Have you evaluated the performance of Tapestry's (TPR) international operations for the quarter ending June 2025? Given the extensive global presence of this maker of high-end shoes and handbags, analyzing the patterns in international revenues is crucial for understanding its financial strength and potential for growth.
The global economy today is deeply interlinked, making a company's engagement with international markets a critical factor in determining its financial success and growth path. It has become essential for investors to comprehend how much a company relies on these foreign markets, as this understanding reveals the firm's potential for consistent earnings, its capacity to harness different economic cycles, and its overall growth prospects.
Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.
While delving into TPR's performance for the past quarter, we observed some fascinating trends in the revenue from its foreign segments that are commonly modeled and observed by analysts on Wall Street.
The company's total revenue for the quarter stood at $1.72 billion, increasing 8.3% year over year. Now, let's delve into TPR's international revenue breakdown to gain insights into the significance of its operations beyond home turf.
A Look into TPR's International Revenue Streams
During the quarter, Greater China contributed $273.9 million in revenue, making up 15.9% of the total revenue. When compared to the consensus estimate of $244.83 million, this meant a surprise of +11.87%. Looking back, Greater China contributed $278.9 million, or 17.6%, in the previous quarter, and $232.4 million, or 14.6%, in the same quarter of the previous year.
Other International generated $141.4 million in revenues for the company in the last quarter, constituting 8.2% of the total. This represented a surprise of -5.86% compared to the $150.21 million projected by Wall Street analysts. Comparatively, in the previous quarter, Other International accounted for $121.9 million (7.7%), and in the year-ago quarter, it contributed $124.7 million (7.8%) to the total revenue.
Of the total revenue, $204.7 million came from Other Asia during the last fiscal quarter, accounting for 11.9%. This represented a surprise of -2.35% as analysts had expected the region to contribute $209.62 million to the total revenue. In comparison, the region contributed $232.1 million, or 14.7%, and $86.2 million, or 5.4%, to total revenue in the previous and year-ago quarters, respectively.
Revenue Projections for Overseas Markets
Wall Street analysts expect Tapestry to report a total revenue of $1.55 billion in the current fiscal quarter, which suggests an increase of 3.1% from the prior-year quarter. Revenue shares from Greater China, Other International and Other Asia are predicted to be 15.8%, 9.2%, and 13.2%, corresponding to amounts of $245.67 million, $143.06 million, and $204.45 million, respectively.
For the entire year, the company's total revenue is forecasted to be $7.2 billion, which is an improvement of 2.7% from the previous year. The revenue contributions from different regions are expected as follows: Greater China will contribute 14.6% ($1.05 billion), Other International 8.8% ($634.14 million) and Other Asia 12.5% ($901.9 million) to the total revenue.
The Bottom Line
Relying on international markets for revenues, Tapestry faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.
With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.
Emphasizing a company's shifting earnings prospects is a key aspect of our approach at Zacks, especially since research has proven its substantial influence on a stock's price in the short run. This correlation is positively aligned, meaning that improved earnings projections tend to boost the stock's price.
Our proprietary stock rating tool, the Zacks Rank, with its externally validated exceptional track record, harnesses the power of earnings estimate revisions to serve as a dependable measure for anticipating the short-term price trends of stocks.
Tapestry currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Reviewing Tapestry's Recent Stock Price Trends
Over the past month, the stock has seen a decline of 2.6% in its value, whereas the Zacks S&P 500 composite has posted an increase of 3.5%. The Zacks Retail-Wholesale sector, Tapestry's industry group, has ascended 3.4% over the identical span. In the past three months, there's been an increase of 31.1% in the company's stock price, against a rise of 9.3% in the S&P 500 index. The broader sector has increased by 6.1% during this interval.
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Tapestry, Inc. (TPR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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