Capri Holdings (CPRI) Q4 2026 earnings summary

Executive summary

• Fiscal 2026 focused on strategic initiatives for Michael Kors and Jimmy Choo, including product innovation, brand storytelling, and consumer engagement, resulting in a return to profitability.

• Q4 revenue declined 3.7% year-over-year (7% in constant currency), aligning with expectations.

• Gross margin expanded to 64.8%, and adjusted EPS rose to $0.22, compared to a loss last year.

• Sale of Versace completed, strengthening the balance sheet and enhancing financial flexibility; results now reflect only continuing operations.

• Inventory was reduced by 17% year-over-year, and $79 million in shares were repurchased in Q4.

Financial highlights

• Q4 revenue was $796 million, down 3.7% year-over-year; gross margin improved to 64.8% from 59.9%.

• Gross margin included a $40 million tariff refund; underlying margin up 300 basis points excluding tariffs.

• Adjusted operating margin for Q4 was (0.1)%, compared to (6.9)% in the prior year.

• Adjusted net income for Q4 was $27 million ($0.22 per share); net debt reduced to $222 million from $1.4 billion.

• Free cash flow for fiscal 2026 was $134 million.

Outlook and guidance

• Fiscal 2027 guidance projects low single-digit revenue growth to ~$3.525 billion, gross margin expansion of ~200 basis points, and operating income of ~$190 million.

• Adjusted EPS is projected at ~$2.15, up ~40% year-over-year, with ~$200 million in planned share repurchases.

• Michael Kors FY27 revenue expected at ~$2.9 billion with low double-digit operating margin; Jimmy Choo at ~$625 million with low single-digit operating margin.

• Retail revenue to grow mid-single digits; wholesale to decline due to reduced off-price shipments.

• FY27 capital expenditures projected at ~$125 million, focused on store renovations and IT.