What drove US’ Capri Holdings’ Q1 FY27 revenue decline?
For the quarter ended June 29, 2026, Capri Holdings posted total revenue of $1.19 billion, representing a 6 per cent year-on-year (YoY) decline compared to $1.27 billion in the same period last year. Net income for the quarter stood at $59 million, down from $81 million a year earlier.
Capri Holdings has reported weaker Q1 FY27 results, with revenue declining 6 per cent YoY to $1.19 billion and net income falling to $59 million amid subdued luxury demand.
Sales declined across Michael Kors, Versace and Jimmy Choo.
The company lowered its FY27 outlook, citing inventory delays, weaker EMEA demand linked to the Middle East conflict and foreign exchange headwinds.
“Our first quarter results reflect the ongoing challenges in the luxury sector, with softer demand across key markets. We remain focused on executing our strategic initiatives and managing inventory levels to position our brands for long-term growth,” said John D Idol, chairman and CEO, Capri Holdings.
Gross profit for the quarter was $708 million, with a gross margin of 59.5 per cent, compared to $763 million and a margin of 60.1 per cent in the prior-year period. Diluted earnings per share (EPS) came in at $0.42, down from $0.58 in Q1 FY26.
Operating income also decreased to $110 million from $142 million, with the operating margin narrowing to 9.2 per cent from 11.2 per cent in Q1 FY26, according to the company’s quarterly results, Capri Holdings said in a press release.
Brand and regional performance
Michael Kors revenue declined 7 per cent YoY to $784 million, while Versace revenue fell 5 per cent to $252 million. Jimmy Choo revenue was $154 million, down 3 per cent YoY.
Regionally, Americas revenue decreased 8 per cent to $670 million, EMEA (Europe, Middle East and Africa) dropped 4 per cent to $355 million, and Asia revenue was flat at $165 million.
Margin analysis
Gross margin contracted by 60 basis points to 59.5 per cent, primarily due to higher promotional activity and unfavourable currency movements. Operating margin also narrowed, reflecting lower sales leverage and increased marketing investments.
Guidance and outlook
Capri Holdings has lowered its FY27 outlook, projecting revenue of about $3.4 billion and diluted EPS of approximately $2.15, citing inventory delays at Michael Kors, weaker demand in EMEA due to the Middle East conflict and foreign exchange headwinds.
For Q2 FY27, the company expects revenue of around $780 million and EPS of $0.20. Michael Kors and Jimmy Choo are both expected to face margin pressure in the second quarter.
The company remains focused on strengthening its brand equity and driving long-term shareholder value, despite near-term macroeconomic uncertainties.
Fibre2Fashion News Desk