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Yahoo Finance Live anchors discuss quarterly earnings for Michael Kors and Versace parent company Capri.
BRIAN SOZZI: Taking a look at Capri Holdings, fashion parent of brands like Michael Kors and Versace. It reported better-than-expected quarterly profits and increased yearly revenue by a company high of 39%. And this was a good-- this was a good quarter here, Brad, by and large. You had, really, Versace sales up 34% year-over-year. Jimmy Choo sales up almost 26%. Michael Kors up 22%. In this quarter, I would say, if you are inclined to connect all the dots in the market, it should absolutely come as no shocker.
Nordstrom last week told you're seeing a massive shift to consumers buying things for occasions-- the backyard barbecue, the dress-up party, again, after they come out from their two-and-a-half-plus years of COVID quarantine-- and hence, you're seeing the company, like a Capri, benefit very well. And I'll note this too-- let's pull up this picture here too. This is one of their newest offerings here.
BRAD SMITH: Oh, what you got?
BRIAN SOZZI: Yeah, a $58 limeade male sandal. Yes, that sandal is, in fact, for males. That probably cost $0.25 to make that sandal in some faraway location. This company is selling it for $58. I see that and I am not surprised to see margins up in the Michael Kors business. That is a fashionable sandal. You're going to pay a premium price for it. That is a margin-favorable item. You also probably-- not surprised to see online most of the sizes out.
BRAD SMITH: It's on sale for $44 right now.
BRIAN SOZZI: You're a buyer.
BRAD SMITH: Of this sandal?
BRIAN SOZZI: Of that sandal.
BRAD SMITH: I already got mine on discount from Express.
BRIAN SOZZI: All right. Wow.
BRAD SMITH: I'm good to go for the summer. Too cool for the summer.
BRIAN SOZZI: Look at that thing.
BRAD SMITH: I mean, look, this is all-- [LAUGHS]
BRIAN SOZZI: Come on.
BRAD SMITH: Look, it's right up to size [INAUDIBLE].
BRIAN SOZZI: It takes $0.25 to make. Look at that.
BRAD SMITH: I mean-- that's where the margins are coming in from. I mean, you look at the margins that came in. Versace-- like, let's just acknowledge the fact that they had a standout quarter in the Versace division. Revenue of $315 million. Increased 34% compared to the prior year. Total revenue increasing, as well, 44% in a constant currency basis. And then you look at the gross profit that came in-- 64%. That's year-over-year improvement, as well, compared to the 63.7% that they saw last year.
And so continuing to lean into either the flip-flop or Versace. We'll see what works out for them best coming up this particular summer, where we know people are looking to kind of spend higher for the higher fashion, if you will, especially as they're re-emerging into some of their social settings.
BRIAN SOZZI: Should note too, very quickly, from [INAUDIBLE] Simeon Siegel noting that it was nice to see a new $1 billion two-year buyback plan from this company. So that was a good thing to see as well. But look, the only trades right now that are working in retail are fashion-oriented players that are really targeted to upper-income consumers, consumers that can afford to spend almost $60 on those $0.25 sandals.