Tapestry CEO Jide Zeitlin, who took that role in September, will stay on for at least the next three years to execute the company's "multi-year growth agenda," the company announced on Monday.
He will also temporarily take over the conglomerate's Coach division because CEO and brand president Joshua Schulman is leaving "after a transition period," according to a company press release. Schulman had arrived in 2017 from upscale department store Bergdorf Goodman.
Tapestry last month had also announced new leadership at its Kate Spade and Stuart Weitzman divisions, as it reported decent holiday sales amid gross margin declines fueled mostly by those two brands.
Tapestry has become entirely Zeitlin's project, with new leadership at Kate Spade and Stuart Weitzman already in place and soon arriving to Coach.
The conglomerate, under previous CEO Victor Luis, had executed an impressive turnaround of the Coach brand, restoring it as a luxury label after years of outlet sales and discounts. That was to be the plan for the other two, but things haven't panned out that way.
Coach performed well in the holiday quarter, with net sales up 2% year over year to $1.3 billion and global comparable sales also up 2%. But at Kate Spade, comps fell 4%, despite the benefit of about 300 basis points from global e-commerce, and Stuart Weitzman net sales fell 7% to $116 million. Meanwhile, the COVID-19 outbreak has fueled concerns among analysts.
But, despite those challenges, several analysts also have expressed confidence in Zeitlin in recent weeks. The company is set to host its first investors day in some six years, making the event highly anticipated. Wells Fargo analyst Ike Boruchow said that of particular interest will be how COVID-19, a disease caused by a member of the coronavirus family, has affected supply and demand.
Meanwhile, Zeitlin seems prepared to hit "pause" on the company's previous strategy of adding to its stable.
"With their first analyst day since 2014 upcoming this summer, we expect to hear compelling details on what [Tapestry's] new senior level management sees ahead for the company," Boruchow said in an emailed client note. In recent meetings with top executives, Boruchow's Wells Fargo team said that "CEO Zeitlin did make two things clear — this will not be a 'shrink to grow' situation and M&A is off the table for the time being. Meaning we won't hear about a fundamental step back, and we certainly would not expect any additions to the ... portfolio until progress is made at both Kate and SW."