CPRI 10-K & 10-Q changes, risk factors and insider trading

The accessories, footwear and apparel industries are heavily influenced by general macroeconomic cycles that affect consumer spending and a prolonged period of depressed consumer spending could havematerially aadversely materialaffect adversedemand effect onfor our business,products, resultspricing of operationsdynamics and financialour condition.ability to manage inventory levels and margins.

•establishing and maintaining acceptable relationships with retailour customers;

Competition, along with other factors such as consolidation, changes in consumer spending patterns and a highly promotional retail selling environment, could also result in significant pricing pressure. These factors may cause us to reduce our sales prices to our wholesale customers and retail consumers, which could cause our gross margins to decline if we are unable to appropriately manage inventory levels and/or otherwise offset price reductions with comparable reductions in our operating costs. If our sales prices decline and we fail to sufficiently reduce our product costs or operating expenses, our profitability may decline, which could have a material adverse effect on our business, results of operations and financial condition.

We operate on a global basis, with approximately 49%47% of our total revenue from operations outside of the United States during Fiscal 2025.2026. AsOur ainternational result,operations weexpose are subjectus to the risks ofrelated doing business internationally, includingto:

•geopolitical events or other political or civil unrest, including protests and other civil disruption;

•unforeseen public health crises, such as pandemic and epidemic diseases, including prior events such as COVID-19 and any variants thereof;

•economic instability and unsettled regional and global conflicts (such as the current war in Ukraine and the Middle East conflict), which may negatively affect consumer spending by foreign tourists and local consumers in the various regions where we operate;

•laws,regulatory regulationsdevelopments and policies of the United States or foreign governments (including sanctions and retaliatory actions by the United States, European Union and others);

•natural disasters or other extreme weather events, including those attributed to climate change; and

•acts of terrorism, military actions or other conditions over which we have no control.control; and

In addition, we pursue selective international expansion in a number of countries around the world and through a number of channels. If our international expansion plans are unsuccessful, it could have a material adverse effect on our business, results of operations and financial condition. There are also some countries where we do not yet have significant operating experience, and in most of these countriescountries, we face established competitors with significantly more operating experience in those locations.

Our business is subject to risks associated with importing products, and the imposition or threat of imposition of new or additional duties, tariffs or trade restrictions or supply chain diligence requirements could have a material adverse effect on our business, results of operations and financial condition.

There are risks inherent to importing our products. Virtually all of our imported products are subject to duties which may impact the cost of such products. In Apriladdition, 2025, the U.S. Government announced tariffs on imports from select countries. The majorityall of the Company'sour products sold in the U.S. are imported from foreign countries in which these tariffs were announced, including Vietnam, Cambodia, Indonesia and Bangladesh, where the primary manufacturers of Michael Kors products are located.located, Inand addition,are retaliatorytherefore tariffssubject to changes in U.S. and international trade policies. Trade actions, including tariffs, safeguard measures, quotas, or other import restrictions, may be implementedimposed, bymodified, countrieschallenged, or replaced from time to time under various legal authorities, and the scope, duration, and applicability of such measures can be unpredictable. Refunds or relief from tariffs or duties, where available, are subject to administrative review, timing delays, and changes in interpretation or enforcement, and there can be no assurance that such amounts will be recovered, or recovered in a timely manner, which could adversely affect operating income and cash flows. Countries where our manufacturersproducts are locatedmanufactured and/or countriessold may implement retaliatory measures or impose additional restrictions in response to whichchanges in U.S. trade policy. While we ship our products may impose safeguard quotasseek to limitmitigate the quantityimpact of productstrade thatmeasures maythrough besourcing imported. Where we can, we rely onstrategies, free trade agreements and other supply chain initiatives inwhere orderavailable, to maximize efficiencies relating to product importation. Increasedincreased tariffs or other trade restrictions against countries where our products are manufactured, and/or anyuncertainty tariffsregarding ortheir other trade restrictions implemented by these countries in retaliation,application, could limit our ability to manufacture products in countries that have the labor and technical expertise needed and we may not be able to find alternative sourcing options in a timely manner or at all. InSuch addition,measures suchmay tariffsalso or other trade restrictions could require us to incur significant costs or causeforce us to increase theprices, priceabsorb chargedhigher tocosts, consumersor foradjust oursourcing products,arrangements, eitherany of which could materially impactadversely affect our revenuerevenue, and profitability. Our ability to navigate any uncertainty, changes or expansion in tariffs or other trade restrictions could have a material negative impact on our business,profitability, results of operations andor financial condition.

•pandemics, epidemics and health-related concerns, including relatedprior toevents such as COVID-19 or variants thereof;

•significant increase in fuel, freight, shipping and other logistics costs,costs or increased transit times, including as a result of disruptions at ports of entry or international shipping routes (including the Red Sea corridor and other routes impacted by the conflicts in the Middle East);

•political or military conflict (such as the current war in Ukraine or the conflicts in the Middle East);

•increases in the costs of fuel (including volatility in the price of oil), travel and transportation (including vessel and freight) (including increases in such costs related to the conflicts in the Middle East);

Reduced travel resulting from economic conditions (including a recession or inflationary pressures), fuel shortages, increased fuel prices,prices (related to the conflicts in the Middle East), travel restrictions, travel concerns and other circumstances, including adverse weather conditions, disease pandemics (including prior events such as COVID-19), epidemics and other health-related concerns, war, terrorist attacks or the perceived threat of war or terrorist attacks, or unsettled regional and global conflicts (such as the current war in Ukraine and the conflicts in the Middle East) could have a material adverse effect on us, particularly if such events impact our customers’ desire to travel to our retail stores.

Our industry is subject to significant pricing pressure caused by many factors, including intense competition and a highly promotional environment, fragmentation in the retail industry, pressure from retailers to reduce the costs of products,products and changes in consumer spending patterns. If we misjudge the market for our products or demand for our products is impacted by external factors, we may be faced with significant excess inventories of some products and missed opportunities for other products. In addition, inaccurate demand forecasting or delayed reaction to trend changes may extend inventory holding periods and negatively affect cash flows and gross margins. We have in the past been, and may in the future be, forced to rely on markdowns, promotional sales, donations or other write-offs to dispose of excess, slow-moving inventory, which may negatively impact our gross margin, overall profitability and efficacy of our brands. In addition, increases in our costs, such as raw materials, labor or freight, could negatively impact our gross margin, and we may not be able to offset such cost increases through pricing measures or other means.

IfWe perform impairment assessments of goodwill and indefinite-lived intangible assets on an annual basis or whenever impairment indicators exist. Judgments regarding the carryingexistence valueof impairment indicators are based on market conditions and operational performance of the reportingbusiness. unitsIn the absence of any impairment indicators, goodwill and indefinite-lived intangible assets are assessed for oneimpairment orduring morethe fourth quarter of oureach brandsfiscal exceedsyear. If the relatedtesting fairperformed value,indicates that impairment exists, we are required to record impairment charges for the difference,difference between the carrying value of the goodwill or intangible assets and thosethe implied fair value of the goodwill and/or intangible assets in the period the determination is made. Goodwill and intangible asset impairment charges couldhave be significant. Duringin the thirdpast quarterbeen, ofand Fiscalcould 2025,in the Companyfuture identifiedbe, impairment indicators due to the reduction of our share price following the termination of the Merger Agreement, continued softening of consumer demand for fashion luxury goods globally and the continuing decline in operating results during the third quarter impacting all three of the Company’s brands. As a result of the Company’s impairment assessment, the Company recorded $671 million of impairment charges, related to our Jimmy Choo and Versace goodwill and intangible assets during the fiscal year ended March 29, 2025.significant. It is also possible that our conclusions regarding impairment or recoverability of goodwill or other intangible assets could change in future periods if, for example, (i) our businesses do not perform as projected, (ii) overall economic conditions in future years vary from current assumptions, (iii) business conditions or strategies change from our current assumptions, (iv) discount rates change, (v) market multiples change or (vi) the identification of our reporting units change, among other factors. Such changes could result in future impairment charges of goodwill or other intangible assets and such amounts could be significant, which could have a material adverse impact on our results of operations and financial condition.

We do not own any of our retail store facilities, but instead lease all of our stores under operating leases. Our leases generally have terms of up to 10 years, generally require a fixed annual base rent and some require the payment of additional percentage rent if store sales exceed a negotiated amount. Certain of our European stores also require initial investments in the form of key money to secure prime locations, which may be paid to landlords or existing lessees. Generally, our leases are “net” leases, which require us to pay all of the costs of insurance, taxes, maintenance and utilities. We generally cannot cancel these leases or withhold payments at our option, and payments under these operating leases account for a significant portion of our operating costs. For example, as of March 29,28, 2025,2026, we were party to operating leases associated with our retail stores that we operate directly throughout the globe, as well as other global corporate facilities, requiring future minimum lease payments aggregating to $1.4$949 billionmillion through Fiscal 20302031 and approximately $501$318 million thereafter through Fiscal 2044. Our substantial operating lease obligations could have a material adverse effect on our business, results of operations and financial condition.

Our results of operations for our international subsidiaries are exposed to foreign exchange rate fluctuations as the financial results of the applicable subsidiaries are translated from the local currency into United States dollar during financial statement consolidation. If the United States dollar strengthens against foreign currencies, the translation of these foreign currency denominated transactions could impact our consolidated results of operations. In addition, we have had in the past, and may again in the future have, intercompany notes amongst certain of our non-United States subsidiaries, which may be denominated in a currency other than the functional currency of a particular reporting entity. As a result of using a currency other than the functional currency of the related subsidiary, results of these operations may be adversely affected during times of significant fluctuation between the functional currency of that subsidiary and the denomination currency of the note. We continuously monitor our foreign currency exposure and hedge a portion of our foreign subsidiaries’ foreign currency-denominated inventory purchases to minimize the impact of changes in foreign currency exchange rates. However,As of March 28, 2026, we have $3.5 billion of hedges outstanding to hedge our net investment in Swiss Franc denominated subsidiaries with contract maturity dates between March 2027 and May 2045, and $2.364 billion of fixed-to-fixed cross-currency hedges outstanding related to our net investment in Euro denominated subsidiaries with contract maturity dates between December 2027 and July 2031. We cannot fully anticipate all of our foreign currency exposures and cannot ensure that these hedges will fully offset the impact of foreign currency exchange rate fluctuations and no hedging strategy can completely insulate us from foreign currency exchange risk. Certain of these net investment hedge contracts are supported by credit support annexes which provide for collateral exchange if the fair value of a derivative contract exceeds a certain threshold, with the earliest effective date being June 2030. Adverse movements in foreign currency exchange rates or interest rates could result in significant collateral posting requirements in the future, which could negatively affect our liquidity, reduce cash available for operations and capital allocation, or require us to obtain additional financing on unfavorable terms. In addition, market disruptions, regulatory or accounting changes, counterparty defaults, or early termination events could increase the cost of maintaining or replacing these hedges or limit their effectiveness, which could adversely affect our results of operations, financial condition and cash flows. We also use forward foreign exchange contracts and cross-currency swap contracts to hedge our net investments in foreign operations against future volatility in the exchange rates between different currencies. We are exposed to risks related to foreign currency exchange rate movements on our net investments in foreign operations due to the volatility in the exchange rates between different functional currencies. ARefer 10%to appreciationItem or7A. devaluation- of“Quantitative theand UnitedQualitative StatesDisclosures dollarabout comparedMarket Risk” for additional information related to the levelimpact of foreign currency exchange ratesrate forchanges currenciesand underour contractforeign ascurrency ofhedging March 29, 2025, would result in a net increase or decrease, respectively, of approximately $365 million in the fair value of these contracts.instruments.

Lastly, increased scrutiny by federal regulators (such as the FTC) and state attorney generals focused on the retail industry may lead to increased privacy and cybersecurity costs such as organizational changes, deploying additional personnel, acquiring and implementing enhanced privacy and security technologies on e-commerce sites, mandatory employee training for those handling customer and employee personal data,data and engaging third-party experts and consultants, and the unauthorized use of proprietary information may lead to lost revenues.

Investor advocacy groups, certain institutional investors, investment funds, other market participants, shareholders, customers, employees and regulators have increasingly focused on ESG or “sustainability” practices of companies. We have a publicly announced global strategy to achieve significant, measurable goals across a range of important environmental and social sustainability issues, including, renewable energy, responsible material sourcing, water use and chemical management and waste reduction. We have also set science-based targets around greenhouse gas emissions (GHG) reductions. We rely on our supply chain partners to meet certain of our targets, including our scope 3 GHG emissions reduction goals; however, our supply chain is complex and almost entirely comprised of parties not within our control. It is possible that stakeholders may not be satisfied with our ESG targets, practices or the speed of adoption or that we may not be successful in achieving our goals on the timelines set or at all, which could negatively impact our brands, our reputation, and customer and employee retention. In addition, we are susceptible to risks associated with changing stakeholder attitudes regarding environmental, social and political issues and consumer perceptions of our position on these issues. Discrepancies between disclosed ESG targets or progress and actual outcomes may expose us to securities litigation, regulatory enforcement or consumer protection claims.

In addition, many jurisdictions in which we and our suppliers operate have begun enacting new ESG and climate legislation and regulations. Such proposed and/or enacted regulations include expanded disclosure requirements regarding GHG emissions and other climate-related information, including disclosure of climate-related risks and independent auditors providing some level of attestation to the accuracy of such disclosures. Evolving product safety, environmental, and chemical‑regulation requirements, including restrictions on certain chemicals may require changes to materials, suppliers, testing procedures or product assortments and could increase costs or limit availability of certain products. In addition, environmental and product‑lifecycle regulations, including extended producer responsibility regimes for packaging and other materials, may impose additional fees, reporting, take‑back, or recycling obligations that could increase compliance costs and operational complexity. Our ability to comply with any such new ESG and/or climate laws and regulations may lead to increased costs and operational complexity and/or we may be required to divert costs and resources in order to comply with ESG frameworks, and legal, legislative and regulatory requirements. Any failure on our part to comply with such ESG-related regulations could lead to adverse consumer actions and/or investment decisions by investors, as well as expose us to government enforcement action and/or private litigation.

Our business, including our retail, distribution and manufacturing operations, is susceptible to the physical and transitional risks associated with climate change and other environmental impacts that could negatively affect our business and operations. For example, the acute and chronic physical risks of climate change, such as increased severity of extreme weather events, changes in weather and precipitation patterns and/or rising temperatures and sea levels may (i) cause potential disruptions to our retail stores, distribution centers and corporate facilities or those facilities of our wholesale customers, licensees or suppliers, (ii) adversely impact global supply chains, including the availability and cost of raw materials, (iii) negatively affect the ability of our manufacturers to fulfill our orders timely and/or to our specifications, (iv) cause shipping disruptions and/or (v) lead to higher freight costs. An increase in extreme weather conditions could also result in more frequent damage and/or closures of our stores and distribution centers (or facilities of our wholesale customers, licensees or suppliers), adversely impact retail traffic, consumers’ disposable income levels or spending habits on discretionary items, or otherwise disrupt business operations in the communities in which we or our partners operate, any of which could result in lost sales or higher costs. In addition, concern over climate change may result in policy/legal-, technology-, market- and/or reputation-related transition risks. For example, increased climate-related disclosures, increased exposure to litigation resulting from new or additional legal requirements, mandates on our products and services,services and substitution of existing products with lower emission options may result in increased operational and administrative compliance costs. Changing customer behavior, increased costs of raw materials, shifts in customer preferences, increased stakeholder concern and stigmatization of the fashion industry are also climate-related transition risks that could negatively impact us.

On August 16, 2022, the Inflation Reduction Act of 2022 was signed into law by the Biden Administration, with tax provisions primarily focused on implementing a 15% corporate alternative minimum tax on global adjusted financial statement income ("CAMT") and a 1% excise tax on share repurchases. The CAMT was effective beginning Fiscal 2024 and is not expected to have a material impact on our effective tax rate, however, we will continue to monitor for any potential impact as additional guidance becomes available.impact. With respect to the 1% excise tax on net share repurchases, this provision of the Inflation Reduction Act was effective on January 1, 2023 and did not have a material impact on our consolidated financial statements.

On December 12, 2022, the European Union member states reached an agreement to implement the Organization for Economic Cooperation and Development’s ("OECD") reform of international taxation known as Pillar Two Global Anti-Base Erosion ("GloBE") Rules, which broadly mirrors certain provisions of the Inflation Reduction Act by imposing a 15% global minimum tax on multinational companies. GloBE has became effective during Fiscal 2025. Based upon our analysis, the Pillar Two initiatives are not projected to have a material impact on our consolidated financial statements.statements at this time. We continue to monitor developments and their impact on our tax provision in accordance with where we earn our income globally.

We have significant deferred tax assets consisting primarily of net operating losses, reserves and interest expense accruals that are not currently deductible for tax purposes. As a result of the three year cumulative loss at a consolidated level, the Company recorded a full valuation allowance for the vast majority of its deferred tax assets in Fiscal 2025. We intend to generate sufficient future income and plan to implement tax planning strategies to utilize these deferred tax assets which may lead to the reversal of all or part of the valuation allowance and a reduction of future income tax expense. If we are unable to generate sufficient future taxable income or achieve the desired results of our tax planning strategies, we may not be able to realize the full benefit of our deferred tax assets which may have an adverse impact to our financial condition and results of operations in future periods.

We require our independent manufacturing contractors to operate in compliance with applicable laws, rules and regulations regarding working conditions, employment practices and environmental compliance, as well as our Supplier Code of Conduct and other compliance policies under our Factory Social and Environmental Compliance Program. Our staff and the third-parties we retain for such purposes periodically visit and monitor the operations of our independent manufacturing contractors to determine compliance. However, we generally do not control these manufacturing contractors or suppliers or their labor, environmental or other business practices. The violation of labor, environmental or other laws by an independent manufacturer or supplier, or divergence of an independent manufacturer’s or supplier’s labor practices from those generally accepted as ethical or appropriate or that violate our Supplier Code of Conduct, could interrupt or otherwise disrupt the shipment of our products, harm our trademarks or damage our reputation. Further, we could be prohibited from importing goods by governmental authorities. The occurrence of any of these events could materially adversely affect our business, financial condition and results of operations.

Our VERSACE,MICHAEL KORS and JIMMY CHOO and MICHAEL KORS trademarks, as well as other material trademarks, copyrights and design and patent rights related to the production, marketing and distribution of our products, are important to our success and our competitive position. We are susceptible to others imitating our products and infringing on our intellectual property rights in the Americas, EMEA, Asia and elsewhere in the world in both online and offline channels. Our brands enjoy significant worldwide consumer recognition and the generally higher pricing of our products creates additional incentive for counterfeiters to infringe on our brands. We work with customs authorities, law enforcement, legal representatives and brand specialists globally in an effort to prevent the sale of counterfeit products, but we cannot guarantee the extent to which our efforts to prevent counterfeiting of our brands and other intellectual property infringement will be successful. Such counterfeiting and other intellectual property infringement could dilute our brands and otherwise harm our reputation and business.

We are subject to shareholdersecurities class action litigation relatingwhich tocould theresult terminatedin Merger.significant costs and liability.

Pursuant to our amended and restated credit agreement, dated February 4, 2025 (the "Amended and Restated Credit Agreement"), the obligations under the 2025 Credit Facilities are secured by liens on substantially all of the assets of the Company and its U.S. subsidiaries that are borrowers and guarantors, excluding real property and other customary exceptions, and substantially all of the registered intellectual property of the Company and its subsidiaries. The terms of our indebtedness also contain affirmative and negative covenants that impose operating and financial restrictions on us and may restrict our ability to engage in future business opportunities or pursue our strategies. The Company’s 2025 Credit Facilities requires us to maintain a quarterly maximum permitted net leverage ratio of no greater than 4.0 to 1.0. The 2025 Credit Facilities also contain certain restrictive covenants, including restrictions on our and certain of our subsidiaries ability to:

As part of our hedging activities, we enter into transactions involving derivative financial instruments, including cross-currency swaps to hedge our net investments in foreign operations against future volatility in the exchange rates between the United States dollar and foreign currencies, with various financial institutions. In addition, we have significant amounts of cash, cash equivalents and other investments on deposit or in accounts with banks or other financial institutions in the United States and abroad. We also rely on borrowings under our revolving credit facilities, under which we had $794$1.182 millionbillion of borrowing capacity as of March 29,28, 2025.2026. We rely on that borrowing capacity to fund our operations. As a result, we are exposed to the risk of default by, or failure of, counterparty financial institutions to meet their contractual obligations to us. This risk may be heightened during economic downturns and periods of uncertainty in the financial markets. If one of our counterparties were to become insolvent or file for bankruptcy, our ability to borrow funds or recover losses incurred as a result of a default or our assets that are deposited or held in accounts with such counterparty may be limited by the counterparty’s liquidity or the applicable laws governing the insolvency or bankruptcy proceedings. In the event of default or failure of one or more of our counterparties, we could incur significant losses or our financial liquidity could be adversely impacted, which could negatively impact our results of operations and financial condition.

Capri Holdings Limited is a global fashion luxury group consisting of iconic brands Versace,Michael Kors and Jimmy Choo and Michael Kors.Choo. 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.

Our Michael Kors brand was launched overin 40 years ago1981 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,footwear and footwearapparel 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 fashion brand in the Americas and Europe with growingstrong brand awareness in other international markets. Michael Kors features distinctive designs, materials and craftsmanship with a Jet Set aesthetic 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-wearfootwear and footwear.apparel. 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.

Termination of the Agreement and Plan of Merger with Tapestry

As previously disclosed, on August 10, 2023, Capri entered into an Agreement and Plan of Merger (the “Merger Agreement”) 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 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.

We operate in threetwo reportable segments, which are as follows:

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),Americas, certain parts of EMEA and certain parts of Asia, and through our e-commerce sites,sites. asIn welladdition, asrevenue is generated 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.worldwide, Inas addition,well revenue is generatedas 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.

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 transactionTapestry related transaction income (costsexpense), impairment charges 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.

The following table presents our total revenue and income (loss) incomefrom fromcontinuing operations by segment for Fiscal 2025,2026, Fiscal 20242025 and Fiscal 20232024 (in millions):

(1)Impairment of assets during Fiscal 2026 includes $35 million and $5 million of impairment charges related to the Michael Kors and Jimmy Choo reportable segments, respectively. Impairment of assets during Fiscal 2025 includes $656 million, $91$92 million and $50 million of impairment charges related to the Versace, Jimmy Choo and Michael Kors reportable segments, respectively. Impairment of assets during Fiscal 2024 includes $283 million, $267 million and $25 million of impairment charges related to the Versace, Jimmy Choo and Michael Kors reportable segments, respectively. Impairment of assets during Fiscal 2023 includes $2 million, $110 million and $30 million of impairment charges related to the Versace, Jimmy Choo and Michael Kors reportable segments, respectively.

(42)SeeRefer to Note 1112 - “Restructuring and Other Charges” to the accompanying consolidated financial statements for details on our restructuring program.

The following table presents our global network of retail stores by brand:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Critical accounting policies are those that are the most important to the portrayal of our results of operations and financial condition and that require our most difficult, subjective and complex judgments to make estimates about the effect of matters that are inherently uncertain. In applying such policies, we must use certain assumptions that are based on our informed judgments, assessments of probability and best estimates. Estimates, by their nature, are subjective and are based on analysis of available information, including current and historical factors and the experience and judgment of management. We evaluate our assumptions and estimates on an ongoing basis. While our significant accounting policies are detailed in Note 3 - “Summary of Significant Accounting Policies” to the accompanying consolidated financial statements, our critical accounting policies and estimates are discussed below and include revenue recognition, inventories, long-lived assets, goodwill and other indefinite-lived intangible assets, share-based compensation, derivativesassets and income taxes.

Revenue is recognized when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for goods or services. We recognize retail store revenue when control of the product is transferred at the point of sale at our owned stores, including concessions. Revenue from sales through our e-commerce sites is recognized at the time of delivery to the customer, reduced by an estimate of returns. Wholesale revenue is recognized net of estimates for sales returns, discounts, markdowns and allowances, after merchandise is shipped and control of the underlying product is transferred to our wholesale customers. To arrive at net sales for retail, gross sales are reduced by actual customer returns, as well as by a provision for estimated future customer returns, which is based on management’s review of historical and current customer returns. The amounts reserved for retail sales returns were $18$14 million, $18$16 million and $22$15 million at March 28, 2026, March 29, 2025,2025 and March 30, 2024 and April 1, 2023,2024, respectively. Net sales for wholesale equals gross sales, reduced by provisions for estimated future returns based on current expectations, as well as trade discounts, markdowns, allowances, operational chargebacks,chargebacks and certain cooperative selling expenses. Total sales reserves for wholesale were $63$49 million, $61$43 million and $73$44 million at March 28, 2026, March 29, 2025,2025 and March 30, 2024 and April 1, 2023,2024, respectively. These estimates are based on such factors as historical trends, actual and forecasted performance and market conditions, which are reviewed by management on a quarterly basis. Our historical estimates of these costs were not materially different from actual results.

Our inventory costs include amounts paid to independent manufacturers, plus dutiesduties, tariffs and freight to bring the goods to the Company’s warehouses, as well as shipments to stores. The combined total of raw materials and work in process recorded on our consolidated balance sheets as of bothMarch 28, 2026 and March 29, 2025 was $20 million and March$17 30,million, 2024 was $45 million.respectively. We continuously evaluate the composition of our inventory and make adjustments when the cost of inventory is not expected to be fully recoverable. The net realizable value of our inventory is estimated based on historical experience, current and forecasted demand and market conditions. In addition, reserves for inventory losses are estimated based on historical experience and inventory counts. Our inventory reserves are estimates, which could vary significantly from actual results if future economic conditions, customer demand or competition differ from expectations. Our historical estimates of these adjustments have not differed materially from actual results.

During Fiscal 2025,2026, Fiscal 20242025 and Fiscal 2023,2024, we recorded impairment charges of $136$40 million, $88$61 million and $36$32 million, respectively, which were primarily related to operating lease right-of-use assets and fixed assets of our retail store locations. Please referRefer to Note 89 - “Property and Equipment, Net” and Note 1415 of- “Fair Value Measurements” to the accompanying consolidated financial statements for additional information.

We record intangible assets based on their fair value on the date of acquisition. Goodwill is recorded as the difference between the fair value of the purchase consideration and the fair value of the net identifiable tangible and intangible assets acquired. The brand intangible assets recorded in connection with the acquisitionsacquisition of Versace and Jimmy Choo were determined to be indefinite-lived intangible assets, which are not subject to amortization. We perform an impairment assessment of goodwill, as well as the Versace brand and Jimmy Choo brand intangible assets on an annual basis, or whenever impairment indicators exist. In the absence of any impairment indicators, goodwill, the Versace brandgoodwill and the Jimmy Choo brand areis assessed for impairment during the fourth quarter of each fiscal year. Judgments regarding the existence of impairment indicators are based on market conditions and operational performance of the business.

When performing a quantitative impairment assessment of our brand intangible assets, the fair value of the Versace and the Jimmy Choo brandsbrand is estimated using a discounted cash flow analysis based on the “relief from royalty” method, assuming that a third-party would be willing to pay a royalty in lieu of ownership for this intangible asset. This approach is dependent on many factors, including estimates of future revenue growth rates, royalty rates and discount rates. Actual future results may differ from these estimates. An impairment loss is recognized when the estimated fair value of the brand intangible assets is less than its carrying amount.

Lastly,During basedthe fourth quarter of Fiscal 2026, we performed our annual goodwill and indefinite-lived intangible asset impairment analysis. Based on a qualitative impairment assessment of the Michael Kors reporting units, we concluded that it is not more likely than not that the fair value of the Michael Kors reporting units exceededwas itsless than their carrying valuevalues and, therefore, werewas not impaired. TheWe elected to perform quantitative impairment charges were recorded within impairment of assets on our consolidated statement of operations and comprehensive (loss) incomeanalyses for the periodJimmy endedChoo Marchreporting 29,units 2025.using a combination of income and market approaches to estimate the fair values of the reporting units. We also elected to perform a quantitative impairment analysis for the Jimmy Choo brand intangible assets.

In Fiscal 2025, we recorded goodwill impairment charges of $66 million related to the Jimmy Choo Wholesale reporting unit and $15 million related to the Jimmy Choo Retail and Wholesale brand intangible assets. In Fiscal 2024, we recorded goodwill impairment charges of $192 million related to the Jimmy Choo Retail and Wholesale reporting units,units and $70 million related to the Jimmy Choo Retail and Wholesale brand intangible assets and $227 million related to the Versace Retail and Wholesale brand intangible assets. In Fiscal 2023, we recorded goodwill impairment charges of $82 million related to the Jimmy Choo Retail and Wholesale reporting units and $24 million related to the Jimmy Choo brand intangible assets. The impairment charges were recorded within impairment of assets on our consolidated statementstatements of operations and comprehensive (loss) income for the fiscal years ended March 30,29, 20242025 and AprilMarch 1,30, 2023,2024, respectively. SeeRefer to Note 910 - “Intangible Assets and Goodwill” to the accompanying financial statements for information relating to the annual impairment analysis performed during Fiscal 2025,2026, Fiscal 20242025 and Fiscal 2023.2024.

There are no material changes from the risk factors previously disclosed in Part I, Item IA.1A. Risk Factors, in our Annual Report on Form 10-K for the year ended March 29,28, 2025.2026.

Capri Holdings Limited is a global fashion luxury group consisting of iconic brands Michael Kors and Jimmy Choo. Our commitment to glamorouscreativity, fashion, 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. Our designs inspire consumers to embrace the feeling of luxury in every moment.

Our Michael Kors brand was launched in 1981 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,footwear and footwearapparel 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 strong brand awareness in other international markets. Michael Kors features distinctive designs, materials and craftsmanship with a jet-setJet Set aesthetic 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-wearfootwear 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.apparel. Taken together, our Michael Kors collections target a broad customer base while retaining our premium luxury image.

Our Jimmy Choo brand offers a distinctive, glamorous and fashion-forward product range,range whosethat, coresince productits offeringinception isin 1996, has been anchored by women’s luxury shoes,footwear, complemented by accessories, including handbags, small leather goods, jewelry, scarves and belts, as well as men’s luxury shoesfootwear 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.inception. 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.

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 that the held for sale and discontinued operations criteria were met and we classified the results of operations and cash flows of our Versace business as discontinued operations in our consolidated statements of operations and comprehensive income (loss) and consolidated statements of cash flows for all periods presented. On December 2, 2025, we completed the sale of our Versace business. The related assets and liabilities associated with the discontinued operations are classified as held for sale in the consolidated balance sheet as of March 29, 2025. Unless otherwise noted, discussion within this management’s discussion and analysis of financial condition and results of operations only relates to our continuing operations. Refer to Note 43 - "“Discontinued Operations"” to the accompanying consolidated financial statements for additional information.

Macroeconomic conditions and inflationary pressures. Global economic conditions, including inflation,inflationary politicalpressure, geopolitical instability due to war or other geopolitical factors (such as the conflicts in the Middle East) and otherbroader macroeconomic uncertainty and the related impact on levels of consumer spending worldwide impacted our business induring the first ninethree months of Fiscal 2026,2027, and are likely to continue to impact our business and the luxury accessories, footwear and apparel industry overall for the foreseeable future. PurchasesGiven the discretionary nature of discretionaryour luxuryproducts, items,fluctuations suchin consumer confidence and disposable income, as thewell accessories,as footwearelevated andinflation, 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 affectimpact our financialbusiness condition and results of operations.performance.

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, and through our e-commerce sites. In addition, revenue is generated 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, as well as 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.

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 costsexpenses and Capri transformation program costs. In addition, certain other costs are not allocated to segments, including Tapestry related transaction income (costs), impairment charges and restructuring and other (expense) 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 continuing operations by segment for the three and nine months ended DecemberJune 27, 20252026 and DecemberJune 28, 20242025 (in millions):

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Critical accounting policies are those that are the most important to the portrayal of our results of operations and financial condition and that require our most difficult, subjective and complex judgments to make estimates about the effect of matters that are inherently uncertain. In applying such policies, we must use certain assumptions that are based on our informed judgments, assessments of probability and best estimates. Estimates, by their nature, are subjective and are based on analysis of available information, including current and historical factors and the experience and judgment of management. We evaluate our assumptions and estimates on an ongoing basis. While our significant accounting policies are detailed in Note 32 - "“Summary of Significant Accounting Policies"” to the accompanying consolidated financial statements, our critical accounting policies are disclosed, in full, in the MD&Amanagement’s discussion and analysis section of our Annual Report on Form 10-K for the fiscal year ended March 29,28, 2025.2026. There have been no significant changes to our critical accounting policies and estimates since March 29,28, 2025.2026.

Comparison of the three months ended DecemberJune 27, 20252026 with the three months ended DecemberJune 28, 20242025

The following table details the results of our operations for the three months ended DecemberJune 27, 20252026 and DecemberJune 28, 2024,2025, and expresses the relationship of certain line items to total revenue as a percentage (dollars in millions):

Total revenue decreased $43$28 million, or 4.0%,3.5%, to $1.025$769 billionmillion for the three months ended DecemberJune 27, 2025,2026, compared to $1.068$797 billionmillion for the three months ended DecemberJune 28, 2024,2025, which included net favorable foreign currency effects of approximately $20$5 million, primarily as a result of the weakening of the United States dollar compared to the Euro and British Pound. On a constant currency basis, our total revenue decreased $63$33 million, or 5.9%.4.1%.

•JimmyMichael ChooKors revenue increaseddecreased $8$45 million, or 5.0%,7.1%, to $167$590 million for the three months ended DecemberJune 27, 2025,2026, compared to $159$635 million for the three months ended DecemberJune 28, 2024,2025, which included favorable foreign currency effects of $5$3 million. On a constant currency basis, revenue increaseddecreased $3$48 million, or 1.9%,7.6%, primarily attributabledriven by our quality of sale initiatives, as we reduced promotional activity compared to higher revenue in the Americas.prior year.

SeeRefer to Note 54 - "“Revenue Recognition"” to the accompanying consolidated financial statements for additional information.

Gross profit decreased $51$2 million, or 7.6%,0.4%, to $623$500 million for the three months ended DecemberJune 27, 2025,2026, compared to $674$502 million for the three months ended DecemberJune 28, 2024, which included net favorable foreign currency effects of $13 million.2025. Gross profit as a percentage of total revenue was 60.8%65.0% and 63.1%63.0% for the three months ended DecemberJune 27, 20252026 and DecemberJune 28, 2024,2025, respectively.

•JimmyMichael ChooKors gross profit increaseddecreased $6$11 million, or 5.7%,2.8%, to $111$377 million for the three months ended DecemberJune 27, 2025,2026, compared to $105$388 million for the three months ended DecemberJune 28, 2024.2025. The 50280 basis point increase in gross profit margin was primarily dueattributable to higher full price sell-throughs.sell-throughs and lower U.S. import tariff costs compared to the prior year.

Total operating expenses decreased $71$3 million, or 11.0%,0.6%, to $577$483 million for the three months ended DecemberJune 27, 2025,2026, compared to $648$486 million for the three months ended DecemberJune 28, 2024. Our operating expenses included a net unfavorable foreign currency impact of approximately $11 million.2025. Total operating expenses decreasedincreased to 56.3%62.8% as a percentage of total revenue for the three months ended DecemberJune 27, 2025,2026, compared to 60.7%61.0% for the three months ended DecemberJune 28, 2024.2025. The components that comprise total operating expenses are explained below.

Selling, general and administrative expenses decreased $2$4 million, or 0.4%,0.9%, to $535$451 million for the three months ended DecemberJune 27, 2025,2026, compared to $537$455 million for the three months ended DecemberJune 28, 2024.2025. As a percentage of total revenue, selling, general and administrative expenses increased to 52.2%58.6% for the three months ended DecemberJune 27, 2025,2026, compared to 50.3%57.1% for the three months ended DecemberJune 28, 2024.2025.

•Michael Kors selling, general and administrative expenses decreased $27$3 million, or 6.7%,1.0%, to $376$304 million for the three months ended DecemberJune 27, 2025,2026, compared to $403$307 million for the three months ended DecemberJune 28, 2024.2025. The decrease was primarily due to cost savings initiatives which resulted in lower retail store related costs and personnel expenses compared to the prior year.

•Jimmy Choo selling, general and administrative expenses decreasedremained $3consistent with the prior year increasing $1 million, or 2.9%, to $101 million for the three months ended December 27, 2025, compared1.0%, to $104 million for the three months ended DecemberJune 28,27, 2024, primarily due to decreased marketing expenses2026, compared to $103 million for the priorthree year.months ended June 28, 2025.

Unallocated corporate expenses, which are included within selling, general and administrative expenses discussed above, but are not directly attributable to a reportable segment, increaseddecreased $28$2 million, or 93.3%,4.4%, to $58$43 million for the three months ended DecemberJune 27, 2025 as2026, compared to $30$45 million for the three months ended DecemberJune 28, 2024.2025. The increasedecrease was primarily due to the reimbursement for certain expenses pursuant to the termination of the Merger Agreement with Tapestry in the prior year of approximately $45 million and a net increase in allowance for credit losses in the current year of approximately $11 million, partially offset by a decrease inlower professional fees related to certain Capriinformation transformationtechnology projects which are now complete.

NM Not meaningful (1)Certain corporate costs are not directly attributable to our brands and, therefore, are not allocated to segments. SeeRefer to Note 1817 - "“Segment Information"” to the accompanying consolidated financial statements for additional information.

Income from continuing operations was $46$17 million for the three months ended DecemberJune 27, 2025,2026, compared to $26$16 million for the three months ended DecemberJune 28, 2024.2025. Income from continuing operations as a percentage of total revenue was 4.5%2.2% for the three months ended DecemberJune 27, 2025,2026, compared to 2.4%income from continuing operations of 2.0% for the three months ended DecemberJune 28, 2024.2025.

•JimmyMichael ChooKors recorded income from operations of $3$55 million for the three months ended DecemberJune 27, 20252026, compared to a loss of $6$63 million for the three months ended DecemberJune 28, 2024.2025. Operating margin increaseddecreased from a loss of 3.8%9.9% for the three months ended DecemberJune 28, 20242025, to income of 1.8%9.3% for the three months ended DecemberJune 27, 2025,2026, primarily due to leveragingdeleveraging of operating expenses on higherlower revenues compared to the prior year.

For the three months ended DecemberJune 27, 2025,2026, we recognized $9$31 million of interest income compared to $8$18 million of interest income for the three months ended DecemberJune 28, 2024.2025. The $1$13 million improvement in interest income, net, is primarily due to lower average borrowings andoutstanding higher interest income from our net investment hedges, partially offset by additional interest expense related to interest rate swaps and debt issuance costs duecompared to the extinguishmentprior ofyear. ourRefer 2025 Term Loans. Seeto Note 1110 - "“Debt Obligations"” and Note 1413 - "“Derivative Financial Instruments"” to the accompanying consolidated financial statements for additional information.

Foreign Currency LossGain

For the three months ended DecemberJune 27, 2025,2026 weand recognized immaterial net foreign currency losses. For the three months ended DecemberJune 28, 2024,2025, we recognized a net foreign currency lossgain of $15$1 million and $5 million, respectively, primarily attributable to the remeasurement of intercompany balances between certain of our subsidiaries.

(Benefit) Provision for Income Taxes

The benefit for income taxes was $2$18 million on pre-tax income of $52 million for the three months ended DecemberJune 27, 2025,2026, compared to a$16 provisionmillion on pre-tax income of $13$40 million for the three months ended DecemberJune 28, 2024.2025. Our effective tax rate for the three months ended DecemberJune 27, 20252026 was (34.6)% compared to (40.0)% for the three months ended June 28, 2025. Our effective tax rate increased for the three months ended June 27, 2026 compared to our effective tax rate for the three months ended DecemberJune 28, 20242025 is not a meaningful metricprimarily due to thechanges impactin ofvaluation allowances in both periods in proportion to the non-deductibleincrease goodwillin impairmentpre-tax chargesincome recordedcompared forto the threeprior months ended December 28, 2024.year.

As a result of the above, our net income was $57$70 million for the three months ended DecemberJune 27, 2025,2026, compared to net income of $6$56 million for the three months ended DecemberJune 28, 2024.2025.