Michael Kors-owner Capri posts quarterly revenue above estimates
On Wednesday, Capri Holdings beat estimates for fourth-quarter revenue as its focus on reviving sales at its Michael Kors brand with new designs helped bring back shoppers.
Capri has narrowed down its focus on the Michael Kors fashion brand following a failed attempt to merge with rival and Coach -parent Tapestry last year. In April, the company sold its underperforming Versace label to Italian rival Prada in a $1.38 billion deal.
"We are confident in our ability to grow Michael Kors to $4 billion in revenue and Jimmy Choo to $800 million over time while restoring operating margin to the double-digit range," Capri CEO John Idol said.
Consumers in North America have scaled back spending on high-end goods amid concerns over looming price hikes on everyday essentials and discretionary items in the coming months due to higher supply chain costs fueled by new tariffs.
The company now expects total annual revenue in the range of $3.3 billion to $3.4 billion, accounting for Versace now as part of discontinued operations.
The forecast excludes changes in global macroeconomic conditions, tariff rates, higher inflation or weakening consumer confidence, Capri said.
It posted a 15.4% drop in revenue to $1.04 billion for the quarter ended March 29, compared with analysts' average estimate of a 19.3% decline to $986.57 million, according to data compiled by LSEG.
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