cause raw material costs to increase and have an adverse effect on our future margins.
In addition, political instability, trade relations, sanctions, price inflationary pressure, or other geopolitical or economic conditions could cause raw material costs to increase and have an adverse effect on our future margins.
Even if our products, marketing campaigns and retail environments do meet changing customer preferences and/or stay ahead of changing fashion trends, our brand image could become tarnished or undesirable in the minds of our customers or target markets, which could materially adversely impact our business, financial condition, and results of operations.
Even if our products, marketing campaigns, consumer experiences and environments do meet changing customer preferences and/or stay ahead of changing fashion trends, our brand image could become tarnished or undesirable in the minds of our customers or target markets, which could materially adversely 16 impact the growth of our brands and the Tapestry multi-brand portfolio, and our overall business, financial condition, and results of operations.
Risks Related to our Indebtedness We have incurred a substantial amount of indebtedness, which could restrict our ability to engage in additional transactions or incur additional indebtedness. As of June 29, 2024, our consolidated debt was approximately $7.24 billion.
Risks Related to our Indebtedness We have incurred a substantial amount of indebtedness, which could restrict our ability to engage in additional transactions or incur additional indebtedness. As of June 28, 2025, our consolidated debt was approximately $2.39 billion.
We cannot accurately predict the amount and timing of any potential future impairment of assets. Should the value of goodwill or other intangible assets become impaired, there could be a material adverse effect on our financial condition and results of operations. Our business may be materially impacted if our fulfillment centers face significant interruptions and operations.
We cannot accurately predict the amount and timing of any potential future impairment of assets. Should the value of goodwill or other intangible assets become impaired, there could be a material adverse effect on our financial condition and results of operations.
Certain provisions of the Company's charter, bylaws and Maryland law may delay or prevent an acquisition of the Company by a third-party. The Company's charter, bylaws and Maryland law contain provisions that could make it more difficult for a third-party to acquire the Company without the consent of our Board.
The Company's charter, bylaws and Maryland law contain provisions that could make it more difficult for a third-party to acquire the Company without the consent of our Board.
As part of our business model, we collect, retain and transmit confidential information and personal data over public networks. In addition to our own databases, we use third-party service providers to store, process and transmit this information on our behalf.
The retail industry, in particular, has been the target of many cyber-attacks. As part of our business model, we collect, retain and transmit confidential information and personal data over public networks. In addition to our own databases, we use third-party service providers to store, process and transmit this information on our behalf.
The imposition of taxes, duties and quotas, the withdrawal from or material modification to trade agreements, and/or if CBP detains shipments of our goods pursuant to the UFLPA, could have a material adverse effect on our business, results of operations and financial condition.
The imposition of taxes, duties and quotas, the withdrawal from or material modification to trade agreements, and/or the detention of our goods by CBP for any reason, could have a material adverse effect on our business, results of operations and financial condition.
Further, expanding in certain markets may have upfront investment costs that may not be accompanied by sufficient revenues to achieve typical or expected operational and financial performance and therefore may be dilutive to our brands in the short-term.
Further, expanding in certain markets may have upfront investment costs that may not be accompanied by sufficient revenues to achieve typical or expected operational and financial performance and therefore may be dilutive to our brands in the short-term. We may also have to compete for talent in international regions as we expand our omni-channel presence.
Risks Related to Global Economic Conditions and Legal and Regulatory Matters We face risks associated with potential changes to international trade agreements and the imposition of additional duties on importing our products.
Risks Related to Macroeconomic Conditions We face risks associated with potential changes to international trade agreements and the imposition of additional tariffs on importing our products.
We are dependent on a limited number of fulfillment centers. Our ability to meet the needs of our customers and our retail stores and e-commerce sites depends on the proper operation of these centers.
Our business may be materially impacted if our fulfillment centers face significant interruptions and operations. We are dependent on a limited number of fulfillment centers. Our ability to meet the needs of our customers and our retail stores and e-commerce sites depends on the proper operation of these centers.
The integration process of any newly acquired company, such as our proposed Capri Acquisition, may be complex, costly and time-consuming.
The integration process of any newly acquired company may be complex, costly and time-consuming.
Also, any delay in the development or launch of a new product could result in our company not being the first to bring product to market, which could compromise our competitive position.
The failure to develop and launch successful new products or to rationalize our assortment appropriately could hinder the growth of our business. Also, any delay in the development or launch of a new product could result in our company not being the first to bring product to market, which could compromise our competitive position.
This exclusive forum provision is intended to apply to claims arising under Maryland state law and would not apply to claims brought pursuant to the Securities Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended, or any other claim for which the federal courts have exclusive jurisdiction. 27 Although we believe the exclusive forum provision benefits us by providing increased consistency in the application of Maryland law for the specified types of actions and proceedings, this provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company and its directors, officers or other employees and may discourage lawsuits with respect to such claims.
Although we believe the exclusive forum provision benefits us by providing increased consistency in the application of Maryland law for the specified types of actions and proceedings, this provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company and its directors, officers or other employees and may discourage lawsuits with respect to such claims.
Stakeholders, including consumers, employees and investors, have increasingly focused on corporate responsibility practices of companies. Although we have announced our ESG strategy and related goals, there can be no assurance that our stakeholders will agree with our strategy or that we will be successful in achieving our goals.
Although we have announced our Corporate Responsibility strategy and related goals, there can be no 23 assurance that our stakeholders will agree with our strategy or that we will be successful in achieving our goals.
The amount of cash required to service our increased indebtedness is greater than the amount of cash flows required prior to the announcement of the Capri Acquisition. Our ability to generate cash flows from our operations is, to a certain extent, subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.
Our ability to generate cash flows from our operations is, to a certain extent, subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.
This ability may be subject to certain economic, financial, competitive and other factors that are beyond our control. Our Board may, at its discretion, decrease or entirely discontinue the dividend program at any time.
Our ability to pay dividends and conduct stock repurchases will depend on our ability to generate sufficient cash flows from operations in the future. This ability may be subject to certain economic, financial, competitive and other factors that are beyond our control. Our Board may, at its discretion, decrease or entirely discontinue the dividend program at any time.
Our success and growth also depends on the continued development of our omni-channel presence for each of our brands globally, leaning into global digital opportunities for each brand, along with continued bricks and mortar expansion in select international regions.
The growth of our business depends on the successful execution of our global omni-channel expansion efforts and our ability to execute our digital and e-commerce priorities. Our success and growth depend on the continued development of our omni-channel presence for each of our brands globally, leaning into global digital opportunities for each brand, along with select bricks and mortar expansion.
In the event of an acceleration of payment to the lenders, this would result in a cross default of the Company’s senior notes (including the Capri Acquisition Senior Notes), causing the Company’s outstanding borrowings to also become due and payable on demand.
Non-compliance with these terms would constitute an event of default under our credit facilities, which may result in acceleration of payment to the lenders. In the event of an acceleration of payment to the lenders, this would result in a cross default of the Company’s senior notes, causing the Company’s outstanding borrowings to also become due and payable on demand.
On December 12, 2022, the E.U. member states also reached an agreement to implement the OECD’s reform of international taxation known as GloBE, which broadly mirrors the Inflation Reduction Act by imposing a 15% global minimum tax on multinational companies.
On December 12, 2022, the E.U. member states also reached an agreement to implement the Organization for Economic Co-operation and Development’s (“OECD”) reform of international taxation known as Global Anti-Base Erosion Rules (“GloBE”), which broadly mirrors the Inflation Reduction Act by imposing a 15% global minimum tax on multinational companies, which was effective on January 1, 2025.
We may also have to compete for talent in international regions as we expand our omni-channel presence. 16 Consequently, if our global omni-channel expansion plans are unsuccessful, or we are unable to retain and/or attract key personnel, our business, financial condition and results of operation could be materially adversely affected.
Consequently, if our global omni-channel expansion plans are unsuccessful, or we are unable to retain and/or attract key personnel, our business, financial condition and results of operations could be materially adversely affected. Significant competition in our industry could adversely affect our business.
In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. As a result of having operations outside of the U.S., we are also exposed to market risk from fluctuations in foreign currency exchange rates.
In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations.
Despite the security measures we have in place, including those described in Item 1C “Cybersecurity”, the possibility of a successful cyber-attack on any one or all of these systems is a serious threat. The retail industry, in particular, has been the target of many cyber-attacks.
Our company implemented a hybrid working model. Continued remote working has increased our dependence on digital technology. Despite the security measures we have in place, including those described in Item 1C “Cybersecurity”, the possibility of a successful cyber-attack on any one or all of these systems is a serious threat.
Our success also depends in part on our and our executive leadership team's ability to execute on our plans and strategies.
Our success also depends in part on our and our executive leadership team's ability to execute on our plans and strategies for each of our brands and for Tapestry, as a multi-brand enterprise.
A failure to compete effectively or to keep pace with rapidly changing consumer preferences and technology and product trends could adversely affect our growth and profitability. The success of our business depends on our ability to retain the value of our brands and to respond to changing fashion and retail trends in a timely manner.
The success of our business depends on our ability to retain the value of our brands and respond to changing consumer preferences and fashion trends in a timely manner.
Any failure on our part to comply with such climate change-related regulations could lead to adverse consumer actions and/or investment decisions by investors, as well as expose us to legal risk. Increased scrutiny from investors and others regarding our ESG initiatives, including matters of significance relating to sustainability, could result in additional costs or risks and adversely impact our reputation.
Any failure on our part to comply with such climate change-related regulations could lead to adverse consumer actions and/or investment decisions by investors, as well as expose us to legal risk.
Further, proposed tax changes that may be enacted in the future could impact our current or future tax structure and effective tax rates.
In addition, our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings. Further, proposed tax changes that may be enacted in the future could impact our current or future tax structure and effective tax rates.
Substantial changes in foreign currency exchange rates could cause our sales and profitability to be negatively impacted. Risks Related to Environmental, Social, and Governance Issues The risks associated with climate change and other environmental impacts and increased focus by stakeholders on climate change, could negatively affect our business and operations.
Risks Related to Corporate Responsibility The risks associated with climate change and other environmental impacts and increased focus by stakeholders on climate change, could negatively affect our business and operations.
Risks Related to Macroeconomic Conditions Economic conditions, such as an economic recession, downturn, periods of inflation or uncertainty, could materially adversely affect our financial condition, results of operations and consumer purchases of discretionary items.
Our ability to navigate any uncertainty, changes or expansion in tariffs or other trade restrictions could have a material negative impact on our business, financial conditions and results of operations. Economic conditions, such as an economic recession, downturn, periods of inflation or uncertainty, could materially adversely affect our financial condition, results of operations and consumer purchases of discretionary items.
A decline in the volume of traffic to our stores could have a negative impact on our net sales.
The occurrence of any of these events could materially adversely affect our business, financial condition and results of operations. A decline in the volume of traffic to our stores could have a negative impact on our net sales.
Our ability to create new products and to sustain existing products is affected by whether we can successfully anticipate and respond to consumer preferences and fashion trends.
Our growth depends on the continued success of existing products, as well as the successful design, introduction of new products and maintaining an appropriate rationalization of our assortment. Our ability to create new products and to sustain existing products is affected by whether we can successfully anticipate and respond to consumer preferences and fashion trends.
If our employment proposition is not perceived as favorable compared to other companies, it could negatively impact our ability to attract and retain our employees.
If our employment proposition is not perceived as favorable compared to other companies, it could negatively impact our ability to attract and retain our employees. Mergers, acquisitions and other strategic investments may not be successful in achieving intended benefits, cost savings and synergies and may disrupt current operations.
Our ability to comply with the evolution of consumer expectations, regulations and governmental standards and legal landscape can lead to increased risk, operational costs and management time and effort.
Our ability to comply with the evolution of consumer expectations, regulations and governmental standards and legal landscape can lead to increased risk, operational costs and management time and effort. Risks Related to Global Economic Conditions and Legal and Regulatory Matters Fluctuations in our tax obligations and effective tax rate may result in volatility of our financial results and stock price.
Fluctuations in our tax obligations and effective tax rate may result in volatility of our financial results and stock price. We are subject to income taxes in many jurisdictions. We record tax expense based on our estimates of taxable income and required reserves for uncertain tax positions in multiple tax jurisdictions.
We are subject to income taxes in many jurisdictions. We record tax expense based on our estimates of taxable income and required reserves for uncertain tax positions in multiple tax jurisdictions. At any one time, multiple tax years are subject to audit by various taxing jurisdictions.
Based on the countries in which we do business that have enacted legislation effective January 1, 2025, we do not expect the impact of these changes to be material for fiscal 2025. A number of other countries are also implementing similar legislation with effective dates starting in 2026.
Based on the countries in which we do business, these changes did not have a material impact in fiscal 2025. Other countries are also implementing similar legislation with effective dates starting in fiscal 2026, known as Qualifying Domestic Minimum Top-Up Tax ("QDMTT"). On June 26, 2025, the U.S.
We take no responsibility for any losses suffered as a result of such changes in our stock price. 26 We periodically return value to investors through payment of quarterly dividends and common stock repurchases. In August 2023, the Company suspended its share repurchase activity in connection with the Merger Agreement with Capri.
We take no responsibility for any losses suffered as a result of such changes in our stock price. We periodically return value to investors through payment of quarterly dividends and common stock repurchases. On November 24, 2024, the Company announced that it entered into ASR agreements to repurchase $2.00 billion shares of Tapestry common stock.
Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across business channels and geographies. Any misstep in product quality or design, executive leadership, customer service, marketing, unfavorable publicity or excessive product discounting could negatively affect the image of our brands with our customers.
Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by unique brand purposes, distinctive products, and differentiated customer experiences across business channels and geographies.
As a result, we expect that throughout the year there could be ongoing variability in our quarterly effective tax rates as events occur and exposures are evaluated. In addition, our effective tax rate in a given financial statement period may be materially impacted by changes in the mix and level of earnings.
The results of these audits and negotiations with taxing authorities may result in a settlement which differs from our original estimate. As a result, we expect that throughout the year there could be ongoing variability in our quarterly effective tax rates as events occur and exposures are evaluated.
The market price of our securities could be adversely affected if our cash dividend rate or common stock repurchase activity differs from investors’ expectations. Refer to “ If we are unable to pay quarterly dividends or conduct stock repurchases at intended levels, our reputation and stock price may be negatively impacted. ” for additional discussion of our quarterly dividend.
Refer to “ If we are unable to pay quarterly dividends or conduct stock repurchases at intended levels, our reputation and stock price may be negatively impacted. ” for additional discussion of our quarterly dividend. Certain provisions of the Company's charter, bylaws and Maryland law may delay or prevent an acquisition of the Company by a third-party.
Our success depends, in part, on attracting, developing and retaining qualified employees, including key personnel. Our business and future success depends heavily on attracting, developing and retaining qualified employees, including our senior management team.
A failure to compete effectively or to keep pace with rapidly changing consumer preferences, technology and product trends could adversely affect our growth and profitability. Our success depends, in part, on attracting, developing and retaining qualified employees, including key personnel. Our business and future success depends heavily on attracting, developing and retaining qualified employees, including our senior management team.
In fiscal 2024, the Company returned capital to its shareholders through a quarterly cash dividend of $0.35 per common share, for an annual dividend rate of $1.40 per share, or $321 million. In August 2023, the Company suspended its share repurchase activity in connection with the Merger Agreement with Capri.
In fiscal 2025, the Company returned capital to its shareholders through a quarterly cash dividend of $0.35 per common share, for an annual dividend rate of $1.40 per share, or $299.3 million. On November 24, 2024, the Company announced that it entered into Accelerated Share Repurchase (“ASR”) agreements to repurchase $2.00 billion shares of Tapestry common stock.
To maximize opportunities, we rely on free trade agreements and other supply chain initiatives and, as a result, we are subject to government regulations and restrictions with respect to our cross-border activity. For example, we have historically received benefits from duty-free imports on certain products from certain countries pursuant to the U.S. Generalized System of Preferences ("GSP") program.
To maximize opportunities, we rely on free trade agreements and other supply chain initiatives and, as a result, we are subject to government regulations and restrictions with respect to our cross-border activity. Additionally, we are subject to government regulations relating to importation activities, including related to U.S. Customs and Border Protection ("CBP") enforcement actions.
In addition, a prolonged disruption in our business may impact our ability to satisfy the leverage ratio covenant under our Revolving Credit Facility and, once the Capri Acquisition has been consummated, our Capri Acquisition Term Loan Facilities.
The consequences and limitations under our outstanding indebtedness could impede our ability to engage in future business opportunities or strategic acquisitions. In addition, a prolonged disruption in our business may impact our ability to satisfy the leverage ratio covenant under our Amended Revolving Credit Facility.
The dividend program and the stock repurchase program each require the use of a significant portion of our cash flow. Our ability to pay dividends and conduct stock repurchases will depend on our ability to generate sufficient cash flows from operations in the future.
In addition to the ASR program, the Company has $800.0 million remaining under its previous share repurchase authorization. The dividend program and the stock repurchase program each require the use of a significant portion of our cash flow.
Furthermore, the product lines we have historically marketed and those that we plan to market in the future are becoming increasingly subject to rapidly changing fashion trends 17 and consumer preferences, including the increasing shift to digital brand engagement and social media communication.
Any misstep in product quality or design, executive leadership, customer service, marketing, unfavorable publicity or excessive product discounting could negatively affect the image of our brands with our customers. Furthermore, our brands’ communications, product lines and experiences are subject to rapidly changing fashion trends and consumer preferences, including the increasing shift to digital brand engagement and social media communication.
Removed
While geographic diversity helps to reduce the Company’s exposure to risks in any one country, we are subject to risks associated with international operations, including, but not limited to: • political or economic instability or changing macroeconomic conditions in our major markets, including the potential impact of (1) new policies that may be implemented by the U.S. or other jurisdictions, particularly with respect to tax and trade policies, (2) the outcome of several elections worldwide, inclusive of the 2024 U.S.
Added
There has been significant reform in U.S. trade policy following the change in U.S. presidential administration in January 2025.
Removed
The occurrence of any of these events could materially adversely affect our business, financial condition and results of operations. 15 Public health crises, such as the Covid-19 pandemic, may adversely affect our business, financial condition, results of operations and cash flows.
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International trade disputes as well as changes and uncertainty regarding international trade and trade policies, including the imposition or threat of the imposition of new or increased tariffs or other trade restrictions on goods from the countries where our manufacturers are located, could result in a materially adverse impact to our business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn addition, the Company has a cybersecurity risk program that includes policies and procedures around onboarding of third-parties, contractual agreement review, risk assessment and on-going monitoring of high-risk vendors. The Company also has several tools and processes in place to actively prevent, detect and manage cybersecurity incidents.
Biggest changeIn addition, the Company has a cybersecurity risk program that includes policies and procedures around onboarding of third parties, contractual agreement review, risk assessment and ongoing monitoring of high-risk vendors. The Company also has several tools and processes in place to actively prevent, detect and manage cybersecurity incidents.
On a periodic basis, the Company engages independent third-party subject matter experts to conduct a cybersecurity maturity assessment based on the National Institute of Standards Technology framework, focused on risk assessment, global payment card industry audits, and compliance audits to help identify gaps and improve existing processes.
On a periodic basis, the Company engages independent third-party subject matter experts to conduct a cybersecurity maturity assessment based on the National Institute of Standards and Technology framework, focused on risk assessment, global payment card industry audits, and compliance audits to help identify gaps and improve existing processes.
As part of our cyber incident response plan, our CISO is responsible escalating certain cybersecurity incidents to relevant senior management, along with several stakeholders, who then convene to evaluate the materiality of such incident using a list of quantitative and qualitative guidelines. In addition, outside advisors would be engaged as deemed necessary.
As part of our cyber incident response plan, our CISO is responsible for escalating certain cybersecurity incidents to relevant senior management, along with several stakeholders, who then convene to evaluate the materiality of such incident using a list of quantitative and qualitative guidelines. In addition, outside advisors would be engaged as deemed necessary.
For a detailed discussion of significant risk factors regarding cybersecurity threats, refer to Item 1A — "Risk Factors — Risks Related to Information Security and Technology.” 28 Governance Our Board has active oversight of risk management, which includes cybersecurity. Several members of our Board have cybersecurity experience gained through direct responsibilities, oversight or other relevant education and experience.
For a detailed discussion of significant risk factors regarding cybersecurity threats, refer to Item 1A — "Risk Factors — Risks Related to Information Security and Technology.” Governance Our Board has active oversight of risk management, which includes cybersecurity. Several members of our Board have cybersecurity experience gained through direct responsibilities, oversight or other relevant education and experience.
This includes: • Vulnerability Management – continuous scanning of the technology environment to identify and remediate potential vulnerabilities. • Attack Surface Management – actively monitor and prevent external attack attempts. • Security Monitoring and Operations – collection and aggregation of security alerts that are reviewed, analyzed and managed by the security operations team. • Threat Intelligence – gathering and analyzing information about current and emerging cyber threats. • Incident Response – incorporating detection and recovery processes, defining roles and responsibilities across the Company, establishing communication protocols and escalation procedures, including performing tabletop exercises. • Disaster Recovery and Business Continuity Plans – covering both technology and business areas globally with annual exercises to validate processes. • Cybersecurity Awareness – educating employees and third-party service providers on best practices for protecting the Company from cyber threats, which includes providing annual security and privacy industry-specific training to employees as well as conducting period phishing simulations to test their awareness.
This includes: • Vulnerability Management – continuous scanning of the technology environment to identify and remediate potential vulnerabilities. • Attack Surface Management – actively monitor and prevent external attack attempts. • Security Monitoring and Operations – collection and aggregation of security alerts that are reviewed, analyzed and managed by the security operations team. 27 • Threat Intelligence – gathering and analyzing information about current and emerging cyber threats. • Incident Response – incorporating detection and recovery processes, defining roles and responsibilities across the Company, establishing communication protocols and escalation procedures, including performing tabletop exercises. • Disaster Recovery and Business Continuity Plans – covering both technology and business areas globally with annual exercises to validate processes. • Cybersecurity Awareness – educating employees and third-party service providers on best practices for protecting the Company from cyber threats, which includes providing annual security and privacy industry-specific training to employees as well as conducting periodic phishing simulations to test their awareness.
The CEO, CFO, and Board are informed if the incident is deemed potentially material.
The CEO, CFO, and Board are informed if the incident is deemed potentially material. 28

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLocation Use Approximate Square Footage Jacksonville, Florida Coach North America fulfillment and customer service 1,050,000 Las Vegas, Nevada Coach North America fulfillment 789,000 Westchester, Ohio Kate Spade and Stuart Weitzman North America fulfillment 601,000 New York, New York Corporate global headquarters 546,000 Chiba, Japan Coach and Kate Spade Japan regional fulfillment 278,000 Shanghai, China Coach Asia regional fulfillment 179,000 New York, New York Kate Spade corporate management (1) 135,000 North Bergen, New Jersey Corporate office and customer service 106,000 Tokyo, Japan Corporate regional management 27,100 Shanghai, China Coach Greater China regional management 21,200 Shanghai, China Corporate regional management 21,200 Elda, Spain Stuart Weitzman regional management, sourcing and quality control 19,000 Dongguan, China Corporate sourcing, quality control and product development 17,000 London, England Corporate regional management 16,500 Ho Chi Minh City, Vietnam Coach sourcing and quality control 12,600 Seoul, South Korea Corporate regional management 11,400 Singapore Coach Singapore regional management, sourcing and quality control 8,700 Hong Kong SAR, China Corporate sourcing and quality control 8,500 (1) In the beginning of fiscal 2025, the Kate Spade corporate management office relocated to the Corporate global headquarters in New York.
Biggest changeLocation Use Approximate Square Footage Jacksonville, Florida Coach North America fulfillment and customer service 1,050,000 Las Vegas, Nevada Coach North America fulfillment 789,000 Westchester, Ohio Kate Spade and Stuart Weitzman North America fulfillment 601,000 New York, New York Corporate global headquarters 546,000 Chiba, Japan Coach and Kate Spade Japan regional fulfillment 278,000 North Bergen, New Jersey Corporate office and customer service 106,000 Shanghai, China Coach Asia regional fulfillment 96,000 Dongguan, China Corporate sourcing, quality control and product development 73,000 Shanghai, China Coach Greater China regional management 21,200 Shanghai, China Corporate regional management 21,200 Elda, Spain Stuart Weitzman regional management, sourcing and quality control 19,000 Tokyo, Japan Corporate regional management 17,000 London, England Corporate regional management 16,500 Ho Chi Minh City, Vietnam Coach sourcing and quality control 12,600 Seoul, South Korea Corporate regional management 11,400 Singapore Coach Singapore regional management, sourcing and quality control 8,700 Hong Kong SAR, China Corporate sourcing and quality control 8,500 In addition to the above properties, the Company occupies leased retail and outlet store locations located in North America and internationally for each of our brands.
ITEM 2. PROPERTIES The following table sets forth the location, use and size of the Company's key fulfillment, corporate and product development facilities as of June 29, 2024. All of the properties are leased, with the leases expiring at various times through fiscal 2037, subject to renewal options.
ITEM 2. PROPERTIES The following table sets forth the location, use and size of the Company's key fulfillment, corporate and product development facilities as of June 28, 2025. All of the properties are leased, with the leases expiring at various times through fiscal 2037, subject to renewal options.
The Company considers these properties to be in generally good condition and believes that its facilities are adequate for its operations and provide sufficient capacity to meet its anticipated requirements. Refer to Item 1. "Business," for further information. 29
These leases expire at various times through fiscal 2036. The Company considers these properties to be in generally good condition and believes that its facilities are adequate for its operations and provide sufficient capacity to meet its anticipated requirements. Refer to Item 1. "Business," for further information. ITEM 3.
Removed
In addition to the above properties, the Company occupies leased retail and outlet store locations located in North America and internationally for each of our brands. These leases expire at various times through fiscal 2036.
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LEGAL PROCEEDINGS See discussion of legal proceedings in Note 13, "Commitments and Contingencies," in the accompanying consolidated financial statements. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 29 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAs of June 29, 2024 the Company had $800 million of additional shares available to be repurchased as authorized under the 2022 Share Repurchase Program. In August 2023, the company suspended its share repurchase activity in connection with the Merger Agreement with Capri. Refer to Note 5 "Acquisitions," for further information.
Biggest changeAs of June 28, 2025, the Company had $800.0 million of additional shares available to be repurchased as authorized under the 2022 Share Repurchase Program and no remaining availability to repurchase shares under the 2025 Share Repurchase Program.
Performance Graph The following graph compares the cumulative total stockholder return (assuming reinvestment of dividends) of the Company's common stock with the cumulative total return of the Standard & Poor's ("S&P") 500 Stock Index and the S&P 1500 Apparel, Accessories & Luxury Goods Index over the five-fiscal-year period ending June 29, 2024, the last day of Tapestry’s most recent fiscal year.
Performance Graph The following graph compares the cumulative total stockholder return (assuming reinvestment of dividends) of the Company's common stock with the cumulative total return of the Standard & Poor's ("S&P") 500 Stock Index and the S&P 1500 Apparel, Accessories & Luxury Goods Index over the five-fiscal-year period ending June 28, 2025, the last day of Tapestry’s most recent fiscal year.
The graph assumes that $100 was invested on June 29, 2019 at the per share closing price in each of Tapestry’s common stock, the S&P 500 Stock Index and the S&P 1500 Apparel, Accessories & Luxury Goods Index, and that all dividends were reinvested.
The graph assumes that $100 was invested on June 27, 2020 at the per share closing price in each of Tapestry’s common stock, the S&P 500 Stock Index and the S&P 1500 Apparel, Accessories & Luxury Goods Index, and that all dividends were reinvested.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market and Dividend Information Tapestry, Inc.’s common stock is listed on the New York Stock Exchange and is traded under the symbol “TPR.” As of August 2, 2024, there were 1,844 holders of record of Tapestry’s common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market and Dividend Information Tapestry, Inc.’s common stock is listed on the New York Stock Exchange and is traded under the symbol “TPR.” As of August 1, 2025, there were 1,765 holders of record of Tapestry’s common stock.
Purchases of the Company's common stock were executed through open market purchases, including through purchase agreements under Rule 10b5-1. The authorized value of shares available to be repurchased under this program excludes the cost of commissions and excise taxes.
Purchases of the Company's common stock under this program were executed through open market purchases, including through purchase agreements under Rule 10b5-1. On November 13, 2024, the Board authorized the Company to repurchase up to $2.00 billion of outstanding shares of its common stock (the "2025 Share Repurchase Program").
Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023 Fiscal 2024 TPR $100.00 $41.28 $140.34 $104.01 $148.98 $154.55 S&P 1500 Apparel, Accessories & Luxury Goods $100.00 $56.86 $113.76 $69.66 $65.62 $57.55 S&P 500 $100.00 $104.32 $153.32 $136.72 $161.80 $201.53 Stock Repurchase Program On May 12, 2022, the Company announced that its Board authorized a common stock repurchase program to repurchase up to $1.50 billion of its outstanding common stock (the "2022 Share Repurchase Program").
Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023 Fiscal 2024 Fiscal 2025 TPR $100.00 $339.92 $251.94 $360.87 $374.35 $779.94 S&P 1500 Apparel, Accessories & Luxury Goods $100.00 $200.09 $122.52 $115.41 $101.21 $101.11 S&P 500 $100.00 $146.97 $131.06 $155.10 $193.19 $221.32 30 Stock Repurchase Program On May 12, 2022, the Company announced that its Board of Directors (the "Board") authorized a common stock repurchase program to repurchase up to $1.50 billion of its outstanding common stock (the "2022 Share Repurchase Program").
There were no shares repurchased during fiscal 2024. 31 ITEM 6. RESERVED 32
There were no shares repurchased during the three months ended June 28, 2025 under the 2022 Share Repurchase Program and the 2025 Share Repurchase Program. ITEM 6. RESERVED 31
Added
Under the 2025 Share Repurchase Program, the Company may repurchase shares on the open market, in privately negotiated transactions or in other transactions, including accelerated share repurchase programs. On November 21, 2024, the Company entered into accelerated share repurchase agreements (the “ASR Agreements”) with Bank of America, N.A. and Morgan Stanley & Co.
Added
LLC (the “Dealers”) to repurchase an aggregate of up to $2.00 billion of the Company’s shares of common stock. Under the ASR Agreements, the Company paid $2.00 billion to the Dealers and received an initial delivery of 28,363,766 shares of the Company's common stock on November 26, 2024.
Added
The total number of shares purchased by the Company pursuant to the ASR Agreements will be based on the volume-weighted average price ("VWAP") of the Company's common stock on specified dates during the term of each of the ASR Agreements, less a discount, and subject to adjustments pursuant to the terms and conditions of the ASR Agreements.
Added
The difference between the initially delivered shares and the total number of shares purchased will be settled in four tranches, no later than the first quarter of fiscal 2026.
Added
During the quarter ended March 29, 2025, the Company cash settled $3.0 million related to 43,094 shares of common stock owed for the settlement of one tranche as a result of the increase in the VWAP of the Company's common stock.
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During the quarter ended June 28, 2025, the Company cash settled $3.6 million related to 49,442 shares of common stock of an additional tranche.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

82 edited+51 added−17 removed64 unchanged
Biggest changeRefer to "Non-GAAP Measures" herein for further discussion on the Non-GAAP measures. 36 Fiscal 2024 Items Fiscal Year Ended June 29, 2024 Items affecting comparability GAAP Basis (As Reported) Acquisition Costs Non-GAAP Basis (Excluding Items) (millions, except per share data) Coach $ 1,651.1 $ — $ 1,651.1 Kate Spade 132.6 — 132.6 Stuart Weitzman (21.2) — (21.2) Corporate (622.4) (109.9) (512.5) Operating income (loss) $ 1,140.1 $ (109.9) $ 1,250.0 Net income (loss) $ 816.0 $ (184.2) $ 1,000.2 Net income (loss) per diluted common share $ 3.50 $ (0.79) $ 4.29 In fiscal 2024, the Company incurred charges as follows: • Acquisition Costs - Total pre-tax charges of $226.6 million attributable to the Capri Acquisition.
Biggest changeThese actions taken together negatively impacted operating income by $984.5 million, increased Loss on extinguishment of debt by $119.4 million, increased interest expense by $60.2 million and reduced the provision for income tax by $213.1 million resulting in a net decrease in net income by $951.0 million or $4.28 per diluted share. 37 Supplemental Segment Data Fiscal Year Ended June 28, 2025 Items affecting comparability GAAP Basis (As Reported) Acquisition and Divestiture Costs Organizational Efficiency Costs Impairment Non-GAAP Basis (Excluding Items) (millions) Coach $ 2,497.2 $ — $ 0.8 $ — $ 2,496.4 Kate Spade 1,567.2 — 5.7 854.8 706.7 Stuart Weitzman 133.8 0.6 — — 133.2 Corporate 675.7 111.9 10.7 — 553.1 SG&A expenses $ 4,873.9 $ 112.5 $ 17.2 $ 854.8 $ 3,889.4 Fiscal 2024 Items Fiscal Year Ended June 29, 2024 Items affecting comparability GAAP Basis (As Reported) Acquisition Costs Non-GAAP Basis (Excluding Items) (millions, except per share data) Coach $ 1,651.1 $ — $ 1,651.1 Kate Spade 132.6 — 132.6 Stuart Weitzman (21.2) — (21.2) Corporate (622.4) (109.9) (512.5) Operating income (loss) $ 1,140.1 $ (109.9) $ 1,250.0 Net income (loss) $ 816.0 $ (184.2) $ 1,000.2 Net income (loss) per diluted common share $ 3.50 $ (0.79) $ 4.29 In fiscal 2024, the Company incurred charges as follows: • Acquisition Costs - Total pre-tax charges of $226.6 million attributable to the Capri Acquisition.
The Company has three reportable segments: • Coach - Includes global sales of primarily Coach brand products to customers through our DTC, wholesale and licensing businesses. • Kate Spade - Includes global sales primarily of kate spade new york brand products to customers through our DTC, wholesale and licensing businesses. • Stuart Weitzman - Includes global sales of Stuart Weitzman brand products primarily through our DTC and wholesale businesses.
The Company has three reportable segments: • Coach - Includes global sales of primarily Coach brand products to customers through our DTC, wholesale and licensing businesses. • Kate Spade - Includes global sales primarily of kate spade new york brand products to customers through our DTC, wholesale and licensing businesses. • Stuart Weitzman - Includes global sales of Stuart Weitzman brand products primarily through our DTC, wholesale and licensing businesses.
Refer to Note 13, "Commitments and Contingencies," for further information. 45 CRITICAL ACCOUNTING POLICIES AND ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect our results of operations, financial condition and cash flows as well as the disclosure of contingent assets and liabilities as of the date of the Company's financial statements.
Refer to Note 13, "Commitments and Contingencies," for further information. 46 CRITICAL ACCOUNTING POLICIES AND ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect our results of operations, financial condition and cash flows as well as the disclosure of contingent assets and liabilities as of the date of the Company's financial statements.
Supplemental Segment Data Fiscal Year Ended June 29, 2024 Items Affecting Comparability GAAP Basis (As Reported) Acquisition Costs Non-GAAP Basis (Excluding Items) (millions) Coach $ 2,224.3 $ — $ 2,224.3 Kate Spade 738.6 — 738.6 Stuart Weitzman 164.1 — 164.1 Corporate 622.4 109.9 512.5 SG&A expenses $ 3,749.4 $ 109.9 $ 3,639.5 37 Tapestry, Inc.
Supplemental Segment Data Fiscal Year Ended June 29, 2024 Items affecting comparability GAAP Basis (As Reported) Acquisition Costs Non-GAAP Basis (Excluding Items) (millions) Coach $ 2,224.3 $ — $ 2,224.3 Kate Spade 738.6 — 738.6 Stuart Weitzman 164.1 — 164.1 Corporate 622.4 109.9 512.5 SG&A expenses $ 3,749.4 $ 109.9 $ 3,639.5 38 Tapestry, Inc.
A hypothetical 10% change in our stock-based compensation expense would not have a material impact to our fiscal 2024 net income. Income Taxes The Company’s effective tax rate is based on pre-tax income, statutory tax rates, tax laws and regulations and tax planning strategies available in the various jurisdictions in which the Company operates.
A hypothetical 10% change in our stock-based compensation expense would not have a material impact to our fiscal 2025 net income. Income Taxes The Company’s effective tax rate is based on pre-tax income, statutory tax rates, tax laws and regulations and tax planning strategies available in the various jurisdictions in which the Company operates.
This section includes a discussion on liquidity and capital resources including an analysis of changes in cash flow as well as working capital and capital expenditures. • Critical Accounting policies and estimates. This section includes any critical accounting policies or estimates that impact the Company. OVERVIEW Fiscal 2024, fiscal 2023 and fiscal 2022 were 52-week periods.
This section includes a discussion on liquidity and capital resources including an analysis of changes in cash flow as well as working capital and capital expenditures. • Critical Accounting Policies and Estimates. This section includes any critical accounting policies or estimates that impact the Company. OVERVIEW Fiscal 2025, fiscal 2024 and fiscal 2023 were 52-week periods.
Refer to Note 15, “Income Taxes,” for further information. Recent Accounting Pronouncements Refer to Note 3, "Significant Accounting Policies," to the accompanying audited consolidated financial statements for a description of certain recently adopted, issued or proposed accounting standards which may impact our consolidated financial statements in future reporting periods. 48
Refer to Note 15, “Income Taxes,” for further information. Recent Accounting Pronouncements Refer to Note 3, "Significant Accounting Policies," to the accompanying audited consolidated financial statements for a description of certain recently adopted, issued or proposed accounting standards which may impact our consolidated financial statements in future reporting periods. 49
This section includes a discussion on global economic conditions and industry trends that affect comparability that are important in understanding results of operations and financial conditions, and in anticipating future trends. • Results of operations . An analysis of our results of operations in fiscal 2024 compared to fiscal 2023 . • Non-GAAP measures.
This section includes a discussion on global economic conditions and industry trends that affect comparability that are important in understanding results of operations and financial conditions, and in anticipating future trends. • Results of Operations . An analysis of our results of operations in fiscal 2025 compared to fiscal 2024 . • Non-GAAP Measures.
Summary - Fiscal 2024 Currency Fluctuation Effects The change in net sales in fiscal 2024 compared to fiscal 2023 has been presented both including and excluding currency fluctuation effects. All percentages shown in the tables below and the discussion that follows have been calculated using unrounded numbers.
Summary - Fiscal 2025 Currency Fluctuation Effects The change in net sales in fiscal 2025 compared to fiscal 2024 has been presented both including and excluding currency fluctuation effects. All percentages shown in the tables below and the discussion that follows have been calculated using unrounded numbers.
Tapestry, Inc. is a house of iconic accessories and lifestyle brands. Our global house of brands unites the magic of Coach, kate spade new york and Stuart Weitzman. Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across business channels and geographies.
Tapestry, Inc. is a house of iconic accessories and lifestyle brands. Our global house of brands unites the magic of Coach and kate spade new york. Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across channels and geographies.
Each of our brands is unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across business channels and geographies.
Each of our brands are unique and independent, while sharing a commitment to innovation and authenticity defined by distinctive products and differentiated customer experiences across business channels and geographies.
(2) The carrying amounts of the China Credit Facility include the impact of changes in the exchange rate of the United States Dollar against the RMB. We believe that our Revolving Credit Facility is adequately diversified with no undue concentrations in any one financial institution.
(2) The carrying amounts of the China Credit Facility include the impact of changes in the exchange rate of the United States Dollar against the Renminbi. We believe that our Amended Revolving Credit Facility is adequately diversified with no undue concentrations in any one financial institution.
At June 29, 2024, a 10% change in the allowances for estimated uncollectible accounts, markdowns and returns would not have resulted in a material change in the Company's reserves and net sales. Inventories The Company holds inventory that is sold through retail and wholesale distribution channels, including e-commerce sites.
At June 28, 2025, a 10% change in the allowances for estimated uncollectible accounts, markdowns and returns would not have resulted in a material change in the Company's reserves and net sales. Inventories The Company holds inventory that is sold through retail and wholesale distribution channels, including e-commerce sites.
The Company’s internal management reporting excluded these items. In addition, the HR Committee uses these non-GAAP measures when setting and assessing achievement of incentive compensation goals. The Company operates on a global basis and reports financial results in U.S. dollars in accordance with GAAP.
The Company’s internal management reporting excluded these items. In addition, the human resources committee of the Company’s Board uses these non-GAAP measures when setting and assessing achievement of incentive compensation goals. The Company operates on a global basis and reports financial results in U.S. dollars in accordance with GAAP.
Besides the firm commitments noted above, the above table excludes other amounts included in current liabilities in the Consolidated Balance Sheets at June 29, 2024 as these items will be paid within one year and certain long-term liabilities not requiring cash payments.
Besides the firm commitments noted above, the above table excludes other amounts included in current liabilities in the Consolidated Balance Sheets at June 28, 2025 as these items will be paid within one year and certain long-term liabilities not requiring cash payments.
Off-Balance Sheet Arrangements In addition to the commitments included in the table above, we have outstanding letters of credit, surety bonds and bank guarantees totaling $28.4 million as of June 29, 2024, primarily serving to collateralize our obligation to third parties for duty, leases, insurance claims and materials used in product manufacturing.
Off-Balance Sheet Arrangements In addition to the commitments included in the table above, we have outstanding letters of credit, surety bonds and bank guarantees totaling $26.5 million as of June 28, 2025, primarily serving to collateralize our obligation to third parties for duty, leases, insurance claims and materials used in product manufacturing.
Fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including weather and macroeconomic events, such as pandemic diseases.
Fluctuations in net sales, operating income and operating cash flows of the Company in any fiscal quarter may be affected by the timing of wholesale shipments and other events affecting retail sales, including weather and macroeconomic events.
Capital Expenditures Total capital expenditures and cloud computing implementation costs were $144.1 million in fiscal 2024. Certain cloud computing implementation costs are recognized within Prepaid expenses and Other assets on the Consolidated Balance Sheets. Seasonality The Company's results are typically affected by seasonal trends. During the first fiscal quarter, we typically build inventory for the winter and holiday season.
Capital Expenditures Total capital expenditures and cloud computing implementation costs were $153.0 million in fiscal 2025. Certain cloud computing implementation costs are recognized within Prepaid expenses and Other assets on the Consolidated Balance Sheets. Seasonality The Company's results are typically affected by seasonal trends. During the first fiscal quarter, we typically build inventory for the winter and holiday season.
At June 29, 2024, a 10% change in the inventory reserve, would not have resulted in material change in inventory and cost of sales. 46 Goodwill and Other Intangible Assets Upon acquisition, the Company estimates and records the fair value of purchased intangible assets, which primarily consists of brands, customer relationships, right-of-use assets and order backlog.
At June 28, 2025, a 10% change in the inventory reserve, would not have resulted in a material change in inventory and cost of sales. 47 Goodwill and Other Intangible Assets Upon acquisition, the Company estimates and records the fair value of purchased intangible assets, which primarily consists of brands, customer relationships, right-of-use assets and order backlog.
Valuation of Long-Lived Assets Long-lived assets, such as property and equipment, are evaluated for impairment whenever events or circumstances indicate that the carrying value of the assets may not be recoverable.
Valuation of Long-Lived Assets Long-lived assets, such as Property and equipment and Operating lease right-of-use ("ROU") assets, are evaluated for impairment whenever events or circumstances indicate that the carrying value of the assets may not be recoverable.
Excluded from the above contractual obligations table is the non-current liability for unrecognized tax benefits of $134.8 million as of June 29, 2024, as we cannot make a reliable estimate of the period in which the liability will be settled, if ever.
Excluded from the above contractual obligations table is the non-current liability for unrecognized tax benefits of $137.5 million as of June 28, 2025, as we cannot make a reliable estimate of the period in which the liability will be settled, if ever.
Tax Legislation On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law by the Biden Administration, with tax provisions primarily focused on implementing a 15% CAMT on global adjusted financial statement income and a 1% excise tax on share repurchases.
Tax Legislation On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law, with tax provisions primarily focused on implementing a 15% corporate alternative minimum tax (“CAMT”) on global adjusted financial statement income and a 1% excise tax on share repurchases.
We do not have the ability to refinance or modify payment terms to the global financial institution through the SCF program. No guarantees are provided by the Company or any of our subsidiaries under the SCF program. Refer to Note 2, "Basis of Presentation and Organization," for additional information.
We do not have the ability to refinance or modify payment terms to the global financial institution through the SCF program. No guarantees are provided by the Company or any of our subsidiaries under the SCF program. Refer to Note 3, "Significant Accounting Policies," for additional information.
The Company believes the FTC’s claims are without merit and intends to defend the lawsuit vigorously.Refer to Note 5, "Acquisitions" for further information. 2025 Growth Strategy In the first quarter of fiscal 2023, the Company introduced the 2025 growth strategy (“ future speed”), designed to amplify and extend the competitive advantages of its brands, with a focus on four strategic priorities: • Building Lasting Customer Relationships: The Company’s brands aim to leverage Tapestry’s transformed business model to drive customer lifetime value through a combination of increased customer acquisition, retention and reactivation. • Fueling Fashion Innovation & Product Excellence: The Company aims to drive sustained growth in core handbags and small leathergoods, while accelerating gains in footwear and lifestyle products. • Delivering Compelling Omni-Channel Experiences: The Company aims to extend its omni-channel leadership to meet the customer wherever they shop, delivering growth online and in stores. • Powering Global Growth: The Company aims to support balanced growth across regions, prioritizing North America and China, its largest markets, while capitalizing on opportunities in under-penetrated geographies such as Southeast Asia and Europe.
Refer to Note 5, "Acquisitions and Divestitures" and Note 12, "Debt" for further information. 2025 Growth Strategy In the first quarter of fiscal 2023, the Company introduced the 2025 growth strategy, future speed, designed to amplify and extend the competitive advantages of its brands, with a focus on four strategic priorities: • Building Lasting Customer Relationships: The Company's brands aim to leverage Tapestry’s transformed business model to drive customer lifetime value through a combination of increased customer acquisition, retention and reactivation. • Fueling Fashion Innovation & Product Excellence: The Company aims to drive sustained growth in core handbags and small leathergoods, while accelerating gains in footwear and lifestyle products. • Delivering Compelling Omni-Channel Experiences: The Company aims to extend its omni-channel leadership to meet the customer wherever they shop, delivering growth online and in stores. • Powering Global Growth: The Company aims to support balanced growth across regions, prioritizing North America and China, its largest markets, while capitalizing on opportunities in under-penetrated geographies such as Southeast Asia and Europe. 33 The Company's next investor day will be held in September 2025, during which the Company will present its latest long-term growth strategy.
There were no items affecting comparability in fiscal 2023. As a supplement to the Company's reported results, these metrics are also reported on a non-GAAP basis to exclude the impact of these items along with a reconciliation to the most directly comparable GAAP measures.
As a supplement to the Company's reported results, these measures are also reported on a non-GAAP basis to exclude the impact of these items along with a reconciliation to the most directly comparable GAAP measures.
The increase in effective tax rate was primarily driven by discrete items recognized in the period partially offset by geographic mix of earnings. Net Income (Loss) Net income decreased 12.8% or $120.0 million to $816.0 million in fiscal 2024 as compared to a net income of $936.0 million in fiscal 2023.
The decrease in effective tax rate was primarily driven by discrete items recognized in the period, partially offset by geographic mix of earnings. Net Income (Loss) Net income decreased 77.6% or $632.8 million to $183.2 million in fiscal 2025 as compared to a net income of $816.0 million in fiscal 2024.
Effect of exchange rate changes on cash and cash equivalents Effect of exchange rate changes on cash and cash equivalents was a decrease of $12.2 million as compared to a decrease of $8.7 million in fiscal 2023. 42 Cash Flows - Fiscal 2023 Compared to Fiscal 2022 The comparison of fiscal 2023 to 2022 has been omitted from this Form 10-K, but can be referenced in our Form 10-K for the fiscal year ended July 1, 2023, filed on August 17, 2023 within Part II.
Effect of exchange rate changes on cash and cash equivalents Effect of exchange rate changes on cash and cash equivalents was an increase of $26.3 million as compared to a decrease of $12.2 million in fiscal 2024. 43 Cash Flows - Fiscal 2024 Compared to Fiscal 2023 The comparison of fiscal 2024 to 2023 has been omitted from this Form 10-K, but can be referenced in our Form 10-K for the fiscal year ended June 29, 2024, filed on August 15, 2024 within Part II.
The forecast is below the historical growth average and is reflective of the current volatile environment, including tighter monetary and fiscal policies which have started to moderate inflation, financial market volatility and the negative economic impacts of geopolitical instability in certain regions of the world. In fiscal 2024, freight costs have continued to moderate as compared to prior year.
The forecast is below the historical growth average and is reflective of the current volatile environment, including escalation of trade tensions, tighter monetary and fiscal policies which have continued to moderate inflation, financial market volatility and the negative economic impacts of geopolitical instability in certain regions of the world. In fiscal 2025, the U.S.
(1) In fiscal 2024, Corporate incurred charges affecting comparability of $109.9 million. Excluding those items affecting comparability, SG&A expenses increased 10.0% or $46.7 million to $512.5 million in fiscal 2024 as compared to $465.8 million in fiscal 2023. (2) Corporate expenses, which are included within SG&A expenses discussed above but are not directly attributable to a reportable segment.
(3) In fiscal 2025, Corporate incurred charges affecting comparability of $122.6 million. Excluding those items affecting comparability, SG&A expenses increased 7.9% or $40.6 million to $553.1 million in fiscal 2025 as compared to $512.5 million in fiscal 2024. (4) Corporate expenses, which are included within SG&A expenses discussed above but are not directly attributable to a reportable segment.
The Company, similar to some companies, includes certain transportation-related costs due to our distribution network in SG&A expenses rather than in Cost of sales; for this reason, our gross margins may not be comparable to that of entities that include all costs related to their distribution network in Cost of sales. 38 Selling, General and Administrative Expenses Fiscal Year Ended June 29, 2024 July 1, 2023 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 2,224.3 43.7 % $ 2,117.2 42.7 % $ 107.1 5.1 % Kate Spade 738.6 55.3 785.1 55.3 (46.5) (5.9) Stuart Weitzman 164.1 68.0 174.4 62.0 (10.3) (5.9) Corporate (1)(2) 622.4 NA 465.8 NA 156.6 33.6 Tapestry $ 3,749.4 56.2 $ 3,542.5 53.1 $ 206.9 5.8 SG&A expenses increased 5.8% or $206.9 million to $3.75 billion in fiscal 2024 as compared to $3.54 billion in fiscal 2023.
The Company, similar to some companies, includes certain transportation-related costs due to our distribution network in SG&A expenses rather than in Cost of sales; for this reason, our gross margins may not be comparable to that of entities that include all costs related to their distribution network in Cost of sales. 39 Selling, General and Administrative Expenses Fiscal Year Ended June 28, 2025 June 29, 2024 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 2,497.2 44.6 % $ 2,224.3 43.7 % $ 272.9 12.3 % Kate Spade (1) 1,567.2 NM 738.6 55.3 828.6 NM Stuart Weitzman (2) 133.8 62.2 164.1 68.0 (30.3) (18.5) Corporate (3)(4) 675.7 NA 622.4 NA 53.3 8.6 Tapestry $ 4,873.9 69.5 $ 3,749.4 56.2 $ 1,124.5 30.0 SG&A expenses increased 30.0% or $1.12 billion to $4.87 billion in fiscal 2025 as compared to $3.75 billion in fiscal 2024.
We use our collective strengths to move our customers and empower our communities, to make the fashion industry more sustainable and to build a company that’s equitable, inclusive and diverse. Individually, our brands are iconic. Together, we can stretch what’s possible.
We use our collective strengths to move our customers and empower our communities, to make the fashion industry more sustainable, and to harness the power of an inclusive culture. Individually, our brands are iconic. Together, we can stretch what’s possible.
Excluding items affecting comparability, net income increased 6.9% or $64.2 million to $1.00 billion in fiscal 2024 from $936.0 million in fiscal 2023. Net Income (Loss) per Share Net income per diluted share was $3.50 in fiscal 2024 as compared to net income per diluted share of $3.88 in fiscal 2023.
Excluding items affecting comparability, net income increased 13.4% or $134.0 million to $1.13 billion in fiscal 2025 from $1.00 billion in fiscal 2024. Net Income (Loss) per Share Net income per diluted share was $0.82 in fiscal 2025 as compared to net income per diluted share of $3.50 in fiscal 2024.
Operating Income (Loss) Fiscal Year Ended June 29, 2024 July 1, 2023 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 1,651.1 32.4 % $ 1,529.9 30.8 % $ 121.2 7.9 % Kate Spade 132.6 9.9 115.0 8.1 17.6 15.3 Stuart Weitzman (21.2) (8.8) (6.7) (2.4) (14.5) NM Corporate (622.4) NA (465.8) NA (156.6) (33.6) Tapestry $ 1,140.1 17.1 $ 1,172.4 17.6 $ (32.3) (2.8) Operating income decreased $32.3 million to $1.14 billion during fiscal 2024 as compared to $1.17 billion in fiscal 2023.
Operating Income (Loss) Fiscal Year Ended June 28, 2025 June 29, 2024 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 1,875.3 33.5 % $ 1,651.1 32.4 % $ 224.2 13.6 % Kate Spade (769.2) (64.3) 132.6 9.9 (901.8) NM Stuart Weitzman (15.4) (7.1) (21.2) (8.8) 5.8 27.8 Corporate (675.7) NA (622.4) NA (53.3) (8.6) Tapestry $ 415.0 5.9 $ 1,140.1 17.1 $ (725.1) (63.6) Operating income decreased $725.1 million to $415.0 million during fiscal 2025 as compared to $1.14 billion in fiscal 2024.
This increase in operating margin was primarily attributed to an increase of 250 basis points in gross margin partially offset by a 140 basis points increase in SG&A as a percentage of sales. • Coach Operating Income increased $121.2 million to $1.65 billion in fiscal 2024, resulting in an operating margin increase of 160 basis points to 32.4%, as compared to $1.53 billion and 30.8%, respectively in fiscal 2023.
This increase in operating margin was primarily attributed to an increase of 210 basis points in gross margin partially offset by 90 basis points increase in SG&A as a percentage of sales. 40 • Coach Operating Income increased $224.2 million to $1.88 billion in fiscal 2025, resulting in an operating margin increase of 110 basis points to 33.5%, as compared to $1.65 billion and 32.4%, respectively in fiscal 2024.
Net cash provided by (used in) investing activities Net cash used in investing activities was $1.04 billion in fiscal 2024 compared to a source of cash of $5.7 million in fiscal 2023, resulting in a $1.05 billion increase in net cash used in investing activities.
Net cash provided by (used in) investing activities Net cash provided by investing activities was $914.0 million in fiscal 2025 compared to a use of cash of $1.04 billion in fiscal 2024, resulting in a $1.96 billion increase in net cash provided by investing activities.
Operating margin was 17.1% in fiscal 2024 as compared to 17.6% in fiscal 2023. Excluding items affecting comparability of $109.9 million in fiscal 2024, operating income increased $77.6 million to $1.25 billion from $1.17 billion in fiscal 2023; and operating margin increased 110 basis points to 18.7% in fiscal 2024 as compared to 17.6% in fiscal 2023.
Operating margin was 5.9% in fiscal 2025 as compared to 17.1% in fiscal 2024. Excluding items affecting comparability of $984.5 million in fiscal 2025, operating income increased $149.5 million to $1.40 billion from $1.25 billion in fiscal 2024; and operating margin increased approximately 130 basis points to 20.0% in fiscal 2025 as compared to 18.7% in fiscal 2024.
The following table presents the total availability, borrowings outstanding and remaining availability under our credit facilities as of June 29, 2024: Total Availability Borrowings Outstanding Remaining Availability (millions) Revolving Credit Facility (1) $ 2,000.0 $ — $ 2,000.0 Capri Acquisition Term Loan Facilities (1) 1,400.0 — 1,400.0 China Credit Facility (1)(2) 34.4 — 34.4 Total $ 3,434.4 $ — $ 3,434.4 (1) Refer to Note 12, "Debt" for further information on these instruments.
The following table presents the total availability, borrowings outstanding and remaining availability under our credit facilities as of June 28, 2025: Total Availability Borrowings Outstanding Remaining Availability (millions) Amended Revolving Credit Facility (1) $ 2,000.0 $ — $ 2,000.0 China Credit Facility (1)(2) 34.9 16.7 18.2 Total $ 2,034.9 $ 16.7 $ 2,018.2 (1) Refer to Note 12, "Debt" for further information on these instruments.
Given the relatively small excess of fair value over carrying value as noted above, if profitability trends decline during fiscal 2025 from those that are expected, it is possible that an interim test, or our annual impairment test, could result in an impairment of these assets.
If profitability trends decline during fiscal 2026 from those that are expected, it is possible that an interim test, or our annual impairment test, could result in an impairment of these assets.
Working Capital and Capital Expenditures The following table presents our financial condition as of June 29, 2024 and July 1, 2023 : June 29, 2024 July 1, 2023 Change (millions) Cash and cash equivalents (1) $ 6,142.0 $ 726.1 $ 5,415.9 Short-term investments (1) 1,061.8 15.4 1,046.4 Current debt (2) (303.4) (25.0) (278.4) Long-term debt (2) (6,937.2) (1,635.8) (5,301.4) Total, net $ (36.8) $ (919.3) $ 882.5 (1) As of June 29, 2024, approximately 4.2% of our Cash and cash equivalents and Short-term investments were held outside the United States.
Working Capital and Capital Expenditures The following table presents our financial condition as of June 28, 2025 and June 29, 2024 : June 28, 2025 June 29, 2024 Change (millions) Cash and cash equivalents (1) $ 1,100.0 $ 6,142.0 $ (5,042.0) Short-term investments (1) 19.6 1,061.8 (1,042.2) Current debt (2) (16.7) (303.4) 286.7 Long-term debt (2) (2,377.9) (6,937.2) 4,559.3 Total, net $ (1,275.0) $ (36.8) $ (1,238.2) (1) As of June 28, 2025, approximately 26.2% of our Cash and cash equivalents and Short-term investments were held outside the United States.
Excluding the impact of foreign currency, net sales increased by 1.3% or $87.6 million. • Coach Net Sales increased 2.7% or $134.9 million to $5.10 billion in fiscal 2024. Excluding the impact of foreign currency, net sales increased 4.1% or $202.4 million.
Excluding the impact of foreign currency, net sales increased by 5.3% or $352.9 million. • Coach Net Sales increased 9.9% or $503.2 million to $5.60 billion in fiscal 2025. Excluding the impact of foreign currency, net sales increased 10.1% or $514.5 million.
"Management’s Discussion and Analysis of Financial Condition and Results of Operations." 41 FINANCIAL CONDITION Cash Flows - Fiscal 2024 Compared to Fiscal 2023 Fiscal Year Ended June 29, 2024 July 1, 2023 Change (millions) Net cash provided by (used in) operating activities $ 1,255.6 $ 975.2 $ 280.4 Net cash provided by (used in) investing activities (1,041.9) 5.7 (1,047.6) Net cash provided by (used in) financing activities 5,214.4 (1,035.9) 6,250.3 Effect of exchange rate changes on cash and cash equivalents (12.2) (8.7) (3.5) Net increase (decrease) in cash and cash equivalents $ 5,415.9 $ (63.7) $ 5,479.6 The Company’s cash and cash equivalents increased by $5.42 billion in fiscal 2024 compared to a decrease of $63.7 million in fiscal 2023, as discussed below.
"Management’s Discussion and Analysis of Financial Condition and Results of Operations." 42 FINANCIAL CONDITION Cash Flows - Fiscal 2025 Compared to Fiscal 2024 Fiscal Year Ended June 28, 2025 June 29, 2024 Change (millions) Net cash provided by (used in) operating activities $ 1,216.6 $ 1,255.6 $ (39.0) Net cash provided by (used in) investing activities 914.0 (1,041.9) 1,955.9 Net cash provided by (used in) financing activities (7,175.2) 5,214.4 (12,389.6) Effect of exchange rate changes on cash and cash equivalents 26.3 (12.2) 38.5 Net increase (decrease) in cash and cash equivalents $ (5,018.3) $ 5,415.9 $ (10,434.2) The Company’s cash and cash equivalents decreased by $5.02 billion in fiscal 2025 compared to an increase of $5.42 billion in fiscal 2024, as discussed below.
As a percentage of net sales, SG&A expenses increased to 56.2% during fiscal 2024 as compared to 53.1% during fiscal 2023. Excluding items affecting comparability of 109.9 million in fiscal 2024, SG&A expenses increased 2.7% or $97.0 million to $3.64 billion from $3.54 billion in fiscal 2023.
As a percentage of net sales, SG&A expenses increased to 69.5% during fiscal 2025 as compared to 56.2% during fiscal 2024. Excluding items affecting comparability of $984.5 million in fiscal 2025, SG&A expenses increased 6.9% or $249.9 million to $3.89 billion from $3.64 billion in fiscal 2024.
Net cash provided by (used in) financing activities Net cash provided by financing activities was $5.21 billion in fiscal 2024 as compared to a use of cash of $1.04 billion in fiscal 2023, resulting in a $6.25 billion increase in net cash provided by financing activities.
Net cash provided by (used in) financing activities Net cash used in financing activities was $7.18 billion in fiscal 2025 as compared to a source of cash of $5.21 billion in fiscal 2024, resulting in a $12.39 billion increase in net cash used in financing activities.
As of June 29, 2024, there were 18 financial institutions participating in the Revolving Credit Facility and 24 financial institutions participating in the Capri Acquisition Term Loan Facilities with no one participant maintaining a combined maximum commitment percentage in excess of 10%.
As of June 28, 2025, there were 18 financial institutions participating in the Amended Revolving Credit Facility, with no one participant maintaining a commitment percentage in excess of 10%.
Gross Profit Fiscal Year Ended June 29, 2024 July 1, 2023 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 3,875.4 76.1 % $ 3,647.1 73.5 % $ 228.3 6.3 % Kate Spade 871.2 65.2 900.1 63.4 (28.9) (3.2) Stuart Weitzman 142.9 59.2 167.7 59.6 (24.8) (14.8) Tapestry $ 4,889.5 73.3 $ 4,714.9 70.8 $ 174.6 3.7 Gross profit increased 3.7% or $174.6 million to $4.89 billion in fiscal 2024 from $4.71 billion in fiscal 2023.
Gross Profit Fiscal Year Ended June 28, 2025 June 29, 2024 Variance (millions) Amount % of Net Sales Amount % of Net Sales Amount % Coach $ 4,372.5 78.1 % $ 3,875.4 76.1 % $ 497.1 12.8 % Kate Spade 798.0 66.7 871.2 65.2 (73.2) (8.4) Stuart Weitzman 118.4 55.1 142.9 59.2 (24.5) (17.1) Tapestry $ 5,288.9 75.4 $ 4,889.5 73.3 $ 399.4 8.2 Gross profit increased 8.2% or $399.4 million to $5.29 billion in fiscal 2025 from $4.89 billion in fiscal 2024.
Interest Expense, net Interest expense, net, increased $97.4 million to $125.0 million in fiscal 2024 as compared to $27.6 million in fiscal 2023. Excluding items affecting compatibility, Interest expense, net, decreased $19.3 million to $8.3 million from $27.6 million in fiscal 2023.
Interest Expense, net Interest expense, net, decreased $39.6 million to $85.4 million in fiscal 2025 as compared to $125.0 million in fiscal 2024. Excluding items affecting comparability, Interest expense, net, increased $16.9 million to $25.2 million from $8.3 million in fiscal 2024.
The Company determined that there was no impairment in fiscal 2024, fiscal 2023 and fiscal 2022. Based on the annual assessment in fiscal 2024, the fair values of our Coach brand reporting units significantly exceeded their respective carrying values.
Based on the annual assessment in fiscal 2025 of the Coach brand reporting unit, the Company determined the fair values significantly exceeded their respective carrying values, therefore resulting in no impairment.
This increase in operating margin was primarily attributed to: ◦ Gross Margin , increased 260 basis points mainly due to lower freight costs, net pricing improvements and favorable currency impacts; ◦ SG&A expenses as a percentage of net sales , increased 100 basis points mainly due to higher marketing spend and higher compensation costs, partially offset by a decrease in distribution costs. • Kate Spade Operating Income increased $17.6 million to $132.6 million in fiscal 2024, resulting in an operating margin increase of 180 basis points to 9.9%, as compared to 115.0 million and 8.1%, respectively in fiscal 2023.
This increase in operating margin was primarily attributed to: ◦ Gross Margin , increased 200 basis points mainly due to net pricing improvements; ◦ SG&A expenses as a percentage of net sales , increased 90 basis points mainly due to higher marketing spend, partially offset by leverage of fixed costs on higher net sales. • Kate Spade Operating Loss increased $901.8 million to a loss of $769.2 million in fiscal 2025, resulting in an operating margin of (64.3)%, as compared to income of $132.6 million and 9.9%, respectively in fiscal 2024.
This increase in net sales was primarily due to an increase of $110.7 million in DTC sales driven by an increase in store and to a lesser extent, e-commerce sales.
This decrease in net sales was due to a decrease of $148.7 million in DTC sales as a result of lower store and to a lesser extent, e-commerce sales.
Net Sales Fiscal Year Ended Variance June 29, 2024 July 1, 2023 Amount % Constant Currency Change (millions) Coach $ 5,095.3 $ 4,960.4 $ 134.9 2.7 % 4.1 % Kate Spade 1,334.4 1,418.9 (84.5) (6.0) (5.4) Stuart Weitzman 241.5 281.6 (40.1) (14.2) (13.4) Tapestry $ 6,671.2 $ 6,660.9 $ 10.3 0.2 1.3 Net sales in fiscal 2024 increased 0.2% or $10.3 million to $6.67 billion.
Net Sales Fiscal Year Ended Variance June 28, 2025 June 29, 2024 Amount % Constant Currency Change (millions) Coach $ 5,598.5 $ 5,095.3 $ 503.2 9.9 % 10.1 % Kate Spade 1,197.1 1,334.4 (137.3) (10.3) (10.1) Stuart Weitzman 215.1 241.5 (26.4) (10.9) (10.9) Tapestry $ 7,010.7 $ 6,671.2 $ 339.5 5.1 5.3 Net sales in fiscal 2025 increased 5.1% or $339.5 million to $7.01 billion.
This increase in operating margin was primarily attributed to: 39 ◦ Gross Margin , increased 180 basis points mainly due to lower freight costs and net pricing improvements; ◦ SG&A expenses as a percentage of net sales , remained even to prior year mainly driven by increased occupancy costs and higher information technology costs, partially offset by lower marketing spend, depreciation and lower compensation costs. • Stuart Weitzman Operating Loss increased $14.5 million to a loss of $21.2 million in fiscal 2024, resulting in an operating margin decrease of 640 basis points to (8.8)%, as compared to an operating loss of $6.7 million and operating margin of (2.4)% in fiscal 2023. • Corporate Operating Expenses increased (33.6)% or $156.6 million to $622.4 million in fiscal 2024.
This decrease in operating margin was primarily attributed to: ◦ Gross Margin , increased 150 basis points mainly due to lower duty expenses, lower freight costs and net pricing improvements; ◦ SG&A expenses as a percentage of net sales , increased 380 basis points mainly driven by higher marketing spend, deleverage of fixed costs on lower net sales, partially offset by a decrease in distribution costs. • Stuart Weitzman Operating Loss decreased $5.8 million to a loss of $15.4 million in fiscal 2025, resulting in an operating margin increase of 170 basis points to (7.1)%, as compared to an operating loss of $21.2 million and operating margin of (8.8)% in fiscal 2024.
SG&A as a percentage of net sales increased 140 basis points to 54.5% as compared to 53.1% in fiscal 2023. This increase in SG&A as a percentage of net sales was primarily due to higher marketing spend, higher compensation costs, increased occupancy costs and higher professional fees, partially offset by a decrease in distribution costs.
SG&A as a percentage of net sales increased 90 basis points to 55.4% as compared to 54.5% in fiscal 2024. This increase in SG&A as a percentage of net sales was primarily due to higher marketing spend and higher compensation costs driven by accrued incentive compensation, partially offset by leverage of fixed costs on higher net sales.
Fiscal Year Ended June 29, 2024 July 1, 2023 Variance (millions, except per share data) Amount % of net sales Amount % of net sales Amount % Net sales $ 6,671.2 100.0 % $ 6,660.9 100.0 % $ 10.3 0.2 % Gross profit 4,889.5 73.3 4,714.9 70.8 174.6 3.7 SG&A expenses 3,749.4 56.2 3,542.5 53.1 206.9 5.8 Operating income (loss) 1,140.1 17.1 1,172.4 17.6 (32.3) (2.8) Interest expense, net 125.0 1.9 27.6 0.4 97.4 NM Other expense (income) 3.2 — 1.7 — 1.5 84.1 Income (loss) before provision for income taxes 1,011.9 15.2 1,143.1 17.2 (131.2) (11.5) Provision for income taxes 195.9 2.9 207.1 3.1 (11.2) (5.4) Net income (loss) 816.0 12.2 936.0 14.1 (120.0) (12.8) Net income (loss) per share: Basic $ 3.56 $ 3.96 $ (0.40) (10.1) Diluted $ 3.50 $ 3.88 $ (0.38) (9.8) NM - Not meaningful GAAP to Non-GAAP Reconciliation The Company’s reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
Fiscal Year Ended June 28, 2025 June 29, 2024 Variance (millions, except per share data) Amount % of net sales Amount % of net sales Amount % Net sales $ 7,010.7 100.0 % $ 6,671.2 100.0 % $ 339.5 5.1 % Gross profit 5,288.9 75.4 4,889.5 73.3 399.4 8.2 SG&A expenses 4,873.9 69.5 3,749.4 56.2 1,124.5 30.0 Operating income (loss) 415.0 5.9 1,140.1 17.1 (725.1) (63.6) Loss on extinguishment of debt 120.1 1.7 — — 120.1 NM Interest expense, net 85.4 1.2 125.0 1.9 (39.6) (31.7) Other expense (income) (6.6) (0.1) 3.2 — (9.8) NM Income (loss) before provision for income taxes 216.1 3.1 1,011.9 15.2 (795.8) (78.7) Provision for income taxes 32.9 0.5 195.9 2.9 (163.0) (83.2) Net income (loss) 183.2 2.6 816.0 12.2 (632.8) (77.6) Net income (loss) per share: Basic $ 0.84 $ 3.56 $ (2.72) (76.3) Diluted $ 0.82 $ 3.50 $ (2.68) (76.5) NM - Not meaningful 36 GAAP to Non-GAAP Reconciliation The Company’s reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
This increase in other expense was related to an increase in foreign exchange losses. Provision (Benefit) for Income Taxes The effective tax rate was 19.4% in fiscal 2024 as compared to 18.1% in fiscal 2023. Excluding items affecting comparability, the effective tax rate was 19.2% in fiscal 2024 as compared to 18.1% in fiscal 2023.
Provision (Benefit) for Income Taxes The effective tax rate was 15.2% in fiscal 2025 as compared to 19.4% in fiscal 2024. Excluding items affecting comparability, the effective tax rate was 17.8% in fiscal 2025 as compared to 19.2% in fiscal 2024.
Net cash provided by (used in) operating activities Net cash provided by operating activities increased $280.4 million primarily due to changes in operating assets and liabilities of $426.8 million partially offset by lower net income of $120.0 million and lower impact of non-cash adjustments of $26.4 million.
Net cash provided by (used in) operating activities Net cash provided by operating activities decreased $39.0 million primarily due to lower net income of $632.8 million and changes in operating assets and liabilities of $207.2 million partially offset by a higher impact of non-cash adjustments of $801.0 million primarily related to the impairment of goodwill and intangible assets.
For a detailed discussion of significant risk factors that have the potential to cause our actual results to differ materially from our expectations, see Part I, Item 1A. "Risk Factors". Current Macroeconomic Conditions and Outlook During fiscal 2024, the macroeconomic environment remained challenging and volatile.
For a detailed discussion of significant risk factors that have the potential to cause our actual results to differ materially from our expectations, see Part I, Item 1A. "Risk Factors". Current Macroeconomic Conditions and Outlook Currency volatility, geopolitical instability and political uncertainty, such as the impact of policies implemented and that may be implemented by the U.S.
FISCAL 2023 COMPARED TO FISCAL 2022 The comparison of fiscal 2023 to 2022 has been omitted from this Form 10-K, but can be referenced in our Form 10-K for the fiscal year ended July 1, 2023, filed on August 17, 2023 within Part II. Item 7.
This change was primarily due to higher net income and a decrease in shares outstanding. 41 FISCAL 2024 COMPARED TO FISCAL 2023 The comparison of fiscal 2024 to 2023 has been omitted from this Form 10-K, but can be referenced in our Form 10-K for the fiscal year ended June 29, 2024, filed on August 15, 2024 within Part II.
Based on the countries in which we do business that have enacted legislation effective January 1, 2025, we do not expect the impact of these changes to be material for fiscal 2025. A number of other countries are also implementing similar legislation with effective dates starting in 2026.
Based on the countries in which we do business, these changes did not have a material impact in fiscal 2025. Other countries are also implementing similar legislation with effective dates starting in fiscal 2026, known as Qualifying Domestic Minimum Top-Up Tax ("QDMTT"). On June 26, 2025, the U.S.
"Management's Discussion and Analysis of Financial Conditions and Results of Operations". 40 NON-GAAP MEASURES The Company’s reported results are presented in accordance with GAAP. The reported SG&A expenses, operating income, interest expense, provision for income taxes, net income and earnings per diluted share in fiscal 2024 reflect certain items affecting comparability, including the impact of Acquisition costs.
The reported SG&A expenses, Operating income, Interest expense, Provision for income taxes, Net income and earnings per diluted share in fiscal 2025 and fiscal 2024 and the reported Loss on extinguishment of debt in fiscal 2025, reflect certain items affecting comparability, including the impact of Acquisition and Divestiture Costs, Organizational Efficiency Costs and Impairment charges.
Excluding items affecting comparability, Corporate operating expenses increased $46.7 million to $512.5 million from $465.8 million in fiscal 2023. This increase in operating expenses was attributed to an increase in SG&A expenses primarily due to increased compensation costs, higher professional fees and increased occupancy costs.
Excluding items affecting comparability, Corporate operating expenses increased $40.6 million to $553.1 million from $512.5 million in fiscal 2024. This increase in operating expenses was due to higher compensation costs driven by accrued incentive compensation and higher professional fees, partially offset by lower occupancy costs.
On December 12, 2022, the E.U. member states also reached an agreement to implement the OECD’s reform of international taxation known as GloBE, which broadly mirrors the Inflation Reduction Act by imposing a 15% global minimum tax on multinational companies.
The CAMT was effective at the beginning of fiscal 2024 and did not have a material impact on the Company’s effective tax rate. 34 On December 12, 2022, the E.U. member states also reached an agreement to implement the Organization for Economic Co-operation and Development’s (“OECD”) reform of international taxation known as Global Anti-Base Erosion Rules (“GloBE”), which broadly mirrors the Inflation Reduction Act by imposing a 15% global minimum tax on multinational companies, which was effective on January 1, 2025.
This future operating performance and cash flow are subject to prevailing economic conditions and to financial, business and other factors, some of which are beyond the Company's control.
This future operating performance and cash flow are subject to prevailing economic conditions and to financial, business and other factors, some of which are beyond the Company's control. Stuart Weitzman Business Divestiture On February 16, 2025, the Company entered into a Purchase Agreement to sell the Stuart Weitzman Business for total cash consideration of $105.0 million, subject to customary adjustments.
Since the determination of future cash flows is an estimate of future performance, there may be future impairments in the event that future cash flows do not meet expectations. 47 Share-Based Compensation The Company recognizes the cost of equity awards to employees and the non-employee Directors based on the grant-date fair value of those awards.
Since the determination of future cash flows is an estimate of future performance, there may be future impairments in the event that future cash flows do not meet expectations.
Excluding items affecting comparability, net income per diluted share increased $0.41 to $4.29 in fiscal 2024 from $3.88 in fiscal 2023. This change was primarily due to higher net income and a decrease in shares outstanding.
Excluding items affecting comparability, net income per diluted share increased $0.81 to $5.10 in fiscal 2025 from $4.29 in fiscal 2024.
Our success does not depend solely on the performance of a single business channel, geographic area or brand. 33 Capri Holdings Limited Acquisition On August 10, 2023, the Company entered into the Merger Agreement by and among the Company, Sunrise Merger Sub, Inc., a direct wholly owned subsidiary of Tapestry, and Capri for $57.00 per share in cash for a total enterprise value of approximately $8.50 billion.
Capri Holdings Limited Acquisition On August 10, 2023, the Company entered into the Merger Agreement by and among the Company, Sunrise Merger Sub, Inc., a direct wholly owned subsidiary of Tapestry, and Capri.
The reported results during fiscal 2024 reflect certain items which affect the comparability of our results, as noted in the following table. There were no charges affecting comparability during fiscal 2023.
The reported results during fiscal 2025 and fiscal 2024 reflect certain items which affect the comparability of our results, as noted in the following tables. Refer to "Non-GAAP Measures" herein for further discussion on the Non-GAAP measures.
The Company has received regulatory approval from all applicable jurisdictions except for the United States. On April 22, 2024, the FTC filed a complaint against the Company and Capri in the United States District Court for the Southern District of New York seeking to enjoin the consummation of the Capri Acquisition.
On April 22, 2024, the FTC filed a complaint against the Company and Capri in the United States District Court for the Southern District of New York seeking to enjoin the consummation of the Capri Acquisition, and on October 24, 2024, the Court issued its Opinion and Order granting the FTC's request for a preliminary injunction of the Merger, pending an administrative trial on the merits which was scheduled to begin on December 9, 2024.
Stock Repurchase Plan On May 12, 2022, the Company announced the Board authorized the additional repurchase of up to $1.50 billion of its common stock. Pursuant to this program, purchases of the Company's common stock will be made subject to market conditions and at prevailing market prices, through open market purchases.
Stock Repurchase Program On May 12, 2022, the Company announced that its Board of Directors (the "Board") authorized a common stock repurchase program to repurchase up to $1.50 billion of its outstanding common stock (the "2022 Share Repurchase Program").
During fiscal 2024, this trend has resulted in impacts to our business including, but not limited to, decreased Net 34 sales of $77.3 million, a positive impact to gross margin of approximately 30 basis points which benefited from the Company's hedging activity and approximately 10 basis point positive impact to operating margin.
Dollar has continued to fluctuate as compared to foreign currencies in regions where we conduct our business. During fiscal 2025, this trend has resulted in impacts to our business including, but not limited to, decreased Net sales of $13.4 million, no impact to gross margin and approximately 20 basis point negative impact to operating margin.
The $5.7 million source of cash in fiscal 2023 was primarily due to proceeds from maturities and sales of investments of $148.0 million, settlement of net investment hedge of $41.9 million, partially offset by capital expenditures of $184.2 million.
The $914.0 million source of cash in fiscal 2025 was primarily due to proceeds from maturities and sales of investments of $2.92 billion, partially offset by purchases of investments of $1.89 billion, mainly related to the proceeds of the Capri Acquisition Senior Notes.
Management believes that cash flows from operations, access to the credit and capital markets and our credit lines, on-hand cash and cash equivalents and our investments will provide adequate funds to support our operating, capital and debt service requirements for fiscal 2025 and beyond.
We have the ability to draw on our credit facilities or access other sources of financing options available to us in the credit and capital markets for, among other things, acquisition or integration-related costs, our restructuring initiatives, settlement of a material contingency or a material adverse business or macroeconomic development, as well as for other general corporate business purposes. 44 Management believes that cash flows from operations, access to the credit and capital markets and our credit lines, on-hand cash and cash equivalents and our investments will provide adequate funds to support our operating, capital and debt service requirements for fiscal 2026 and beyond.
The increase in net sales was also attributed to an $81.4 million increase in wholesale sales primarily driven by international, which included growth in the digital wholesale channel. • Kate Spade Net Sales decreased 6.0% or $84.5 million to $1.33 billion in fiscal 2024. Excluding the impact of foreign currency, net sales decreased 5.4% or $77.1 million.
The increase in net sales was also attributed to a $89.4 million increase in wholesale sales, mainly driven by North America and Greater China. • Kate Spade Net Sales decreased 10.3% or $137.3 million to $1.20 billion in fiscal 2025. Excluding the impact of foreign currency, net sales decreased 10.1% or $135.2 million.
We continue to closely monitor regulatory developments to assess potential impacts. 35 RESULTS OF OPERATIONS FISCAL 2024 COMPARED TO FISCAL 2023 The following table summarizes results of operations for fiscal 2024 compared to fiscal 2023. All percentages shown in the tables below and the related discussion that follows have been calculated using unrounded numbers.
All percentages shown in the tables below and the related discussion that follows have been calculated using unrounded numbers.
This decrease in net sales was primarily due a decrease of $76.9 million in DTC sales as a result of lower store and to a lesser extent, e-commerce sales. • Stuart Weitzman Net Sales decreased by 14.2% or $40.1 million to $241.5 million in fiscal 2024. Excluding the impact of foreign currency, net sales decreased 13.4% or $37.7 million.
The decrease in DTC sales was partially offset by an increase of $10.2 million in wholesale sales. • Stuart Weitzman Net Sales decreased 10.9% or $26.4 million to $215.1 million in fiscal 2025. Excluding the impact of foreign currency, net sales decreased 10.9% or $26.4 million.
As of June 29, 2024 the Company had $800 million of additional shares available to be repurchased as authorized under the 2022 Share Repurchase Program. In August 2023, the Company suspended its share repurchase activity in connection with the Capri Acquisition. Refer to Note 5, "Acquisitions," for further information.
As of June 28, 2025, the Company had $800.0 million of additional shares available to be repurchased as authorized under the 2022 Share Repurchase Program and no remaining availability to repurchase shares under the 2025 Share Repurchase Program.
(2) Interest on outstanding debt includes fixed interest expenses for unsecured notes. The estimated interest expenses associated with our term loan is based on the current interest rate as of June 29, 2024. Refer to Note 12, "Debt," for further information.
(2) The principal and interest of the China Credit Facility include the impact of changes in the exchange rate of the United States Dollar against the Renminbi as of June 28, 2025. (3) Interest on outstanding debt includes fixed interest expenses for unsecured notes. Refer to Note 12, "Debt," for further information.
Currency volatility, political instability and potential changes to trade agreements or duty rates may also contribute to a worsening of the macroeconomic environment or adversely impact our business.
Presidential Administration, including, but not limited to, changes to trade agreements, tax legislation or duty rates may also contribute to a worsening of the macroeconomic environment or adversely impact our business. During the second half of fiscal 2025, the U.S. Government announced tariffs on imports from select countries.
In response to the current environment, the Company continues to take strategic actions considering near-term exigencies and remains committed to maintaining the health of the brands and business. Geopolitical Disruptions to Supply Chain During fiscal 2024, certain geopolitical events have impacted trade routes in the Red Sea which have modestly increased inventory in-transit times and costs.
In response to the current environment, the Company is closely monitoring changes and continues to take strategic actions considering near-term exigencies and remains committed to maintaining the health of the brands and business. Fiscal 2025 Impairment During the fourth quarter of fiscal 2025, the Company performed its annual goodwill and indefinite-lived intangible assets impairment analysis.
The $426.8 million increase in changes in operating asset and liability balances was primarily driven by the following: • Accrued liabilities were a source of cash of $91.6 million in fiscal 2024 as compared to a use of cash of $93.0 million in fiscal 2023, primarily driven by accrued incentive compensation and an increase in accrued interest due to issuance of the Capri Acquisition Senior Notes. • Accounts payable were a source of cash of $49.1 million in fiscal 2024 as compared to a use of cash of $98.1 million in fiscal 2023, primarily driven by a reduction of in-transit inventory in the prior year. • Other Assets were a use of cash of $0.1 million in fiscal 2024 as compared to a use of cash of $100.7 million in fiscal 2023, primarily driven by an increase in other receivables due to the net investment hedge, tax refunds in the current year and lower cloud computing project spend.
The $207.2 million decrease in changes in operating asset and liability balances was primarily driven by the following: • Inventories were a use of cash of $108.2 million in fiscal 2025 compared to a source of cash of $85.8 million in fiscal 2024, primarily driven by increased inventory purchases for Coach to support continued sales growth and pull forward of inventory receipts. • Accounts payable were a use of cash of $15.0 million in fiscal 2025 as compared to a source of cash of $49.1 million in fiscal 2024, primarily driven by a decrease in professional fees due to higher spending in the prior year related to the Capri Acquisition and timing of other payments, partially offset by an increase in advertising. • Accounts receivables were a source of cash of $8.8 million in fiscal 2025 as compared to a use of cash of $37.3 million in fiscal 2024, primarily driven by timing of collections.
This decrease in Interest expense, net, was mainly due to higher interest income partially offset by higher interest on the term loan due 2027 (the "Term Loan due 2027"). Other Expense (Income) Other expense increased $1.5 million to $3.2 million in fiscal 2024 as compared to an expense of $1.7 million in fiscal 2023.
This increase in net interest expense was mainly due to an increase in interest expense as a result of the issuance of the 2030 and 2035 Senior Notes and borrowings under the Existing Revolving Credit Facility, partially offset by a decrease in interest expense as a result of the repayment of the Term Loan due 2027.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

20 edited+1 added−5 removed8 unchanged
Biggest changeThe following table shows the estimated fair values of the senior unsecured notes at June 29, 2024 and July 1, 2023 based on external pricing data, including available quoted market prices of the instruments, and consideration of comparable debt instruments with similar interest rates and trading frequency, among other factors, and are classified as Level 2 measurements within the fair value hierarchy: June 29, 2024 July 1, 2023 (millions) USD Senior Notes: 4.250% Senior Notes due 2025 $ 300.2 $ 295.1 7.050% Senior Notes due 2025 508.1 — 7.000% Senior Notes due 2026 770.7 — 4.125% Senior Notes due 2027 378.2 371.7 7.350% Senior Notes due 2028 1,036.5 — 7.700% Senior Notes due 2030 1,042.9 — 3.050% Senior Notes due 2032 402.9 399.5 7.850% Senior Notes due 2033 1,311.3 — EUR Senior Notes: 5.350% EUR Senior Notes due 2025 (1) 543.8 — 5.375% EUR Senior Notes due 2027 (1) 550.8 — 5.875% EUR Senior Notes due 2031 (1) 556.4 — (1) The fair values of the Capri Acquisition EUR Senior Notes include the impact of changes in the exchange rate of the United States Dollar against the Euro.
Biggest changeThe following table shows the estimated fair values of the senior unsecured notes at June 28, 2025 and June 29, 2024 based on external pricing data, including available quoted market prices of the instruments, and consideration of comparable debt instruments with similar interest rates and trading frequency, among other factors, and are classified as Level 2 measurements within the fair value hierarchy: June 28, 2025 June 29, 2024 (millions) USD Senior Notes: 4.250% Senior Notes due 2025 $ — $ 300.2 7.050% Senior Notes due 2025 — 508.1 7.000% Senior Notes due 2026 — 770.7 4.125% Senior Notes due 2027 393.0 378.2 7.350% Senior Notes due 2028 — 1,036.5 5.100% Senior Notes due 2030 756.8 — 7.700% Senior Notes due 2030 — 1,042.9 3.050% Senior Notes due 2032 443.2 402.9 7.850% Senior Notes due 2033 — 1,311.3 5.500% Senior Notes due 2035 748.2 — EUR Senior Notes: 5.350% EUR Senior Notes due 2025 (1) — 543.8 5.375% EUR Senior Notes due 2027 (1) — 550.8 5.875% EUR Senior Notes due 2031 (1) — 556.4 (1) The fair values of the Capri Acquisition EUR Senior Notes include the impact of changes in the exchange rate of the United States Dollar against the Euro.
Borrowings under the Revolving Credit Facility bear interest at a rate per annum equal to, at the Company’s option, (i) for borrowings in U.S.
Borrowings under the Amended Revolving Credit Facility bear interest at a rate per annum equal to, at the Company’s option, (i) for borrowings in U.S.
This hypothetical net change in fair value should ultimately be largely offset by the net change in the related underlying hedged items. Refer to Note 10, "Derivative Investments and Hedging Activities," for additional information. 49 Interest Rate Risk The Company is exposed to interest rate risk in relation to its indebtedness and investments.
This hypothetical net change in fair value should ultimately be largely offset by the net change in the related underlying hedged items. Refer to Note 10, "Derivative Investments and Hedging Activities," for additional information. 50 Interest Rate Risk The Company is exposed to interest rate risk in relation to its indebtedness and investments.
As a result of the above considerations, we do not believe that we are exposed to any undue concentration of counterparty credit risk associated with our derivative contracts as of June 29, 2024. The Company is also exposed to transaction risk from foreign currency exchange rate fluctuations with respect to various cross-currency intercompany loans, payables and receivables.
As a result of the above considerations, we do not believe that we are exposed to any undue concentration of counterparty credit risk associated with our derivative contracts as of June 28, 2025. The Company is also exposed to transaction risk from foreign currency exchange rate fluctuations with respect to various cross-currency intercompany loans, payables and receivables.
The fair value of outstanding foreign currency contracts included in current liabilities at June 29, 2024 and July 1, 2023 was $4.8 million and $0.3 million, respectively. The fair value of these contracts is sensitive to changes in foreign currency exchange rates. The Company is also exposed to foreign currency exchange rate fluctuations with respect to net investment hedges.
The fair value of outstanding foreign currency contracts included in current liabilities at June 28, 2025 and June 29, 2024 was $8.0 million and $4.8 million, respectively. The fair value of these contracts is sensitive to changes in foreign currency exchange rates. The Company is also exposed to foreign currency exchange rate fluctuations with respect to net investment hedges.
Our exposure to changes in interest rates is primarily attributable to debt outstanding under the Revolving Credit Facility. Refer to Note 12, "Debt," for additional information.
Our exposure to changes in interest rates is primarily attributable to debt outstanding under the Amended Revolving Credit Facility. Refer to Note 12, "Debt," for additional information. Our exposure to changes in interest rates is primarily attributable to debt outstanding under the $2.00 Billion Amended Revolving Credit Facility.
This analysis assumes a like movement by the foreign currencies in our hedge portfolio against the U.S. Dollar. As of June 29, 2024, a 10% appreciation or depreciation of the U.S. Dollar against the foreign currencies under contract would result in a net increase or decrease, respectively, in the fair value of our derivative portfolio of approximately $55.0 million.
This analysis assumes a like movement by the foreign currencies in our hedge portfolio against the U.S. Dollar. As of June 28, 2025, a 10% appreciation or depreciation of the U.S. Dollar against the foreign currencies under contract would result in a net increase or decrease, respectively, in the fair value of our derivative portfolio of approximately $294 million.
As of June 29, 2024 and July 1, 2023, we have multiple fixed to fixed cross currency swap foreign exchange and forward foreign exchange agreements with aggregate notional amounts of $1.45 billion and $1.20 billion, respectively, to hedge our net investment in Euro-denominated subsidiaries and Japanese Yen-denominated subsidiaries against future volatility in the exchange rates between the United States dollar and their local currencies.
As of June 28, 2025 and June 29, 2024, we have multiple fixed to fixed cross currency swap foreign exchange and forward foreign exchange agreements with aggregate notional amounts of $1.69 billion and $1.45 billion, respectively, predominately to hedge our net investment in Euro-denominated subsidiaries, Japanese Yen-denominated subsidiaries and Chinese Renminbi-denominated subsidiaries against future volatility in the exchange rates between the United States dollar and their local currencies.
As of June 29, 2024 and July 1, 2023, the total notional values of outstanding forward foreign currency contracts related to these loans, payables and receivables were $348.2 million and $272.3 million, respectively. The fair value of outstanding forward currency contracts included in current assets at June 29, 2024 and July 1, 2023 was $58.3 million and $39.0 million, respectively.
As of June 28, 2025 and June 29, 2024, the total notional values of outstanding forward foreign currency contracts related to these loans, payables and receivables were $157.0 million and $348.2 million, respectively. The fair value of outstanding forward currency contracts included in current assets at June 28, 2025 and June 29, 2024 was $6.8 million and $58.3 million, respectively.
The fair values of outstanding derivative contracts related to net investment hedges included in current assets and long-term assets at June 29, 2024 and July 1, 2023 was $32.2 million and $13.1 million, respectively.
The fair values of outstanding derivative contracts related to net investment hedges included in current assets and long-term assets at June 28, 2025 and June 29, 2024 was $15.6 million and $32.2 million, respectively.
The interest rate payable on the 4.125% Senior Notes due 2027 and the Capri Acquisition Senior Notes will be subject to adjustments from time to time if either Moody’s or S&P or a substitute rating agency downgrades (or downgrades and subsequently upgrades) the credit rating assigned to the respective senior notes of such series.
The interest rate payable on the 4.125% Senior Notes due 2027 will be subject to adjustments from time to time if either Moody’s or S&P or a substitute rating agency downgrades (or downgrades and subsequently upgrades) the credit rating assigned to the respective senior notes of such series. Refer to Note 12, "Debt" for further information on these instruments.
To mitigate such risk, certain subsidiaries enter into forward currency contracts. As of June 29, 2024 and July 1, 2023, the total notional values of outstanding forward currency contracts designated as cash flow hedges were $764.6 million and $842.3 million, respectively.
To mitigate such risk, certain subsidiaries enter into forward currency contracts. As of June 28, 2025 and June 29, 2024, the total notional values of outstanding forward currency contracts designated as cash flow hedges were $735.0 million and $764.6 million, respectively.
Under the term of the cross currency swap contracts, we will exchange the semi-annual fixed rate payments on United States denominated debt for fixed rate payments of 6.0% to 6.3% in Euros and fixed rate payments of 3.1% to 7.9% in USD.
Under the term of the cross currency swap contracts, we will exchange the semi-annual fixed rate payments on United States denominated debt for fixed rate payments of 5.5% to 6.4% in Euros, Japanese Yen and Chinese Renminbi for fixed rate payments of 5.5% to 7.9% in USD.
The fair values of outstanding derivative contracts related to net investment hedges included in current and long-term liabilities at June 29, 2024 and July 1, 2023 was $139.4 million and $90.5 million, respectively.
The fair values of outstanding derivative contracts related to net investment hedges included in current and long-term liabilities at June 28, 2025 and June 29, 2024 was $263.0 million and $139.4 million, respectively.
This primarily includes exposure to exchange rate fluctuations in the Chinese Renminbi, the British Pound Sterling and the Japanese Yen. To manage the exchange rate risk related to these balances, the Company enters into forward currency contracts.
This primarily includes exposure to exchange rate fluctuations in the Chinese Renminbi, the Singapore Dollar and the New Taiwan Dollar. To manage the exchange rate risk related to these balances, the Company enters into forward currency contracts.
Dollars, either (a) an alternate base rate or (b) a rate based on the forward-looking SOFR term rate administered by CME Group Benchmark Administration Limited (or any successor administrator satisfactory to the administrative agent), (ii) for borrowings in Euros, the Euro Interbank Offered Rate, (iii) for borrowings in Pounds Sterling, the Sterling Overnight Index Average Reference Rate and (iv) for borrowings in Japanese Yen, the Tokyo Interbank Offer Rate, plus, in each case, an applicable margin.
Dollars, either (a) an alternate base rate or (b) a term secured overnight financing rate, (ii) for borrowings in Euros, the Euro Interbank Offered Rate, (iii) for borrowings in Pounds Sterling, the Sterling Overnight Index Average Reference Rate and (iv) for borrowings in Japanese Yen, the Tokyo Interbank Offer Rate, plus, in each case, an applicable margin.
A hypothetical 10% change in the Credit Facilities' interest rates would have resulted in an immaterial change in interest expense in fiscal 2024. The Company is exposed to changes in interest rates related to the fair value of the senior unsecured notes.
The Company is exposed to changes in interest rates related to the fair value of the senior unsecured notes.
The applicable margin will be adjusted by reference to a grid based on the ratio of (a) consolidated debt (with certain customary deductions for unrestricted cash and permitted investments) to (b) consolidated EBITDAR.
The applicable margin will be adjusted by reference to a grid (the “Pricing Grid”) based on the ratio of (a) consolidated debt (subject to reduction for certain debt incurred in connection with a pending acquisition or for debt being discharged, satisfied or defeased), to (b) consolidated EBITDAR.
Refer to Note 12, "Debt" for further information on these instruments. 50 The Company’s investment portfolio is maintained in accordance with the Company’s investment policy, which defines our investment principles including credit quality standards and limits the credit exposure of any single issuer.
The Company’s investment portfolio is maintained in accordance with the Company’s investment policy, which defines our investment principles including credit quality standards and limits the credit exposure of any single issuer. The primary objective of our investment activities is the preservation of principal while maximizing interest income and minimizing risk. We do not hold any investments for trading purposes.
The primary objective of our investment activities is the preservation of principal while maximizing interest income and minimizing risk. We do not hold any investments for trading purposes. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Refer to “Index to Financial Statements,” appearing at the end of this Annual Report on Form 10-K. ITEM 9.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Refer to “Index to Financial Statements,” appearing at the end of this Annual Report on Form 10-K. 51 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.
Removed
Our exposure to changes in interest rates is primarily attributable to debt outstanding under the $1.05 Billion Three-Year Term Loan Facility and the $350.0 million Five-Year Term Loan Facility (collectively, the "Capri Acquisition Term Loan Facilities") and the $2.00 Billion Revolving Credit Facility.
Added
Borrowings under the Amended Revolving Credit Facility are subject to interest rate risk due to changes in SOFR. A hypothetical 10% change in the Amended Revolving Credit Facility interest rates would have resulted in an immaterial change in interest expense in fiscal 2025.
Removed
Borrowings under the Capri Acquisition Term Loan Facilities bear interest at a rate per annum equal to, at the Company’s option, either (a) an alternate base rate or (b) a rate based on the forward-looking SOFR term rate administered by CME Group Benchmark Administration Limited (or any successor administrator) plus, in each case, an applicable margin.
Removed
The applicable margin will initially be (x) in the case of the Three-Year Term Loan Facility, 0.250% for base rate loans and 1.250% for SOFR loans and (y) in the case of the Five-Year Term Loan Facility, 0.375% for base rate loans and 1.375% for SOFR loans.
Removed
The applicable margin will be adjusted by reference to a grid (the “Pricing Grid”) based on the ratio of (a) consolidated debt to (b) consolidated EBITDAR. Borrowings under the Capri Acquisition Term Loan Facilities and Revolving Credit Facility (collectively, the "Credit Facilities") are subject to interest rate risk due to changes in SOFR.
Removed
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.

Other TPR 10-K year-over-year comparisons