Capri Holdings (NYSE:CPRI) reported third quarter fiscal 2026 results that exceeded earnings expectations but saw its shares fall due to ongoing revenue pressures and margin concerns.
The luxury fashion group posted total revenue of $1.025 billion, down 4% year-over-year, slightly above analyst estimates of around $1 billion.
Adjusted earnings per share came in at $0.81, up 30% from the prior year and ahead of consensus forecasts of $0.77.
Gross margin declined to 60.8% from 63.1% a year ago, reflecting higher-than-expected tariffs.
Michael Kors revenue decreased 5.6% to $858 million, while Jimmy Choo grew 5% to $167 million. Adjusted operating margin for the company was 7.7%, compared with 9.1% in the prior year.
Capri Holdings significantly reduced its net debt to $80 million by the end of the quarter, following the sale of its Versace business. The company generated $252 million in free cash flow and cut net inventory by 6.5% year-over-year.
Despite the EPS beat, investors reacted cautiously to the softer revenue trends and ongoing margin pressures. Shares were down almost 12% at about $20 late morning on Tuesday.