Good morning, everyone, and thank you for joining Tapestry's 2022 Investor Day. Before the program begins, please reference the information on the screen. The following presentation includes forward-looking statements that are based on information currently available to Tapestry and is subject to risks and uncertainties that could cause actual results to differ materially from the information presented today. In addition, the presentation will reference certain non-GAAP financial measures. Please see Tapestry's investor website for full reconciliation of GAAP to non-GAAP financial measures. Now the program will begin with a short video. Let's get started. Let's go. Good morning. Welcome everyone to Tapestry's 2022 Investor Day. I'm Joanne Crevoiserat, Tapestry's Chief Executive Officer, and I am thrilled to be here with my team to discuss the significant runway ahead for Tapestry and each of our brands. Today, I will touch on who we are as a company and our unique competitive advantages. We'll go through the radical transformation we've undergone in the last two years, and importantly, we will cover our roadmap for sustained, meaningful growth and value creation going forward. Beginning with who we are. Tapestry is a powerful and differentiated company, and it all starts with our iconic brands, Coach, Kate Spade, and Stuart Weitzman. The thread that runs through all three of our brands is their authenticity and strong consumer connections. Our brands each have a rich heritage. They were all New York City born from entrepreneurial roots, really capturing the energy of this city, and they all have a track record of driving innovation over time. We operate at global scale with intention. Our business is the culmination of individual touch points. We create products and experiences one at a time. One product, one team member, one customer at a time. From New York to Shanghai, from our headquarters here at Hudson Yards, and in each of our stores. It's the culmination of these individual events and moments that together create a powerful global organization, one that benefits each of our brands. We are a purpose-driven company. We bring together diverse people and ideas under one roof and give them a place to grow. We stretch what's possible to drive positive change for our brands, for our consumers, for our industry, and for society. In addition to our unique DNA, we have strong competitive advantages that position us to win with the consumer and deliver long-term growth. It starts with our strong, globally relevant brands. We also play in attractive and growing categories. We have omni-channel leadership, a global platform, and a talented team, and I'm gonna touch on each of these points. Starting with our brands. We are passionate brand builders. Our brands have distinctive positioning in their market and strong emotional connections with their consumers, and to know them is to love them. When we look at data from our survey work, we see repurchase intent from our consumers exceeding 70% for all three of our brands, which is a testament to the quality product and experiences we deliver. Todd, Liz, and Giorgio will talk more about what makes each of their brands special, the strength of their brands, their differentiated positioning, and their continued relevance with consumers. Second, we play in attractive categories. These categories are large, and they're growing. The categories have emotional and functional relevance with a broad consumer base. Our core markets of handbags, leather goods, and footwear represent nearly $100 billion of opportunity. In aggregate, the global luxury goods market represents over $295 billion, growing to $370 billion by 2025. These categories have proved incredibly resilient over time, through business cycles and even through shocks like COVID. This reinforces our confidence in the mid- to high single-digit growth that we expect for the category going forward. Third, we have an advantaged business model. We are omni-channel leaders, and we've established digital capabilities and a presence online across all three of our brands, which complements our world-class stores and store teams. Our model is both proven and profitable, with both channels contributing to profit growth. In fact, 90% of our business is direct-to-consumer, which means we control where and how our brands show up. We are able to connect directly with consumers and build relationships, and it allows us to importantly glean data and insights, which helps us to deliver even more relevant and impactful experiences wherever our customer chooses to shop. This helps us maintain lasting relationships with our consumers. We have a modern, agile, and data-driven platform which serves as a consumer engagement engine. We've invested to build these capabilities to support the growth and agility of our brands. We have a robust consumer database, architecture, and analytical tools, and we glean rich data from our direct-to-consumer model, and that helps us learn preferences about our customers and deepen those customer connections. We also have a modern technology infrastructure which powers wide-ranging commercial needs. It also helps us to test, learn, and scale with efficiency. With our history as a manufacturer, we have a globally diverse supply chain which delivers craftsmanship at scale. We are able to deliver innovation with global reach and consistent execution, which is incredibly important as we deliver value for our consumers. This diverse supply chain allows us to reduce risk, which has been unbelievably important in the last couple of years for sure. We have the flexibility to match supply with demand. We have the best team in the business. We're a team of proven operators and brand builders with deep industry experience. We have clear priorities, a culture of trust and empowerment, and alignment and focus on our vision for the future. I've spent over 35 years in this industry, and I couldn't be more confident in the team we've pulled together here at Tapestry. It truly is a privilege to work with them and with our talented, passionate teams around the world. This is the team that successfully executed the Acceleration Program which fundamentally transformed our company, allowing us to strengthen our brands, get closer to our customers, and compete in a rapidly changing environment. Two years ago, we set a strategy to change the way we worked and adopt a more consumer-centric mindset and utilize our data-rich platform to help us acquire new customers and better connect with our existing customer base. At the same time, we made a commitment to leading in digital, recognizing the increasing importance of the omni-channel journey for our customers. We also recognized the need to fundamentally pivot our focus and our investment, driving efficiencies across our business to support brand building and high return investments. Overall, we needed to be more agile. We needed to double down on innovation at every touch point with consumers. And these priorities became even more important as the world around us profoundly changed. We drove strong results as we navigated a challenging environment, and we emerged a stronger company. As we sharpened our focus on the customer, we started by defining and refining our understanding of our target consumers and clarifying our brand positioning to stay true to each brand's DNA. This helped us to improve execution through product, marketing, and our experiences. The result was improvement across customer metrics. We acquired 15 million new customers in North America alone over the last 2 years, and this was healthy growth for our brands and for their future. These customers were increasingly younger customers, a higher penetration of Millennial and Gen Z consumers, and they were coming to our brands through our core categories at higher average retails, and we see them coming back to our brands with higher frequency. We also drove increased retention, and we re-engaged lapsed customers. Together, this increased our active customer base, and we saw higher spend per customer overall. We prioritized leading with a digital-first mindset, and we unlocked consumer connection and growth. We grew digital to $2 billion in 2022, 30% of our sales. This was more than three times pre-pandemic levels. More importantly, we set the foundation for future growth in digital. We became more agile. We unlocked efficiencies across our organization and increased investments in our brands. You can see here marketing doubled as a percentage of sales to 8% by fiscal 2022. The success of these efforts is clearly demonstrated in our recent financial results. In fiscal 2022, we delivered record revenue of $6.7 billion. That's an 11% increase versus pre-pandemic levels, despite profound disruption around the world. We expanded our operating margin by 250 basis points even as we reinvested in the business. We grew EPS 35% above pre-pandemic levels and positioned Tapestry and our brands to deliver profitable growth over the years and decades to come. Importantly, our people underpin the success. Our team is one of our greatest competitive advantages. Our focus through the transformation has been to unlock the power of our people. Our success is evident in our results, but also in the external recognition we've received and the strong engagement we see from our teams. As we close the chapter on our Acceleration Program and look to the future, we are at an inflection point. The consumer is changing, and we're not going back to the way things were. We saw these trends developing before the pandemic, but the disruption over the last few years only accelerated these shifts. The consumer is more omni-connected. They're navigating digital and physical experiences on their journey from discovery to purchase to advocacy, and their expectations are high. They want a seamless, consistent experience at all touch points with brands. Consumers also want brands who enable them to express their own individuality and be authentically true to themselves. They're increasingly environmentally and socially conscious, and they wanna interact with brands whose values align with their own. We see the growing influence of younger consumers. By fiscal 2025, Millennial and Gen Z consumers will make up 70% of the luxury goods market. Importantly, Gen Z is influencing the trend landscape and buying behaviors of older generations, amplifying their impact. Looking to the future, we see these shifting trends and we are ready. Our company and each of our brands are well-positioned against each of these trends. The consumer moves differently today, and so do we. We're ready to move at what we call future speed. We move at the speed of the consumer, and that is the pace of the future speed. To stay ahead of the curve, some things need to happen quickly, while others need to happen intentionally with heart. At Tapestry, we are powering our iconic brands to grow. We are also building them to endure. We're moving quickly to meet our customers where they are when they want us. Using data and digital to connect our brands to more consumers around the globe, we're continuously innovating, learning, testing, winning faster to create indelible impressions and deep, long-lasting relationships with our customers. We are agile and responsive. We perform in real time, all the time. We're moving intentionally in the details that matter. We craft our products with integrity, quality, and care. We're connecting with our consumers through meaningful marketing, memorable retail experiences, and iconic brands to empower self-expression. At Tapestry, we believe in stretching what's possible. We have the courage to push boundaries. Future speed is how we reach, how we outperform, how we grow. By listening to our consumers and connecting to our purpose. Future speed is now. Future speed is how we define our next stage of growth. It isn't one destination. The world is ever-changing, and it's not about perfectly predicting the future. It's about staying close to consumers, delivering innovation, and staying agile and responsive to change. We've designed our organization and prepared our brands to do just that. That's what will power our growth agenda. With this intentional focus, our growth agenda delivers strong revenue and earnings growth. On the top line, we expect growth of 6%-7% to reach $8 billion by fiscal 2025, and earnings per share over $5, representing a low-to-mid teens annual growth rate. Our efficient operating model will drive strong cash flow. We expect to return over $3 billion in cash to shareholders over the next three years. We will do this by driving balanced, profitable top-line growth across our brands. With Coach growing mid-single digits, Kate Spade increasing high-single digits, and Stuart Weitzman growing low double digits. We will do this at strong profitability, growing our margins at Tapestry. We will harness our competitive advantages to drive growth for our brands. Each brand has a unique strategy, and investments in our platform allow us to amplify and accelerate their potential. We will win by building lasting customer relationships. Fueling fashion innovation and product excellence, delivering compelling omni-channel experiences, and powering global growth. Starting with the customer. Building on the strong foundation we set during the Acceleration Program, we'll continue to strengthen our understanding of our target consumers. We have an insatiable curiosity about our customer. Soon you'll hear from Todd, Liz, and Giorgio about how we'll leverage insights and test-and-learn approach to drive customer acquisition, making important investments in top-of-funnel marketing to drive brand heat. We'll strengthen retention, leveraging our omni-channel capabilities to drive engagement with our consumers, and we'll drive frequency through our breadth of lifestyle offerings. We'll reactivate lapsed customers with increasingly relevant product and marketing authentic to each brand's DNA. You'll also hear from Noam Paransky about how we're better equipped to target and measure our marketing impact and optimize our customer experience through the power of our platform. Of course, our products are what solidify our customer relationships. We offer the highest quality, innovative products to our customers at compelling value. We will deliver balanced growth across our core and lifestyle categories. The core handbag and small leather goods market continues to grow. It's proven to be durable during shocks and through business cycles because it serves emotional. Our categories serve emotional and functional needs for our consumers. Our research shows a high intent to spend in the coming 12 months in these categories as consumers return to real-world activities, driving a need across our core categories. Our core categories will grow mid-single digits through 2025. Again, you'll hear from our brand leaders about the innovation and development behind icons and our strong brand codes. We'll leverage our platform to continue to deliver in these categories. We see demand from customers in adjacent categories. We see runway to expand into a larger TAM across lifestyle, where our brands are seeing growing consumer brands in categories of jewelry, footwear, men's, ready-to-wear. Our brand presidents will share how we're leveraging the lifestyle categories to build customer engagement and lifetime value. Third, we'll continue to deliver compelling omni-channel experiences. With our unique business model that's 90% direct-to-consumer and each channel driving profitable growth, we're well positioned to meet consumers where and how they choose to engage with our brands. With our now scaled digital business as a complement to our store experience, we're building a solid foundation in digital, and our e-commerce is expected to grow high single digits going forward, representing a third of our total revenue by fiscal 2025. We'll also drive productivity in our existing fleet, selectively opening new stores, mainly in China. Our goal is to provide a seamless, consistent, and unparalleled brand experience for our consumer. Fourth, we will power growth across the globe. We have strong teams across regions with a deep understanding of their markets and consumers, and we're planning growth in each region, with the largest contribution coming from our key markets, North America, which will deliver mid-single-digit growth, and China, where we expect continued recovery and growth. Success isn't just about the bottom line. As part of our future focus, Our Social Fabric strategy reflects our commitment to our people, our planet, and our communities. A few of these commitments include increasing diversity in our own leadership, and we'll champion volunteerism in the communities where we live and work. In fact, we've committed to deliver 100,000 volunteer service hours by 2025, and we're nearly there already. We're committed to establishing 95% traceability and mapping of our raw materials and procuring 100% renewable energy in our own operations by 2025, with a long-term commitment to achieve net zero carbon emissions by 2050. These commitments are important to our goal of not only being a true fashion authority, but also driving true positive impact. In summary, Tapestry has emerged from the past 2 years a stronger company, and we have even more confidence in the opportunities ahead. This confidence is rooted in our clear strategic focus, blending consumer centricity with brand building. We have unique competitive advantages, starting with our three iconic brands and a platform that enables innovation and responsiveness to change. This is what's required to win in the current environment, and we're ready. Our foundation is strong and our growth agenda is clear. By powering our iconic brands to move at the speed of the consumer, we will drive meaningful long-term growth and value for all of our stakeholders. I'm excited for you to hear from our team today who will help bring this all to life. I'd now like to welcome Todd Kahn to the stage to share our vision and strategies for Coach. Thank you. Good morning. I don't know what's harder to follow, Joanne or J.Lo, but we are so happy to be here, and I am so pleased that I get to share with you the story of Coach and where we're taking the momentum we've built. What I'm gonna do is break it down to a little bit about who we are, and then I'm gonna talk about our customer, which you know is our key. We're gonna talk a little bit about our brand positioning, and then I'll bring it all together about our growth agenda. Who we are. Many of you know the story, and the story started a few blocks from here in a loft, and it encapsulated the spirit of New York. What was the spirit of New York? It was basically that immigrants from all over the world could come together and create beautiful product through grit, through hard work, through intelligence. It wasn't about where you were from, who you are, what your family lineage was. Those traits are as relevant today as they were 80 years ago. Courage to be real. Two years ago, we set out a new path, a path to excavate our purpose, and we came to courage to be real. Courage to be real is in everything we do. Not just our product and our merchandising, but our business approach. Our business approach, recognizing that we had to challenge ways of thinking and ideas, and we recognized that great ideas come from everyone in the company, and not just from the top. We use courage to be real, to create our values. First, genuine at heart. Genuine at heart talks to the essence of what we do, our legacy product, our leather goods. Crafted to last. Crafted to last talks about the individualism of every single piece of product we make, and that even today, 30 years later, product that was created here in New York is some of the most sought-after product that Coach has made and continues to resonate with our customers. Be yourself together. Coach has always represented this idea of self-expression and individualism, but we recognize that people seek being an individual, but being part of a community. My favorite, wonder what if. Wonder what if says we are not gonna be limited by traditional luxury views, but we have the opportunity to think broadly and differently across the brand. What has that created? That has created a beloved brand that has global reach. We're almost $5 billion today, transacting in 50 countries. We have innovated on product, creating iconic styles, and that has resonated with our customer. Finally, we have fashion leadership. We are engaged in the fashion conversation through our runway shows and through our activities every day at Coach. We have grown from strength to strength over many years. In FY 2018 and 2019, we recognized we were not at our optimal. In April of 2020, we pivoted. We changed our approach. Through the Acceleration Program at Tapestry and through our own initiatives at Coach, we moved from using price and promotion as the single lever to talking about value and values. That has resulted in incredible results. Since FY 2019, you see we've grown our revenue by over $650 million and have added 300 basis points in operating income. How did we do it? Three things. First, we focused on the customer. We have always been good about customer data, but we got better at it. We used the Tapestry platform to make us even more customer-centric. We've acquired new customers. These customers are transacting at higher rates and higher AURs. We've innovated. We reduced our SKU count, but we recognized the idea that our icons have longer shelf life than we ever gave credit for, and we've seen that with Tabby, and Rogue, and Willow. We've grown our men's business dramatically as we have our lifestyle components. Lastly, digital. We took a business which was doing mid- to high-single digits in digital penetration to now almost 30% globally, and we have runway. As Joanne said, we play in attractive markets, so there's so much room for us to continue to grow the Coach brand. Our customer. We recognize that we need to distort our marketing and our storytelling to the Gen Z and Millennial customer, and we're gonna use this as a customer acquisition vehicle. Why? Very simply, that's where the money is. Through a recent Bain report, by 2025, 70% of the luxury spend will come from this customer. We also know Gen Z and Millennials have an incredible influence in luxury and fashion to other generations. With this younger customer, we didn't stop there. Everybody can identify, yes, we wanna sell younger people, but those are table stakes. We went further. We looked at the demographics of the customer and identified a timeless consumer that really resonates with the Coach brand, and that timeless consumer, these are some of her attributes. Okay? They seek put-together looks that project confidence. They are looking for tried and tested, quality, iconic pieces that go with the different versions of their own self-expression. What does this customer tell us? Well, beyond our demographic work and our qualitative work, we did ethnographic work. What does that mean? We spent hundreds of hours with our customers, now, in their homes, because one of the things we recognize, which you all know is true, what people say and what people do are not always the same. We went into their homes. We saw their closets. We saw what they bought. We saw what was important to them. Let's take a quick listen to what they say. I like to stand out because I don't wanna be just another face, if that makes sense. My mother is a very confident woman, and she always really showed that to me. My clothes definitely make me feel confident. That was the word that I was searching for. It's like a radiating feeling, you know? Your confidence radiates onto other people, and they may look at you and say, "Where'd you get your outfit? I love your outfit." That makes you even more excited. Just, you know, when I have something in my phone, it just makes me kinda. It just makes me feel confident and ready to conquer the day. You know, I feel like I have one less thing to worry about. You know? I feel. Sometimes we have casual Fridays, and I always tend to dress up still, like business casual, because I feel, like, less confident when I wear stuff like this. When I, like, wear stuff like this with a turtleneck and heels, I feel like I can just conquer the world. What did you hear? You heard a lot about confidence. As this generation moves from teenage years to adulthood, they want brands to help them ensure their levels of confidence. We know that what we heard in North America transcends that market. Some of the same attributes of this timeless consumer are in all the markets we transact, and these are some of the qualitative ideas that resonate with customers around the world. Now, I know what some of you are thinking, "Uh-oh. Are they gonna walk away from their core customer by going after this younger customer?" I'm gonna tell you the answer is definitively no, and I'll tell you why. First of all, there's a truth about fashion. Fashion has always looked to the youngest generation for inspiration. If you think about the social awakening that took place in the 1960s, which created casualization in clothing, which led to the denim of the 1970s and 1980s. We all look for younger generations to inspire us. I tease us internally, we all have three ages. We have the age we look, the age we feel, and the age we act, and for me, there's about a 30-year delta there. They put some makeup on, so maybe I shrunk the delta a little bit, but we think we have the right, because we all wanna be confident. We all wanna feel good. We all wanna be put together. That doesn't just talk about our bull's-eye customer. That talks about our halo space. J.Lo is ageless. She attracts a wide group of people from all ages, not just her current age. We know with this strategy and this marketing push, we will not only get our bull's eye, we will get our halo and our stretch plans. Our brand positioning. Before I talk about our future, I think it's important to spend a minute on our past, and I think about Coach having four chapters. The first chapter, our genesis story with Miles and Lillian Cahn, starting with glove-tanned leather. We were innovators back then. We created a concept from a baseball glove and turned it into a company. We then moved into the 1960s with Bonnie Cashin. Bonnie Cashin took everyday items and made them fashionable. Even today, our turnlock was inspired by Bonnie Cashin, who saw a closure on a convertible top and turned that into the most iconic closure in our industry. Into the 2000s, when we invented accessible luxury. What was accessible luxury? It was the idea that you didn't have to spend an exorbitant amount of money to buy a high-quality bag. We did very well for about 10 years in that space because we were alone, and it engendered a lot of competition. What happened? We recognized we had to pivot, and in 2014, Stuart Vevers joined our company, and we moved from just being a house of leather to a fashion company, holding our first fashion shows and being part of the American dialogue on fashion. Where does that take us? It's more fun to be ahead of the crowd than lost in it. We have always been innovators, and we have always been ahead of the crowd, and I believe today we are launching the next golden age of Coach. Expressive luxury is the evolution of what we've been doing for the last couple of years. It embraces this idea that luxury brands, to be meaningful to this current generation, it's not just about impressing, but it's about helping them create their identities, their multiple identities. Because as you know today, self-expression is not just in the real world, but it's how you project yourself online. Coach is there for them on this journey of self-expression, and I think this is gonna resonate really strongly with our customers. What does this all do? This is where you guys get really excited. We, as Joanne has said, we're gonna grow from just under $5 billion to $5.7 billion by 2025, and we're just getting started. This is not the end. This is a way point. We are gonna continue to deliver best-in-class operating margins. What are the drivers of our operating margin? We have a lot of levers, but I'll focus on three. The three most important ones are customer acquisition. We're gaining a new customer. That new customer is transacting more frequently with us, and they're transacting at higher AURs. We will continue to drive AUR improvement through this period. Finally, we'll benefit from our geographic mix across the globe. Now, there's some modifiers. Inflation, that's not something I can control, but we think with our AUR growth, we can at least check it. We also see a lifestyle mix. We're gonna grow lifestyle that in some cases may hurt operating margins, but I actually think it's a positive because the lifetime value of a customer who transacts with us across multiple categories is higher and more rewarding and allows us to participate in the brand with more frequency. Finally, we're gonna continue to invest in Omni, which has proven not only that it is incremental for us, but it is a benefit. We're gonna do three things. We're gonna continue to build the brand and connect emotionally with our customer. We're gonna innovate, and we're gonna move from digital to omni. First, brand building. We do great with product, and we have for a long time. Now, you're gonna see us do equally well with our storytelling, with our marketing, so we can ensure that we have an emotional connection with our consumers and win their hearts and minds because we know you have to satisfy both their functional needs and their emotional needs. Innovation. This is at the heart of everything we've done. We will continue to innovate in our core women leather product. As you've seen us do through the Acceleration Program, we have taken iconic ideas and have elongated them. We will grow in men's. One of the wonderful things I love about our men's product, it has some of the highest AURs in our company. We also know when we talk about men's, it's not just traditional men's product. There's a fluidity that we have very traditional masculine product, you have very traditional feminine product, and then you have a wide spectrum in between that bring all kinds of people into the Coach brand. You're gonna see us continue to grow selectively, footwear, ready-to-wear, where we have the right to win. Finally, we're gonna double down on sustainability. We have been in the sustainability game before it was fashionable with our long-lasting leather product. But recently, with our (Re)Love program, we have brought to life opportunities to engage in Coach in a much different way. Some of you may have seen in the atrium, our introduction of Coachtopia. Coachtopia is a collection that we will launch later this year that is fully embracing sustainability from inception through multiple lives. I do hope after this presentation, you spend a little time at the Coachtopia presentation. Digital to omni. It isn't about digital first or physical first. Those terms are somewhat irrelevant to our customer. Our customer shops where they wanna shop, how they wanna shop, when they wanna shop, and they do that throughout their journey, sometimes starting digitally, sometimes ending in brick-and-mortar, and vice versa. What we know is our most valuable customers are those who transact with us across multiple channels. Here's a headline for you. The younger generation, this Gen Z and Millennial, are channel agnostic. They do not think of retail and outlet as different channels. They care about the experience they get in that channel. If you have any doubt about that, look at our success with coachoutlet.com and coach.com during the last two years. Where are we gonna play? We're playing in the same markets we're playing now, we're just gonna do it even better. We see tremendous growth and opportunity in North America and in China, and we'll continue to engage rest of Asia and Europe, but we have so much opportunity in those two big markets. How are we gonna win? Again, through the same categories we're winning today. Women's leather goods, men's, continued growth in lifestyle and footwear. Magic and Logic. For those of you who have covered us, you know this is something we've talked about for a very long time. We are at our best when we balance Magic and Logic. I've been talking a lot about Logic, but one floor above us, Stuart Vevers is hard at work preparing for our spring fashion show, working on the Magic, which I hope many of you will get to see live on Monday. Let's hear from Stuart for a quick minute. Hello, everyone. Thank you all for being here and for your support of Tapestry and Coach. I'm happy to have this moment to say hello and share my anticipation for the future of our house. First, I want to give a shout-out to the teams at Coach who are hard at work on our runway presentation right now. Our spring show is coming up on Monday, right here in New York, and I hope you will all tune in. It's going to be a lot of fun. There will definitely be some surprises along the way. The runway is one of the places where we innovate and push Coach forward. It's where we reimagine our heritage through the lens of a new generation, where we first debuted our approach to sustainability, and where we first shared our vision for a more inclusive fashion world through our Coach family. In our next chapter, I'm excited to debut our new vision of expressive luxury, rooted in inspiring confidence in the next generation to express themselves, and my personal belief that fashion should be about exploring who you are and having fun. I'm looking forward to continuing to evolve Coach, not just on the runway, but throughout our business across the world. Together, I think we can create the future the next generation deserves. On behalf of the teams, we're so excited for Coach's vision and look forward to bringing it to life with all of you. Thank you. If I can leave you with one overarching thought, many of you are gonna write reports today. I hope the headline read, "Coach introduces expressive luxury to capture a modern customer." Thank you for your support. Thank you for your interest in Coach and Tapestry. We really are grateful for that. Now it's my pleasure to introduce Liz Fraser, President and CEO of Kate Spade. Thank you so much. Can I hear a little commotion for Drew? Can I hear it for Drew from Kate Spade? Y'all go wild. I'm in love. These earrings are giving me like. Fish Mondays. Got his hands in my hair. She's gorgeous Good morning. I'm Liz Fraser. I'm the brand president and CEO of Kate Spade. I joined in March of 2020, just a week before COVID. I've been here about two and a half years. I have long been a fan of the Kate Spade brand from the beginning, and I believe this brand is magic. I'm here today charmed as ever by Kate Spade. It has a beautiful brand story, beautiful product, passionate customer, passionate team, and unlimited potential, and I know the sky is the limit for us. I've worked for many great brands over my career, but none of them have this much opportunity. It is honestly why I came here. I'm so excited to share our story with you today. I'm going to begin by sharing a little bit about who we are, what we've achieved, and why this gives us immense confidence, and after that, we'll turn to the future and talk about how we're gonna drive even more results. First, let me tell you a little bit about us. This is our purpose. We believe that we can bring joy, color, and life to the world. We also believe it's a chain reaction, so a little joy makes the world better. This is our promise to the customer. We are gonna make everyday things that they use extraordinary, whether it's a beautiful dress, a colorful phone case, maybe a plate for your bridal registry, and especially a handbag. We need to spark a smile for our customer, and this spark has been a hallmark of our brand since our founding, and today we just keep getting better at it. It is the cohesive thread that runs through everything we do, whether it's our product, our digital experience, our stores, our windows, most importantly, our people. It's everywhere, and our customers, they can feel it. These are our values. They add dimension to what we mean when we say, "Joy colors life." We built them over years. They're fundamental to who we are, what we do, and how we do it, whether it's internally or externally. We're playful and pragmatic from the beginning. We welcome with warmth. We're obviously wonderfully determined. We believe in well-being, and we celebrate the story. At our core, we are storytellers, and our products are the words to the stories we tell. Speaking of stories, I'll tell you about how we did start. Our brand was founded in 1993 with a spark. Kate had an idea for a bag that would be practical, but with a sense of play, of color. It would be fun. She made her first samples out of construction paper in her apartment here in New York City. Andy Spade, he helped build this idea into an entire world. It was a true storytelling and lifestyle brand which was well ahead of its time. From that spark, something magical was born. It was a combination of Kate's playful and pragmatic design vision, combined with Andy's storytelling genius and the collaborative group of friends who brought it all to life. It's been 30 years. That spark has grown. We've come a very long way from the construction paper samples. We now are in over 40 countries. Just in our direct channels alone, we served over 6 million unique visitors last year. Our brand is at its best when we are ourselves, when we stick to that core spark. Collaboration, fun, color, optimism, this is in our DNA, this is in our bones, and this is who we are. That is exactly what we've been focusing on since the day I walked in the door in March of 2020. We charted a course to reset and crystallize our foundation, because it's really a good one, and prepare for the next phase of big growth. This work fell into three categories. We focused on our brand, clarify it. What is our DNA? What are our true differentiators? Focused our laser focus on our customer, and we have such an emotional connection with her, and if you add that to the amazing consumer-centric platform that we have at Tapestry, we are able to understand her so much more deeply. We also built a very strong team. People are very drawn to working at Kate. It has a very rich culture, it has a clear purpose, and it's really fun actually to work here. Now I'll tell you a little bit more about our customer. We call her the enthusiast. She is far more than a traditional mindset or a demographic. Sorry, not a demographic. She's a mindset. She's playful. She's creative. She's carefree and confident. She loves to shop, and she uses fashion as a form of self-expression. She's practical too. She wants to buy something that's very functional. She wants to dress in a way that makes her feel happy. She's not that worried about what other people think. Of course, like everyone, she would take a compliment though. At Tapestry, you know, we do a lot of consumer research, so this has enabled us to really understand more deeply about what she wants from us, and what she wants is emotion, even if she buys a black tote bag. There are three very clear emotions that she is looking for. She wants joy. She loves us because we bring joy to her, through our products, through our storytelling, but it's approachable and very relatable. Secondly, she wants style. She wants products that speak to trends, but that remain true to her style. She wants it to feel effortless and authentic, but in the context of what's considered stylish. Lastly, she's looking for a treat. She wants product and experiences that are special, and that shopping our brand is a delight for her. We have a strong emotional connection with our customer, and this is priceless. That emotional connection ignites a desire that cannot be denied. It's a feeling of, "I just have to have this." One example that really struck me when I first started working here, it was full lockdown. We're really in the beginning of COVID, but we started selling this $350 pineapple-shaped bag. Obviously, no one needed a bag like that during a lockdown, but it sold out, and it sold out because it brought joy, it was stylish, and it was absolutely, definitely a treat. We see this time and time again with our customer. They don't just like us, they love us. Our North America data shows us that two-thirds of our customers say that we are their most loved handbag brand. In addition to the data, we can also hear it straight from their mouths. I'll play the video. Just look at her. She's gorgeous. This color is everything. I'm obsessed. I'm so happy. Guys. Are you seeing this? Holy sh. I don't think I can control myself. No way. I love this. I love this set. I love it. Their joy, it brings me joy. Speaking of a chain reaction. You match our amazing brand with this incredible consumer-centric platform. This is a powerful formula. We've been strengthening our foundation. We've generated a lot of momentum in the business. These results are giving us tremendous confidence and conviction in our strategy and in our future. In FY 2022, we achieved record revenue of over $1.4 billion. This was a 22% growth from prior year, 6% above FY 2019's pre-pandemic levels. Even our core North America market grew by 26%. The good news is we grew our profit even more. We grew it. Our operating income was up 28%. How did we do this? Well, increasing our handbag AURs, they were up low double-digit. By this, we did by developing new handbag pillars. We increased our AURs, our MSRPs, and we reduced our discounting. Lastly, we brought in over 3 million new customers last year, and we reactivated 1.4 million, and some of them were really deeply lapsed, like over 36 months. These new customers and the reactivated ones spent more. The new customers, their spend was up by 25%, and the reactivated up 34%. With this, we are ready to catapult. We are ready to catapult into the future. We really believe. Going forward, we're going to lean on what makes us special, what helps us build the strong foundation that we have. We're growing revenue. We expect to reach $1.9 billion by FY 2025. This is approximately a 10% CAGR from last year. This puts us right on track to surpass $2 billion within our planning horizon. We're also growing the bottom line. With significant improvements already in profitability, we will expand our operating margin from 11% in FY 2023 to the mid-teens% by FY 2025, and again, well on track to achieve our target of high teens% by the end of our planning horizon. We're going to fuel our gross margin expansion and our SG&A leverage by continuing the AUR growth, creating really true iconic products that become evergreen, leaning into high-margin international expansion, which we'll get into shortly, and leveraging Tapestry's rich data and digital platform. How are we gonna do this? Most importantly, by being true to ourselves, harnessing that incredible emotional power of our brand, leaning into what delights our customer, and using it to drive multifaceted growth by category, by channel, and by region. To do this, we'll focus on three priorities. We're going to become even more emotional, more lifestyle, and more global. What do I mean when I say more emotional? I mean leaning into customer engagement. We'll do this through product, through stories. This allows us to drive higher AURs, higher gross margin, higher purchase frequency, and of course, acquire new customers. We'll do this by offering distinct product that delights her, new icons and heritage nods that have recognizable Kate codes, and elevating our branding. We're going to engage with a lot of energy across all our touch points, whether it's from our stores, which by the way, we're unveiling a new store concept later this fall, in several locations, which I'm excited about. Two virtual or in real life pop-ups. We find that customers, new and existing, love to engage with them. They're very immersive. In our digital channels, we've begun experimenting with the metaverse. Just this week, we launched a virtual townhouse, which I hope many of you will have some fun exploring. You're able to create your own wallpaper, write on a kindness wall, and of course you can buy product. We're also going to engage through a strong social impact effort. This connects our customers beyond product with our brand. Our customers really care, and we have a long history in the women's empowerment and mental health space, and our customers know that and they appreciate it. Of course, we're going to lead with storytelling. This is synonymous with the Kate Spade brand. Stories that span product, in-store experience, marketing, and special activations. Storytelling is our superpower. It is what drives that emotional connection that we've been speaking about, and it comes across in all of our communications. Let me play you a clip from our fall campaign. One of my favorite things about that video is that everything in it is a Kate Spade product. We already have the world of Kate Spade. To be sure, we're a handbag business, but we are a lifestyle brand, and of course, we will lead with handbags. It is our heart and soul. We plan to expand the world of Kate by becoming more lifestyle. You might wonder, why would you wanna do that? Well, lifestyle products really animate our emotional brand story. They drive new customer acquisition, they drive purchase frequency, and they lead to a much higher customer lifetime value. Each category does serve a unique purpose. Jewelry, for example, brings in a younger customer. Footwear brings in new and more diverse customers. Ready-to-wear is already 50% of our revenue in some of the newer regions like China. The living products allow us to engage with our customer in sort of key moments of her life. Maybe it's a graduation gift, or she's getting married, or she's buying a new home. Today, our lifestyle offering is just over 20% of our revenue mix. Leather goods is the vast majority of the business. We will drive outsized growth in lifestyle, but we're gonna grow other goods as well. We expect to see lifestyle growing at a mid-teens CAGR by FY 2025, hitting about $400 million. Leather goods will grow at a very healthy high single-digit clip, supported by higher AURs and our unit growth. In our customer journey, all the categories are interconnected. Growing lifestyle will drive accelerated growth for handbags. Finally, on to our third pillar, becoming more global. We want to bring our brand promise to new markets. We want to delight enthusiasts around the world. From North America to Japan, to Europe, to China, our enthusiasts exist across all these markets. There are nuances, but there are also huge common denominators. Joy, style, and treat. We are uniquely positioned to grow in these markets. We plan to grow everywhere, but grow the international regions faster. Of course, we're gonna grow our highly profitable core North America market, where we're proven. We'll continue to grow there at a healthy mid-single digit CAGR. At the same time, we can grow the regions faster, driven by Asia and Europe. We're very under-penetrated today, and these carry very nice margins. We will be disciplined and focused, but we do need to grow the rest of the world. In closing, we have an amazing brand with a tremendous opportunity ahead of us. We have the right strategy. We have the right team in place to realize our potential, and we've already started to prove it. By focusing on our strategy to become more emotional, more lifestyle, more global, we will drive sustainable, profitable growth for many, many years to come. We've seen fantastic progress in the past couple of years, but we are honestly just getting started. That spark that fueled the Kate Spade brand for 30 years is getting bigger and brighter, getting faster, more bold and more powerful, and it is going to fuel us far beyond $2 billion. This is a mega brand in the making. With that, I'm gonna thank you, and I hope you come look at our product. I'd like to welcome my colleague, Giorgio Sarné. Thank you. Good morning, everyone. Thank you for being with us. Thank you for the people that are following us on the web, and thank you to my team for the great work that they have done so far to make sure that Stuart Weitzman shines and sparks. My name is Giorgio Sarné. I'm the President and CEO of Stuart Weitzman. I joined Stuart Weitzman in March 2020. I have been with Tapestry since 2013, and obviously, today I will focus on our long-term strategy as you know. I'll speak about the brand. I'll speak about the product, our vision, our customers, and some very exciting marketing activities that we will roll out in the next few days, some of them already out. Before I speak about the details, I want to remind everybody who is Stuart Weitzman. Stuart Weitzman is an iconic born and based brand founded in 1986 in New York. We are loved by all or many celebrities around the world. We are a constant favorite on the red carpet, and you can see here some of the amazing personalities, celebrities that wear our shoes, and many more obviously are wearing our shoes every single day. We are known obviously for our products, our iconic boots, the 5050 family, and the fashionable expression of the 5050 family, the Reserve, the Lowland, the Highland family, to give you a few examples. We are also known for our exciting, sexy sandals. The NUDIST family is this beautiful product that every woman around the world knows and wants to wear every day. When we speak about product, we cannot forget our everyday essentials. Here you can see some examples of these everyday essentials. The Colby Bootie, the PALMER LOAFER, the Stuart Pump are some of these examples. Moving from product to distribution, we are present in the most important capital of the world with our direct operated stores and the best wholesale partners that you can find today. We have around 100 directly operated stores today with 40 of them in North America and 55 in China. Obviously, we cover the other parts of the world with these amazing partners we have. An area of significant strength is our e-commerce business. Obviously, we leverage the amazing Tapestry platforms, data platforms, consumer platforms, and all the IT platforms that we have developed together with our colleagues. The e-commerce business represented 30% of our sales in North America in FY 2022 and is a strategic focus for us. We also have another big area of strength, is the strong relationship that we have with our customers. They are customers that are very affluent. They are ready to pay for our shoes. They spent, as you can see, nearly $600 on average for our shoes last year, and many more are ready to spend much more than this, of course. They come to Stuart Weitzman for fashion, quality and comfort, and obviously, we are ready to deliver on these promises. Now in FY 2022, we played to win, and this is showing, I would say, both in top line and bottom line. You know, first, we improved our product relevancy, which drove double-digit AUR and sales growth. We also increased our supply chain agility, and we were able to deliver product with quality and on time. We also saw significant growth in customers with both recruited and existing retained customers that grew by 33%, and the new customers grew by 33%. The new customer grew by 32%. We also saw, this is the most important part of what we did in FY 2022, a return to profitability. This was the first time since FY 2018. Now, our vision for the future is very, very clear. We want to be the global New York-based luxury footwear brand, fusing relevance, creativity and fashion. We have a tremendous opportunity in front of us. We have in front of us a market that is worth $30 billion, the footwear premium market, and we see a potential for this market to grow to $37 billion in the next 3 years. We do see strong appetite among those who are aware of our brand with higher consideration and purchase intent versus other luxury players that we track on our studies and platform. This gives us enormous confidence about our ability to succeed and deliver. Now, I said that in FY 2022, we played to win. Our call to action for FY 2023 is to win with heat. We want to create brand heat. We want to create brand momentum, relevancy, conversation around our brand. We'll focus. Obviously, on our existing customers, our loyal customers, are very important customers for us, and we'll re-engage and engage through amazing clienteling experiences. We want to recruit a younger customer, a Millennial customer, that is very important for our future and is going to represent 50% of the luxury purchases in the coming years. What does it mean when we're it? You know, you would ask me, what do you want to do, Giorgio? The plan is very clear. We want to spark consumer desire with our product, we want to create and build exciting omni-channel experiences, and we want to create this brand heat. Now speaking about product, we are working relentlessly on four axes. Product and the AUR elevation, you know, in terms of quality, in terms of materials we use, in terms of embellishment we use. We are making our icon more exciting. We are obsessed about innovating on our icons, again, with new material and fashionable expression of these icons. We are expanding across categories, so we know that our customer has different needs for different occasions, and we are working on different shapes and fashionable expression of our icon, leveraging our codes to make the new products even more exciting. Finally, we will be leveraging global collaboration to bring new customers and create brand interest. Here in this picture, you can see one of the collaboration we did with Disney recently. Very high-end, very luxurious, and brought a lot of new customers and excitement to our brand. When we speak about our channels, our omni-channel experiences, digital is going to play a key role. Again, as I said, we leverage the Tapestry platforms, the rich platforms we have, and our focus is going to be about the fluid integration of this physical and virtual world. Stores will play a key role to engage our customers, to give beautiful experiences about our product, and we'll do this through clienteling and leveraging our rich database of customers. Finally, wholesale. Wholesale will continue to play an important role for us. It's going to be an important channel for growth, for partnerships, and for visibility of our brand. This third pillar, I have to say, is the most exciting one. At least this is the one that excite me the most today and I'm eager to share with you. We are launching a new communication platform. We are launching a new purpose, a new visual identity, and very important, a new ambassador. Our new purpose is Stuart Weitzman celebrates women who stand strong. Today, I saw many women in this room that stand strong in Stuart Weitzman shoes. It's an evolution, a more customer-centric, I would say, communication of what we stand for already, but more modern and more, as I said, customer-centric. We have a new logo. We have worked on a new logo, a new color, a new mark. All these new codes will be rolling out in the coming days, and already if you go on our website, you can see some of these elements there. Now we have a short video that put all this together and gives you the tone of what we are going to do. Hopefully, you will be as excited as I am to share this with you. Wow. This is the new ambassador. I want to be sure that you understand that this is not the campaign, this is just a sizzle to share with you the tone and the motions of what we are going to do. Why Kim? Many of you probably have this question in mind. With approximately 328 million-329 million Instagram followers, the population of the United States more or less, she's the top admired influencer among millennials. She is a fashion icon that is part of culture and communities conversation. This is a powerful partnership that I hope is going to change the perception of the Stuart Weitzman brand for the long term. We are proud of it, we are very excited about it, and the first campaign with Kim will be launched later this month with an exciting amplification program that starts in New York, then Los Angeles, London, and Milan. Obviously, you are all here, you want to know about our financials. Joanne already shared these important numbers. We will reach approximately $450 million in net sales in FY 2025, with high single-digit operating margin. These represent over $130 million in total sales growth versus FY 2022, with a CAGR of 12%-13%. We'll focus on footwear, we'll gain market share in footwear, and we'll drive growth both through AUR elevation and unit growth. In terms of region, we'll see growth across all regions. We have opportunities everywhere, but you will see outsized growth in Asia driven by China. Obviously, North America is a key priority. In China, we'll open around 25 new stores in the next three years, and we'll continue to drive digital. We'll invest in localized marketing, and we will adapt to the rapidly changing consumer needs and environment changes. In terms of channels mix, we will see accelerated growth in global digital and stores. In North America, productivity is key. We'll really focus on productivity, clienteling. In China, it's about productivity and increased distribution. Digital remains a critical priority and will be a long-term focus for our brand and Tapestry. Finally, we expect all of these actions to translate to significant improvement in operating margin to approximately high single digits by FY 2025. We expect this to be driven by AUR elevation, China and digital acceleration, growth in store productivity, and obviously continued growth in wholesale. In summary, $450 million in revenue, high single-digit, approximately high single-digit operating margin in 2025, in FY 2025, through a very clear and focused strategy anchoring winning with heat through emotional and desirable product, exciting omni-channel experiences, and creating brand heat and awareness. Obviously, I'm excited, energized about this plan. We are working very hard, and we are implementing this immediately. Now, we will take about 15 minutes of break. There will be snack outside, and we'll come back in this room for the next segment. Thank you and enjoy the rest of the day and thank you to the people that are following on the web. Thanks a lot. Thank you. Welcome back to the program. Now introducing Noam Paransky, Chief Omni and Innovation Officer. Hi, I'm Noam Paransky. Thank you for joining us today. I'm here to talk today about Tapestry's digital transformation. We recognized several years ago the opportunity to shift our approach given the fundamental changes in how consumers engage with the brands that matter the most to them. As we began, we established a set of guiding principles to inform our decisions about what to build and how to build it. At its foundation, it's about customer-centric transformation. That transformation that's been occurring broadly across all areas of Tapestry. You can't be customer-centric without meeting the customer where they're at. We radically shifted our marketing activity into social media channels and opened all of our web properties 24/7. This included a migration from an outdated flash sale model in our value channels. Also, importantly, new teams, new ways of working. We create a new leveraged digital operating model with a digital center of excellence supporting our brand digital teams and working closely together. With digital, you can't drive digital without testing and learning, the experimentation mindset. We've established a robust test-and-learn program. Every month, we run dozens of high-impact tests, and we test and we learn and we win. Since inception, we've achieved over $750 million in A/B-tested wins. Building a platform. We set out to develop an enterprise digital platform, one that could be fully leveraged across all of our brands, enabling our brands to move at the speed of the customer while enabling each brand's unique expression. Against this backdrop, we set an ambitious agenda to build the full suite of capabilities to deliver on our comprehensive vision. We call it our customer engagement engine. Let me start with an overview of this engine powering digital and customer before showing how we leverage our broader enterprise platform. We focused on three growth pillars, simple yet powerful, generating quality traffic, converting that traffic, and having fanatically happy customers ready to come back for more and telling their friends all about it. It starts with knowing our target consumer and efficiently engaging them at scale to drive that traffic. Our large customer file is the advantage in driving repeat purchase and lifetime value. We're able to have precise targeting and paid channels and be highly efficient in our own marketing channels. Also, importantly, we look to empower our greatest asset in our company, our associates. Incredibly passionate about our brands, deep product knowledge, and we enabled them with revamped and new clienteling solutions. This allows our associates to engage with customers not just inside the four walls of the store, but anytime, anywhere. We improved our digital experiences to drive a more capable online experience to drive conversion. We're better connecting the digital and physical experiences. Finally, we've worked tirelessly in improving the post-purchase experience, again, to be that key enabler of that satisfied customer with high repurchase intent, looking to tell their friends all about the great experience that they had. What does this actually look like? There's a lot on the slide here, and there's a reason for that. It's been six years in the making, including the ERP systems, and we're incredibly proud of it. It's a comprehensive, modernized enterprise cloud-based technology stack that represents approximately $500 million in capital investment. It's a mix of best-of-breed and proprietary solutions and supports our brands and regions, ex China. It's an enterprise solution. The code, the partners, the teams, everything is fully shared. It allows us to move at maximum velocity and represents a digital-in-the-box capability for our brands and regions. Importantly, it's incredibly difficult to replicate, and we think that we are many years ahead of our peers and competitors in our implementation. It gives us the optionality to continue to make targeted and continued investments, those that can be measured and to drive continued improvements and drive sales. It provides a single source of truth to our teams on our customers and enables our teams to easily and efficiently orchestrate 360-degree campaigns. The engine helps us to engage and build audiences in both marketing channels as well as on our website and owned channels. The purpose of the engine is for us to more fully understand the consumer with the purpose of ensuring that each and every touch point with the consumer is hyper relevant. The engine provides advanced analytics to our teams and decision support to understand the predicted consumer path and lifecycle activities. Critically, it enables us to test and learn at scale, to measure, to understand, to evolve, to know the impact of our activities and allow us to continue to drive and improve our best practices. The engine helps us to effectively manage engagement in all of our channels, both marketing, website, and owned. With this platform built, we've quickly moved to finding ways to leverage the platform to improve outcomes across each of our brands. Most importantly, we can now leverage a powerful stream of data to recognize, personalize, and optimize the experience for our customers. Our capabilities here are broad and cut across all areas of engagement, and it's driving strong results. We know this works because we've built robust measurement frameworks, which allows our teams to understand what each dollar of marketing investment yields and uplift profit, and where and when in the business that profit is actually realized. This allows us to plan and understand the impact of our activities across our business units, as well as the timing considerations of these investments. We work closely with our finance teams, I'm sure you guys like that, to establish our profit and timing objectives. This, coupled with the savings from the Acceleration Program, have enabled us, as Joanne mentioned, to profitably expand our marketing spend from 4%-8% of sales over the last three years. This has supported the acquisition of 15 million new customers over the last two years. The engagement engine is a significant competitive advantage and has been a key enabler of growing digital sales from $600 million-$2 billion, as Joanne mentioned, and again, driving the acquisition of those new customers. Most critically, for all of you and for us, we've done so profitably. I now wanna show you exactly how the platform powers our brands with a speed that just a few years ago would have been, honestly, unimaginable. Okay. Our e-commerce platform is fully modernized to create exceptional dynamic product experiences. In the industry, what we've built is called a headless progressive web app. I know, it just rolls off the tongue. In English, we've moved from building our web experiences on very nice and fine stone tablets, right? Chiseling it out. They're static. They take a long time to code or chisel and are relatively inflexible. I can't bend the stone tablet. Maybe you guys can. You look pretty strong, but you never know. We're now building something more akin to LEGO. Modular web components are being changed on the fly to build dynamic and engaging web experiences. I've got a 7-year-old, a 9-year-old. This is how my kids build LEGO. They buy a set, it's usually one of these expensive licensed ones, and they'll build the LEGO set as per the instructions. At the end, they've got exactly what was in the instructions. It looks great, it looks cool, but then they will deconstruct it, and they will take all the pieces, and they will then match it with other sets, and they will build something really cool and creative. They're able to do that because the LEGO system is really simple. Everything fits together. Everything just works, right? We're employing the same principles for our teams. Our teams can take our LEGOs, which we would call components, and utilize them in nearly any way imaginable. This also makes website personalization much more feasible. Our commerce toolkit, which we call TORo, also allows our teams to work at the speed of the customer. We're gonna show a video after this where you're gonna see an example of a brand team collaboratively designing a homepage experience. The teams leverage an extensive library of available components that are seamlessly integrated into the TORo Commerce Platform framework, and anything that's developed is available to all brands and regions on the platform. Well, this video will obviously be sped up. The time to develop an existing component has been decreased by over 90%. That helps a lot 'cause that allows us to build more experiences, to test effectively as our teams can focus on content development and not coding or deployment. This is a huge advantage because effective consumer engagement, it's not automatic despite what a software provider might tell you. It requires ideation, experimentation, velocity, measurement, and discipline. What we can see here very quickly are the teams pulling components. These are each of the little blocks that they're pulling in. You can see the collaboration in real time, and now they're gonna start to lay content into the experience, taking the wireframe, taking the components, and then building and bringing in the brand expression, building the experience to life. Now, most of you have probably not had part of your career in web development, but this historically is very arduous and painful. Each of these components work within the TORo system. High performance, high reliability, very, very hard for a brand team as they're building experiences to break the site because everything just works just like the LEGO. This approach has another fundamental benefit. It delivers a site experience which is much faster. The physics in commerce are very simple. Faster site, all things being equal, means higher conversion. In particular, the site is faster when transitioning pages. Whereas legacy architectural approaches require pages in transition to be reloaded, progressive web apps load the pages with near instantaneous performance. Progressive web apps use service workers, manifests, and other web-based platform features in combination with progressive enhancement to give users an experience very nearly on par with native apps, but without requiring the friction of the download. When we apply this, we get higher conversion. Now we're gonna show you what two experiences side by side look like. As we go to the next page, we'll see our legacy experience on the left, and this is a newer legacy experience. It's really good, but it's a single page app. On the right-hand side, we'll see our microservices experience, which is currently live and what you would see if you go to the Coach Outlet site. Here you can see same simulated journey, no games. You can see how quickly, though, as the transitions start to go, how much faster the experience on the right is. That's more page views. That's more add to bag. That's more conversions. You can see. That experience on the left is a pretty solid single page app, but you can see fundamentally long ago we added to bag, and we are ready to check out. There we are. Importantly, this speed and performance is fully leveraged across the platform. We wanna reiterate here, the brands aren't leveraging similar solutions. This is a platform. They are leveraging the same solution, the same code. This allows them to update branding and user experience in the system without coding changes. It allows them to add new available features, and it allows them to remove ones that they don't wish to use. It also allows our brands to drive changes to market faster and with more consistency. Finally, it does so very efficiently because we only have to build and deploy once. This allows our brands to benefit from Tapestry's scale and the investments that we're making together, all while preserving the unique experience and identity of each of our brands. Those are just a few of the many powerful examples of how our digital transformation empowers our brands. Now, importantly, while I focused on talking about digital commerce, this enterprise approach cuts across all of Tapestry. We engage across the enterprise with a focus on seamlessly sharing and leveraging capabilities, learnings, best practices, and methodologies. What you see here behind me or on your screen is our Tapestry digital community and our operating system. The tech is cool, but this is our secret sauce. These are the teams that we've built, the new skills that we've introduced to the organization, and how we all work together. We've got net new skills and teams, up-level capabilities, new ways of working, resulting in a modern approach to how we operate our platform, and digital growth improved omni outcomes and improved amplification of our brands. The powerful digital platform that we've built over the last several years provides our brands with tremendous advantages that allow them to delight their customers, realize their growth potential, and do so more rapidly and, more importantly to you guys, profitably. Now, my colleagues know I can talk all day about this stuff, and if I had the time, I would. Let's hear from our brands about what it's like to leverage the Tapestry platform. I'd like to invite my friends Todd, Liz, and Giorgio, who are gonna join me on stage to talk about how our digital platform has enabled the brands to drive profitable digital omni outcomes. Hello, welcome back to the stage. It was getting pretty hot up here, so I appreciate you guys coming to lend me some support. I'd like to ask each of you a question or so, starting with Todd. How did the Tapestry platform inform our decisions around outlet.com, and how have you built the channel to ensure that we differentiate the customer and the experience? Thanks, Noam. As many of you know, we've had a coachoutlet.com site for many years, and if you go back about 8 years ago, it was a closed loop system. We invited you in. What did that mean? Instead of acquiring new customers, we kept talking to the same customer over and over and over again, and ultimately that led to a singularity in the site, which to attract them and to acquire more, sales, we had to discount more. What we did through the platform is we opened it up, and through the work of Noam and team and the collaboration between Tapestry and the brand, we were able to differentiate between coach.com and coachoutlet.com. Because the old model, if you think about it, was one of geographic distinction. You had to get certain product on Madison Avenue or Fifth Avenue, and then you drove an hour and a half to an outlet store. Today, we had to be so much better. We have to put side-by-side product and which is a click away. Nobody's driving somewhere to differentiate it. The platform has enabled us to create experiences and looks that are differentiated and attract a customer to both. It's super exciting. It's given us much more flexibility, and it allows us to talk to our customer in an authentic way. Finally, the test and learn agenda that we have been able to implement because of the things you saw here, the ease of use, the speed. We can try different things all the time. Instead of investing, trying something, and waiting three months to find out the results, we see results in hours. Thank you. Liz, next question for you. To know you is to know your love of Kate Spade and your love of the enthusiast, your core target customer. How's the platform enabled you to effectively identify and target the enthusiast, in also helping to bring back all those lapsed customers that you spoke of earlier? Well, it's helping in every way possible. I mean, first of all, we've been able to identify who the right customer target is for us. I spoke quite a bit about the enthusiast, and we really do share a kindred spirit with that person. The other thing about her is that, first of all, she buys a lot of handbags. This segmentation is this part of the market that buys, on average, four handbags a year, which is wonderful for us. She also buys handbags at a pretty high price. I mean, her average purchase is about $400. This is a super rich space for us to mine, and it's amazing because they are so similar to us and our personality. Once we're, you know, once we're engaging with her, we're able to really be very focused, based on the platform that we have. One of my favorite tools is that we're able to drill down to a SKU level. We know exactly who is buying what style and color, and size. One example of this would be in our Spade Flower Jacquard platform, which is one of our new icons, we have this super cute sneaker, and we know that the customer who's buying that sneaker is younger, and she's more diverse. Now we're able to keep targeting her with the types of products that we know she's going to love. It's really a- It's an amazing virtuous circle of knowing who she is and then just being able to speak to her in the most targeted way. Thank you. Thanks. Giorgio, last question for you. Bold moves today. Amazing. What insights are you using to shape your marketing strategy to create brand heat? Are you seeing any notable results thus far? As Todd and Liz said, you know, we are using the same platforms, obviously adapted to our brand. We have deep knowledge, insights about our customers, who they are, where they shop, what they shop, when, how many times, when they want to reengage with us. Through the discussions, you know, the exchanges we have with them through the platforms and in the stores, we know that when they know our brand, they get obsessed about our brand, they love our brand, and we have a purchase intent, a consideration that is higher than anybody else, or very, very high, I would say. Based on these assumptions and this knowledge, we know that we have to increase our excitement. We need to increase brand heat. We need to increase engagement. This informed the strategy of winning with heat and all the actions and the pillars that I explained today to you. The Millennials clearly an important target for us. You know, we know also through the discussion and the studies we do, that they are extremely important. The decision to take somebody and to have this amazing partnership with Kim Kardashian, I can tell you it's not easy to have Kim Kardashian. She loves the brand. The family loves the brand. We are very proud, obviously, to have that and excited. We also know that our customers, you know, you have heard it many times, they want purposeful company and products. You know, the idea of being a brand that celebrate woman who stand strong is very important to us. As I said, it's something that is an evolution where we have been and will continue to do this to celebrate women in a much more relevant and engaging way. There are many more insights obviously that we have about the consumers and the brand, but I just want to share some of the most important now with you. Thank you. Thank you. Well, thank you all for joining me up here today and for your amazing partnership on the journey that we've been on. Excited to see what our teams continue to do together as we move forward. Thank you. Thank you. Thank you. I'd now like to introduce Scott Roe, Tapestry's CFO and COO. All right. Good morning. Are you still with us? You hanging in there? I see a lot of, fingers, people tickling the ivories. There's probably notes being written as we speak. Well, you heard, hopefully, at least in my opinion, very exciting and compelling overview of our strategy, our aspirations from Joanne. You've heard from each of our brand leaders about the unique and differentiated positions and solid growth plans that we have. You heard from Noam and our brand leaders about just one aspect of the powerful platforms that we have here at Tapestry. Now it's time for my favorite question. Well, that was all real interesting. So what? So what does it mean financially? Hopefully over the next few minutes I'm gonna answer that question, lay it out, break it down, give you some of the reasons for the confidence that we have and the aspirations that we've laid out today. Let's dive in. We're committed to strong and sustainable shareholder returns. Okay? That's a big, bold statement. What gives us, what gives me the confidence to make a strong statement like that? Well, first of all, great people, really strong brands that are well positioned against attractive, growing and profitable categories, right? That's a structural advantage that we have. We have a transformed business and a transformed business model. Joanne alluded to that. I'm gonna unpack that even a little bit more. That gives us the ability to both invest in our business and our brands and continue to grow our profits in a sustainable way. Lastly, we generate a lot of cash. This transformed business model has a very strong cash flow yield, and that coupled with our commitment around capital allocation and returning that cash to you, the investors, I think is a powerful and perhaps underappreciated part of our story. I'm gonna break this down logically, go step by step. First of all, attractive categories. You already heard this from Joanne. You know, I think the point is obvious. We play in large, structurally attractive categories. This is the weather map, and it's red, right? Dark red. When you look at consumer trends, which we spend a lot of time trying to understand and put these weather maps in motion, we believe these categories are gonna be even more attractive over time. You can see by the size of our business, we're just getting started. There's a lot of white space, a lot of room to run. Perhaps this is not as well appreciated. We use the term resilient categories. I think this is an interesting set of data that maybe gives a little more illumination into what we mean when we say resilient. This is a 22-year view since the turn of the century of the category, the primary categories in which we play, handbags, SLGs and premium footwear. You can see throughout the dot-com bubble burst, throughout the Great Recession, 2008, 2009, and of course, the more recent COVID period, it's been a remarkably resilient category. Hopefully you saw a little indications as to why that is. The emotional connection, deep emotional connection of our brands within these categories has proven to be a very resilient and reliable source of growth over time. I said we have a transformed business model. Joanne started talking about that too. Let's unpack that a little bit. First of all, this organization is consumer centric. In order to be consumer centric, you need two things. You need to understand the consumer, right? That means having the data. Remember, 90% of the business is direct-to-consumer, so we're data rich. Then what you do with the data, right? I'd say that's an area over the last couple years where we've gotten much more focused and acute. It is really understanding, analyzing that data. The question, so what? That's interesting, but so what and how do you apply it? You saw some small examples of that today from Noam and our brand leaders and throughout our presentation. We are a digital-first organization. We have those capabilities that we just unlocked. Agility, maybe we wish we weren't quite so agile given what's happened over the last couple years. In all seriousness, the forced agility through the pandemic and the rapid changes in the consumer behavior have forced us to be more agile. The great news is we prepared pretty well, right? We have an omni-channel capability. We built the capabilities to chase the consumer or be ahead of the consumer where they wanna go. I think that's unfortunately a muscle we're gonna have to apply in the future because it's probably not just gonna be smooth sailing. I think some of these disruptions are probably here with us for a long time. We've stopped hoping for calm and prepared for a turbulent and continually evolving landscape of the consumer and also the marketplace. A couple data points. Some of these you saw before, a couple you haven't. You know, digital sales are three times what they were just 3 years ago in 2019. Again, an example of agility. We didn't predict that in 2019, but we were prepared to capture it. Marketing spend. This is gonna be. I'm gonna address this a little bit more. We've doubled our marketing spend. At the same time, we increased our profitability by 250 basis points. Our SKU counts are about half of what they were. What that really means, think of that as simplifying your business, right? Making smaller or bigger bets on more focused iconic product, which just helps increase our batting average going forward. Lastly, even though traffic is still down in store compared to, say, 2019, we're more profitable today. You know, a lot of the things that we're doing around margin and productivity and understanding the consumer and marketing more effectively, obviously, that benefits all channels. Importantly, we're seeing an improvement on a lower traffic base on our stores. That gives us more flexibility. Today is really about the future. We're gonna talk about what our aspirations are for the future. Don't forget, this isn't a field of dreams. We've been performing. What we're saying is this is a proven and profitable model and formula. We grew 11% over the last 3 years. Our operating margin up 250 basis points. Because of that strong cash generation coupled with our commitment to return it, we've seen earnings up 35%, right? 35% since 2019. Sustainable, profitable growth, that's what we're focused on. Not so much even the quarter by quarter, it's the long view. If we've learned anything, it's the long view of the customer, it's the long view of our business. The turbulence we can't help, right? But it's staying true to the, and focused on the discipline around our operating model and the things that we've learned over the Acceleration Program will give us confidence. It gives me confidence and gives us the formula, I think, to win over time. How do we win? We've already unpacked this earlier. Joanne really talked about it. It's through understanding and building deeper relationships. Todd talked about not just relying or leading with price, but lead with engagement. I think that's a good microcosm for the new way of thinking to that Tapestry is all about, right? Price is and always will be part of our equation, of course, but it's not the lead. Understanding and deepening our engagement is key. Omni-channel experiences, we'll talk more about channel breakdown in a minute, but we're prepared to follow the consumer where the consumer wants to go. Finally, global growth. While we have powerful international platforms, you'll see we still have a lot of white space ahead of us. All that summarizes $8 billion, 6%-7% constant currency growth, more than $5 EPS, low- to mid-teens% from a growth standpoint, and a cumulative cash return of $3 billion. That's the tale of the tape. Importantly, this growth is balanced. It's balanced in terms of brands, geography, categories. Let's give you a little more granularity. You saw this already. Our brands are all growing from Coach at mid-single digits% all the way up to Stuart off a lower base at a low double-digit level. Let me try that again. Low double-digit CAGR during this period. By category, one thing I wanna just underscore that was pointed out by all of our brand leaders, our brands are powerful lifestyle brands which have the permission and are already present in lifestyle categories. We're there today. This is not new. We see disproportionate growth in those categories. We're gonna grow a little bit faster, but don't lose the thread. More than 80% of our business is still in the core categories that you know us for, right? Handbags, SLGs, those core and very attractive categories. By channel, we see digital growing from a penetration to just under a third of our total business. Importantly, Joanne made this point earlier, our direct-to-consumer is still about 90% of the total, which means we control our destiny, and we're data rich, right? We own that customer relationship without the friction of a third party in between us. We're balanced in terms of geographies. We have really strong footholds and long-standing meaningful businesses in North America, in China, and Japan. We're relatively under-penetrated, and you'll see higher growth rates in Europe and rest of Asia. Particularly rest of Asia has been particularly strong as we look forward, and that gives us optimism to continue to increase our global footprint. We are financially disciplined in the way in which we operate our business and, you know, it's I would say disciplined operators, disciplined capital allocators. What does that mean? I'll give you at least one aspect of this. This is a disaggregation of the earnings algorithm going forward. It must be a good sign if the cameras go up, and people take pictures, we must have landed a point here. That's really good to see. It's pretty simple really. We're growing in this period of our LRP to in the area of 19% operating income. We expect gross margins to be up about 100 basis points. That's a combination of price, you know, AUR increases, price increases, and also mix. That's just math. We're growing a little faster in higher margin parts of the country, mostly geographies, and so that's gonna benefit us. Also, scale and efficiency. Remember Noam said what we're building in terms of our digital capabilities, our e-commerce platform, the data and analytics that go behind that. These are common platforms, which means they're leverageable. We do see a lot of leverage in the model, but we're not just letting that leverage fall to profit. We're reinvesting back in our business in the capabilities that we believe are differentiating. Now, that's marketing and digital investments. I'm gonna give you a little more what that means. This is the P&L view. I'll give you a CapEx view here in just a minute. All right. A breakdown by brand. I know you wanna see it. This is the three brands from both a gross margin and an operating margin standpoint. A couple things you'll notice. We're growing gross margins in all of our brands. Again, what I think about is it's a volatile environment. There's a lot of pressures. There's FX, there's inflation, there's, you know, all different sorts of input cost pressures, freight, but we have pricing power, and we're well-positioned, and we're disciplined. The ability to, over time, price and maintain those gross margins is a key part of this plan. You'll see that also operating margin at Coach, which is already at 30%, our expectations are to continue to reinvest in the growth. Such a profitable, efficient machine, we wanna keep investing, but we wanna also make sure that we're getting the growth. You'll see relatively more margin improvement from the other two brands who start from a lower base, right? You would expect that we would get both gross margin and leverage in Kate Spade and Stuart Weitzman as you look at the margin evolution over this 3-year period. Okay, and finally, significant cash flow generation. Again, at $3 billion, you remember from our recent guidance for this year, about $1 billion this year, so obviously two more over the course of the next 2 years. That's a lot of cash. What are we gonna do with it? Well, here's our capital allocation priorities, and they really aren't changed from what we've been talking about. We number one believe reinvestment in our business is the highest and best use of capital. We believe that we have differentiated platforms that are fueling our growth, and the first bite of the apple is gonna be to continue to invest in those capabilities and marketing communications around our brands, right? The second is, as we have excess cash, and I use that word to mean that's code for we're not putting on debt to buy back shares, we will return that cash, and we modeled that out as about $700 million a year returned through repos. I think, hopefully, we have some credibility that we actually mean that and do it with, you know, $1.6 billion in the year just ended. Let me just say one thing as you think about the repo. You know, I don't want to lose the main point here, which is this is an efficient model which generates a lot of cash, and we are shareholder friendly from a capital allocation prioritization standpoint. We've just kinda modeled this straight line. When I look at where our shares are trading today, we do our own, you know, like you probably would too, we do multiple versions of DCF and intrinsic value calculations, and I would argue, we got a pretty compelling investment to buy back our shares. Over time, should that change and those dynamics, would we revisit perhaps the balance? Of course, we would, right? On the other hand, it's hard to predict what may happen, and I don't want you all to lose the fact that there's a lot of cash flow yield here, and we intend to follow our prioritization here in terms of capital returns. You'll also notice, number three, the future M&A. We believe that these platforms and the capabilities that we have today are scalable and one day would be a great platform for additional brands to be added to to get the leverage and the synergy around that. Not today, right? We believe that this plan is so compelling from an organic standpoint, that that's our first priority and that's where we're at today. In the future, that is something that we believe can make sense. I'm gonna tell you a little bit more about not just M&A, but how we think about capital prioritization in a couple slides. I said reinvestment in the business is our number one priority. What does that mean? It's the things we just talked about, right? It's around data, consumer, analytics, it's machine learning. It's all the things. Well, I guess Noam could have talked. We could have used this entire presentation for Noam to talk about the things that we're doing and the capabilities. You saw, I guess, a little sliver of it. We believe that, in general, understanding the consumer better, getting better data, analyzing that data, and most importantly, putting that data into application like you saw with the brand leaders, is a core tenet of the change and the transformation of this business that our team under Joanne's leadership is really focused on. Direct-to-consumer stores are and will, in our opinion, as far as we can see, be an important part of the journey, and we need to continue to get better at operating. That partially means, you know, refreshing the fleet, continuing to invest in our in-store capabilities and building stores mostly outside of the U.S., specifically in China. Every so often, with growth comes step costs related to infrastructure, so that's obviously. We gotta fuel the growth that we have and enable it. This is a picture of CapEx. Kind of an EKG chart here, so a little explanation is probably useful. We talked about, by the way, the near end side of this in our last print. We had CapEx in 2022 that ended up pushing into 2023 for a number of reasons, mostly COVID-related delays in projects, mostly in the international markets and specifically China. There was some transfer from 2022 to 2023. I mentioned every so often you have these step costs. We have a new distribution center that's coming online in Las Vegas, so it just so happens that the majority of that spend falls in fiscal 2023. If you zoom out a couple clicks and you look at it from a broader perspective and as you all think about your modeling, what can you expect? 2%-3% of sales from a CapEx standpoint. Roughly half of that in technology and digital capabilities, the other half in stores. Again, predominantly outside of the U.S. and predominantly in China as you look forward. Number two priority, return capital to shareholders. Two ways we do that. Dividends, we've said consistently, at least since I've been here, that we're gonna grow the dividend once we reinstated it at a rate greater than earnings. Putting a little more granularity on that and saying the payout ratio from 35%-40% during this three-year period. In addition, the $700 million, I think I already covered that. $700 million, that's again, not adding cash. As you think about the cadence of that, we don't really believe in ASRs or trying to time the market, so that's more of a programmatic approach from a buyback standpoint over time. I don't know about y'all, but I'm pretty bad at guessing the market or timing the market. We just say we're gonna be consistent and try to return that cash programmatically. One of the questions, I said we're disciplined capital allocators. What does that mean? What kind of discipline do we apply? You've seen some version of this, many of you, in terms of the lenses that are applied for capital. Some of you have seen three lenses. We have four. The one that we've added is around execution. Let me unpack this a little bit. Before I do, this is how we think about all major capital allocation decisions. Whether it's going into a new geography, maybe it's adding a capability, using our balance sheet to add a capability, acquiring something that might build versus buy might be a smart decision for us to make. New categories, launching new categories, how do you think about that? One day, even M&A. As you think about the portfolio evolution, it's really the same discipline, right? One is platform capabilities, and that might be. Maybe another way to say it is, do we bring something to the table? Do we understand this consumer? Do we have capabilities that would benefit this consumer? Do we have the ability to execute? Do we understand the marketplace, et cetera? Strategic, think of that as being positioned against attractive growing parts of the market, total addressable market. It's also the—it's the where to play, how to win, right? It's one of the most important decisions that we all make as business leaders and capital allocators is where to play, especially in these categories. We wanna make sure we're in something that's constructive, growing, and I like to shorthand it, say, is the wind at your back or in your face, right? Do we have a reasonable chance to win? Then from an execution standpoint, it can look wonderful on paper, but can you actually do it? Do you have the capabilities? Do you have the capacity? Is the competitive dynamic such that you believe that you have a compelling story that you can win? That's the new lens that we've added. Then finally, and maybe most importantly, is the TSR financial hinge, which simply says, I'm gonna lay out in just a minute a disaggregation of our TSR on this organic plan that's pretty strong, right? I've been doing this a while. It's pretty strong delivery, and that is our baseline. Against that, we're gonna measure other opportunities to say, "Is it accretive or is it dilutive compared to this baseline?" Right? That's the way to think about that. Let's move on. Here it is. Disaggregation of shareholder return. High teens, right? We see a high teens% delivery. The breakdown of that is 6%-7% from a sales growth, a revenue growth standpoint. That's constant currency. Really not much from margin expansion. We're already pretty profitable. As I mentioned earlier, it's really about the discipline to maintain our profit and reinvest in our business to give us higher confidence in our ability to get the growth in these categories and maintain sustainable top-line growth. Finally, when you think about all that cash that's being returned, right, and from a programmatic way, that's earnings. That's EPS. 5%-7%. It's a big number. Let me say it again. 5%-7% from share repurchases. That takes you to low-to-mid teens from a earnings standpoint. Put in a 3% dividend, which I sincerely hope that yield goes down over time, gets you to the high teens. Now, the other obvious thing is I didn't put anything in multiple expansion. I frankly don't understand why our multiple's where it is. It's an outlier, you know, relative newcomer. One of the reasons I'm here, by the way, is I see the upside potential there, but you'll be the judges of that, right? I believe when we deliver this plan, we should see a few turns on the multiple, but I guess time will tell whether that's true. That's the algorithm. Again, I think we've laid out all the building blocks, the reasons why we have confidence in this algorithm. I would just summarize the plan we just presented by saying we have great teams, strong brands positioned against attractive categories. They're attractive because they're large and growing, and they're attractive because they yield high margins. We believe that the momentum that we have, we are proven and profitable. This isn't a plan of hope. This is really a continuation and a doubling down on the things that have made us successful and proven successful. We're gonna continue doing those things and continue investing and feeding those things going forward. This is a transformed business and a transformed business model, which allows that flywheel, right, to reinvest in the business and deliver increasing profitability that I think is pretty special. It means that we're coming from a position of strength. Finally, the cash generation, coupled with our capital allocation priorities, I think gives us a pretty compelling story. I'm gonna close with a personal observation. I've been in Tapestry now a little over a year, and some of you asked me, "Hey, why are you coming to Tapestry? Why, why this company?" I said three things, right? Trust and respect to the people. This is a great team. They're sitting right over there, and they're gonna join me on stage in a minute. We've got a great team. I said, "Is the case for change made?" It's one thing to talk about, we're gonna transform, we're gonna become digital. Think about this. This company, I don't know, Noam, five years ago or so, was in a technological debt position, right? Because most companies were, right? Let's be honest. There was an implementation of our first S/4HANA, which we are on a global instance of S/4HANA cloud-based. Pretty amazing as a step one. In the Acceleration Program, all the things that Noam and several of us have talked about have been built, and we're right on the cusp of now doing the fun stuff, right? The plumbing is there. The architecture is here. We're not just talking about change, we're actually changing and transforming this business model. The last and third factor I had was, is it winnable? Is it winnable to me meant is there asymmetrical upside? Again, I look at it outside in. I look at the profitability of the business, the attractiveness of the category, the strength of the brands, the capabilities of the team, the cash flow yield that we have, and our valuation, and I think it's very winnable. I see asymmetric upside for this business, and frankly, it's one of the reasons that I'm here. That's the summary of the financial presentation. I would ask that you bear with me for just a couple minutes. I'm gonna invite our colleagues back up to the stage. It's gonna take us about 5 minutes to reposition and get up here, and then we're gonna do a Q&A session. Thank you very much. All right, we'll take it from the top. It's great to see everyone. I am Christina Colone. I am the Global Head of Investor Relations at Tapestry. It is so great to be with you here in person, as well as those of you who have joined us on our webcast, and of course with our team. We have around 45 minutes for Q&A. I'll take questions from the audience as well as from people on the webcast. Just ask that you raise your hand and introduce yourself with your name and your firm. Let's kick off. We'll take the first question from Bob Drbul at Guggenheim. A couple questions actually, if I could. The first one's for Todd. Could you talk a little more around the AUR opportunities that you see, you know, over the next few years for the Coach brand? Just like, you know, where you could take it, where you see, you know, whether it's category, geography. My second question, Liz, can you talk a little bit more around the operating margin expansion that you have, you know, 11% to mid-teens? Like, low-hanging fruit, different buckets, biggest opportunities that we can, you know, really start to see some traction in that. Thanks. Great. Hi, Bob. How are you? Nice to see you. As you know, we've been on this AUR focus for a while, and for the last effectively three years, we've raised our AUR, particularly in our core handbag assortment. That's where I'm primarily focused. A lot of the AUR growth has come from less discounting, and some of it has come from ticket. At the end of the day, the most important thing is what the consumer ultimately pays and sees. You'll see us, as we talked about at our last earnings call, that we're taking ticket up on a lot of categories, particularly our handbags, and we are being very, very careful and thoughtful about our ultimate discounting. Now, we know at certain channels, at certain times of year, we use that lever, but we've been much, much more restrained. The most important thing I think to take away today, there's more white space between where Coach trades and traditional European luxury than any time in our 20 years plus as a public company. That gives us confidence and room to continue to take price throughout this planning horizon. I feel very good about it. We're gonna constantly focus on newness and innovation, and as we take these families, Tabby, Rogue, Willis, and add new features, new fabrications, it gives us opportunity to take price along that journey, particularly as we bring this new customer into the fold. They have been retrained, if you will, to pay a higher price. Again, when you compare us to pinnacle traditional luxury, we are a compelling value, and that's what I think is exciting. I'll just jump on to Todd's comments because I think it's a little bit related. In the same way that there's a lot of white space in the market, there's a lot of white space for Kate Spade. You know, we still have a long way to go to build up our AURs. We're well on the way. We're doing that by really doubling down on our branding. I mean, our product is really commands a much higher price point than I think it has, and we should continue to be able to go along up through the white space. That's allowing us to really do gross margin expansion. We have so much opportunity in markets that are much richer in margin, so really excited about that. They're just, you know, it's really all the building blocks are there, and now we're just going up. I would just build on one thing, too, Liz. I mean, as you think, there is a leverage point from SG&A, and Liz and the Kate Spade brand has had the welcome to Tapestry as they've gone on the platforms and these are powerful platforms which will power the future. That has some step costs related to it, but over time, that's a one and done, right? Over time, as you continue to grow, you continue to grow those margins, coupled with leveraging that SG&A, you know, that's a double factor on your profitability. Got tongue-tied there. On Kate Spade profitability over time. Great. The next question from Lorraine Hutchinson, Bank of America. Thanks. Hi, it's Lorraine Hutchinson. I wanted to ask about the e-commerce channel and the expansion into some of the factory products. I think one of the reasons you always kept that invite-only is to avoid cannibalization. Can you talk to us a little bit about the customer you've acquired, how much cannibalization you've seen, and then also maybe comment on the health of the factory outlet store channel now that there's that e-commerce option? Thank you. I'm gonna kick us off and then Todd probably add some color to this. You know, that conversation and that question really, we've changed our perspective about our channels and our product, and we've really focused on the consumer. The consumer doesn't shop a channel, they shop Coach. What we've done with this expansion into digital, first of all, is put us where she is and put our brand. You know, to ignore digital is to ignore an obvious place that our customers want to engage with brands, not only to purchase, but also to discover brands. As we thought about our transformation, it was critically important for us to embrace digital. Then as we thought about that, we also had to think about how our brands show up on these digital platforms. Todd talks a lot about the fact that we've pivoted away from price as a lever. We are more talking about the quality of the brand and the value that we represent in the marketplace, and we do have. It does make sure we have to ensure we have differentiation in those channels. That's been an amazing unlock for our business. As we get focused on the consumer and put our brands across the board, all three brands, where our consumers are in digital spaces, on social media, we're engaging more customers. Importantly, these customers are increasingly younger, so we're acquiring new customers with this approach, and it's really healthy growth for our brands. Todd, I'll turn it to you. Yeah. I think you hit on so many of the key points. One of the things that I think is really important to think about is the most valuable customer we have shops all channels. Sometimes what they'll do is they'll reward themselves with a fabulous Rogue bag. Maybe for their mother-in-law, they'll buy a SLG from coachoutlet.com. We're okay with that, okay? We, in fact, invite that. That is a great opportunity for us. Is there more work for our merchants and creatives to differentiate product because they don't have the geographic diversity that we used to have? Of course there is. You know what I like about this? It requires us to be more transparent with our customer. There's no more head fakes. They're all out there. They can do one is one click away. We have to be better, we have to be stronger, we have to tell more compelling stories, and we are doing that. The halo impact of what we walk down the runway, then maybe a year later showing up in an outlet, some version of that, is what creates brand heat. I feel very good about this. Your second part of your question, brick-and-mortar is a great business for us, okay? We are very happy with our brick-and-mortar outlet stores. I think you're probably focused in North America, in your question, but we have brick-and-mortar outlets in Japan, in Europe, in China. Some of our highest AURs are in China. Sometimes they've experimented very successfully with taking, at the front of the store, some very, especially when it comes to ready-to-wear, retail product out there. There are some categories, like perfume, we have one price point across both channels because it's just about the brand. I think you're gonna see us experiment with hybrids too. We don't have a need for great proliferation of brick-and-mortar outlet stores in North America because we are satisfying such a demand with coachoutlet.com. As Noam has indicated, and as Joanne has said many times, it's accretive, it's incredibly profitable for us. I would add a quantitative lens as well. As we've embarked on this pivot and go-to-market strategy, if you look at the Google Trends, which is a publicly available toolkit, as we've embarked on a strategy, the interest in Coach as a search term has exploded. Has Coach outlet increased nominally? Yes. The real growth has been in the brand interest. We feel very confident with all these lenses that this has been the right path for us to go on. Thank you. The next question from Ike Boruchow. Hey, everyone. Ike Boruchow, Wells Fargo. I just wanted to ask about China. You know, on the slide you put up around the door growth, it looks like it's the overwhelming majority, if not all the door growth. Maybe just update your market share today, what you're, you know, what the revenue targets are there, what kind of share you're trying to get to, tier cities you're moving into. Just more on the outlook from there would be really helpful. We have a great business in China, and we've been in that market for over two decades with the Coach brand, and we have strong teams on the ground who are operating very successfully. Importantly, we see a customer base in China that demands our brands. Our brands are well-positioned to a broad base of customers that the middle-class consumer base is very broad and importantly growing. To your question, Ike, we see long-term runway in China for continued growth at Coach and at Stuart Weitzman, where we have today higher penetration. At Kate, our penetration is very low, and we see tremendously more runway there. To your question on store growth, we do see more store growth in China and Asia, more globally, but more broadly, but in China specifically over time, and that will be in additional cities. You know, we haven't broken down the market share, but I will tell you that our brands and that consumer in China. First of all, the consumer has proven to be incredibly resilient over time. Having been in the market for so long, we have seen this consumer time and again come back to the category. In fact, we've done some research in the market recently, even through the lockdowns, and it shows strong intent to purchase in our categories for the coming 12 months. We have a lot of confidence in the consumer, in the Chinese consumer, confidence in the future and their engagement with our categories. Our brands are some of the highest at the top of our category on digital channels in China with the consumer. We see the consumer continuing to value our brands and engage with our brands strongly in the market. That gives us confidence, not only that there's growth in the market based on the macro trends that we see over time, but there's an affinity for our brands and a tremendous runway ahead. Great. Michael Binetti from Credit Suisse. Hey, thanks for taking our questions. Michael Binetti from Credit Suisse. Todd, Scott, maybe a jump ball. I'm curious on the Coach brand. He's a lot taller. I don't know if that's fair. He wins in the jump ball. He can probably jump higher. For the Coach brand, maybe a little more on the relationship between the mid-single-digit revenue target and the 30% margin, which is about where the brand was in fiscal 2022. You gave us where the growth was coming from, pretty reliable. There's some tailwinds to the margins from that. You gave us the gross margins, ASPs you mentioned. Maybe walk us through some of the offsets or the pockets of opportunity for upside to that margin since, you know, I think that leaves room for quite a bit of reinvestment, or upside if you do trend towards that mid-single-digit range. Yeah. Maybe I'll start and you can. I guess I'll start the ball rolling, but maybe- I knew he was gonna have to take it. Maybe he'll take possession after I flub it here. You know, one thing I would say, Michael, is you're right. You know, we want to continue to reinvest in the brand. Because of the already exceptional profitability of Coach, you know, our focus is maintaining the growth on this wonderfully profitable machine, right? And taking advantage of the opportunities we see. I think it's important to look at that in reverse because should we find ourselves in a fundamentally different marketplace, we can also throttle those investments back, right? One of the things that acceleration and transformation has done, as we've moved more into what I would... You know, variable or expenses that can be throttled up or down versus just, you know, fixed, every day, kind of overhead type expenses. That's part. When we say we have agility and an agile model, that's part of what I'm thinking about. The investments, you know, Todd, maybe you wanna say- Yeah. ...where you're investing. You know, a couple things. You hit it on the head. We have a lot of levers, and we aren't just gonna continue to spend 8% on marketing if the marketing doesn't pay for itself. I wanna be very clear about this. Yes, we're gonna invest in top-of-funnel marketing. We believe it, the storytelling is really important to continue this growth. But we're gonna measure it. We hold ourselves to high standards. My colleagues back there on supply chain, I'm not letting them off the hook on COGS, and opportunities, particularly as we see we come out to more normal ideas on shipping and logistics and even leather opportunities as demand may come down a little bit. That's opportunity for us. We know how to interact with our SPs, our service providers, and if we can continue to give them guaranteed flow on iconic styles, those are opportunities to get price. Okay? So the Acceleration Program, by reducing our SKU counts, actually benefits how we look to the consumer, but it's also a huge benefit for us in terms of the make. Then we don't just rest on SG&A. "Oh, it's all good." We look at every aspect of our business to make sure that we're operating at our best, and I'm challenging our teams every day about. Is this the right formula? We've also increased the profitability of our brick-and-mortar stores. We said two years ago, Joanne and I traded comments often, we don't believe in stores as marketing vehicles. We believe in stores as profitable vehicles, and you've seen us do that, and that is the lens we have. We'll continue to look for productivity, we'll continue to look for COGS savings, we'll continue to look for SG&A, and we will also look at that marketing spend to make sure it's driving the sales. If there is a massive recession, all those things are variable that we can take in to continue to drive this, the type of returns we've been giving to you for the last couple of years. Adrienne at Barclays. Thank you. Adrienne Yih from Barclays. Todd, my first question is for you. The mid-single-digit CAGR growth, when we looked at Scott's chart, it had been mid-single digit for a couple decades. That implies sort of growing in line with the market. Pinnacle, obviously, we know what they've done over the past three years, and there's a natural growth just mid-single digit. My question really is: how much of that mid-single digit is dollar versus units, and why would you not be able to take a little bit more of that? I love taking market share, and in the last two years, we've taken market share. We're not gonna take market share at the expense of profitability. Tomorrow, I can take a ton of market share, just lower all my prices, okay? That is not the game we're playing. We believe in sustainable long-term growth, achieving best-in-class operating margins, which is what we're gonna deliver. I think as we give voice to expressive luxury, as it becomes something from a beautiful video to something real, as our designers and our merchants really embrace that, particularly with the engine and the platform that we have from Tapestry, learning more and more about the customer. Because we've always been good at hindsighting, okay? Coach, that was in our DNA for a long period of time. The difference today is we're working on tools and ways to not hindsight, but to put it into the beginning of the process, to inform our creative. The logic now is used to make the magic work. So do I hope and is my expectation we'll do better than that? Of course it is, okay? This is a very reasonable, well-thought plan that will maintain the margins that we've been delivering. That, to me, is more important than just trying to steal market share at the expense of profitability. Thank you. Oliver Chen. How many questions, Oliver? Oliver Chen, Cowen and Company. Thank you. ESG's been a really strong priority for Tapestry. How might that intersect with what we should think about for financial modeling and your algorithm? There's many aspects of this, from emissions to life cycle to digital passports. Second question and final question on traffic. Traffic's been volatile and negative and positive and negative as well. What's your longer term assumption for how that evolves and/or, the strategies you should undertake or the protection you should have? Thank you. I'll try and answer both, but by the time I finish my first one, I'll forget your second one. ESG is a fundamental part of our business, and it's part of the fabric of our company. We call our ESG strategy Our Social Fabric for a reason. It is incorporated in our financials, and I would say critical in terms of underpinning our financials. As we think about the people pillar of our ESG strategy, we are embracing diversity and inclusion in our business. I would argue that as a creative business, we need that diversity to execute at our very best. We've tied those goals to compensation for our leadership because I believe, and we believe, that it is fundamental in terms of our ability to perform. Likewise, as we think about all of the work we're doing on sustainable materials and mapping of our raw materials and our supply chain and reducing carbon emissions, and making our longer term plans around reducing carbon emissions, that's critical. It's critical as risk management, and those are critical actions we have to take for our communities, for our customers. I think they're fundamental and foundational to our business model. We have incorporated it. We've stepped up. We have bold commitments out there. Frankly, it's energizing our organization. Our team wants to be part of the solution, and we're working hard at it. Traffic. Traffic. I knew I would forget. Thank you. You know, we've called our next phase of growth future speed because, you know, we see changes in trend happening all the time. In fact, the consumer is changing, so there, whether it be changes in traffic, changes in the supply chain, you know, over the last couple of years, I think we've proven the ability and the agility to navigate a lot of these changes. We've designed our organization to be agile so that we can stay close to our customer regardless of where they choose to shop. We have to be close to what they value, and our brands have become much more in touch with their own DNA, right? Their own values and how they wanna show up in the world, but also understanding their customer. We can intersect their customer at a values level, as we know our customer and use that rich data that we have to know the customer even better, and then leverage our platform to be where our customer is. We have the agility, and we have the platform and the capability to meet our customer where they are. We're actually less concerned about traffic higher here or higher there. We've navigated changes in demand beautifully over the last couple of years to deliver for our customers when different parts of the world shut down, either supply chain or demand changes with store closures. Again, we've engineered the organization to be able to deliver through all of that. Matt Boss from JPMorgan. Thanks. Matt Boss at JPMorgan. Nicely laid out presentation today. Thank you. First, Joanne, as we think about the flywheel for sustainable growth that you laid out, could you speak to new customer acquisition versus share of wallet from your most loyal customers that you're seeing today across the portfolio? Maybe Scott, could you just help rank the key drivers of gross margin expansion that's in the plan and what you've embedded for the competitive landscape, maybe relative to pre-pandemic? The consumer acquisition versus retention and driving lifetime value are both important. You know, I think at some time you can concentrate only on retention and talking to your existing customers. I call consumer acquisition oxygen. It's the oxygen our brands need to continue to bring new customers to our brands. We have great brands. I hope one thing you've taken away today and are inspired by is the just tremendous power of the portfolio of brands that we have. We know as we introduce more customers to these brands, and we're available on these platforms and social media, where customers are discovering brands, we're bringing customers to our brands. It's healthy. As I mentioned earlier, it's healthy growth for the brands because they're coming in and transacting at higher AURs. They're coming back with more frequency, and they're increasingly younger. That all is an important part of continuing to build for the long term on our brands. On retention, you know, that's an easier get, right? You've got a customer who already loves you, and we see. I think one of the statistics I shared, we see that when a customer knows us, they love us. They have a high intention to return to our brands after they've transacted once. We know that when we introduce customers to our brands, we have a better chance at retaining them, and we have the capabilities to do that. We can retain them if they come into a physical location or online. We have new tools of communication that we can reach that customer and an understanding of what might be next in terms of their needs and desires within the brand. We have lifestyle categories that allow us to expand how that customer engages with each of our brands, and it drives lifetime value. Yeah, Matt, and I think the first part of your question was around gross margin, what are the big drivers? You know, again, this, we're here to talk about the long-term plan. If I think about the long term, you know, we laid it out on the chart. Really, I'm gonna call it price, and price is all in, right? Price is a combination of merchandising to a new cost reality, whether it be, you know, freight, rising or lower, input costs, all the FX, all the dynamics that are there. Short term, you can have some noise. Longer term, what gives me con... Sorry, what gives me confidence and what is really embedded in this is the continued AUR growth and pricing power, frankly, which is offsetting those cost pressures and allowing us to continue to drive top line. You know, our margins are not heroic, right? We said we'd do 100 basis points over the three-year period. In the shorter term, there's more noise. We laid that out in our guidance, and I'll not, you know, go back through that. You know, we do see some of those cost pressures moderating over time. Again, we'll merchandise into the new realities. As it relates to your question around, I think it was basically what did we assume in terms of macroeconomic conditions and big assumptions, in short, we didn't assume any big changes in the conditions, right? We didn't assume a big recession coming down the pike, although it's not great today, right? I mean, we're in a tough environment, and we've taken what we see today and projected that forward on a fairly linear basis. The biggest individual example of that would be in China, where we've seen a reduction in the business. We're seeing positive signs. It continues to improve over time, and that continued improvement path is assumed throughout the three-year plan that we put in place. Mark at Baird. Thank you. Mark Altschwager from Baird. The transformation around the ERP system and how you've been able to better leverage the customer data is interesting and quite powerful. With that and the confidence you've built around the data analytics, how has your thinking on acquisitions evolved, and what is the unique value that Tapestry platform can bring to a brand relative to when the company embarked on its multi-brand journey, what seven years ago? We are unlocking incredible power with our platform and the investments that we've made in our technology infrastructure and our digital capabilities. As Noam pointed out, it's not just about the technology, but about how we use the technology. Data and analytics are great, but you need to put them in the hands of the decision makers. The ways of working that we've developed over the last couple of years has been a real unlock in terms of value creation for our brands. We've integrated all of these capabilities into our brands, but we're just getting started. We have a very strong portfolio of brands that we're leveraging these capabilities against, and we have a lot of runway still to unlock with the portfolio that we have at Tapestry today. It is a scalable platform. We have the capability to scale. We're leveraging it today across the three brands, and we see a lot of runway. We laid out our goals today on the runway we see, and that is our current focus. Brooke of Goldman Sachs. Thank you. Brooke at Goldman Sachs. We talked a lot about the strength of the digital platform, and you just mentioned this a moment ago. Would love to hear you dimensionalize the most important investments in digital and analytics over the course of the next few years in the plan, and the unlocks that you anticipate as a result. That's a great question. The opportunities are vast. Some of the things that we're gonna deploy, I'm not really sure what they are today. One of the key points of the infrastructure that we've built is the really solid core technology architecture that we have. The architecture that we've spent the last six years putting in allows us to adopt new technology faster. We're on modern platforms, we're in the cloud. We have a modern architecture that allows us to harness this data that we have. It's rich data. There's a lot of it. So having the capability and the engineering capabilities to leverage that data across different applications is a tremendous competitive advantage for us. We're using it, and I'll toss it to Noam. You probably have a few. We're using it today to really build out our digital experiences, and we have an opportunity to really become more omni. One point that I'm particularly passionate about is connecting all of these capabilities with our store associates. You know, over the past two years, it's become so apparent that our customer values the experience that our associate provides. Our associates have been innovating and reaching out to our customers in digital spaces more and more, and we're harnessing the power of our platform and connecting it to our associates, and we're just getting started on that, honestly. That is, you know, that presents tremendous upside potential as we go forward. Noam, I'm not sure if there's anything more you would add. Yeah. I mean, you covered a lot of it, beautifully. I mean, really, at its core, it's about building the best customer engagement engine in the business supporting a multi-brand environment. I touched on it a little bit, but it's not just data for data's sake, right? Whether it's in merch planning buying or marketing touchpoints, it's about relevance, right? There's an opportunity at each part of the product development funnel, at each point of the customer engagement funnel, to create much more relevant touchpoints. I think you all know it and see it as consumers broadly, right? There's a tremendous opportunity to really understand the consumers at this stage of the funnel and knowing and understanding what's gonna be valuable in a creative, just like our amazing store associates would do in the store, right? They know exactly what to say and how to say and what to show with it, and even the best AI doesn't fully replicate that, right? It's about that intentionality and investing in experiences and capabilities that really drive that relevance forward touch by touch point by touch point by touch point, getting those learnings, and then that quickly syndicates and propagates across the family of brands because all the teams are working so closely together, and I'm sure people have questions about the metaverse and other experiences, right? There's gonna be continued places where she plays. New social networks, new environments, right? It's about continuing to build out our microservices architecture to be able to play seamlessly wherever she's at, and that's really where the focus of the investments, whether it's capital or in people power, where that'll be pointed. Maybe just build on that. The way I think about it very simplistically is the more you know about the consumer, the more bespoke that communication can be, and it's not infallible, but it increases our batting average, right? We're less likely to irritate the consumer by sending them irrelevance, and by the same token, we're more likely to put something in front of the consumer that's going to compel them, engage them to interact with our brand. Simplistically, we're just trying to get better and better and better at that, and that's based on knowledge. Jay Sole from UBS. Jeff, damn it. Great. Thank you. Jay Sole from UBS. My question's about the secondary market for handbags. Can you talk about how your thoughts have evolved over time about what the company's relationship is with this channel, and maybe talk to us how the plan you've laid out today addresses, you know, how the company views the channel going forward. Is it an opportunity? It is a competitor? Any thoughts you can share would be appreciated. Thank you. Yeah. I'm gonna kick it off quite briefly and say that we look at it as an opportunity and toss it to Todd, where Coach brand is really investing, not necessarily in other platforms, but in our own brand. Wave to Todd. Yeah. Thank you. Yeah. I think what's most relevant about the platform is what we can do ourselves. If you think about the journey we've been under the last couple of years with our (Re)Loved program, we recognize that our consumer wants to ensure what they're buying has longevity. We've made a commitment to minimize our carbon footprint, minimize our waste, so the (Re)Loved program is one aspect of that. We're ramping it up and scaling it up. We make 1,000 bespoke bags a month now just on (Re)Loved. That's powerful. Our AURs there tend to be higher, so it's really interesting in that regard. There's a lot of different platforms out there over time. We'll see how many of them make sense or don't make sense. I don't think we're committed to any one of them. You know, we really do believe in a test and learn agenda. I think ultimately Coachtopia, for me, is the future. Coachtopia, while it will start off as a small idea, the learnings that we take from Coachtopia, and when you meet our leader of Coachtopia this afternoon or right after this in the atrium, you'll hear her passion about using the learnings to bring back to Coach. In the construction of our bags, thinking about it, the glues, the ways to deconstruct, so there is secondary life. I think that, to me, is the bigger opportunity for us, because what our customer wants to know is they're buying something now. Again, it goes back to this timeless consumer. I wanna know it is timeless. I don't wanna just buy a fad. For us, I think that's what's relevant. Dana Telsey. Thank you. As you think about the customer base that you talked about, with 70% of luxury being from Gen Z and millennials over time, where are each of the brands now, where do you think they get to, and how do you see the core customer evolving and where they go to? Thank you. You. Yeah. I think across our portfolio, there's. It obviously varies in terms of our average customer base. I think our average customer is you know 40-ish years old plus or minus depending on the brand. And you know what we've had success in over the last 2 years is understanding our brand and not actually targeting an age. I think Todd talked about this and spoke about this well. It's not talking about an age. It's really understanding the core DNA and positioning of the brand and then reaching out to customers in a relevant way particularly younger customers. We're true to who the brands are and the brand DNA and we have been attracting younger consumers to our brands at increasing rates. We know the formula works and that is our focus. We are watching the trends shifting, and we're ready to engage these consumers where they are. You see that around the world as well. You see that in where we're showing up and how we're showing up. On TikTok, I think Kate Spade has, like, some unbelievable hashtag views on TikTok alone. Coach was the first fashion brand to have a transactional site on the TikTok and Douyin in China. We have a test-and-learn agenda. We have the capabilities, and we're placing our brands in the places where younger consumers are discovering brands and engaging with brands. That, we think, is the formula for success. The only thing I can add, and Joanne talked about this just a second ago, but just to put a fine point on it. While we, the Coach brand globally may be a young forty today, when you think about our growth markets like China, that's a much younger customer. That's 10 years to 12 years younger. And as this emerging middle class continues to prosper, those are new opportunities. There's gonna be in the next, I think it's 5 years, like 100 million new participants in the middle class in China. That's huge opportunity for us. In markets, we kinda downplay it because we have such big numbers in China and North America, but I don't wanna lose sight of the rest of Southeast Asia, Indonesia, Singapore. These markets are untapped for us in any material way. They're much younger, and there are a lot of people that we can talk to, and we're seeing success in those markets today. I would also add that similar to the idea of expanding and regionally, I also think by category becomes very important. For example, I mentioned earlier in the presentation, but we are acquiring a lot of young, new customers through jewelry. One of the most exciting things we're gonna do next year is we're gonna be opening up a standalone jewelry store in London. That is gonna be a very interesting test and learn for us because, A, they're very small footprint stores, so the economics on them is very, very good, and it is just a young customer acquisition machine. Looking forward to that. I'm so jealous of her jewelry business. Super high margins as well. You know, when you speak, when you think about strategizing, even when you have a smaller brand, you know, and smaller base of customers, what was interesting in the last years is that we rejuvenated our base. You know, and the most unbelievable part was that we are recruiting a lot of young customers with our iconic product, obviously the fashionable expression of this iconic product. You know, that made extremely confident, you know, in the fact that, you know, we need to capitalize even more on these iconic products and push these products in front of these people. Simeon from BMO. Hey, everyone. Thanks for all the information. Great day. Given the wealth of data that you have, can you talk a little bit more about the frequency of shopping, the evolution or maybe even, like, the handbags purchased per person per year? I'm just curious what you've seen, given you know your customers so well, over the last few years, and then within the new cohort of the acquired customers. At this point, do we know, or I'm sure you do, are you willing to share the gross margin delta between Kate Spade and Coach? How much of that is structural versus channel and product versus just scale? Thank you. The first part of your question was about. Frequency. Oh, frequency. Thank you. Frequency of purchase, you know, we are seeing increasing frequency from our customers, particularly in our new customers. We're focused on this, what Noam loves to call the customer P&L. We're creating our strategies underpinned by this customer P&L, understanding our customer acquisition needs, our retention goals, and our frequency goals. Importantly, as we put those together, we're putting specific strategies underneath each. When we have our customer acquisition strategy, which I defined as oxygen for our brands, we have the capabilities to test and learn behind different acquisition vehicles. That's what's, you know. We measure our success. We're even improving our measurement criteria and our measurement tools to be able to measure success there. Retention, to your point, is a huge opportunity for us as we think particularly about going from the first purchase to the second purchase. As we go from one to two, we're increasingly likely to get her for the third, fourth, and fifth, as you likely know. Those, I would say, are the two areas of focus, acquisition and retention, particularly on that second purchase. I think there was a question on gross margin structural differences. You know, I guess from my perspective, and invite my colleagues to chime in here, a couple things to remember. Number one, the served market of Kate is different than Coach. Coach is a much broader, bigger enterprise with different global exposures, China in particular, which tends to have a slightly different product aesthetic and higher margins and, you know, that's probably the biggest single difference is the geography and the categories. Also, I mean, frankly, you know, the rejuvenation of Coach is a little bit ahead of where Kate is. Under the leadership here from Liz and the team, they've made great progress. They're just getting started, right? I think part of it is evolution and part of it is served market. That would be any adds? Just to add a little color on that. It's why we're laser focused on building handbag pillars that can become evergreen. Because once you have a sizable evergreen, as Coach well knows, evergreen component of your business, it is a cash machine. That's what we're building, and I hope if you look at the product, you can see where it's begun. You know, from the Coach perspective, we see it now. You know, we've had the benefit of a signature platform. We've had the benefit of elongating families. Liz and her team, it really only in the last year and a half, two years have started to introduce that, and it's getting traction. If you know the their signature Spade platform becomes even close to Coach, it changes their profile dramatically, and it's compelling. Their product is great, compelling. As I said, I was only half joking about how envious I am of her jewelry business. I mean, it's powerful, and it does bring in the younger customer. You know, often we talk a little bit about the learnings, "Oh, Coach is giving learnings to the other brands." There's a lot that we learn from them. I'm in her stores almost as often as I am in my stores, so. Kimberly of Morgan Stanley. I was hoping, Scott, that you could break down the 11% revenue growth between 2019 and 2022 between price and unit volume. Is it, you know, price is up 11% and unit volume is stable? Or what's the breakdown? Then if you have the statistics by brand, that would be great. Secondarily, what would you like to see out of the businesses that you've acquired over the last 5 years, 6 years, 7 years? What would you like to see them produce financially before you would green-light another acquisition? Thanks. Yeah, I don't know if that's all gonna be on me. I guess the first question is, you know, we're here to talk about the future. I mean, in general, as we look back, I don't know if we've broken that down. It was mainly price. Yeah. Mainly. Mainly price. Mainly price. Yeah. Exactly. I don't know if I guess. I think that's. Yeah. That shows the health of our business. We didn't have to promote, create more unit volume. I think there's upside here, at least speaking for the Coach brand. We've taken price. We like that. We don't have to work as hard. It's a good thing. Yeah. Our focus through our transformation has been on brand building and really restoring the health and vibrancy to each of our brands. We see that playing out in pricing power. We're really pleased with the results. Again, 11%, as you mentioned, over pre-pandemic levels growing through a tremendously turbulent time for our customers, which I think shows how focused we are on delivering for our customers. As it relates to acquisition and the targets for our brands, we have so much runway ahead of us, you know, even at Coach, especially at Coach, at high margins. We've laid out, I think, a very compelling case here for growth at Stuart Weitzman and Kate Spade, not only on the top line, but also in operating margin, which we think represents tremendous value creation for our company over the next few years. Again, Kimberly, as we mentioned, that is our near-term focus. The platform is scalable. We think we have a lot to offer our brands, but we have a lot of runway with the brands in our portfolio today. Great. We'll take our last question from Aneesha at Bernstein. Thank you. Aneesha Sherman from Bernstein. So we've heard a lot about the younger consumer and the fact that she shops more frequently. That's been remarkably resilient this year. As we go into next year, if these younger consumers do end up more pressured by the macro- We do end up seeing some mix shift within your portfolio, shift towards outlet, perhaps a shift towards competitors that are not being as price disciplined. How do you think about those risks to the 6%-7% top line, and do you have enough give in your outlook to account for that? We believe our outlook is very realistic. You know, our eyes are wide open in terms of what's happening with our consumer and how our consumer behaves. We do have a tremendous platform to engage that consumer across multiple channels, wherever, however, and whenever she chooses to shop. Those are all profitable channels for us, so it is important to point that out. Even our stores, which are still under some traffic pressure, are more profitable today than they were pre-pandemic, even our stores channel. In terms of how we're thinking about managing our business, you know, we have made a fundamental pivot over the last two years, and Scott touched on it a little bit. We've created efficiencies across our business so that we can invest in brand building. We're not just talking to our customers about price. Because we're 90% direct to consumer, we control our destiny, and we're not going back to old ways. We are talking. We have more levers to drive traffic, to engage our customer that aren't price. It's talking about our great product. Also, as Scott mentioned, we have a much more variable model. We've created efficiencies across our platform to allow us to lean into brand building and move at the speed of the customer. That's really our focus. The other thing I wanna add, I think what I'm about to say is true for all brands, but I can say definitively for the Coach brand. We welcome rational competition, but we're not reliant on it. We have moved so far from where we were, and we believe our brand codes are so strong and differentiated from maybe our closest competitors, that if there's people who start discounting because they have over-inventory, it's just not fungible. You can't get a signature product. You can't get the quality. You can't buy into the storytelling that Coach by simply buying another bag. When you couple that with the delta between us and traditional European luxury, there's so much room. If our young consumer wants that great go out bag and her choice is Pillow Tabby at a few hundred dollars or a traditional European luxury, the delta there is $1,500. I think that bodes well for our future, regardless of what may happen in the mid- to short-term, on the economy. Thank you so much. I will now turn it to Joanne for some closing remarks. I'll awkwardly stand in front of my team here. So I just wanna thank you all for coming. This was a great day for us to be able to tell our story. You know, thank you on behalf of the entire Tapestry team and our organization, really. We appreciate your interest and your support of our business. We are building on our transformation from a position of strength, and I hope that we were able to convey that to you today. You know, we have great brands and a powerful platform, and we are powering our iconic brands to move at the speed of the consumer, and that's what gives us confidence in the growth agenda that we've laid out today. Again, thank you for coming, and have a great day.