Executive Summary
Capri Holdings Limited (NYSE: CPRI) reported its Q1 FY2026 results with total revenues of $797 million, reflecting a 6% decrease year-over-year, while net income reached $56 million, with earnings per share (EPS) of $0.50. The results, although indicating a decline in revenue, showed signs of sequential improvement across both the retail and wholesale channels due to strategic initiatives that aim to revitalize brand engagement and product appeal. Management expressed optimism for a return to growth in FY2027, attributing improved performance to enhanced brand storytelling and reduced promotional cadence. A positive trend was noted in average unit retail (AUR), which turned positive for the first time in three years, suggesting a potential turnaround in consumer engagement and selling strategies within the luxury market.
Key Performance Indicators
QoQ: -36.80% | YoY:-34.83%
QoQ: -38.18% | YoY:-29.59%
QoQ: 102.71% | YoY:-48.39%
QoQ: 110.24% | YoY:111.86%
QoQ: 109.54% | YoY:110.92%
Key Insights
Revenue: $797M (down 6% YoY)
Net Income: $56M
EPS: $0.50 (up 111.9% YoY)
Gross Profit: $502M, Gross Margin: 63%
Operating Income: $16M, Operating Margin: 2.0%
Total Assets: $5.47B
Total Liabilities: $5.48B
Net Debt: $1.54B
Cash Position: $129M
Inventory: $779M (up 10.8% YoY)
Management indicated that gross margin remains stable, with an anticipated target range of 60.5% to 61% for the fiscal year, despite increased tariff impacts contributing to cost challenges. Expected reve...
Financial Highlights
Revenue: $797M (down 6% YoY)
Net Income: $56M
EPS: $0.50 (up 111.9% YoY)
Gross Profit: $502M, Gross Margin: 63%
Operating Income: $16M, Operating Margin: 2.0%
Total Assets: $5.47B
Total Liabilities: $5.48B
Net Debt: $1.54B
Cash Position: $129M
Inventory: $779M (up 10.8% YoY)
Management indicated that gross margin remains stable, with an anticipated target range of 60.5% to 61% for the fiscal year, despite increased tariff impacts contributing to cost challenges. Expected revenue guidance for FY2026 is now between $3.375B and $3.45B, reflecting a bullish outlook driven by stronger-than-expected first-quarter performance.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
797.00M |
-34.83% |
-36.80% |
| Gross Profit |
502.00M |
-29.59% |
-38.18% |
| Operating Income |
16.00M |
-48.39% |
102.71% |
| Net Income |
56.00M |
111.86% |
110.24% |
| EPS |
0.44 |
110.92% |
109.54% |
Management Commentary
Management Insights:
- John Idol, CEO, remarked: "We are encouraged by our first quarter results. Trends improved sequentially, leading to both revenue and earnings per share that exceeded our expectations. This performance demonstrates the progress we are making as we execute against our strategic initiatives to reenergize our fashion luxury houses."
- Raj Mehta, Interim CFO, noted: "We now estimate unmitigated impact of tariffs on products shipped into the United States will increase our cost of goods sold by approximately $85 million in fiscal 2026."
- Both executives emphasized that brand storytelling and influencer marketing are crucial to reengaging consumers and improving revenue performance.
"We are beginning to see signs that our strategies are working... We are on track to stabilize our business this year while establishing a strong foundation for a return to growth in fiscal '27."
â John D. Idol
"Our strategies are centered around Michael's design vision, delivering exciting fashion with standout style."
â John D. Idol
Forward Guidance
The management set a forward guidance for FY2026, projecting total company revenue to be between $3.375 billion and $3.45 billion. Furthermore, they expect improved performance trends in the back half of fiscal 2026 due to strategic investments in brand visibility and product launches. Management projected an operating income turning slightly positive in FY2026, resting on a robust marketing strategy and channel optimization initiatives, which management expects will ultimately improve margins and operational efficiency through careful cost management.