Capri Holdings Ltd

Previous wording

Capri Holdings Limited is a global fashion luxury group consisting of iconic, founder-led brands Versace, Jimmy Choo and Michael Kors. Our commitment to glamorous style and craftsmanship is at the heart of each of our luxury brands. We have built our reputation on designing exceptional, innovative products that cover the full spectrum of fashion luxury categories. Our strength lies in the unique DNA and heritage of each of our brands, the diversity and passion of our people and our dedication to the clients and communities we serve.

Current wording

Capri Holdings Limited is a global fashion luxury group consisting of iconic brands Michael Kors, Jimmy Choo and Versace. Our commitment to glamorous style and craftsmanship is at the heart of each of our luxury brands. We have built our reputation on designing exceptional, innovative products that cover the full spectrum of fashion luxury categories. Our strength lies in the unique DNA and heritage of each of our brands, the diversity and passion of our people and our dedication to the clients and communities we serve.

Previous wording

Our Michael Kors brand was launched over 40 years ago by Michael Kors, a world renowned designer, whose vision has taken the Company from its beginnings as an American luxury sportswear house to a global accessories, ready-to-wear, and footwear company with a global distribution network that has presence in over 100 countries through Company-operated retail stores and e-commerce sites, leading department stores, specialty stores and select licensing partners. Michael Kors is a highly recognized luxury fashion brand in the Americas and Europe with growing brand awareness in other international markets. Michael Kors features distinctive designs, materials and craftsmanship that combines stylish elegance and a sporty attitude. Michael Kors offers three primary collections: the Michael Kors Collection line, the MICHAEL Michael Kors line and the Michael Kors Mens line. The Michael Kors Collection establishes the aesthetic authority of the entire brand and is carried by select retail stores, our e-commerce sites, as well as in the finest luxury department stores in the world. MICHAEL Michael Kors has a strong focus on accessories, in addition to offering ready-to-wear and footwear. We have also been developing our men’s business in recognition of the significant opportunity afforded by the Michael Kors brand’s established fashion authority and the expanding men’s market. Taken together, our Michael Kors collections target a broad customer base while retaining our premium luxury image.

Current wording

Our Michael Kors brand was launched over 40 years ago by Michael Kors, a world-renowned designer, whose vision has taken the Company from its beginnings as an American luxury sportswear house to a global accessories, ready-to-wear, and footwear company with a global distribution network that has presence in over 100 countries through Company-operated retail stores and e-commerce sites, leading department stores, specialty stores and select licensing partners. Michael Kors is a highly recognized fashion luxury brand in the Americas and Europe with growing brand awareness in other international markets. Michael Kors features distinctive designs, materials and craftsmanship that combines stylish elegance and a sporty attitude. Michael Kors offers three primary collections: the Michael Kors Collection line, the MICHAEL Michael Kors line and the Michael Kors Mens line. The Michael Kors Collection establishes the aesthetic authority of the entire brand and is carried by select retail stores, our e-commerce sites, as well as in the finest luxury department stores in the world. MICHAEL Michael Kors has a strong focus on accessories, in addition to offering ready-to-wear and footwear. We have also been developing our men’s business in recognition of the significant opportunity afforded by the Michael Kors brand’s established fashion authority and the expanding men’s market. Taken together, our Michael Kors collections target a broad customer base while retaining our premium luxury image.

Previous wording

Our Jimmy Choo brand offers a distinctive, glamorous and fashion-forward product range, enabling it to develop into a leading global luxury accessory brand, whose core product offering is women’s luxury shoes, complemented by accessories, including handbags, small leather goods, jewelry, scarves and belts, as well as men’s luxury shoes and accessories. In addition, certain categories, such as fragrances and eyewear, are produced under licensing agreements. Jimmy Choo’s design team is led by Sandra Choi, who has been the Creative Director for the brand since its inception in 1996. Jimmy Choo products are chic, glamorous and instinctively seductive. The brand offers classic and timeless luxury products, alongside innovative collections that are intended to set and lead fashion trends. Jimmy Choo is represented through its global store network, its e-commerce sites, as well as through the most prestigious department and specialty stores worldwide.

Current wording

Our Jimmy Choo brand offers a distinctive, glamorous and fashion-forward product range, whose core product offering is women’s luxury shoes, complemented by accessories, including handbags, small leather goods, jewelry, scarves and belts, as well as men’s luxury shoes and accessories. In addition, certain categories, including fragrance and eyewear, are produced under licensing agreements. Jimmy Choo’s design team is led by Sandra Choi, who has been the Creative Director for the brand since its inception in 1996. Jimmy Choo products are unique, instinctively seductive and chic. The brand offers classic and timeless luxury products, alongside innovative collections that are intended to set and lead fashion trends. Jimmy Choo is represented through its global store network, its e-commerce sites, as well as through the most prestigious department and specialty stores worldwide.

Previous wording

Our Versace brand has long been recognized as one of the world’s leading international fashion design houses and is synonymous with Italian glamour and style. Founded in 1978 in Milan, Versace is known for its iconic and unmistakable style and unparalleled craftsmanship. Over the past several decades, the House of Versace has grown globally from its roots in haute couture, expanding into the design, manufacturing, distribution and retailing of ready-to-wear, accessories, footwear, eyewear, watches, jewelry, fragrance and home furnishing. Versace’s design team is led by Donatella Versace, who has been the brand’s Artistic Director for over 20 years. Versace distributes its products through a worldwide distribution network, which includes boutiques in some of the world’s most fashionable cities, its e-commerce sites, as well as through the most prestigious department and specialty stores worldwide.

Current wording

Our Versace brand has long been recognized as one of the world’s leading international fashion design houses and is synonymous with Italian glamour and style. Founded in 1978 in Milan, Versace is known for its iconic and unmistakable style and unparalleled craftsmanship. Over the past several decades, the House of Versace has grown globally from its roots in haute couture, expanding into the design, manufacturing, distribution and retailing of ready-to-wear, accessories, footwear, eyewear, watches, jewelry, fragrance and home furnishings. Until recently, Versace’s design team was led by Donatella Versace, who had been the brand’s Artistic Director for almost 30 years. Effective April 1, 2025, Dario Vitale became Versace’s Chief Creative Officer. Versace distributes its products through a worldwide distribution network, which includes boutiques in some of the world’s most fashionable cities, its e-commerce sites, as well as through the most prestigious department and specialty stores worldwide.

Previous wording

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Current wording

On April 8, 2025, our Board of Directors made the decision to sell Versace to Prada, and a definitive agreement was entered into on April 10, 2025. Accordingly, we determined the Versace business met held-for-sale and discontinued operations accounting criteria beginning in Fiscal 2026 and we began to separately report the results of this business as discontinued operations in our consolidated statements of operations and comprehensive income (loss) and to present the related assets and liabilities as held for sale in our consolidated balance sheets for the first quarter ended June 28, 2025. These changes have been applied to all periods presented. Unless otherwise noted, discussion within this management’s discussion and analysis of financial condition and results of operations relates to our continuing operations. Refer to Note 4 - "Discontinued Operations" to the accompanying consolidated financial statements for additional information.

Previous wording

As previously disclosed, on August 10, 2023, Capri entered into an Agreement and Plan of Merger with Tapestry, Inc., a Maryland corporation, and Sunrise Merger Sub, Inc., a British Virgin Islands business company limited by shares and a direct wholly owned subsidiary of Tapestry. The Merger Agreement provides that, among other things and on the terms and subject to the conditions set forth therein, Tapestry would acquire Capri in an all-cash transaction by means of a merger of Merger Sub with and into Capri, with Capri surviving the Merger as a wholly owned subsidiary of Tapestry.

Current wording

As previously disclosed, on August 10, 2023, Capri entered into an Agreement and Plan of Merger with Tapestry, a Maryland corporation, and Sunrise Merger Sub, Inc., a British Virgin Islands business company limited by shares and a direct wholly owned subsidiary of Tapestry. The Merger Agreement provided that, among other things and on the terms and subject to the conditions set forth therein, Tapestry would acquire Capri in an all-cash transaction by means of a merger of Merger Sub with and into Capri, with Capri surviving the Merger as a wholly owned subsidiary of Tapestry.

Previous wording

Macroeconomic conditions and inflationary pressures. Global economic conditions and the related impact on levels of consumer spending worldwide impacted our business in the first nine months of Fiscal 2025, and are likely to continue to impact our business and the luxury accessories, footwear and apparel industry overall for the foreseeable future. Inflation, rising interest rates, higher fuel and energy costs and commodity prices, reductions in net worth based on stock market declines and uncertainty, home prices, credit availability and consumer debt levels, concerns of a global banking crisis, political instability due to war or other geopolitical factors, including the presidential change in the U.S., and other macroeconomic pressures and general uncertainty regarding the overall future economic environment have created a challenging retail environment, which is expected to continue in the near term. Purchases of discretionary luxury items, such as the accessories, footwear and apparel that we produce, tend to decline when disposable income is lower or when there are recessions, inflationary pressures or other economic uncertainty which could negatively affect our financial condition and results of operations.

Current wording

Macroeconomic conditions and inflationary pressures. Global economic conditions, including inflation, political instability due to war or other geopolitical factors and other macroeconomic uncertainty and the related impact on levels of consumer spending worldwide impacted our business in the first three months of Fiscal 2026, and are likely to continue to impact our business and the luxury accessories, footwear and apparel industry overall for the foreseeable future. Purchases of discretionary luxury items, such as the accessories, footwear and apparel that we produce, tend to decline when disposable income is lower or when there are inflationary pressures or other economic uncertainty which could negatively affect our financial condition and results of operations.

Previous wording

Disruptions or delays in shipping and distribution and other supply chain constraints. Any disruptions in our shipping and distribution network, including port congestion, vessel availability, container shortages and temporary factory closures, could have a negative impact on our results of operations. These disruptions include the recent attacks on commercial shipping vessels in the Red Sea that have led to disruption and instability in global supply chains, which have resulted in shipment delays. These shipping disruptions have also resulted in, and may continue to result in, increased freight costs. See Item 1A — “Risk Factors” — “We primarily use foreign manufacturing contractors and independent third-party agents to source our finished goods” and “Our business is subject to risks inherent in global sourcing activities, including disruptions or delays in manufacturing or shipments” of our Annual Report on Form 10-K for the fiscal year ended March 30, 2024 for additional discussion.

Current wording

Disruptions or delays in shipping and distribution and other supply chain constraints. Disruptions in our shipping and distribution network, including at U.S. ports and in the Red Sea, as well as port congestion, vessel availability, container shortages and temporary factory closures, have in the past impacted our business, and continued disruptions or delays could negatively impact on our results of operations in the future.

Previous wording

We generate revenue through the sale of Michael Kors products through four primary Michael Kors retail formats: “Collection” stores, “Lifestyle” stores (including concessions), outlet stores and e-commerce, through which we sell our products, as well as licensed products bearing our name, directly to consumers throughout the Americas, certain parts of EMEA and certain parts of Asia. Our Michael Kors e-commerce business includes e-commerce sites in the United States, Canada, EMEA and Asia. We also sell Michael Kors products directly to department stores, primarily located across the Americas and EMEA, to specialty stores and travel retail shops in the Americas, Europe and Asia, and to our geographic licensees in certain parts of EMEA, Asia and Brazil. In addition, revenue is generated through product and geographic licensing arrangements, which allow third parties to use the Michael Kors brand name and trademarks in connection with the manufacturing and sale of products, including watches, jewelry, fragrances and eyewear, as well as through geographic licensing arrangements, which allow third parties to use the Michael Kors tradename in connection with the retail and/or wholesale sales of our Michael Kors branded products in specific geographic regions.

Current wording

We generate revenue through the sale of Michael Kors products through four primary Michael Kors retail formats: “Collection” stores, “Lifestyle” stores (including concessions), outlet stores and e-commerce sites, through which we sell our products, as well as licensed products bearing our name, directly to consumers throughout the Americas (United States, Canada and Latin America), certain parts of EMEA (Europe, Middle East and Africa) and certain parts of Asia (Asia and Oceania). Our Michael Kors e-commerce business includes e-commerce sites in the United States, Canada, EMEA and Asia. We also sell Michael Kors products directly to department stores, primarily located across the Americas and EMEA, to specialty stores and travel retail shops in the Americas, Europe and Asia, and to our geographic licensees in certain parts of EMEA, Asia and Brazil. In addition, revenue is generated through product and geographic licensing arrangements, which allow third parties to use the Michael Kors brand name and trademarks in connection with the manufacturing and sale of products, including watches, jewelry, fragrances and eyewear, as well as through geographic licensing arrangements, which allow third parties to use the Michael Kors tradename in connection with the retail and/or wholesale sales of our Michael Kors branded products in specific geographic regions.

Previous wording

We generate revenue through the sale of Jimmy Choo luxury goods through directly operated Jimmy Choo retail and outlet stores throughout the Americas (United States, Canada and Latin America), certain parts of EMEA and certain parts of Asia, through our e-commerce sites, as well as through wholesale sales of luxury goods to distribution partners (including geographic licensing arrangements that allow third parties to use the Jimmy Choo tradename in connection with retail and/or wholesale sales of Jimmy Choo branded products in specific geographic regions), multi-brand department stores and specialty stores worldwide. In addition, revenue is generated through product licensing agreements, which allow third parties to use the Jimmy Choo brand name and trademarks in connection with the manufacturing and sale of products, including fragrances and eyewear.

Current wording

We generate revenue through the sale of Jimmy Choo luxury goods through directly operated Jimmy Choo retail and outlet stores throughout the Americas, certain parts of EMEA and certain parts of Asia, through our e-commerce sites, as well as through wholesale sales of luxury goods to distribution partners (including geographic licensing arrangements that allow third parties to use the Jimmy Choo tradename in connection with retail and/or wholesale sales of Jimmy Choo branded products in specific geographic regions), multi-brand department stores and specialty stores worldwide. In addition, revenue is generated through product licensing agreements, which allow third parties to use the Jimmy Choo brand name and trademarks in connection with the manufacturing and sale of products, including fragrances and eyewear.

Previous wording

We generate revenue through the sale of Versace luxury accessories, ready-to-wear and footwear through directly operated Versace boutiques throughout North America (United States and Canada), certain parts of EMEA (Europe, Middle East and Africa) and certain parts of Asia (Asia and Oceania), as well as through Versace outlet stores and e-commerce sites. In addition, revenue is generated through wholesale sales to distribution partners (including geographic licensing arrangements), multi-brand department stores and specialty stores worldwide, as well as through product license agreements in connection with the manufacturing and sale of the Versace Jeans Couture product line, fragrances, watches, eyewear and home furnishings.

Current wording

We generate revenue through the sale of Versace luxury accessories, ready-to-wear and footwear through directly operated Versace boutiques throughout North America (United States and Canada), certain parts of EMEA and certain parts of Asia, as well as through Versace outlet stores and e-commerce sites. In addition, revenue is generated through wholesale sales to distribution partners (including geographic licensing arrangements), multi-brand department stores and specialty stores worldwide, as well as through product license agreements in connection with the manufacturing and sale of the Versace Jeans Couture product line, fragrances, watches, eyewear and home furnishings. As previously noted, the results of the Versace business are excluded from the segment information herein for all periods presented.

Previous wording

In addition to the reportable segments discussed above, we have certain corporate costs that are not directly attributable to our brands and, therefore, are not allocated to segments. Such costs primarily include certain administrative, corporate occupancy, shared service and information technology systems expenses, including system implementation costs and Capri transformation program costs. In addition, certain other costs are not allocated to segments, including Merger related expenses, impairment charges and restructuring and other income (expense). The segment structure is consistent with how our chief operating decision maker plans and allocates resources, manages the business and assesses performance. The following table presents our total revenue and income from operations by segment for the three and nine months ended December 28, 2024 and December 30, 2023 (in millions):

Current wording

In addition to the reportable segments discussed above, we have certain corporate costs that are not directly attributable to our brands and, therefore, are not allocated to segments. Such costs primarily include certain administrative, corporate occupancy, shared service and information technology systems expenses, including enterprise resource planning system implementation costs and Capri transformation program costs. In addition, certain other costs are not allocated to segments, including transaction related costs and restructuring and other expense. The segment structure is consistent with how our chief operating decision maker plans and allocates resources, manages the business and assesses performance.

Previous wording

Total revenue decreased $540 million, or 13.7%, to $3.407 billion for the nine months ended December 28, 2024, compared to $3.947 billion for the nine months ended December 30, 2023, which included net unfavorable foreign currency effects of approximately $17 million, as a result of the strengthening of the United States dollar compared to all major currencies in which we operate for the nine months ended December 28, 2024. On a constant currency basis, our total revenue decreased $523 million, or 13.3%. The decrease is primarily attributable to an overall slowdown in demand for luxury fashion goods globally, as well as the result of certain strategic initiatives previously put in place at Versace and Michael Kors that did not perform as expected.

Current wording

Total revenue decreased $51 million, or 6.0%, to $797 million for the three months ended June 28, 2025, compared to $848 million for the three months ended June 29, 2024, which included net favorable foreign currency effects of approximately $14 million, as a result of the weakening of the United States dollar compared to all major currencies in which we operate. On a constant currency basis, our total revenue decreased $65 million, or 7.7%.

Previous wording

•Michael Kors revenue decreased $125 million, or 12.1%, to $909 million for the three months ended December 28, 2024, compared to $1.034 billion for the three months ended December 30, 2023, which included unfavorable foreign currency effects of $4 million. On a constant currency basis, revenue decreased $121 million, or 11.7%, primarily due to softening demand globally for fashion luxury goods, as well as the result of certain strategic initiatives previously put in place at Michael Kors that did not perform as expected.

Current wording

•Michael Kors revenue decreased $40 million, or 5.9%, to $635 million for the three months ended June 28, 2025, compared to $675 million for the three months ended June 29, 2024, which included favorable foreign currency effects of $9 million. On a constant currency basis, revenue decreased $49 million, or 7.3%, primarily attributable to a continued slowdown in demand for fashion luxury goods, particularly in North America and Asia, as well as the result of certain strategic initiatives previously put in place at Michael Kors that did not perform as expected, partially offset by increased revenue in EMEA. See Note 5 to the accompanying consolidated financial statements for additional information.

Previous wording

Gross profit decreased $116 million, or 12.5%, to $812 million for the three months ended December 28, 2024, compared to $928 million for the three months ended December 30, 2023, which included net unfavorable foreign currency effects of $2 million. Gross profit as a percentage of total revenue was 64.4% and 65.0% for the three months ended December 28, 2024 and December 30, 2023, respectively. The gross profit margin decrease was primarily related to lower full price sell-throughs for the three months ended December 28, 2024, as compared to the three months ended December 30, 2023.

Current wording

Gross profit decreased $33 million, or 6.2%, to $502 million for the three months ended June 28, 2025, compared to $535 million for the three months ended June 29, 2024, which included net favorable foreign currency effects of $9 million. Gross profit as a percentage of total revenue was 63.0% and 63.1% for the three months ended June 28, 2025 and June 29, 2024, respectively.

Previous wording

Total operating expenses increased $596 million, or 73.9%, to $1.402 billion for the three months ended December 28, 2024, compared to $806 million for the three months ended December 30, 2023. Our operating expenses included a net favorable foreign currency impact of approximately $1 million. Total operating expenses increased to 111.2% as a percentage of total revenue for the three months ended December 28, 2024, compared to 56.5% for the three months ended December 30, 2023. The components that comprise total operating expenses are explained below.

Current wording

Total operating expenses decreased $38 million, or 7.3%, to $486 million for the three months ended June 28, 2025, compared to $524 million for the three months ended June 29, 2024. Our operating expenses included a net unfavorable foreign currency impact of approximately $7 million. Total operating expenses decreased to 61.0% as a percentage of total revenue for the three months ended June 28, 2025, compared to 61.8% for the three months ended June 29, 2024. The components that comprise total operating expenses are explained below.

Previous wording

As a percentage of total revenue, selling, general and administrative expenses increased to 53.9% for the three months ended December 28, 2024, compared to 52.5% for the three months ended December 30, 2023, primarily due to deleveraging of expenses on lower revenues for the three months ended December 28, 2024.

Current wording

Selling, general and administrative expenses decreased $36 million, or 7.3%, to $455 million for the three months ended June 28, 2025, compared to $491 million for the three months ended June 29, 2024. As a percentage of total revenue, selling, general and administrative expenses decreased to 57.1% for the three months ended June 28, 2025, compared to 57.9% for the three months ended June 29, 2024.

Previous wording

Unallocated corporate expenses, which are included within selling, general and administrative expenses discussed above, but are not directly attributable to a reportable segment, decreased $17 million, or 25.0%, to $51 million for the three months ended December 28, 2024 as compared to $68 million for the three months ended December 30, 2023, primarily due to a decrease in professional fees and information technology costs related to certain Capri transformation projects which are now complete.

Current wording

Unallocated corporate expenses, which are included within selling, general and administrative expenses discussed above, but are not directly attributable to a reportable segment, decreased $17 million, or 27.4%, to $45 million for the three months ended June 28, 2025 as compared to $62 million for the three months ended June 29, 2024, primarily due to a decrease in professional fees related to certain Capri transformation projects which are now complete and the absence of transaction related costs incurred in the prior year.

Previous wording

During the three months ended December 28, 2024, we recorded income of $2 million primarily related to gains on lease terminations partially offset by severance and store closure costs. During the three months ended December 30, 2023, we recorded expenses of $5 million primarily related to equity awards associated with the acquisition of Versace. See Note 9 to the accompanying consolidated financial statements for additional information.

Current wording

During each of the three months ended June 28, 2025 and June 29, 2024, we recorded expense of $1 million primarily related to store closure costs, partially offset by gains on lease terminations. See Note 10 to the accompanying consolidated financial statements for additional information.

Previous wording

As a result, loss from operations was $590 million for three months ended December 28, 2024, compared to income from operations of $122 million for the three months ended December 30, 2023. Loss from operations as a percentage of total revenue was 46.8% for the three months ended December 28, 2024, compared to income from operations of 8.5% for the three months ended December 30, 2023. See Segment Information above for a reconciliation of our segment operating income to total operating (loss) income.

Current wording

Income from operations was $16 million for the three months ended June 28, 2025, compared to $11 million for the three months ended June 29, 2024. Income from operations as a percentage of total revenue was 2.0% for the three months ended June 28, 2025, compared to 1.3% for the three months ended June 29, 2024.

Previous wording

•Michael Kors recorded income from operations of $147 million for the three months ended December 28, 2024, compared to $219 million for the three months ended December 30, 2023. Operating margin decreased from 21.2% for the three months ended December 30, 2023, to 16.2% for the three months ended December 28, 2024, primarily due to deleveraging of operating expenses on lower revenues compared to the prior year.

Current wording

•Michael Kors recorded income from operations of $63 million for the three months ended June 28, 2025, compared to $75 million for the three months ended June 29, 2024. Operating margin decreased from 11.1% for the three months ended June 29, 2024, to 9.9% for the three months ended June 28, 2025, primarily due to deleveraging of operating expenses on lower revenues compared to the prior year.

Previous wording

•Jimmy Choo recorded a loss from operations of $6 million for the three months ended December 28, 2024, compared to income of $4 million for the three months ended December 30, 2023. Operating margin decreased from 2.4% for the three months ended December 30, 2023 to an operating loss of 3.8% for the three months ended December 28, 2024, primarily due to deleveraging of operating expenses on lower revenues.

Current wording

•Jimmy Choo recorded income from operations of $4 million for both the three months ended June 28, 2025 and June 29, 2024. Operating margin increased from 2.3% for the three months ended June 29, 2024 to 2.5% for the three months ended June 28, 2025, primarily due to favorable channel mix.

Previous wording

For the three months ended December 28, 2024, we recognized $8 million of interest income compared to $1 million of interest expense for the three months ended December 30, 2023. The $9 million improvement in interest (income) expense, net, is primarily due to higher interest income from our net investment hedges and lower average borrowings and effective interest rates on our outstanding debt (see Note 10 and Note 13 to the accompanying consolidated financial statements for additional information).

Current wording

For the three months ended June 28, 2025, we recognized $18 million of interest income compared to $4 million of interest income for the three months ended June 29, 2024. The $14 million improvement in interest income, net, is primarily due to higher interest income from our net investment hedges and lower average borrowings and effective interest rates on our outstanding debt (see Note 11 and Note 14 to the accompanying consolidated financial statements for additional information).

Previous wording

For the three months ended December 28, 2024, we recognized a net foreign currency loss of $23 million compared to a gain of $2 million for the three months ended December 30, 2023, primarily attributable to the remeasurement of intercompany transactions with certain of our subsidiaries.

Current wording

For the three months ended June 28, 2025, we recognized a net foreign currency gain of $5 million compared to a loss of $4 million for the three months ended June 29, 2024, primarily attributable to the remeasurement of intercompany balances between certain of our subsidiaries.

Previous wording

As a result of the foregoing, our net loss was $547 million for the three months ended December 28, 2024, compared to net income of $105 million for the three months ended December 30, 2023.

Current wording

As a result of the above, our net income was $56 million for the three months ended June 28, 2025, compared to net income of $5 million for the three months ended June 29, 2024.

Previous wording

Our primary sources of liquidity are the cash flows generated from our operations, along with borrowings available under our credit facilities (see below discussion regarding “Revolving Credit Facilities”) and available cash and cash equivalents. Our primary use of this liquidity is to fund the ongoing cash requirements, including our working capital needs and capital investments in our business, debt repayments, acquisitions, returns of capital, including share repurchases and other corporate activities. We believe that the cash generated from our operations, together with borrowings available under our revolving credit facilities and 364 Day Term Loan and available cash and cash equivalents, will be sufficient to meet our working capital needs for the next 12 months and beyond, including investments made and expenses incurred in connection with our store opening and renovation plans, investments in corporate and distribution facilities, continued IT system development, e-commerce and marketing initiatives. We spent $101 million on capital expenditures during the nine months ended December 28, 2024.

Current wording

Our primary sources of liquidity are the cash flows generated from our operations, along with borrowings available under our credit facilities (see below discussion regarding “Revolving Credit Facilities”) and available cash and cash equivalents. Our primary use of this liquidity is to fund the ongoing cash requirements, including our working capital needs and capital investments in our business, debt repayments, acquisitions, returns of capital, including share repurchases and other corporate activities. We believe that the cash generated from our operations, together with borrowings available under our revolving credit facilities and available cash and cash equivalents, will be sufficient to meet our working capital needs for the next 12 months and beyond, including investments made and expenses incurred in connection with our store opening and renovation plans, investments in corporate and distribution facilities, continued IT system development, e-commerce and marketing initiatives. We spent $13 million on capital expenditures during the three months ended June 28, 2025. We expect to spend approximately $110 million in Fiscal 2026, which includes Michael Kors and Jimmy Choo store renovations, as well as information technology and digital enhancements.

Previous wording

Net cash provided by operating activities was $442 million during the nine months ended December 28, 2024, as compared to net cash provided by in operating activities of $265 million for the nine months ended December 30, 2023. The increase in net cash provided by operating activities was primarily attributable to timing of payments due to improved management of Accounts Payable and Accounts Receivable in the current year, partially offset by a decrease in our net income after non-cash adjustments.

Current wording

Net cash provided by operating activities was $20 million during the three months ended June 28, 2025, as compared to net cash provided by in operating activities of $66 million for the three months ended June 29, 2024. The decrease in net cash provided by operating activities was primarily attributable to earlier receipt of inventory in the current year along with the timing of tax payments made compared to the prior year.

Previous wording

Net cash used in investing activities was $68 million during the nine months ended December 28, 2024, as compared to net cash used in investing activities of $139 million during the nine months ended December 30, 2023. The decrease in net cash used in investing activities was primarily attributable the receipt of $42 million related to the settlement of certain net investment hedges and lower capital expenditures of $38 million, partially offset by $9 million of acquisition related payments compared to prior year.

Current wording

Net cash used in investing activities was $13 million during the three months ended June 28, 2025, as compared to net cash used in investing activities of $25 million during the three months ended June 29, 2024. The decrease in net cash used in investing activities was primarily attributable to the $9 million acquisition of an Italian shoe manufacturer in the prior year.

Previous wording

Cash Used in Financing Activities

Current wording

Cash Provided by (Used in) Financing Activities

Previous wording

Net cash used in financing activities was $212 million during the nine months ended December 28, 2024, as compared to net cash used in financing activities of $116 million during the nine months ended December 30, 2023. The increase in cash used by financing activities of $96 million was primarily attributable to higher debt repayments of $196 million partially offset by a decrease in cash used to repurchase our ordinary shares of $103 million compared to prior year.

Current wording

Net cash provided by financing activities was $94 million during the three months ended June 28, 2025, as compared to net cash used in financing activities of $9 million during the three months ended June 29, 2024. The increase in cash provided by financing activities of $103 million was primarily attributable to higher net debt borrowings of $101 million.

Previous wording

(1)The financial covenant in our 2022 Credit Facility requires us to comply with the quarterly maximum net leverage ratio test of 4.00 to 1.0. As of December 28, 2024 and March 30, 2024, we were in compliance with all covenants related to the agreements then in effect governing our debt. On August 23, 2024, we entered into a first incremental term loan amendment to provide for a $450 million 364 Day Term Loan which utilized the $500 million accordion feature. The $500 million accordion feature was fully available to us as of March 30, 2024. See Note 10 to the accompanying consolidated financial statements for additional information.

Current wording

(1)The financial covenant in our 2025 Credit Facilities requires us to comply with a quarterly maximum net leverage ratio test of 4.0 to 1.0. The Revolving Credit Facility excludes up to a $750 million accordion feature as of June 28, 2025 and March 29, 2025, respectively. As of June 28, 2025 and March 29, 2025, we were in compliance with all covenants related to our agreements then in effect governing our debt. See Note 11 to the accompanying consolidated financial statements for additional information.

Previous wording

(2)As of December 28, 2024 and March 30, 2024, all amounts are recorded as long-term debt on our consolidated balance sheets, besides the Senior Notes, due in November 2024, which are recorded within short-term debt on our consolidated balance sheets as of March 30, 2024.

Current wording

(2)As of June 28, 2025 and March 29, 2025, all amounts are recorded as long-term debt on our consolidated balance sheets.

Previous wording

(5)The balance as of December 28, 2024 consists of $25 million related to our supplier financing program recorded within short-term debt on our consolidated balance sheets, $9 million related to the sale of certain Versace tax receivables, recorded within long-term debt on our consolidated balance sheets and $7 million of other loans recorded as long-term debt on our consolidated balance sheets. The balance as of March 30, 2024 consists of $11 million related to our supplier finance program recorded within short-term debt on our consolidated balance sheets, $11 million related to the sale of certain Versace tax receivables, with $1 million and $10 million recorded within short-term debt and long-term debt, respectively, and $2 million of other loans recorded as long-term debt on our consolidated balance sheets.

Current wording

(3)The balance as of June 28, 2025 primarily consists of $21 million related to our supplier financing program recorded within short-term debt in our consolidated balance sheets and $6 million of other loans recorded as long-term debt on our consolidated balance sheets. The balance as of March 29, 2025 consists of $24 million related to our supplier finance program recorded within short-term debt on our consolidated balance sheets and $5 million of other loans recorded as long-term debt in our consolidated balance sheets.

Previous wording

(6)The balance as of December 28, 2024 and March 30, 2024 represents the total availability of the credit facility, which excludes bank guarantees.

Current wording

(4)The balance as of June 28, 2025 and March 29, 2025 represents the total availability of the credit facility, which excludes bank guarantees.

Previous wording

We believe that our 2022 Credit Facility is adequately diversified with no undue concentration in any one financial institution. As of December 28, 2024, there were 17 financial institutions participating in the facility, with none maintaining a maximum commitment percentage in excess of 10%. We have no reason to believe that the participating institutions will be unable to fulfill their obligations to provide financing in accordance with the terms of the 2022 Credit Facility.

Current wording

We believe that our 2025 Credit Facilities is adequately diversified with no undue concentration in any one financial institution. As of June 28, 2025, there were 17 financial institutions participating in the facility, with none maintaining a maximum commitment percentage in excess of 10%. We have no reason to believe that the participating institutions will be unable to fulfill their obligations to provide financing in accordance with the terms of the 2025 Credit Facilities.

Previous wording

The following table presents our treasury share repurchases during the nine months ended December 28, 2024 and December 30, 2023 (dollars in millions):

Current wording

The following table presents our treasury share repurchases during the three months ended June 28, 2025 and June 29, 2024 (in millions):

Previous wording

On November 9, 2022, we announced our Board of Directors approved a two-year share repurchase program (the “Existing Share Repurchase Plan”) to purchase up to $1.0 billion of our outstanding ordinary shares. Share repurchases may be made in open market or privately negotiated transactions and/or pursuant to Rule 10b5-1 trading plans, subject to market conditions, applicable legal requirements, trading restrictions under the Company’s insider trading policy and other relevant factors. However, pursuant to the terms of the Merger Agreement, and subject to certain limited exceptions, we were prohibited from repurchasing our ordinary shares other than the acceptance of our ordinary shares as payment of the exercise price of our options or for withholding taxes with respect of our equity awards. Accordingly, we did not repurchase any of our ordinary shares during the pendency of the Merger Agreement pursuant to the Existing Share Repurchase Plan. The Existing Share Repurchase Plan expired on November 9, 2024.

Current wording

On November 9, 2022, we announced that our Board of Directors approved a two-year share repurchase program to purchase up to $1.0 billion of our outstanding ordinary shares. Share repurchases may be made in open market or privately negotiated transactions and/or pursuant to Rule 10b5-1 trading plans, subject to market conditions, applicable legal requirements, trading restrictions under the Company’s insider trading policy and other relevant factors. However, pursuant to the terms of the previously terminated Merger Agreement, and subject to certain limited exceptions, we were prohibited from repurchasing our ordinary shares other than the acceptance of our ordinary shares as payment of the exercise price of our options or for withholding taxes with respect of our equity awards. Accordingly, we did not repurchase any of our ordinary shares during the pendency of the Merger Agreement pursuant to the share repurchase program. The share repurchase program expired on November 9, 2024.

Previous wording

For the three months ended December 28, 2024, we recognized asset impairment charges of $675 million primarily related to the impairment of the Jimmy Choo Wholesale and Versace Retail and Wholesale reporting units’ goodwill and Versace and Jimmy Choo brand intangible assets. For the three months ended December 30, 2023, we recognized asset impairment charges of $6 million primarily related to operating lease right-of-use assets at certain Versace and Michael Kors store locations. See Note 12 to the accompanying consolidated financial statements for additional information.

Current wording

See Note 15 to the accompanying consolidated financial statements for additional information.

Previous wording

We have not created, and are not party to, any special-purpose or off-balance sheet entities for the purpose of raising capital, incurring debt or operating our business. Our off-balance sheet commitments relating to our outstanding letters of credit were $29 million at December 28, 2024, including $28 million in letters of credit issued outside of the 2022 Credit Facility. In addition, as of December 28, 2024, bank guarantees of approximately $38 million were supported by our various credit facilities. We do not have any other off-balance sheet arrangements or relationships with entities that are not consolidated into our financial statements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues, expenses, results of operations, liquidity, capital expenditures or capital resources.

Current wording

We have not created, and are not party to, any special-purpose or off-balance sheet entities for the purpose of raising capital, incurring debt or operating our business. Our off-balance sheet commitments relating to our outstanding letters of credit were $27 million at June 28, 2025, including $25 million in letters of credit issued outside of the 2025 Credit Facilities. In addition, as of June 28, 2025, bank guarantees of approximately $31 million were supported by our various credit facilities. We do not have any other off-balance sheet arrangements or relationships with entities that are not consolidated into our financial statements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues, expenses, results of operations, liquidity, capital expenditures or capital resources.