Key Highlights

  • First-quarter fiscal 2027 Revenue was $769 million, down 3.5% year over year, but Net Income attributable to Capri rose 30% to $69 million.
  • Michael Kors generated $590 million in revenue with $55 million of operating income, and Jimmy Choo generated $179 million with $13 million of operating income.
  • Capri completed the sale of Versace to Prada in December 2025 for roughly $1.365 billion in net consideration, reclassifying it as discontinued operations.
  • Operating cash flow improved to $73 million, and the company is managing Tariff headwinds while executing its two-brand strategy.

Capri Holdings (NYSE:CPRI), the luxury-fashion company that owns Michael Kors and Jimmy Choo, reported that its turnaround is gaining traction following the sale of its Versace brand. With profitability improving even as revenue declines modestly, the question is whether the streamlined, two-brand strategy can continue to build momentum.

Capri now operates two luxury brands, Michael Kors, its largest, spanning accessories, apparel and footwear, and Jimmy Choo, focused on premium footwear and accessories, after completing the divestiture of Versace. The company is pursuing a turnaround centered on stabilizing and reinvigorating Michael Kors, growing Jimmy Choo, and improving profitability, while managing tariff and macroeconomic headwinds in the luxury sector.

Latest Developments

In its most recently reported quarter, the first quarter of fiscal 2027 (ended June 2026), Capri reported revenue of $769 million, down 3.5% year over year, but net income attributable to Capri rose 30% to $69 million, with diluted EPS of $0.60 versus $0.44. Michael Kors generated $590 million in revenue with $55 million of operating income, and Jimmy Choo generated $179 million with $13 million of operating income. Capri completed the sale of Versace to Prada in December 2025 for roughly $1.365 billion in net consideration, reclassifying Versace as discontinued operations. Operating Cash Flow improved to $73 million, and the company is managing tariff headwinds while executing its two-brand strategy.

Financial and Business Position

Capri's improving profitability despite lower revenue is an encouraging sign that its turnaround and cost discipline are taking hold, and the Versace sale simplified the company and provided significant proceeds. The focus now is on stabilizing Michael Kors, which remains the core of the business, and growing Jimmy Choo, while navigating tariffs and a selective luxury-spending environment. The improved cash generation and the streamlined portfolio give Capri a clearer path.

Stock-Market Context

The company carries a favorable analyst rating, and the improved sentiment reflects the improving profitability and turnaround progress. The case for continued momentum rests on Michael Kors stabilizing and returning to growth, Jimmy Choo expanding, continued Margin and profitability improvement, and effective management of tariffs; the cautionary case is that revenue is still declining, and that the luxury sector faces selective consumer spending and tariff pressures.

What Investors Should Watch

Investors may focus on whether Michael Kors revenue stabilizes and returns to growth, continued expansion and profitability at Jimmy Choo, margin and Earnings trends, the management of tariff and macroeconomic headwinds, and how Capri deploys the proceeds from the Versace sale. Evidence that the two-brand strategy is driving a stabilization in revenue alongside continued profitability improvement would do the most to determine whether the turnaround can build.

Capri Holdings' Investment case now rests entirely on the turnaround of its two remaining brands following the divestiture of Versace, a transaction that simplified the company, provided substantial proceeds, and left it focused on Michael Kors and Jimmy Choo. Michael Kors remains the core of the business and the key to the turnaround, since its scale means its stabilization and eventual return to growth are essential for Capri's overall trajectory, while Jimmy Choo offers a smaller but growing luxury footwear-and-accessories franchise.