Employees prepare a window display at a Kate Spade shop in The Shoppes at Marina Bay Sands shopping mall in Singapore on June 19, 2020 as retail shops reopen in Singapore following the further easing of restrictions that were in place due to the COVID-19 novel coronavirus.
Roslan Rahman | AFP | Getty Images
Coach and Kate Spade owner Tapestry reported a narrower-than-expected loss on Thursday, as strong online sales helped offset the impact of closed stores during the coronavirus pandemic.
It also said it will reduce expenses and focus on digital growth as part of a turnaround plan.
Shares of the company rose less than 1% in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting for the fiscal fourth quarter ended June 27, based on a survey of analysts by Refinitiv:
- Losses per share: 25 cents, adjusted vs. 57 cents, expected
- Revenue: $714.8 million vs. $663 million, expected
Tapestry reported a net loss of $293.8 million, or $1.06 per share, compared with a profit of $148.9 million, or 51 cents a share, a year ago.
Excluding special items, the company lost 25 cents per share.
Net sales dropped to $714.8 million from $1.51 billion a year ago.
Analysts had expected a loss of 57 cents per share, on revenue of $663.3 million, based on a Refinitiv survey.
As it faces challenges from the pandemic, Tapestry also lost its top leader. CEO Jide Zeitlin resigned in mid-July as the board began a probe into his personal conduct. He had been chairman since 2014 and had just taken over the CEO role in September from Victor Luis.
Tapestry’s Chief Financial Officer Joanne Crevoiserat, a former Abercrombie & Fitch executive, is serving as interim CEO as the company looks for a permanent replacement.
The company committed to speeding along a turnaround plan. It said it will become leaner, more focused on its e-commerce business and appeal to consumers in new ways to drive up sales for Coach, Kate Spade and the Stuart Weitzman. It estimated it will reduce expenses by about $300 million, including $200 million projected in fiscal 2021.
During the quarter, it also reported hopeful signs. It said it returned to positive year-over-year sales growth in Mainland China. It also reopened the majority of the stores it operates across the globe.
This story is developing. Please check back for updates.