Capri Holdings Limited Announces Second Quarter Fiscal 2026 Results

Revenue, Gross Margin and Operating Income Exceeded Expectations Announces $1 Billion Share Repurchase Program Capri Holdings Limited (NYSE:CPRI), a global fashion luxury group, today announced its financial results for the second quarter of Fiscal 2026 ended September 27, 2025. Second Quarter Fiscal 2026 Highlights from Continuing Operations Revenue decreased 2.5% on a reported basis and 4.2% in constant currencyOperating margin of (1.4)%; adjusted operating margin of 2.3%Loss per share of $(0.28); adjusted loss per share of $(0.03) reflecting a higher than anticipated tax rate John D. Idol, the Company's Chairman and Chief Executive Officer, said, “We are encouraged by our second quarter results. 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 energize our fashion luxury houses.” Mr. Idol continued, “With the Versace sale expected to close in our fiscal third quarter, we are now fully focused on the growth of our two iconic brands Michael Kors and Jimmy Choo. We plan to use the proceeds of the sale to repay the majority of our debt, substantially strengthening our balance sheet and providing greater financial flexibility to both invest in our growth as well as return capital to shareholders in the future. Given the encouraging signs of stabilization across our business and our planned reduction in debt levels, our Board of Directors has authorized a new $1 billion share repurchase program which the Company expects to begin implementing in fiscal 2027.” Mr. Idol concluded, “Looking ahead, we continue to expect retail trends to improve in the back half of fiscal 2026 positioning us to return to growth in fiscal 2027. Longer term we remain optimistic about the sustainable growth potential of both Michael Kors and Jimmy Choo.” Second Quarter Fiscal 2026 Results Financial Results and non-GAAP Reconciliation The Company's results are reported in this press release in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and on an adjusted, non-GAAP basis. A reconciliation of GAAP to non-GAAP financial information is provided at the end of this press release. As previously announced, on April 10, 2025, the Company and Prada S.p.A. (“Prada”) entered into a Stock Purchase Agreement (the “Purchase Agreement”) whereby Prada has agreed to acquire certain subsidiaries of the Company which operate the Company’s Versace business for an aggregate purchase price of $1.375 billion in cash, subject to certain adjustments. As a result, the Company determined that the held for sale and discontinued operations criteria have been met and the Company has classified the results of operations and cash flows of its Versace business as discontinued operations in its consolidated statements of operations and comprehensive (loss) income and consolidated statements of cash flows for all periods presented. The related assets and liabilities associated with the discontinued operations are classified as held for sale in the consolidated balance sheets as of September 27, 2025, March 29, 2025, and September 28, 2024. The transaction is expected to close in the second half of calendar 2025, subject to customary closing conditions including regulatory approvals. Unless otherwise noted, the discussion below including analysis of financial condition and results of operations relates only to continuing operations. Overview of Capri Holdings Second Quarter Fiscal 2026 Results Total revenue of $856 million decreased 2.5% compared to last year. On a constant currency basis, total revenue decreased 4.2%.Gross profit was $522 million and gross margin was 61.0%, compared to $547 million and 62.3% in the prior year. Tariffs negatively impacted the gross margin rate by approximately 130 basis points.Loss from operations was $12 million and operating margin was (1.4)%, compared to loss from operations of $6 million and operating margin of (0.7)% in the prior year. Adjusted income from operations was $20 million and adjusted operating margin was 2.3%, compared to $37 million and 4.2% in the prior year.Net loss was $34 million, or $(0.28) per diluted share, compared to net income of $42 million, or $0.37 per diluted share, in the prior year. Adjusted net loss was $4 million, or $(0.03) per diluted share, compared to $76 million, or $0.64 per diluted share, in the prior year. A higher than anticipated effective tax rate versus our original guidance due to the Company's valuation allowance position negatively impacted adjusted net income by $24 million or $0.20 per share.Net inventory as of September 27, 2025 was $766 million, a 2.8% decrease compared to the prior year.Cash flow used in operating activities for the second quarter was $33 million, while capital expenditures were $13 million, resulting in free cash flow of $(46) million.Cash and cash equivalents totaled $120 million, and total borrowings outstanding were $1.76 billion, resulting in net debt of $1.64 billion as of September 27, 2025 versus $1.58 billion last year. Michael Kors Second Quarter Fiscal 2026 Results Michael Kors revenue of $725 million decreased 1.8% on a reported basis and 3.3% on a constant currency basis.Michael Kors gross profit was $430 million and gross margin was 59.3%, compared to $451 million and 61.1% in the prior year.Michael Kors operating income was $73 million and operating margin was 10.1%, compared to $87 million and 11.8% in the prior year. Jimmy Choo Second Quarter Fiscal 2026 Results Jimmy Choo revenue of $131 million decreased 6.4% on a reported basis and 9.3% on a constant currency basis.Jimmy Choo gross profit was $92 million and gross margin was 70.2%, compared to $96 million and 68.6% in the prior year.Jimmy Choo operating loss was $9 million and operating margin was (6.9)%, compared to operating loss of $5 million and operating margin of (3.6)% in the prior year. Share Repurchase Program On November 4, 2025, the Company announced the Board of Directors approved a three-year share repurchase program of up to $1 billion of its outstanding ordinary shares, which the Company expects to begin implementing in fiscal 2027. Share repurchases may be made in open market or privately negotiated transactions, subject to market conditions, applicable legal requirements, trading restrictions under the Company's insider trading policy and other relevant factors. The program may be suspended or discontinued at any time. Outlook The following guidance is provided on an adjusted, non-GAAP basis, and is based on continuing operations only. Guidance reflects incremental tariffs on imports into the United States from the European Union at 15%, Cambodia and Indonesia at 19%, Bangladesh and Vietnam at 20%, India at 25% and China at 30%. Financial results could differ materially from the current outlook due to a number of external events which are not reflected in our guidance, including changes in global macroeconomic conditions, incremental tariff rates in excess of our assumptions, greater than anticipated inflationary pressures or weakening consumer confidence, and further considerable fluctuations in foreign currency exchange rates. Fiscal Year 2026 Outlook For Capri Holdings, the Company expects the following: Total revenue of approximately $3.375 to $3.45 billionOperating income of approximately $100 millionNet interest income of approximately $85 to $95 millionEffective tax rate in the mid-teens rangeWeighted average diluted shares outstanding of approximately 120 millionDiluted earnings per share of approximately $1.20 to $1.40Capital expenditures of approximately $110 million For Michael Kors, the Company expects the following: Total revenue of approximately $2.8 to $2.875 billionOperating margin in the high-single-digit range For Jimmy Choo, the Company expects the following: Total revenue of approximately $565 to $575 millionOperating margin in the negative mid-single-digit range Third Quarter Fiscal 2026 Outlook For Capri Holdings, the Company expects the following: Total revenue of approximately $975 million to $1.0 billionOperating margin of approximately 7.0% to 8.0%Net interest income of approximately $20 millionEffective tax rate in the low to mid-single-digit rangeWeighted average diluted shares outstanding of approximately 120 millionDiluted earnings per share of approximately $0.70 to $0.80 For Michael Kors, the Company expects the following: Total revenue of approximately $825 to $845 millionOperating margin in the low-teens range For Jimmy Choo, the Company expects the following: Total revenue of approximately $150 to $155 millionOperating margin in the negative low- to mid-single-digit range The Company is unable to provide a reconciliation of the non-GAAP financial outlook to the corresponding GAAP measures presented in this press release and on the Company’s conference call without unreasonable effort due to the challenge in quantifying various significant items, including, but not limited to, foreign currency fluctuations, taxes, increased tariffs, and any future restructuring and other charges and expenses. Conference Call Information A conference call to discuss second quarter Fiscal 2026 results is scheduled for today, November 4, 2025 at 8:30 a.m. ET. A live webcast of the conference call will be available on the Company's website, www.capriholdings.com. In addition, a replay will be available shortly after the conclusion of the call and remain available until November 11, 2025. To access the telephone replay, listeners should dial 1 (844) 512-2921 or 1 (412) 317-6671 for international callers. The access code for the replay is 13754843. A replay of the webcast will also be available within two hours of the conclusion of the call. Use of Non-GAAP Financial Measures Constant currency effects are non-GAAP financial measures, which are provided to supplement our reported operating results to facilitate comparisons of our operating results and trends in our business, excluding the effects of foreign currency rate fluctuations. Because we are a global company, foreign currency exchange rates may have a significant effect on our reported results. The Company believes presenting metrics on a constant currency basis will help investors to understand the effect of significant year-over-year foreign currency exchange rate fluctuations and provide a framework to assess how business is performing and expected to perform excluding these effects. We calculate constant currency measures and the related foreign currency impacts by translating the current year's reported amounts into comparable amounts using prior year's foreign exchange rates for each currency. All constant currency performance measures discussed in this press release should be considered a supplement to and not in lieu of our operating performance measures calculated in accordance with U.S. GAAP. The Company also presents free cash flow, which is a non-GAAP measure and is calculated by taking net cash provided by operating activities less capital expenditures for the period. The Company believes that free cash flow is an important liquidity measure of cash that is available after giving effect to our capital and strategic plans, and that it is useful to investors because it measures the Company's ability to generate cash. Additionally, this earnings release includes certain non-GAAP financial measures that exclude certain costs associated with impairment charges, Capri transformation costs, restructuring and other charges, store renovation program costs and transaction related expenses. The Company uses non-GAAP financial measures, among other things, to evaluate its operating performance and in order to represent the manner in which the Company conducts and views its business. The Company believes that excluding these items helps its management and investors compare operating performance based on its ongoing operations. While the Company considers the non-GAAP measures to be useful supplemental measures in analyzing its results, they are not intended to replace, nor act as a substitute for, any amounts presented in its consolidated financial statements prepared in conformity with U.S. GAAP and may be different from non-GAAP measures reported by other companies. About Capri Holdings Limited Capri Holdings is a global fashion luxury group consisting of iconic brands Michael Kors, Jimmy Choo and Versace. Our commitment to glamorous style and craftsmanship is at the heart of each of our luxury brands. We have built our reputation on designing exceptional, innovative products that cover the full spectrum of fashion luxury categories. Our strength lies in the unique DNA and heritage of each of our brands, the diversity and passion of our people and our dedication to the clients and communities we serve. Capri Holdings Limited is publicly listed on the New York Stock Exchange under the ticker CPRI. Forward Looking Statements This press release contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Capri about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. All statements other than statements of historical facts included herein, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words “plans”, “believes”, “expects”, “intends”, “will”, “should”, “could”, “would”, “may”, “anticipates”, “might” or similar words or phrases, are forward-looking statements. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions, which could cause actual results to differ materially from those projected or implied in any forward-looking statements. These risks, uncertainties and other factors include but are not limited to, macroeconomic pressures and general uncertainty regarding the overall future economic environment, the imposition or threat of imposition of new or additional duties, tariffs or trade restrictions on the importation of our products; changes in fashion, consumer traffic and retail trends; fluctuations in demand for our products; loss of market share and increased competition; risks associated with operating in international markets and global sourcing activities, including currency fluctuations, disruptions or delays in manufacturing or shipments; departure of key employees or failure to attract and retain highly qualified personnel; levels of cash flow and future availability of credit, Capri's ability to successfully execute its growth strategies or cost reduction measures; the risk of cybersecurity threats and privacy or data security breaches; reductions in our wholesale channel; high consumer debt levels, recession and inflationary pressures and general economic, political, business or market conditions; the impact of epidemics, pandemics, disasters or catastrophes; our ability to successfully execute the proposed sale of Versace to Prada and other risks related to the transaction; extreme weather conditions and natural disasters; acts of war and other geopolitical conflicts; the risk of any litigation relating to the Company's previously proposed merger with Tapestry, Inc., the termination of the merger agreement and/or public disclosures related thereto; as well as the risk factors identified in the Company's Annual Report on Form 10-K, Form 10-Q and Form 8-K reports filed with the Securities and Exchange Commission. Please consult these documents for a more complete understanding of these risks and uncertainties. Any forward-looking statement in this press release speaks only as of the date made and Capri disclaims any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations. SCHEDULE 1 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except share and per share data) (Unaudited) Three Months Ended Six Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Total revenue $ 856 $ 878 $ 1,653 $ 1,726 Cost of goods sold 334 331 629 644 Gross profit 522 547 1,024 1,082 Total operating expenses 534 553 1,020 1,077 (Loss) income from operations (12 ) (6 ) 4 5 Other income, net — — (1 ) — Interest income, net (17 ) (10 ) (35 ) (14 ) Foreign currency loss (gain) 3 (11 ) (2 ) (7 ) Income before income taxes 2 15 42 26 Provision (benefit) for income taxes 36 (27 ) 20 (21 ) Net (loss) income from continuing operations (34 ) 42 22 47 Net income (loss) from discontinued operations, net of tax 6 (19 ) 3 (36 ) Net (loss) income (28 ) 23 25 11 Less: Net (loss) income attributable to noncontrolling interest from continuing operations — (1 ) — 1 Net (loss) income attributable to Capri $ (28 ) $ 24 $ 25 $ 10 Weighted average ordinary shares outstanding: Basic 119,786,829 118,467,372 119,293,324 117,953,855 Diluted 119,786,829 118,777,723 119,653,017 118,517,098 Net (loss) income per ordinary share attributable to Capri: Basic from continuing operations $ (0.28 ) $ 0.37 $ 0.19 $ 0.40 Basic from discontinued operations $ 0.06 $ (0.17 ) 0.03 (0.31 ) Basic per ordinary share $ (0.22 ) $ 0.20 $ 0.22 $ 0.09 Diluted from continuing operations $ (0.28 ) $ 0.37 $ 0.19 $ 0.40 Diluted from discontinued operations $ 0.06 $ (0.17 ) 0.03 (0.31 ) Diluted per ordinary share $ (0.22 ) $ 0.20 $ 0.22 $ 0.09 SCHEDULE 2 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In millions, except share data) (Unaudited) September 27, 2025 March 29, 2025 September 28, 2024 Assets Current assets Cash and cash equivalents $ 120 $ 107 $ 119 Receivables, net 217 215 218 Inventories, net 766 701 788 Prepaid expenses and other current assets 203 156 143 Current assets held for sale 399 342 399 Total current assets 1,705 1,521 1,667 Property and equipment, net 383 393 422 Operating lease right-of-use assets 885 825 927 Intangible assets, net 580 582 624 Goodwill 203 199 270 Deferred tax assets 1 — 285 Other assets 98 99 113 Noncurrent assets held for sale 1,762 1,594 2,484 Total assets $ 5,617 $ 5,213 $ 6,792 Liabilities and Shareholders’ Equity Current liabilities Accounts payable $ 370 $ 379 $ 365 Accrued payroll and payroll related expenses 85 81 78 Accrued income taxes 84 66 34 Short-term operating lease liabilities 254 249 265 Short-term debt 11 24 470 Accrued expenses and other current liabilities 230 233 263 Current liabilities held for sale 328 304 315 Total current liabilities 1,362 1,336 1,790 Long-term operating lease liabilities 859 814 907 Deferred tax liabilities 67 233 176 Long-term debt 1,753 1,466 1,227 Other long-term liabilities 1,042 417 492 Noncurrent liabilities held for sale 604 575 714 Total liabilities 5,687 4,841 5,306 Commitments and contingencies Shareholders’ equity Ordinary shares, no par value; 650,000,000 shares authorized; 228,929,803 shares issued and 119,072,572 outstanding at September 27, 2025; 227,672,351 shares issued and 117,913,201 outstanding at March 29, 2025; 227,571,175 shares issued and 117,824,265 outstanding at September 28, 2024 — — — Treasury shares, at cost (109,857,231 shares at September 27, 2025, 109,759,150 shares at March 29, 2025 and 109,746,910 shares at September 28, 2024) (5,464 ) (5,462 ) (5,462 ) Additional paid-in capital 1,501 1,476 1,454 Accumulated other comprehensive (loss) income (433 ) 57 3 Retained earnings 4,322 4,297 5,489 Total shareholders’ equity of Capri (74 ) 368 1,484 Noncontrolling interest 4 4 2 Total shareholders’ equity (70 ) 372 1,486 Total liabilities and shareholders’ equity $ 5,617 $ 5,213 $ 6,792 SCHEDULE 3 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES CONSOLIDATED REVENUE DATA ($ in millions) (Unaudited) Three Months Ended Six Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Revenue by Segment and Region: Michael Kors The Americas $ 457 $ 492 $ 870 $ 943 EMEA 194 187 344 325 Asia 74 59 146 145 Michael Kors Revenue 725 738 1,360 1,413 Jimmy Choo The Americas 34 35 80 87 EMEA 67 71 145 148 Asia 30 34 68 78 Jimmy Choo Revenue 131 140 293 313 Capri The Americas 491 527 950 1,030 EMEA 261 258 489 473 Asia 104 93 214 223 Total Capri Revenue $ 856 $ 878 $ 1,653 $ 1,726 SCHEDULE 4 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES CONSOLIDATED SEGMENT DATA ($ in millions) (Unaudited) Three Months Ended Six Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 Total revenue: Michael Kors $ 725 $ 738 $ 1,360 $ 1,413 Jimmy Choo 131 140 293 313 Total revenue $ 856 $ 878 $ 1,653 $ 1,726 Gross profit: Michael Kors $ 430 $ 451 $ 818 $ 870 Jimmy Choo 92 96 206 212 Total gross profit $ 522 $ 547 $ 1,024 $ 1,082 Selling, general and administrative expenses: Michael Kors $ 339 $ 344 $ 646 $ 668 Jimmy Choo 94 93 197 198 Corporate 48 60 93 122 Total selling, general and administrative expenses $ 481 $ 497 $ 936 $ 988 Depreciation and amortization: Michael Kors $ 18 $ 20 $ 36 $ 40 Jimmy Choo 7 8 14 15 Corporate 5 7 10 12 Total depreciation and amortization $ 30 $ 35 $ 60 $ 67 (Loss) income from operations: Michael Kors $ 73 $ 87 $ 136 $ 162 Jimmy Choo (9 ) (5 ) (5 ) (1 ) 64 82 131 161 Less: Corporate expenses (53 ) (57 ) (103 ) (119 ) Impairment of assets (21 ) (20 ) (21 ) (20 ) Transaction related costs — (10 ) — (15 ) Restructuring and other expense (2 ) (1 ) (3 ) (2 ) Total (loss) income from operations $ (12 ) $ (6 ) $ 4 $ 5 Operating margin: Michael Kors 10.1 % 11.8 % 10.0 % 11.5 % Jimmy Choo (6.9 )% (3.6 )% (1.7 )% (0.3 )% Capri (1.4 )% (0.7 )% 0.2 % 0.3 % SCHEDULE 5 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES SUPPLEMENTAL RETAIL STORE INFORMATION (Unaudited) As of Retail Store Information: September 27, 2025 September 28, 2024 Michael Kors 691 755 Jimmy Choo 216 226 Total number of retail stores 907 981 SCHEDULE 6 CAPRI HOLDINGS LIMITED AND SUBSIDIARIES CONSTANT CURRENCY DATA ($ In millions) (Unaudited) Three Months Ended % Change September 27, 2025 September 28, 2024 As Reported Constant Currency Total revenue: Michael Kors $ 725 $ 738 (1.8 )% (3.3 )% Jimmy Choo 131 140 (6.4 )% (9.3 )% Total revenue $ 856 $ 878 (2.5 )% (4.2 )% Six Months Ended % Change September 27, 2025 September 28, 2024 As Reported Constant Currency Total revenue: Michael Kors $ 1,360 $ 1,413 (3.8 )% (5.2 )% Jimmy Choo 293 313 (6.4 )% (9.3 )% Total revenue $ 1,653 $ 1,726 (4.2 )% (5.9 )% SCHEDULE 7 RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In millions, except per share data) (Unaudited) Three Months Ended Six Months Ended September 27, 2025 September 28, 2024 September 27, 2025 September 28, 2024 (Loss) income from operations, as reported $ (12 ) $ (6 ) $ 4 $ 5 Adjustments: Impairment charges 21 20 21 20 Capri transformation(1) 6 12 8 26 Restructuring and other charges(2) 2 1 3 2 Store renovation program 3 — 4 — Transaction related costs(3) — 10 — 15 Total adjustments 32 43 36 63 Income from operations, as adjusted $ 20 $ 37 $ 40 $ 68 Operating margin, as reported (1.4 )% (0.7 )% 0.2 % 0.3 % Operating margin, as adjusted 2.3 % 4.2 % 2.4 % 3.9 % Net (loss) income attributable to Capri from continuing operations, as reported $ (34 ) $ 43 $ 22 $ 46 Adjustments to income from operations from above 32 43 36 63 Tax effect of income from operations adjustments (2 ) (10 ) (2 ) (15 ) Net (loss) income attributable to Capri from continuing operations, as adjusted $ (4 ) $ 76 $ 56 $ 94 Weighted average basic ordinary shares outstanding 119,786,829 118,467,372 119,293,324 117,953,855 Weighted average diluted ordinary shares outstanding 119,786,829 118,777,723 119,653,017 118,517,098 Diluted net (loss) income per ordinary share from continuing operations, as reported $ (0.28 ) $ 0.37 $ 0.19 $ 0.40 Net income adjustments per ordinary share 0.25 0.27 0.28 0.40 Diluted net (loss) income per ordinary share from continuing operations, as adjusted $ (0.03 ) $ 0.64 $ 0.47 $ 0.80 (1) The Capri transformation program represents a multi-year, multi-project initiative intended to improve the operating effectiveness and efficiency of our organization by creating best in class shared platforms across our brands and by expanding our digital capabilities. These initiatives cover multiple aspects of our operations including supply chain, marketing, omni-channel customer experience, e-commerce, data analytics and IT infrastructure. (2) Relates to costs incurred in connection with the Company's Global Optimization Plan which primarily relate to severance, lease termination and store closure costs. (3) Relates to costs incurred by the Company in connection with the previously terminated merger agreement with Tapestry, Inc. Source: Capri Holdings Limited