Capri Holdings Limited (NYSE:CPRI) reported fourth-quarter results on Wednesday that topped Wall Street earnings expectations, helped by margin expansion and tariff-related benefits, even as the company issued a softer sales outlook for fiscal 2027.
Capri Earnings Snapshot
The luxury fashion group reported adjusted earnings of 22 cents per share, ahead of analyst estimates of 11 cents per share.
Revenue declined 3.7% year over year to $796 million, narrowly missing the consensus estimate of $796.4 million.
Gross profit increased to $516 million from $495 million a year earlier. Gross margin expanded to 64.8% from 59.9%, helped by a $40 million reduction in cost of goods sold tied to expected refunds related to IEEPA tariffs.
Operating cash flow for fiscal 2026 totaled $197 million, while free cash flow reached $134 million.
Capri ended the quarter with $135 million in cash and $357 million in borrowings.
During the fourth quarter, the company repurchased about 4 million ordinary shares for $79 million through open-market transactions. As of March 28, 2026, approximately $921 million remained available under its share repurchase authorization.
Segment Performance
Results were mixed across Capri’s brand portfolio.
Revenue at Michael Kors fell 5.5% year over year to $656 million, or 8.4% on a constant-currency basis. Gross profit rose to $424 million, while gross margin improved to 64.6% from 58.6%, supported by a $38 million benefit tied to expected tariff-related refunds. Operating income increased to $57 million, with operating margin expanding to 8.7% from 4.6%.
At Jimmy Choo, revenue rose 5.3% year over year to $140 million and was flat on a constant-currency basis. Gross profit increased to $92 million, although gross margin edged lower to 65.7% from 66.2%.
The segment posted an operating loss of $20 million, compared with a loss of $10 million a year earlier. Operating margin widened to negative 14.3% from negative 7.5%.
Outlook
For the first quarter, Capri expects earnings of 40 cents per share, above analyst estimates of 34 cents per share. The company forecast revenue of $750 million, below the consensus estimate of $789.7 million.
For fiscal 2027, Capri projected earnings of $2.15 per share, topping estimates of $1.79 per share. The company lowered its sales outlook to $3.525 billion from a prior target of $4.4 billion, compared with analyst expectations of $3.532 billion.
Capri said gross margin is expected to expand by about 200 basis points, driven by pricing actions, improved product mix and continued efficiency gains.
Operating income is projected to rise about 60% year over year to roughly $190 million, reflecting operating leverage across the business.
The company also said Jimmy Choo is expected to return to profitability in fiscal 2027, supported by ongoing cost reductions and improving brand momentum.
Capri plans to refurbish about 100 stores and upgrade roughly 150 department store locations as part of efforts to elevate the retail experience and strengthen its brands.
The company maintained its long-term targets, including $4 billion in revenue for Michael Kors and $800 million for Jimmy Choo.
Capri Price Action
CPRI Price Action: Capri Holdings shares were down 4.86% at $17.60 at the time of publication on Wednesday, according to Benzinga Pro data.
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