Coach Gets Fired

Updated from 10:01 a.m. EDT

Shares of Coach (COH) tumbled 12% Tuesday after the luxury handbag maker offered cautious comments about the holiday season.

The New York-based company reiterated its profit forecast for the fiscal year but said traffic at its U.S. retail stores has slowed in recent weeks, leading it to give a "conservative" same-store sales forecast for rest of the year.

Shares were down $5.09 to $36.38 in recent trading.

The outlook came in Coach's first-quarter earnings report, in which the company posted a profit of $154.8 million, or 41 cents a share, for the period ended Sept. 29. A year earlier, Coach made $125.6 million, or 34 cents a share.

The earnings per share were above Coach's July forecast of 39 cents, and were a penny ahead of analysts' average estimate.

Coach's first-quarter sales rose to $676.7 million from $529.4 million a year earlier. Wall Street anticipated sales of $659 million, according to Thomson Financial.

Same-store sales, or sales at stores open at least a year, jumped 19.3% in the U.S. In Japan, where Coach has a significant presence, same-store sales rose at a low-single-digit rate.

U.S. retail stores recorded a 10.8% rise in same-store sales, while outlet stores saw a 27.3% surge.

For the key holiday period, however, Coach forecast a same-store sales rise in the low-single-digits for its North American retail sales, though it expects its outlet stores will generate growth at least in the mid-teens.