What happened

Shares of Canada Goose (GOOS 1.16%) were heading south today after the apparel company best known for its winter parkas gave cautious remarks on its U.S. business in its fourth-quarter earnings report this morning.

As a result, the stock closed down 10.5% on the news. 

So what

Canada Goose stock actually opened the day up 10% as the company delivered better-than-expected results in the winter period.

Revenue rose 31.4%, driven by 65.4% growth in Asia-Pacific, reaching 293.2 million Canadian dollars, which was much better than estimates of just 13.5% growth.

Management gave credit to the reopening in China following the end of its zero-COVID policy, as shoppers there rushed to snap up luxury goods during the quarter. Asia-Pacific is now its biggest market, with CA$114.1 million in revenue in the quarter.

On the bottom line, the company's adjusted earnings per share increased from CA$0.04 to CA$0.14, which beat estimates at CA$0.07.

CEO Dani Reiss said: "I am pleased with our fourth-quarter results, particularly the strong revenue results generated in Greater China and EMEA. This is a testament to the strength of the brand, and this momentum has continued alongside early encouraging results in North America in fiscal 2024 year to date."

Now what

Looking ahead, Canada Goose called for CA$1.4 billion to CA$1.5 billion in revenue in the current year, or 19% at the midpoint, which was better than analyst estimates, and it expects per-share profit of CA$1.20 to CA$1.48, which was lower than the analyst consensus at $1.46.

Investors also seem spooked by comments about the U.S. market, as sales fell 4.5% in the U.S. in the fourth quarter.

Management also said on the call that it wasn't being "super-ambitious" in the U.S. and expects a challenging year there.

Investors may seem to be fearful that those problems could spread elsewhere, but Canada Goose got less than one-fourth of its sales from the U.S. in the quarter, meaning the U.S. market isn't as important to the apparel stock as you might think. That makes today's sell-off look like an overreaction.