CPRI Stock Forecast & Price Target

Capri Holdings experienced substantial growth in Asia, with a year-over-year increase of 25.4% in FQ2, signaling a recovery from previous declines and improved demand for footwear, particularly new fashion boots and sneakers. The global consumer databases for both Michael Kors and Jimmy Choo increased by 9% year-over-year, indicating successful marketing strategies and consumer engagement, bolstered by collaborations with influencers and a successful presence at New York Fashion Week. Additionally, despite total borrowings of $1.76 billion, the company ended the quarter with $120 million in cash and equivalents, positioning itself for a potential return to growth as retail trends are expected to improve in the second half of FY26.

Capri Holdings reported a 2.5% year-over-year decline in total revenues for the second quarter, reaching $856 million, which, while better than some market forecasts, still reflects ongoing revenue pressures, particularly at its flagship brand Michael Kors, which accounted for 85% of sales and saw a decrease of 1.8%. Additionally, the company experienced a continuous trend of declining sales across both its luxury brands, Michael Kors and Jimmy Choo, with the latter facing a 6.4% revenue drop, indicating weak demand and market volatility affecting premium apparel and accessories. Further compounding these challenges, Capri Holdings has indicated a potential gross margin decline of approximately 200 to 250 basis points in the next quarter, driven by increased inventory carrying higher tariffs, which may adversely impact profitability.