Tapestry ($TPR) — which owns Coach, Kate Spade and Stuart Weitzman — reported a 20% drop in quarterly sales today, as the Coronavirus outbreak forced 90% of stores to either close or operate on reduced hours. The retailer reported a net loss of $677.1 million, or $2.45 per share, for its fiscal third quarter, compared with a profit of $117.4 million, or 40 cents a share, a year ago.
Coach sales dropped 20%, Kate Spade sales fell 11%, and Stuart Weitzman sales plummeted 40% during the quarter. Tapestry said its strong online growth didn’t counteract the revenue lost due to store closures.
Last month, the count of discounted items at Coach peaked at 667, up 14% from February.
While the company has already reopened most of its stores in China and South Korea, tomorrow it will start to open up about 40 shops in North America for curbside pickup. Tapestry plans to slowly bring shoppers back into stores. Store workers will be provided with gloves and masks.
Tapestry plans to slash some corporate and retail jobs to cut costs. According to CNBC, these actions are expected to result in pretax charges of around $55 million to $70 million, primarily related to severance costs. Job postings have dropped 10% from March.
Tapestry will not yet forecast fourth-quarter or full-year earnings. Shares are currently down more than 36% this year. ″No one is immune to the effects of this one hundred year storm,” Chief Executive Jide Zeitlin said in a statement.
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