Photograph by Victor J. Blue/Bloomberg
Shares of Coach parent company Tapestry were rising in premarket trading on Thursday following a third-quarter earnings beat, even as the luxury goods manufacturer said it faced margin pressures and cut its outlook for 2022.
Tapestry (ticker: TPR ) posted adjusted earnings of 51 cents per share, above Street estimates calling for 41 cents per share. Revenue clocked in at $1.44 billion, mostly in line with estimates for $1.42 billion.
Margins also contracted for the quarter to 69.9%, impacted by higher freight expenses. During the same period last year, the gross margin was 71.6%.
The company cut its earnings per share outlook, saying it expected a headwind of between 25 cents to 30 cents-a-share due to incremental Covid pressure in China, as well as a 17-cent negative impact due to a shift in international trade policies .
Tapestry is now forecasting revenue of $6.7 billion for the year, with earnings per share diluted close to $3.45. Revenue guidance is in line with expectations, but earnings per share fell lower than the $3.61 analysts were predicting.
Tapestry stock was up 2.5% in premarket trading on Thursday. The shares have lost 34% this year.
Write to Sabrina Escobar at [email protected]
,
Credit: www.marketwatch.com /