Capri Holdings has today forecast revenue for the year as well as fiscal 2026 below Wall Street estimates, as the Michael Kors owner grapples with slowing demand for luxury goods, especially in the Americas and Asia.
The company also missed third-quarter profit estimates by a wide margin.
The global luxury goods sector has seen its slowest sales in years, with a 2% fall in 2024, according to Bain & Co estimates, hit by a property crisis in China.
Earlier this month, French peer LVMH posted a slight rise in sales in its latest quarter, but battered the hopes of investors who were expecting stronger signs of recovery.
Meanwhile, Capri is looking for a reset after its $8.5 billion deal with Coach-owner Tapestry to create a US luxury conglomerate collapsed following opposition from the Federal Trade Commission.
The company has been struggling to grow demand for its brands, especially Michael Kors, which has seen sales declines for several quarters due to lack of newness in its merchandise.
In fiscal 2026, the label is set to rake in revenue of $2.75 billion, below expectations of $3.08 billion.
In its first annual forecast since pausing it during the deal talks with Tapestry, Capri projected fiscal 2026 net revenue of $4.1 billion. Analysts on average were expecting $4.52 billion, according to data compiled by LSEG.
It expects revenue of $4.4 billion for fiscal 2025, below analysts' expectations of $4.51 billion.
The company's brands, Versace, Jimmy Choo and Michael Kors, all reported sales declines in the all-important Christmas quarter.
Revenue in the Americas for Michael Kors, which contributed 68% to total revenue in 2024, fell 10%, while in Asia it declined 27%.
The company posted a quarterly net loss of $547m, due to a non-cash impairment charge of $602m.
On an adjusted basis, Capri reported a profit of 45 cents per share for the third quarter ended December 28, missing estimates of 66 cents.
