Capri Holdings’ losses widen as Versace sale nears

Capri Holdings has reported a decline in sales in its fourth quarter of fiscal 2025, amid what CEO John Idol described as a “challenging year” for global luxury fashion.

For the fourth quarter ended 29 March 2025, Capri’s total revenue declined 15.4% on a reported basis to $1 billion (£790 million). The group posted a net loss of $645 million (£509 million), widening from a loss of $472 million (£372 million) the prior year, which was largely due to a $545 million (£431 million) non-cash tax valuation allowance.

Despite sharp revenue drops across its brands, the company remains focused on a strategic turnaround aimed at returning to growth by fiscal 2027.

John D. Idol, Chairman and CEO, said: “Fiscal 2025 was a challenging year for Capri Holdings, but we are optimistic about our path forward. While there is uncertainty around the impact of tariffs on the global economic environment, we remain focused on executing new strategic initiatives designed to return Capri to growth.”

Brand breakdown:

• Michael Kors, the group’s largest brand, saw revenues drop 15.6% to $694 million (£548 million) in Q4, with operating income falling to $32 million (£25 million).
• Jimmy Choo proved relatively resilient, with revenues down just 2.9% to $133 million (£105 million). However, it still recorded an operating loss of $10 million (£7.9 million).
• Versace, which is nearing its sale to the Prada Group, saw the sharpest decline, down 21.2% to $208 million (£164 million) in revenue for the quarter.

As announced in April, Capri entered into a definitive agreement to sell Versace to Prada Group for $1.375 billion (£1.09 billion) in cash, with the deal expected to close in the second half of 2025, subject to regulatory approvals. The sale marks a strategic pivot for Capri, which acquired Versace in 2018 for approximately €1.8 billion (£1.49 billion).

The move is part of a broader repositioning, as Capri looks to strengthen its balance sheet and refocus investments into Michael Kors. According to CEO John Idol, the sale will enable Capri to “substantially reduce our debt levels and reinstate a share repurchase program in the future”.

Looking ahead, Capri forecasts FY26 revenues of $3.3 to $3.4 billion (£2.61 to £2.69 billion) with operating income around $100 million (£79 million). Michael Kors’ revenue is expected to be between $2.75 and $2.85 billion (£2.17 and £2.25 billion). Jimmy Choo’s revenue is expected to be between $540 and $550 million (£427 and £435 million)

Capri expects to return to growth in fiscal 2027, with long-term revenue goals of $4 billion (£3.16 billion) for Michael Kors and $800 million (£632 million) for Jimmy Choo. However, the company cautioned that external headwinds, such as including tariff uncertainty, could continue to impact performance in the near term.

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