Tapestry Inc. shares swung from an early surge to a sharp intraday decline after the luxury accessories company posted fiscal third-quarter results that exceeded analyst expectations and issued a higher full-year non-GAAP outlook.
In morning trading the stock fell 9.28% to $135.02, wiping out a substantial pre-market rally that followed the results. For the quarter Tapestry reported earnings per share of $1.66, beating the consensus estimate of $1.26 by $0.40. Revenue came in at $1.92 billion, ahead of the $1.79 billion analysts had forecast.
The company also raised its full-year non-GAAP guidance, calling for revenue of approximately $7.95 billion, an operating margin of approximately 23%, and EPS of approximately $6.95. Management said it expects to return $1.6 billion to shareholders in fiscal 2026.
Despite the top- and bottom-line upside, details disclosed on the earnings call and recent activity by insiders appeared to temper investor enthusiasm. Tapestry said non-GAAP operating margin rose 490 basis points to 22.4% in the quarter, but that gain occurred while the business absorbed a tariff and duties headwind of 180 basis points. Within the portfolio, Kate Spade was flagged as still challenged, facing near-term revenue declines and margin pressure from tariffs.
Adding pressure to market sentiment, CEO Joanne C. Crevoiserat sold 48,795 shares of the company on February 18 at an average price of $154.87, representing roughly $7.56 million in proceeds. That transaction, disclosed alongside the quarterly results, coincided with a broader wave of selling.
Market dynamics also played a role. The stock entered the earnings release in an elevated position. Tapestry reached an all-time high of $161.97 on February 26, 2026 and closed the prior session at $148.83, having more than doubled from its 52-week low of $75.48. Observers described the ensuing action as a classic sell-the-news episode - profit-taking after a sharp rally left limited room for further upside surprise.
Broader market moves provided little support during the selloff. The S&P 500 was essentially flat at +0.09% on the session, the Dow Jones Industrial Average was down -0.17%, and the Nasdaq Composite was up +0.48%.
Company commentary highlighted continued momentum from Tapestry's "Amplify" growth strategy, and the quarter materially outpaced analyst expectations on both revenue and EPS. Still, the combination of tariff-driven margin pressure at Kate Spade, recent insider selling, and profit-taking after the stock's run created a scenario where sustained pre-market gains were reversed once institutional selling intensified.
What this means
Tapestry delivered a clear earnings beat and lifted its full-year targets, while signaling ongoing headwinds in parts of its portfolio and facing shareholder return commitments. The market response underscores how robust results can be offset by valuation positioning, portfolio-specific operational risks, and insider transactions.