Capri reports 8.4% revenue decline in Q4 amid global softening demand for luxury fashion

Capri Holdings announced on Wednesday revenues fell 8.4% to $1.223 billion for the fourth quarter, on the back of declining retail sales in the mid-single-digits.  

The owner of Michael Kors, Versace and Jimmy Choo brands said total company retail sales were impacted by softening demand globally for fashion luxury goods. In wholesale, revenue decreased in the high-teens driven by softer demand in the Americas and EMEA.

By brand, Versace revenue fell 3.6% to $264 million, with the Americas and EMEA regions down 1% and 11% respectively, dragging a 6% uptick in Asia. 

Jimmy Choo revenue dropped 9.3% to $137 million, clocking declines in all markets. Revenue in the Americas declined 9%, while revenue in EMEA decreased 6% and revenue in Asia declined 14%. 

Lastly, Michael Kors brand sales fell 9.7% to $822 million, on more declines across markets including revenue in the Americas down 9%, EMEA down 7% and revenue in Asia down 16%. 

Net losses widened to $472 million, or $4.03 per diluted share, compared to net loss of $34 million, or $0.28 per diluted share, in the prior year. 

“Overall, we were disappointed with our results as performance in the fourth quarter continued to be impacted by softening demand globally for fashion luxury goods. In our retail channel, sales trends improved sequentially in the Americas and EMEA while trends slowed in Asia. In our wholesale channel, sales remained challenged,” said John D. Idol, the company’s chairman and chief executive officer.

“Versace, Jimmy Choo and Michael Kors continued to resonate with consumers as evidenced by the 11.6 million new consumers added across our databases, representing 14% growth versus last year. This reflects the strong brand equity and enduring value of our three iconic houses. Looking forward, we remain focused to executing our strategic initiatives to deliver long-term sustainable growth across each of our luxury houses.” 

The earnings update comes ahead of Capri’s previously announced merger with rival U.S. fashion conglomerate Tapestry Inc.