The owner of the Coach Handbags and Kate Spade brands lately reported fiscal first-quarter proceeds that surpass analyst projections, but sales fell short owing to weakness at Kate Spade. Tapestry also presented a fresh viewpoint for fiscal 2020. It anticipates sales to surge at a low-single-digit rate and flat proceeds per share in comparison with this year. Its shares jumped 0.7% during early trading and it had increased 6% in the premarket. Based on Refinitiv data, the earnings per share were 40 Cents versus 37 Cents projected. The revenue posted was $1.358 Billion versus $1.371 Billion expected. The net income dropped to $20 Million (or by 7 cents a share) in the same period ended on September 28, from $122.3 Million (or 42 cents a share) in 2018.
Exclusive of $76 Million in charges about a change in how it sums up for leases, Tapestry gained 40 cents a share, which is 3 Cents ahead of analysts’ estimations. The net sales declined from $1.38 Billion a year ago to $1.36 Billion, missing prospects for $1.37 Billion. In September, Tapestry replaced Victor Luis (CEO) with Jide Zeitlin (Chairman). In a statement, Zeitlin stated that Kate Spade’s drop-down was “on track with anticipations, showing the previously identified challenges in product and merchandising.” Zeitlin said to CNBC when the transition was declared that one of his main initiatives as CEO will be to aim at “major growth drivers,” and one of those being Kate Spade.
On a similar note, Kate Spade was in news for entering a sports smartwatch market. Reportedly, Kate Spade is advancing its watch line and tapping in a robust market for athletic devices. Lately, the brand launched its first sports smartwatch, produced in collaboration with its watch licensee Fossil. This smartwatch offers untethered GPS, heart-rate tracking, and Google Pay plus music, weather, and training apps.