Appetite For Luxury Prompts Forecast Boost By Versace Parent

The post-pandemic appetite for luxury goods has prompted Capri Holdings — parent to Michael Kors, Versace and Jimmy Choo — to increase its profit and revenue forecast for the 2022 fiscal year, U.S. News reported on Tuesday (June 29).

The luxury goods company expects that the desire for luxury goods will continue increasing as the world continues returning to a new normal post-pandemic.

“As the world reopens, we are pleased to be seeing better than expected performance from all three of our iconic fashion luxury houses,” Chief Executive Officer John Idol said, per the article.

Capri is forecasting annual revenue of roughly $5.15 billion, with adjusted earnings of $3.80 to $3.90 per share. The previous forecast had anticipated $5.10 billion in annual revenue and adjusted earnings of $3.70 to $3.80 per share.

“Analysts are projecting revenue of $5.15 billion for the year started April and earnings of $3.87 per share,” said the article, stating that the information is based off IBES data from Refinitiv.

The company’s competitors — LVMH, Hermès and Gucci-owner Kering — also are seeing an increased demand for luxury merchandise and reaped benefits from the investments made to grow an online presence, according to U.S. News.

Pop-up luxury shops are another trend inspired by the pandemic with top designer brands like Dior, Prada, Valentino, Cuyana and Ted Baker using the time this summer to evaluate consumers’ return to physical shopping. Instead of a pop-up boutique, Gucci is planning a permanent spot away from Manhattan and out to East Hampton this summer.

A May report from the Bain Consultancy said that sales of luxury merchandise could return to pre-pandemic levels this year. Bain forecasted in November 2020 that luxury goods would not rebound until 2023.

During the pandemic, the luxury goods space lost 23 percent in sales figures, its largest decline ever and the first in over 10 years as the world locked down and tourism ground to a near halt.