Capri Holdings (CPRI) Q4 2025 earnings summary

Executive summary

• Announced definitive agreement to sell Versace to Prada Group for $1.375 billion, with proceeds to reduce debt, fund growth, and potentially reinstate share repurchases; Versace to be classified as discontinued operation in FY26.

• Fourth quarter revenue declined 15–15.4% year-over-year, with Michael Kors down 15.6–16% and Jimmy Choo down 2.9–3%.

• Net loss for Q4 was $645 million ($5.44 per share); adjusted net loss was $581 million ($4.90 per share), mainly due to a $545 million non-cash tax valuation allowance.

• Strategic initiatives underway to reinvigorate Michael Kors and expand Jimmy Choo, with early signs of improvement in sales momentum and consumer engagement; customer database grew 10% year-over-year.

• Capri is in early stages of a turnaround, with new strategies and leadership focused on returning to growth.

Financial highlights

• Q4 revenue was $1.0 billion, down 15–15.4% year-over-year (14.1% in constant currency).

• Q4 gross margin was 61.0%, down from 62.7% last year; Michael Kors at 58.6%, Jimmy Choo at 66.2%.

• Q4 operating loss: $33 million; net loss: $581 million, including a $545 million non-cash tax valuation allowance.

• Free cash flow for fiscal 2025 was $153 million; net debt at year-end was $1.3 billion, down from $1.5 billion.

• Weighted average diluted shares outstanding for FY26 guidance: ~119 million.

Outlook and guidance

• Fiscal 2026 revenue expected at $3.3–$3.4 billion; Michael Kors: $2.75–$2.85 billion, Jimmy Choo: $540–$550 million; operating income around $100 million.

• Gross margin guidance: 61–61.5%; diluted EPS expected between $1.20–$1.40; effective tax rate ~15%.

• Michael Kors FY26 operating margin expected high single digits; Jimmy Choo negative mid-single digits.

• First quarter 2026 revenue guidance: $765–$780 million; EPS: $0.10–$0.15; break-even operating margin.

• Guidance excludes Versace, which will be classified as discontinued from FY26.