Tapestry acquired Stuart Weitzman in 2015 for $574 million but struggled to drive profitability. The brand saw a 16% sales decline in the second quarter of 2025, with an annual loss of $21.2 million. The sale to Caleres is expected to close this summer. With Stuart Weitzman off the books, Tapestry will focus on Coach and Kate Spade, both of which have performed better than their footwear counterpart. Coach saw a 10% sales increase to $1.7 billion in the second quarter, fueled by Gen Z demand. Meanwhile, Kate Spade has faced headwinds, with a 10% sales decline to $416.4 million, which has prompted a strategic reset. Tapestry did not reply to a request for comment.

Meanwhile, with the merger dead, Capri may divest Versace and Jimmy Choo to boost shareholder value, according to industry insiders. Sources indicate that potential buyers — including Prada Group, which has not acquired a company since the 1990s — are already circling. Prada was granted exclusive access to Versace’s financials for four weeks as of February 19. While the deal would expand Prada’s reach, Versace’s declining revenues and uncertain valuation could complicate negotiations. Jimmy Choo, Versace and Prada are set to present their latest collections at Milan Fashion Week, which starts on February 24. Prada Group-owned Miu Miu will show in Paris on March 11.

The Tapestry-Capri deal was first announced in August 2023 as an attempt to form a U.S. luxury powerhouse. By April 2024, the FTC had sued to block the deal, citing concerns over competition in the affordable luxury handbag market. In October, a federal judge ruled against the merger, siding with the FTC, and by November, Tapestry and Capri officially terminated the agreement.

Brian Yarbrough, an Edward Jones analyst covering Tapestry, told Glossy in November that the company was fortunate the deal was blocked, as he had always viewed it as a poor decision.

“In retail acquisitions, success stories are rare,” Yarbrough said. “While Coach is performing well, Kate Spade and Stuart Weitzman are struggling. Adding three more underperforming brands would have left Tapestry with just one strong performer out of six, which simply wouldn’t make sense.”

With the failed merger behind it, Capri is now in a period of recalibration. During an investor day on February 19, CEO John Idol emphasized the company’s focus on “product innovation, impactful marketing and right-sizing our retail fleet.”

If Versace and Jimmy Choo do hit the market, it could be a sign that Capri is looking to simplify operations and put more weight behind Michael Kors, its most significant revenue driver.

According to Ariel Ohana, managing partner at Ohana & Co., which advised on some of the biggest luxury M&A deals, the challenges in the luxury footwear market go beyond just corporate restructuring. “The wholesale channel is in shambles, with closures or restructuring at key luxury retailers, including Farfetch, Matches and Net-a-Porter, and the Saks-Neiman merger. Many luxury footwear brands relied heavily on this channel, and the decline has forced them to rethink their distribution models,” he told Glossy.

Compounding the issue is a broader consumption shift. “High-heeled shoes are losing favor, especially with Gen Z, who prioritize comfort and practicality,” he said. “The ‘athleisure’ trend isn’t just in apparel — it’s reflected in footwear, too. Golden Goose, On Running and New Balance are all seeing double-digit revenue growth, while brands still focused on high heels, like Jimmy Choo, are struggling.”

On the other side of the transaction, Caleres is strategically enhancing its portfolio. Known for brands like Famous Footwear, Sam Edelman, Allen Edmonds and Naturalizer, Caleres has been actively expanding its market presence. In November 2024, the company appointed Nancy Bitetto as svp of New York brands, including Franco Sarto, Vince and Veronica Beard, aiming to “accelerate growth and expand profitability within the Caleres brand portfolio.” In a brand statement, CEO Jay Schmidt said, “Attracting exceptional leadership is a crucial element of our strategic priorities.”

Positioned as a lead Caleres brand, Weitzman is expected to drive nearly half of the company’s total revenue and contribute the majority of operating profit. Caleres plans to tap into its proven footwear expertise to scale the brand across categories and channels, with a focus on profitability post-integration. CEO Jay Schmidt emphasized the company’s commitment to a smooth transition in collaboration with both the Tapestry and Stuart Weitzman teams.

The unwinding of the Tapestry-Capri deal has forced both companies to rethink their futures. For Tapestry, the strategy is now clear: streamline operations and focus on its core brands, Coach and Kate Spade. For Capri, the outlook is less certain. If it follows through on the rumored sales of Versace and Jimmy Choo, it could signal a pivot back to a more manageable portfolio centered on Michael Kors. In the second quarter of fiscal 2025, Michael Kors’s revenue declined by 16% year-over-year to $738 million, with its operating income decreasing to $87 million from $169 million in the prior year.

But it also raises a larger question: Has the dream of an American LVMH finally been abandoned? 

“Turning a mono-brand company into a multi-brand group is an enormous cultural shift,” said Ohana. “Coach and Michael Kors were both built as singular, dominant brands. When you add smaller brands or brands from different markets — like Weitzman in footwear or Versace in luxury — you create enormous challenges in management focus and brand strategy. Sometimes, companies pursue this strategy not because it’s best for the brands, but because public market pressure forces them to find new growth levers when their core business plateaus.”

Executive moves

• Kering is promoting Mélanie Flouquet, currently chief strategy officer, to general secretary effective March 1. She’ll focus on strengthening the group’s governance, risk management and regional integration.
• Nordstrom has appointed veteran Neiman Marcus stylist Catherine Bloom as director of luxury styling. In step, it has transformed its Melrose Place Nordstrom Local into a dedicated “Catherine Bloom for Nordstrom” space to host clients.

Earnings

• ​​Alibaba posted a strong third quarter on February 20, driven by surging AI demand and steady e-commerce growth. Revenue for the three months ending Dec. 31 rose 8% year-over-year to 280.1 billion renminbi ($38.3 billion), beating analyst expectations. Profit skyrocketed 239% to 48.9 billion renminbi ($6.7 billion), fueled by AI infrastructure expansion and higher returns from equity investments. Taobao and Tmall, Alibaba’s core e-commerce business, saw revenue climb 5% to 136 billion renminbi ($18.6 billion), while its high-spending 88VIP loyalty program grew by double digits to reach 49 million members.

The latest from Glossy

Other news to know