NEW YORK — Capri Holdings Ltd, formerly Michael Kors, forecast first-quarter profit below expectations on Wednesday as it spends more on marketing and opening new stores for its recently acquired Versace brand, sending its shares down 10 percent.
The company, which is banking on the popularity of Jimmy Choo and Versace to offset weakness at Michael Kors, has been investing in new stores under the brands, sponsoring fashion events and hiring movie stars to promote the brands.
The company forecast first-quarter earnings per share in the range of $0.85 to $0.90, including a 15-cent hit from the Versace acquisition. Analysts on average had expected $1.23 per share, according to IBES from Refinitiv.
Capri forecast first-quarter sales to be $1.36 billion, also missing analysts' expectation of $1.44 billion.
For the fourth quarter, however, the company earned $0.63 per share excluding items, beating analysts' expectation of $0.61.
Total revenue rose 13.9 percent to $1.34 billion, edging past the average analyst estimate of $1.33 billion, according to IBES data from Refinitiv.
By Soundarya J; editor: Saumyadeb Chakrabarty.