Capri Holdings Earnings Call Transcripts
Fiscal Year 2026
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Modernization efforts for Michael Kors and Jimmy Choo are driving improved consumer engagement, with Jimmy Choo showing strong sales growth and Michael Kors benefiting from new marketing, pricing, and store renovations. Financial outlook includes margin expansion, reduced debt, and continued investment in core brands.
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Third quarter results exceeded expectations, with improved gross margins and EPS despite a 4% revenue decline. Strategic initiatives and the Versace sale strengthened the balance sheet, positioning for growth and margin expansion in fiscal 2027.
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Q2 revenue fell 2.5% to $856M, with gross margin down due to tariffs, but full-price comps turned positive at Michael Kors and retail trends improved at Jimmy Choo. Versace sale proceeds will reduce debt, and a $1B share repurchase is planned for fiscal 2027.
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Revenue and EPS exceeded expectations despite a 6% year-over-year decline, with sequential improvement across all regions. Strategic initiatives at Michael Kors and Jimmy Choo are gaining traction, and guidance for fiscal 2026 was raised, though higher tariffs will impact margins.
Fiscal Year 2025
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Following the Versace sale, the company is refocusing on Michael Kors and Jimmy Choo, targeting growth through brand revitalization, store renovations, and strategic pricing. Margin expansion and positive sales inflection are expected next fiscal year, with strong profitability goals for both brands over the next three to five years.
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Q4 revenue fell 15% year-over-year, with Michael Kors down 16% and Jimmy Choo down 3%. The pending Versace sale will reduce debt and refocus growth on Michael Kors and Jimmy Choo, with strategic initiatives showing early positive signs and a return to growth expected in 2027.
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Future growth will be driven by brand-focused strategies, cost reductions, and targeted investments, with revenue growth expected from fiscal 2027. Versace, Jimmy Choo, and Michael Kors each have tailored plans to expand product categories, optimize stores, and enhance digital engagement.
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Revenue fell 12% year-over-year amid global luxury demand softness and brand repositioning challenges. Strategic initiatives and cost reductions are expected to stabilize performance in fiscal 2026, with a return to growth targeted for fiscal 2027.
Fiscal Year 2024
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Capri is refocusing on independent growth after terminating its merger, with brand-specific transformation plans for Michael Kors, Versace, and Jimmy Choo. Financial performance has been challenged by global luxury softness and internal missteps, but cost reductions, data-driven strategies, and renewed focus on North America aim to stabilize and return to growth.