The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
NEW YORK, United States — Michael Kors missed Wall Street's quarterly revenue estimates for the first time in almost two years, as the luxury hand-bag maker recorded lower sales at retail outlets in Europe, where it is trying to gain a stronger foothold.
Shares of the company fell 11.3 percent to $50.97 in premarket trading on Wednesday following the news.
Revenue from Kors' European retail stores fell nearly 10 percent during the quarter ended September, leading to total retail revenue of $643.9 million.
The result missed analysts' average estimate of $661.1 million, according to IBES data from Refinitiv.
ADVERTISEMENT
Kors has been reducing inventory at its European stores to create exclusivity for its products in a region where wealthy fashion consumers have long preferred local luxury brands from LVMH and Gucci parent Kering.
In order to better compete with peers in Europe, Kors is spending over $2 billion to buy Italian luxury designer Versace.
Kors said quarterly net income attributable to the company fell to $137.6 million from $202.9 million a year earlier.
Total revenue rose 9.3 percent to $1.25 billion, falling short of analysts' expectations of $1.26 billion. The miss was the first since the quarter ended December 2016.
Excluding one-time items, the company earned $1.27 per share, above analysts' estimates of $1.10 per share.
By Uday Sampath; editor: Sai Sachin Ravikumar.
In 2020, like many companies, the $50 billion yoga apparel brand created a new department to improve internal diversity and inclusion, and to create a more equitable playing field for minorities. In interviews with BoF, 14 current and former employees said things only got worse.
For fashion’s private market investors, deal-making may provide less-than-ideal returns and raise questions about the long-term value creation opportunities across parts of the fashion industry, reports The State of Fashion 2024.
A blockbuster public listing should clear the way for other brands to try their luck. That, plus LVMH results and what else to watch for in the coming week.
L Catterton, the private-equity firm with close ties to LVMH and Bernard Arnault that’s preparing to take Birkenstock public, has become an investment giant in the consumer-goods space, with stakes in companies selling everything from fashion to pet food to tacos.