What's Happening?
Capri Holdings Limited reported a net loss in the second quarter of its 2025/26 financial year, with revenue from continuing operations totaling $856 million. This figure excludes contributions from Versace,
which was sold to Prada SpA. The revenue decline of 2.5% compared to the previous year was adjusted to a 4.2% decrease when accounting for currency fluctuations. Michael Kors and Jimmy Choo, the remaining brands in the portfolio, experienced revenue declines of 3.3% and 9.3%, respectively. The gross margin fell from 62.3% to 61.0%, and the operating loss increased to $12 million. The net loss attributable to shareholders was $28 million, impacted by higher interest payments and tax burdens.
Why It's Important?
The financial results of Capri Holdings highlight the challenges faced by luxury fashion brands in maintaining profitability amid economic pressures and strategic changes. The sale of Versace and the focus on remaining brands indicate a shift in strategy aimed at revitalizing the company's portfolio. The decline in revenue and increased operating losses underscore the difficulties in navigating market fluctuations and consumer demand. The company's ability to stabilize and grow its business will be critical in determining its future success. The unchanged annual forecasts suggest confidence in the strategic initiatives being implemented to improve performance.
What's Next?
Capri Holdings plans to continue its strategic initiatives to revitalize its luxury fashion houses, focusing on improving revenue, gross margin, and operating income. The company remains committed to its annual forecasts, expecting revenue from continuing operations to be between $3.38 and $3.45 billion. The focus will be on enhancing brand desirability and expanding market presence. The luxury fashion industry will be monitoring Capri Holdings' progress in executing its strategic plans and achieving financial stability.
