Capri beats expectations as Versace exit sharpens focus on Michael Kors and Jimmy Choo

Capri Holdings has reported stronger-than-expected third-quarter results for fiscal 2026, signalling early momentum in its post-Versace era as the group sharpens its focus on Michael Kors and Jimmy Choo while dramatically reducing debt.

For the three months ending December 27, 2025, the New York-listed luxury group posted revenue of $1.025 billion (£750 million), down 4 % year-on-year, but ahead of internal expectations. Earnings per share reached $0.47 (£0.34), with adjusted EPS coming in at $0.81 (£0.59), exceeding market forecasts.

The quarter also marked a significant reset of Capri’s balance sheet following the completion of the sale of Versace to Prada in December. Net debt fell sharply to $80 million (£58 million), down from $1.17 billion (£850 million) a year earlier.

John D. Idol, Chairman and Chief Executive Officer of Capri Holdings, said: "We were pleased with our third quarter performance, which exceeded our expectations. Across both Michael Kors and Jimmy Choo we continue to advance our strategic initiatives to position our iconic brands for long-term success.

"Looking ahead, we remain confident that these strategies will support a return to growth in fiscal 2027 as well as establish the groundwork for sustainable performance well into the future."

While revenue declined amid ongoing macroeconomic uncertainty and currency headwinds, profitability showed signs of improvement. Operating margin rose to 4.5%, compared to 2.4% a year earlier.

Net income from continuing operations increased to $57 million ($41.5 million), compared to $6 million (£4.4 million) in the prior year. The group also generated $252 million (£183.5 million) in free cash flow during the quarter.

In terms of brands, Michael Kors continued to feel pressure, with revenue declining 5.6% to $858 million (£625 million). By contrast, Jimmy Choo delivered a return to growth, with revenue rising 5% to $167 million (£121 million).

For the full fiscal year 2026, Capri Holdings reiterated guidance for total revenue of approximately $3.45 to $3.475 billion (£2.51 to £2.53 billion). The group expects Michael Kors to deliver revenue of up to $2.875 billion (£2.09 billion), while Jimmy Choo is forecast to generate between $590 million and $600 million (£430 million and £437 million).