Tapestry Inc (0LD5.L) Q2 2025 Earnings Report

Tapestry Inc delivered a compelling QQ2 2025 with meaningfully higher top-line results and expanded margins, driven by what appears to be resilient demand for Coach, Kate Spade, and Stuart Weitzman across direct-to-consumer and wholesale channels. Revenue of $2.195B rose roughly 48% year over year and 46% quarter over quarter, while gross margin stood at 74.4% and operating margin at 22.4%, signaling robust product mix monetization and operating leverage as branding and pricing power held firm in the premium accessories category. Net income totaled $310.4M and EPS (adjusted/diluted) reached $1.41/$1.38, underscoring a disciplined cost structure alongside strong top-line momentum.

The company generated solid cash flow, with operating cash flow of $506.0M and free cash flow of $475.1M for the period, supporting a cash-rich profile even as management deployed capital through debt repayment and share repurchases. Net cash used in financing activities was large at $(6.70)B, reflecting substantial debt repayments (~$(4.69)B) and share repurchases (~$(2.01)B). The balance sheet remains robust, with cash and equivalents of $983.4M and total debt of $4.11B, yielding a net debt of $3.12B and a debt-to-capitalization ratio of 0.75. Liquidity metrics remained solid (current ratio 1.58, quick ratio 1.05), though leverage remains a key consideration as the company sustains its growth and brand investments.

Overall, the QQ2 2025 results reinforce Tapestry’s positioning in the premium luxury accessories space, supported by a durable cash generation profile and strong brand portfolio. The key questions for investors revolve around continued demand resilience, margin management, and the ability to de-leverage while funding growth initiatives in DTC and international markets.