Michael Kors Parent Capri Plans 2027 Price Hikes To Offset Trump-Era Tariff Costs

Capri Holdings’ (CPRI) interim CFO Rajal Mehta said on Wednesday that the company will implement targeted price increases in fiscal 2027 to offset the impact from higher costs tied to U.S. President Donald Trump’s tariff policies on global trading partners.

Mehta added that the unmitigated impact of tariffs on products shipped into the U.S. is expected to increase the company’s costs by $85 million in fiscal 2026, compared with its prior estimate of $60 million.

“Our sourcing is broadly diversified with the majority of Michael Kors production originating from Vietnam, Cambodia and Indonesia,” Mehta said on a post-earnings call.

He added that Jimmy Choo sources the vast majority of its products from Italy and China represents about 5% of total Capri U. S. Production volumes.

Retail sentiment on Capri improved to ‘bullish’ from ‘neutral’ a day ago, with chatter at ‘high’ levels, according to Stocktwits data.

Shares of Capri were up 12% during midday trading after first-quarter revenue and profit estimates beat expectations.

“The consumer remains engaged and appears to be getting more engaged with both brands,” CEO John Idol said.

The company had offloaded Italian fashion brand Versace several months ago. Capri sold it to Italy’s Prada in a $1.4 billion deal to focus on its core brands, Michael Kors and Jimmy Choo.

Capri, after its failed merger with Tapestry (TPR) has been undergoing a turnaround to improve sales of Michael Kors through e-commerce growth.

The company expects second-quarter total revenue of about $815 million to $835 million, compared with analyst expectations of $799.7 million, according to data compiled by Fiscal AI.

Capri stock has declined nearly 4% so far this year and has declined over 36% in the last 12 months.

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