Accessories and lifestyle brand Tapestry has reported that its net income for the third quarter (Q3) of fiscal year 2024 (FY24) dropped to $139m, compared to $187m in Q3 FY23.  

The company’s earnings per diluted share (EPS) also decreased to $0.60 from $0.78 in Q3 FY23. 

Net sales for the quarter ending 30 March 2024 were $1.48bn, a 2% decline from $1.509bn in the corresponding period of 2023.  

Despite the decrease in net sales, Tapestry’s gross profit saw a slight increase, totalling $1.11bn with a gross margin of 74.7%. 

The improvement was attributed to a combination of lower freight expenses, favourable foreign exchange rates and operational enhancements. 

Its operating income for the quarter was $204m, down from $239m in Q3 FY23, with the operating margin shrinking to 13.8% in Q3 FY24 from 16.1% in Q3 FY23.  

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The retailer’s selling, general and administrative expenses accounted for 60.9% of sales – $903m in Q3 FY24. 

Tapestry, which owns the Coach, Kate Spade and Stuart Weitzman brands, expects its revenue for fiscal 2024 to exceed $6.6bn and EPS between $4.20 and $4.25.  

Tapestry CEO Joanne Crevoiserat said: “Our third-quarter earnings results outperformed expectations, reflecting our unwavering commitment to disciplined brand building and operational excellence.  

“Our talented global teams continued to advance our long-term initiatives, fuelling innovation and consumer connections, while successfully harnessing the power of our customer engagement platform to navigate the dynamic backdrop with focus and agility.  

“Moving forward, we are confident in our vision for the future and the significant runway to drive sustainable growth and shareholder value.” 

In August 2023, Tapestry entered an agreement to acquire Capri Holdings for $8.5bn.  

The acquisition has faced regulatory hurdles, with the US Federal Trade Commission filing a lawsuit to block the deal due to competition concerns.