Capri Holdings Limited (NYSE: CPRI) Q4 2025 Earnings Call | 05/28/2025

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Capri Holdings Limited (NYSE: CPRI) reported Q4 2025 results on May 28, 2025, with revenue down 15.4% year-over-year to $1.04 billion, reflecting persistent weakness across its luxury portfolio amid challenging market conditions and softer consumer demand. Michael Kors, the company’s flagship brand, saw revenue decline 15.6% to $694 million, while Jimmy Choo and Versace posted declines of 2.9% and 21.2% to $133 million and $208 million, respectively. Gross profit for the quarter was $631 million, with a gross margin of 61.0%, down from 62.7% last year, as higher costs and lower sales volume weighed on profitability. The company reported an operating loss of $116 million, an improvement from the $543 million loss a year earlier, but the net loss widened to $645 million, or $5.44 per diluted share, largely due to a non-cash tax valuation allowance. Adjusted loss from operations was $33 million, with an adjusted operating margin of (3.2)%, compared to adjusted operating income of $78 million and a 6.4% margin in the prior year. Net inventory stood at $869 million, up 1% year-over-year, mainly due to earlier-than-expected receipts. Capri ended the quarter with $166 million in cash and $1.3 billion in total borrowings. Strategically, Capri entered a definitive agreement in April 2025 to sell Versace to Prada Group for $1.375 billion in cash, a transaction expected to close in the second half of 2025. Management stated that this move will help reduce debt, invest in future growth, and potentially reinstate a share repurchase program. CEO John D. Idol emphasized that, despite a tough fiscal year, new strategic initiatives are underway to improve performance at Michael Kors and Jimmy Choo, with positive early indicators emerging. Looking ahead, Capri Holdings projects fiscal 2026 revenue between $3.3 billion and $3.4 billion, with operating income expected around $100 million and diluted EPS in the range of $1.20 to $1.40, though management cautioned that tariff and currency uncertainties may impact results. The company aims to return to growth in fiscal 2027, targeting $4 billion in revenue for Michael Kors and $800 million for Jimmy Choo over time, alongside restoring double-digit operating margins. Outlook: FY2026: Revenue guidance of $3.3–$3.4 billion; operating income ~$100 million; diluted EPS $1.20–$1.40. Focus on debt reduction, margin improvement, and brand turnaround initiatives. Versace sale to Prada Group expected to close in H2 2025, supporting future investment and balance sheet strength. About Inside Ticker: For more expert analysis and real-time updates on Capri Holdings Limited (NYSE: CPRI) and other market movers, follow Inside Ticker and visit InsideTicker.com for in-depth reports, financial insights, and the latest news on leading companies. #CapriHoldings #CPRI #EarningsCall #Q42025 #LuxuryBrands #MichaelKors #JimmyChoo #Versace #RevenueDecline #Turnaround #StockMarket #InsideTicker