Capri Holdings losses widen as Versace sale nears completion

Capri Holdings has reported a wider loss for the second quarter of fiscal 2026, as revenue declined across its remaining brands Michael Kors and Jimmy Choo, ahead of the planned sale of Versace to Prada.

For the quarter ended 27 September 2025, total revenue from continuing operations fell 2.5% to $856 million (£657 million). The group posted a net loss of $34 million (£24.5 million), compared to net income of $76 million (£58.3 million) a year earlier.

Operating margin stood at 1.4%, compared to 0.7% last year, while adjusted operating margin was 2.3%, down from 4.2%.

John D. Idol, Chairman and CEO of Capri Holdings, said the results were stronger than anticipated: "Trends continued to improve sequentially, which resulted in revenue, gross margin and operating income exceeding our expectations. This performance demonstrates the progress we are making as we execute against our strategic initiatives to energise our fashion luxury houses."

The company said it expects the $1.375 billion (£1.06 billion) sale of Versace to Prada to close in the fiscal third quarter. Proceeds will be used to repay the majority of its debt, which Capri said will "substantially strengthen" its balance sheet and allow greater flexibility for future investment.

The board has also authorised a new $1 billion (£770 million) share repurchase programme, which it expects to begin in fiscal 2027.

Brand Breakdown

Michael Kors' revenue fell 1.8% to $725 million (£558 million), or 3.3% in constant currency, with operating income of $73 million (£56 million).

Jimmy Choo revenue declined 6.4% to $131 million (£100 million), or 9.3% in constant currency. The brand posted an operating loss of $9 million (£6.9 million), compared to a loss of $5 million last year.

Looking ahead, for fiscal 2026, Capri expects total revenue of $3.375 - $3.45 billion (£2.59 - £2.56 billion) and operating income of around $100 million (£76 million). Michael Kors is projected to deliver revenue of $2.8 - $2.875 billion (£2.15 - £2.21 billion), while Jimmy Choo is forecast between $565 - $575 million (£433 - £441 million).

The company continues to expect improvement in retail trends in the second half of the year, positioning it to return to growth in fiscal 2027.