Capri Holdings post-Versace: A year of strategic recalibration and brand stabilisation

A year on from Capri Holdings agreeing to sell Versace, the US fashion group has moved through a period of strategic upheaval, entering a new phase defined less by expansion and more by recalibration. At the core of its mission is the stabilisation of its remaining brands, Michael Kors and Jimmy Choo, where early signs of progress are emerging. The strategy itself, however, remains a work in progress. Here is everything that has happened so far;

April 2025: Versace sale announced

On April 10, 2025, Capri formally agreed to sell Versace to Prada for a reported discounted sum of 1.375 billion dollars. The move followed a blocked merger with fellow US conglomerate Tapestry that put a halt to Capri’s core consolidation strategy and mounting underperformance across brands, especially at Michael Kors.

The sale of Versace essentially served as a sign of Capri’s departure from its ambition to operate as a multibrand luxury conglomerate competing with European groups like LVMH. Instead, the company sought to establish itself as a more focused, financially-stable, mid-luxury operator, with the goal of strengthening financials over brand expansion.

Days after the announcement, chairman and CEO, John D. Idol confirmed the development of plans to increase shareholder value and strengthen the balance sheet through strategic initiatives, previously touched upon during an earlier investor day. With this, the executive set his sights on bolstering the growth of Capri’s remaining brands, Michael Kors and Jimmy Choo, as part of a businesswide reset.

August 2025: Early stabilisation

Capri began reporting as a two-brand business. Despite “better-than-expected” results, with the company swinging to a profit compared to the same period the prior year, Q1 FY25 (ending June 28, 2025) data showed shrinking revenue (down 6 percent) and smaller margins, particularly at Michael Kors.

During this period, Capri officially entered into a transition phase with no specific growth engine, instead relying on cost discipline and early-stage brand repositioning. Idol said at the time that the Q1 results were encouraging, having demonstrated strategic progress to revitalise its two brands.

September 2025: Physical revitalisation

Early revitalisation efforts became apparent in the rejuvenated Michael Kors store in London, where Capri appeared to be favouring intimacy, visual storytelling and a curated experience. The shift aligned with a wider trend among retailers for creating more carefully considered spaces with an experiential edge.

November 2025: A slip into red

While still exceeding management expectations, Capri slipped into the red during Q2 FY25 (ended September 27, 2025). Revenue fell 2.5 percent compared to the same period in the year prior, while operating loss increased from six million to 12 million dollars, despite significant cost reductions. The bottom line was a net loss attributable to shareholders of 28 million dollars, compared to a profit of 24 million dollars in the year before.

The report marked Capri’s lowest operational point, with negative operating margin and weak Jimmy Choo performance. The company did underline a planned debt repayment via Versace proceeds, however, as well as future share buybacks, hinting at a shift towards a shareholder return model. Idol remained optimistic, stating that trends had improved.

Share repurchase programme

Capri further confirmed the launch of a one billion dollar share repurchase programme due to start FY27, during which the company is also aiming to return to growth. The initiative exhibits a confidence in post-restructuring cash flow, as well as a shift toward financial discipline over mergers and acquisitions.

December 2025: From ‘misguided’ to ‘modern glamour’

A pivotal moment came in December when Idol admitted that the previous repositioning of Michael Kors was “misguided”, noting that the brand had drifted from its core identity. The public nod to brand mismanagement was a rare moment in the industry, with Idol having acknowledged that attempts to “premiumise” an accessible luxury label had fallen flat. Additionally, an overextension and assortment changes had alienated core customers, forcing the team to reevaluate their approach.

Instead, Idol underlined an intention to restore Michael Kors’ “modern glamour” identity, returning to its “jet-set” roots through hotel-based storytelling, the renovation of over 50 percent of its global store fleet, and a renewed emphasis on ready-to-wear, which will have an expanded presence in renovated sites. The brand’s pricing architecture is also being restructured to reflect this revised aesthetic, with reduced reliance on promotional activity and a restoration of value perception on the table.

Versace sale finalises

This same month, Prada finalised the sale of Versace, officially taking the Italian luxury brand off Capri’s hands. The move ushered in somewhat of an immediate financial transformation for Capri, reducing its net debt dramatically from 1.17 billion dollars to 80 million dollars, opening up the capacity for reinvestment.

Under Cpari’s new mini-conglomerate setup, Michael Kors was positioned as the core revenue driver while Jimmy Choo was deemed a smaller, yet still important asset, dispelling any prior speculation that the footwear brand would follow Versace in a sale.

February 2026: A balance sheet clean-up

The Q3 FY25 period (ended December 27, 2025) presented Capri as a financially stable but commercially challenged company. Overarching revenue fell 4 percent, driven by a 5.6 percent decline at Michael Kors yet offset by 5 percent growth at Jimmy Choo, returning the brand to growth. Operating profit rose to 46 million dollars, while net profit jumped from six million to 57 million dollars. Tariff developments, however, caused the company’s gross margin to fall to 60.8 percent.

While the surprisingly solid figures showed promise in the turnaround, the continued revenue decline showed that such efforts were not yet translating into a recovery in demand.

Michael Kors’ 45th anniversary show

Michael Kors’ NYFW show for its AW26 collection served almost as a visualisation of Capri’s turnaround efforts. Following the theme ‘New York Chic’, the collection personified the “modern glamour” aesthetic Idol was striving for, present in a string of reinvented wardrobe classics that were accentuated by Kors’ signature colour range.

March 2026: From ‘cautious’ to ‘optimistic’

At Citi's 2026 conference, Idol stated that Capri had moved from “cautiously optimistic” to “optimistic”. The confidence is based on early traction in full-price channels, store renovation performance, and Jimmy Choo’s growth.

Michael Kors solidified

At Michael Kors, Capri has committed to a 300 million dollar investment to renovate 350 stores, 100 of which are expected to be revamped in FY26. The company is also planning a global rollout of its ‘Jet Set Lounges’, a contemporary expression of the brand’s ‘jet-set spirit’. The first opened in Beijing last week.

Elsewhere, the company is continuing to realign its pricing strategy after seeing an improvement in full price sales amid a continued reduction in reliance on promotions and off-price. Idol said the reset has led to higher full-price sell-through and rising engagement after a successful correction of elasticity misjudgement.

Jimmy Choo growth pillar

At Jimmy Choo there has been a major shift in perspective, pivoting the brand from an optional asset to a credible growth pillar. The company is targeting 800 million dollars in revenue, with accessory sales expected to make up 40 percent of sales. Such a shift is present in the move from an occasion footwear focus to a wider lifestyle focus, positioning the brand as a strategic bridge between luxury and accessible luxury.

CMO appointment

Capri’s recent appointment of Corey Moran, formerly of Google, as chief marketing officer builds on efforts to more strongly emphasise data-driven marketing and customer engagement, with a focus on integrating brand storytelling. Moran’s background suggests a shift towards performance-led marketing, particularly within digital channels, where Capri has already increased investment.

Conclusion: What next for Capri

Capri has undergone a clear structural shift over the past year, moving from a multibrand luxury ambition to a more focused turnaround model built around two core brands. The strategy is underpinned by respective revivals, while margin improvement, inventory discipline and capital return also remain key.

Regionally, North America and Europe remain resilient, while Asia, particularly China, is rebounding. Despite this, the next phase of the business will be shaped by a number of tensions, requiring the company to rebuild brand desirability without undermining accessibility.