In the past few seasons, the big story at Coach has been a massive effort to turn around its sinking business, which has thus far involved overhauling the look of its stores, cutting down on discounting, hiring Stuart Vevers to take over the brand's creative direction and, at Fashion Week this September, launching a new clothing collection called Coach 1941 to help clarify its creative vision.
The New York-based company fully expected its sales to take a temporary hit due to some of these measures, namely closing stores and reducing the frequency of promotional offers. Things would get worse before they'd get better. But now, after a few quarters of lackluster sales, things finally seem to be picking up.
Coach announced Tuesday morning that net sales for the first quarter of fiscal 2016 totaled $1.03 billion, compared to $1.04 billion last year. Looking at the tail end of 2015, though, that's quite an improvement: the third quarter brought a 15 percent drop in sales ($929 million, down from $1.1 billion the year before), and the fourth quarter resulted in a 12 percent decrease ($1 billion compared to $1.14 billion). By comparison, Coach's most recent sales results represent a decrease of a mere 3 percent.
That relative success was particularly evident in Europe, where sales grew at a double digit pace, and in mainland China. Hong Kong, however, saw its sales slip thanks to decreased tourist traffic.
At this point, Coach is preparing a push into the holiday season, investing big-time in under-$100 gift sets. As for the product offering, expect an emphasis on those classic wintertime fashion tropes: shearling, metallics and glitter.