Capri Holdings exceeds Q3 expectations despite revenue decline

US fashion group Capri Holdings Limited experienced a decline in sales during the third quarter of the 2025/26 financial year. However, it successfully returned to profitability. The company's latest results, published on Tuesday, surpassed the expectations of both management and analysts.

In the most recent quarter, which ended on December 27, revenue from continuing operations amounted to approximately 1.02 billion dollars. This figure excludes contributions from the Versace brand, whose sale to the fashion group Prada SpA was completed in early December. This represented a 4.0 percent decrease compared to the same period last year. Adjusted for currency fluctuations, revenue shrank by 5.9 percent.

The decline in group revenue was attributed to losses at its core brand, Michael Kors. Its revenues fell by 5.6 percent in the third quarter to 858 million dollars, or 7.3 percent on a currency-neutral basis. In contrast, the footwear label Jimmy Choo achieved an increase of 5.0 percent, reaching 167 million dollars. This represents a 1.9 percent rise on a currency-neutral basis.

Unexpectedly high costs from recent tariff developments caused the gross margin to fall to 60.8 percent. This is a decrease from the 63.1 percent reported in the same quarter last year. However, due to lower one-off charges, operating profit from continuing operations increased from 26 million US dollars to 46 million dollars. Adjusted for special items, operating income decreased from 97 million US dollars to 79 million dollars.

Company to maintain its strategic course

Net profit from continuing operations jumped from six million dollars to 57 million dollars. Adjusted for special items, it increased from 74 million dollars to 98 million dollars. The reported quarterly net income attributable to shareholders was 116 million dollars. This follows a net loss of 547 million dollars in the same period last year. The previous year's loss was largely due to significant impairment charges related to Versace.

Chairman and CEO John Idol praised the surprisingly solid figures. “We are very pleased with our third-quarter results, which exceeded our expectations,” he emphasised in a statement, reaffirming the group's direction. “At both Michael Kors and Jimmy Choo, we are continuing to advance our strategic initiatives to position our unique brands for long-term success,” Idol explained.

Based on the current figures, management has slightly raised its revenue forecast. For the current 2025/26 financial year, it now expects revenue from continuing operations to be between 3.45 and 3.475 billion dollars. The target for adjusted operating profit from continuing operations remains unchanged. It therefore remains at approximately 100 million dollars.

This article was translated to English using an AI tool.

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