Michael Kors-owner beats revenue estimates on resilient luxury demand

[August 09, 2022]  (Reuters) -Michael Kors-owner Capri Holdings Ltd beat quarterly revenue estimates on Tuesday, helped by unwavering demand for luxury goods from higher-income consumers who remain largely unaffected by rising prices.

People walk by a Michael Kors store in Lakewood, Colorado June 1, 2016. REUTERS/Rick Wilking/File Photo

The effects of 40-year-high inflation has shown little, if any, impact on middle- and high-income households who have been spending on designer labels since the return of socializing and will continue to do so undeterred by the economic crisis.

In contrast, low-income households have been hit hard by inflation because a large portion of their income is spent on essential items ranging from food to fuel and accommodation.

The company's total revenue rose 8.5% to $1.36 billion in the first quarter ended July 2, beating analysts' average estimate of $1.29 billion, according to IBES data from Refinitiv.

Net income for Capri, which also owns Italian fashion house Versace, fell to $203 million, or $1.40 per share, from $219 million, or $1.41 per share, a year earlier.

(Reporting by Uday Sampath in Bengaluru; Editing by Shinjini Ganguli)

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