Despite a tough retail environment, volatility in tourist spending and macroeconomic headwinds, Coach, Inc. (COH – Free Report) posted better-than-expected second-quarter fiscal 2017 bottom-line results. The adjusted earnings of 75 cents a share beat the Zacks Consensus Estimate by a couple of cents, thereby resulting in a positive earnings surprise of 2.7% and marking the 12th-straight quarter of earnings beat. The quarterly earnings also increased roughly 11% year over year.

Net sales of this New York-based company came in at $1,321.7 million, up about 4% year over year, and include a favorable impact of 40 basis points from currency translation. However, sales growth were hurt by 100 basis points on account of management’s efforts to elevate the Coach brand’s positioning in the North American wholesale channel by lowering promotional events and door closures. We noted that the top line came almost in line with the Zacks Consensus Estimate of $1,322.2 million.

Coach registered third consecutive quarter of positive comparable-store sales at its North American segment. The company’s international operations witnessed healthy growth with strength seen across Europe and Mainland China.

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The company is undergoing a brand transformation and is introducing modern luxury concept stores in key markets. The acquisition of Stuart Weitzman has been accretive to its performance, and is being viewed as a significant step in its efforts toward becoming a multi-brand company. Management highlighted that net sales for the Coach brand aggregated $1.20 billion (up 2%), while that of Stuart Weitzman brand totaled $118 million (up 26%) for the quarter.

Coach’s shares were up 1% during pre-market trading hours. However, we noted that in the past six months, the stock has declined 17.2%, while the Zacks categorized Textile-Apparel Manufacturing industry, to which it belongs, has fallen 17.8%.