Bob Drbul

Bob Drbul inquired about the impact of pricing increases or ticket increases on consumer response and vendor support. He also asked for an update on the credit business trends, including new applications and credit spend, and expectations for Q4 and 2026.

Answer

Chairman and CEO Tony Spring stated that pricing on newness and fashion had little impact on consumer appetite, especially for middle to upper-income customers, exceeding expectations. He noted that for basics, consumers might wait for promotions. COO and CFO Tom Edwards highlighted the strong performance of the credit business, with Q3 revenue up over 30% and full-year guidance up approximately 20%, driven by a healthy portfolio and improved net credit loss results. He also noted higher new applications year-over-year, indicating future growth.

Bob Drbul asked for more details on pricing increases and consumer response, as well as vendor support. He also inquired about the trends in the credit business, including new applications and higher credit spend, and expectations for Q4 and 2026.

Answer

Chairman and CEO Tony Spring explained that pricing on newness and fashion has had minimal impact on consumer appetite, particularly for middle to upper-income customers, exceeding expectations. He noted that for basics and aspirational customers, there's more waiting for value, but Macy's has planned promotions. COO and CFO Tom Edwards detailed the credit business's strong performance, with revenue up over 30% in Q3 and approximately 20% for the full year, driven by a healthy portfolio and improved net credit loss results. He highlighted higher applications year-over-year as a positive indicator for future growth, linking credit to loyalty and broader customer engagement.

Bob Drbul of BTIG asked about the performance and global consistency of Coach's footwear and bag charms businesses, inquiring about their penetration levels.

Answer

Coach CEO Todd Kahn confirmed global consistency, noting strong performance in sneakers across genders and markets, particularly in more mature markets like China and North America. He highlighted the long-term value of footwear for customer acquisition and the meaningful contribution of bag charms, which often drive repeat purchases and engagement.

Bob Drbul asked about the performance of Coach's footwear and charms businesses, specifically their global consistency and penetration rates across markets.

Answer

Scott Roe (CFO and COO, Tapestry) confirmed the global consistency and success of both footwear (especially sneakers across genders) and charms. He noted that footwear often leads to multiple purchases, and charms drive repeat customer visits, providing additional engagement opportunities.

Asked for details on the newly launched digital marketplace, including early customer feedback, future plans, and its expected contribution to digital sales.

Answer

The marketplace launched successfully in late April with positive feedback, but it was a small launch. The company plans to scale it in 2025 and does not expect a material impact on 2024 results. The primary goals are to increase customer choice and improve product discovery online.