NYSE:TPR
TAPESTRY, INC.
A high-growth fashion retailer utilizing AI and big data to minimize waste and maximize profitability in the competitive apparel industry.
Key Metrics
Investment Thesis
Bull Case
Investors might favor TPR for its unique data-driven moat that historically delivers industry-leading inventory turns and gross margins, positioning it to outperform traditional peers as the sector shifts toward sustainability. The company's strong brand portfolio across multiple price points offers diverse revenue streams that can weather macroeconomic headwinds better than single-brand competitors.
Bear Case
The dramatic contraction in net income from $936.0M in 2023 to $183.2M in 2025 raises concerns about sustainability of earnings quality and potential undisclosed liabilities or aggressive accounting adjustments. High levels of long-term debt ($2.4B) combined with a retained earnings deficit of $2.56B suggest the company is under financial stress and may struggle to fund growth without further dilution or distress financing.
About TAPESTRY, INC.
TAPESTRY, INC. (NYSE: TPR) is a leading global designer of women's apparel, footwear, and accessories that leverages its proprietary data-driven technology to optimize product design, sourcing, and inventory management.
Analysis
Management Discussion
While revenue grew to $7.01B in 2025, net income declined sharply to $183.2M from $816.0M in 2024, a significant drop that warrants scrutiny regarding margin compression or one-time charges not fully detailed in the summary metrics. The company's massive cash burn of over $7 billion for financing activities and substantial debt repayments indicate aggressive balance sheet restructuring or refinancing efforts following previous capital raises.
Industry Overview
The global fashion industry is undergoing a transformation driven by sustainability demands and the need for faster, more responsive supply chains. Companies that can utilize big data to predict trends accurately are gaining significant market share over traditional retailers who rely on historical sales data which often leads to overproduction and waste.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $6.66B | $6.67B | $7.01B |
| Cost of Revenue | $1.95B | $1.78B | $1.72B |
| Gross Profit | $4.71B | $4.89B | $5.29B |
| Operating Expenses | $3.54B | $3.75B | $4.87B |
| Operating Income | $1.17B | $1.14B | $415.0M |
| G&A | $3.54B | $3.75B | $4.02B |
| Stock-Based Comp | $78.8M | $85.9M | $87.3M |
| D&A | $182.2M | $174.0M | $162.9M |
| Amortization | $6.5M | $6.5M | $5.2M |
| Other OpEx | $0 | $0 | $854.8M |
| Non-Operating Income | $-29.3M | $-128.2M | $-198.9M |
| Pre-Tax Income | $1.14B | $1.01B | $216.1M |
| Income Tax | $207.1M | $195.9M | $32.9M |
| Continuing Ops | $936.0M | $816.0M | $183.2M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $936.0M | $816.0M | $183.2M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $936.0M | $816.0M | $183.2M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $2.36B | $8.80B | $2.91B |
| Cash & Equivalents | $726.1M | $6.14B | $1.10B |
| Marketable Securities | $15.4M | $1.06B | $19.6M |
| Accounts Receivable | $211.5M | $228.2M | $239.3M |
| Inventory | $919.5M | $824.8M | $860.7M |
| Other Current Assets | $491.0M | $546.9M | $686.0M |
| Long-Term Assets | $4.75B | $4.59B | $3.67B |
| Intangibles | $1.36B | $1.35B | $719.6M |
| Goodwill | $1.23B | $1.20B | $983.3M |
| Operating Leases | $1.38B | $1.31B | $1.33B |
| LT Investments | $1.3M | $1.3M | $1.4M |
| Other LT Assets | $785.7M | $719.2M | $639.6M |
| Total Assets | $7.12B | $13.40B | $6.58B |
| Current Liabilities | $1.29B | $1.71B | $1.56B |
| Accounts Payable | $416.9M | $452.2M | $456.1M |
| Current Debt | $25.0M | $303.4M | $16.7M |
| Current Leases | $297.5M | $299.7M | $299.0M |
| Deferred Revenue | $43.0M | $45.5M | $38.0M |
| Taxes Payable | $41.8M | $49.7M | $56.8M |
| Other Current Liab | $-84.8M | $-95.2M | $-46.6M |
| Long-Term Liabilities | $3.55B | $8.79B | $4.17B |
| Long-Term Debt | $1.64B | $7.00B | $2.40B |
| LT Operating Leases | $1.33B | $1.22B | $1.21B |
| Other LT Liab | $531.5M | $560.2M | $563.6M |
| Total Liabilities | $4.84B | $10.50B | $5.72B |
| Shareholders' Equity | $2.28B | $2.90B | $857.8M |
| Paid-In Capital | $3.68B | $3.76B | $3.67B |
| Retained Earnings | $-1.22B | $-722.2M | $-2.56B |
| AOCI | $-189.9M | $-145.9M | $-261.2M |
| Total L&E | $7.12B | $13.40B | $6.58B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $936.0M | $816.0M | $183.2M |
| Non-Cash Adjustments | $326.7M | $368.5M | $904.3M |
| Working Capital Changes | $-287.5M | $71.1M | $129.1M |
| Cash from Operations | $975.2M | $1.26B | $1.22B |
| Capital Expenditures | $184.2M | $108.9M | $122.7M |
| Cash from Investing | $5.7M | $-1.04B | $914.0M |
| Debt Repayments | $31.2M | $468.8M | $7.16B |
| Share Buybacks | $703.5M | $0 | $1.72B |
| Dividends Paid | $283.3M | $321.4M | $299.3M |
| Cash from Financing | $-1.04B | $5.21B | $-7.18B |
| FX Effect | $-8.7M | $-12.2M | $26.3M |
| Net Change in Cash | $-63.7M | $5.42B | $-5.04B |
| Beginning Cash | $789.8M | $726.1M | $6.14B |
| Ending Cash | $726.1M | $6.14B | $1.10B |
Frequently Asked Questions
How does TAPESTRY, INC. make money?
The company operates primarily through two distinct business segments: Design (creating and selling its own branded products) and Retail (operating physical stores, e-commerce platforms, and wholesale partnerships). Revenue is generated across women's apparel, footwear, and accessories sold globally via direct-to-consumer channels and third-party retail partners.
What are the main risks for TPR?
The apparel industry faces inherent risks including rapid shifts in consumer fashion trends that can lead to markdowns if not predicted accurately by their data models. Global supply chain disruptions and rising material costs could impact gross margins despite operational efficiencies. Currency exchange rate fluctuations may also affect the company's international revenue and profitability.
What is TPR's competitive advantage?
TAPESTRY leverages a proprietary digital platform that analyzes consumer trends to drive real-time design decisions, significantly reducing the time-to-market for new collections. The company's data-centric approach minimizes inventory waste and optimizes cash flow compared to traditional fashion retailers, while its vertical integration from design to retail provides superior margin control.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.