Capri Holdings Revenue Falls 3.5% in Q1 FY2027 as Michael Kors Declines and Jimmy Choo Posts Double-Digit Growth

Capri Holdings, the parent company of Michael Kors and Jimmy Choo, announced on August 5 its financial results for the first quarter of fiscal 2027, which ended June 27, 2026. Total revenue decreased 3.5% year over year to $769 million. On a constant-currency basis, revenue declined 4.1%.

Performance diverged across the group’s two brands. Michael Kors recorded a revenue decline, while Jimmy Choo delivered double-digit growth. Reflecting inventory delays at Michael Kors, softer trends in the EMEA region and updated foreign exchange assumptions, Capri Holdings lowered its fiscal 2027 revenue outlook from approximately $3.525 billion to approximately $3.4 billion.

Summary

Profitability Improves Despite Revenue Decline

Although Capri Holdings reported lower quarterly revenue, gross profit totaled $500 million and gross margin reached 65.0%, compared with $502 million and 63.0% in the prior-year period. The improvement was primarily driven by higher full-price sell-throughs and lower tariff rates compared with the first quarter of fiscal 2026.

Operating income increased to $17 million from $16 million, while operating margin improved to 2.2% from 2.0%. Adjusted operating income rose to $28 million, with an adjusted operating margin of 3.6%, compared with $20 million and 2.5%, respectively, a year earlier.

Net income increased to $69 million from $56 million. Diluted earnings per share rose to $0.60 from $0.47, while adjusted diluted earnings per share increased to $0.67 from $0.50.

John D. Idol, Chairman and Chief Executive Officer of Capri Holdings, said:

“We are encouraged by our first quarter results, which exceeded our expectations and demonstrated the progress we are making to build a stronger and more profitable business. Our strategic initiatives across both Michael Kors and Jimmy Choo are driving deeper consumer engagement through enhanced brand storytelling and compelling product innovation.”

Michael Kors Revenue Declines 7.1%

Michael Kors generated revenue of $590 million, representing a 7.1% decline from the prior-year period. On a constant-currency basis, revenue decreased 7.6%. Approximately $10 million of revenue was attributable to wholesale shipments occurring earlier than anticipated.

By region, revenue in the Americas declined to $372 million from $413 million, while EMEA revenue decreased to $142 million from $150 million. Asia was the only region to record growth, with revenue increasing to $76 million from $72 million.

Gross profit fell to $377 million from $388 million. However, gross margin expanded by 280 basis points to 63.9% from 61.1%, primarily due to higher full-price sell-throughs and lower tariff rates.

Operating income declined to $55 million from $63 million, while operating margin decreased to 9.3% from 9.9%. The contraction was primarily attributed to expense deleverage resulting from lower revenue.

Jimmy Choo Posts 10.5% Revenue Growth

Jimmy Choo’s revenue increased 10.5% year over year to $179 million. On a constant-currency basis, revenue rose 9.3%.

The brand recorded growth across all regions. Revenue in the Americas increased to $58 million from $46 million, EMEA revenue rose to $82 million from $78 million, and Asia revenue edged up to $39 million from $38 million.

Gross profit increased to $123 million from $114 million. Gross margin, however, declined to 68.7% from 70.4%, primarily due to channel mix.

Operating income more than tripled to $13 million from $4 million, while operating margin expanded to 7.3% from 2.5%. The improvement was mainly driven by expense leverage on higher revenue.

Fiscal 2027 Revenue Outlook Lowered to Approximately $3.4 Billion

Capri Holdings lowered its fiscal 2027 revenue outlook to approximately $3.4 billion from its previous forecast of approximately $3.525 billion.

The revised outlook reflects an approximately $50 million impact from lower-than-anticipated second-quarter revenue at Michael Kors due to inventory delays. It also incorporates an approximately $50 million impact from softer trends in EMEA amid the ongoing conflict in the Middle East and approximately $35 million in foreign currency headwinds relative to the company’s previous assumptions.

At the brand level, Capri Holdings lowered its full-year revenue forecast for Michael Kors from approximately $2.9 billion to approximately $2.765 billion. By contrast, the company raised its Jimmy Choo revenue outlook from approximately $625 million to approximately $635 million.

Commenting on the outlook, Idol said: “As we look at the balance of fiscal 2027 we expect Jimmy Choo to continue to grow and return to profitability. At Michael Kors certain headwinds including lower than anticipated inventory levels in the second quarter, softer trends in EMEA and updated foreign currency exchange rate assumptions are impacting our revenue outlook. As a result we now expect fiscal 2027 revenue of approximately $3.4 billion.”

Despite lowering its revenue forecast, Capri Holdings maintained its fiscal 2027 diluted earnings per share outlook of approximately $2.15, representing growth of about 40% from the prior year. The company said cost-reduction measures would enable it to preserve its earnings outlook amid the revised revenue expectations.

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