Capri revenue tumbles in Q1 amid softening luxury market

Dive Brief:

• Capri Holdings revenue fell 13.2% to $1.1 billion in the first quarter of its 2025 fiscal year, compared to $1.2 billion year over year, according to a Thursday report.
• Versace and Michael Kors brands both saw low double-digit percentage revenue declines, while Jimmy Choo revenue was down 5.5%. The company attributed all the decreases to a softening global demand for luxury fashion goods. 
• The company saw a net loss of $14 million for the quarter, down sharply from a net income of $48 million the previous year. Adjusted Q1 net income was $4 million, versus $88 million year over year.

Dive Insight:

The company’s Q1 decline follows an 8.4% fourth-quarter decline and an 8% year-over-year decline for fiscal 2024.

“Overall, we were disappointed with our first quarter results as performance continued to be impacted by softening demand globally for fashion luxury goods,” John D. Idol, chairman and CEO, said in the release. “We are continuing to manage our operating expenses and inventory levels carefully in light of the challenging global retail environment.”

Capri saw an $8 million loss from operations in the quarter, compared to an $80 million operations income the previous year. Adjusted income from operations was $16 million, compared to $111 million year-over-year.

The company’s net inventory totaled $902 million as of June 29, representing a 23% drop compared to Q1 last year, which the company said reflected its ongoing inventory management.

“Looking forward, we remain focused on executing our strategic initiatives to deliver long-term sustainable growth across each of our luxury houses,” Idol said, adding that the company added 12.6 million new consumers to its databases in the quarter.

Earlier in the year, a proposed merger between Capri and rival firm Tapestry was blocked by the Federal Trade Commission.

If the FTC fails to prevent the deal, the resulting conglomerate would add Capri’s brands to Tapestry’s existing stable, which includes Coach, Kate Spade and Stuart Weitzman. The $8.5 billion acquisition would create one of the largest luxury companies in the U.S.

Furthermore, Capri could use the funds to pay off its debt, which according to its Q1 earnings total $1.5 billion, down slightly from $1.7 billion last year.

Idol said Capri “intends to vigorously defend this [FTC] case alongside Tapestry and we look forward to the successful completion of the pending acquisition.” He added that the combined companies would deliver value to shareholders and provide new opportunities for employees.

“By joining with Tapestry, our brands will have greater resources and capabilities to accelerate the expansion of their global reach while preserving their unique DNA,” Idol said.