Capri Holdings shares jumped 10% in premarket trading: how come?

Shares of Capri Holdings Ltd (NYSE: CPRI) are up more than 10% in premarket trading after the fashion company reported better-than-expected results for its fiscal third quarter.

Q3 results

Capri said its net income printed at $322 million that translates to $2.11 per share. In the same quarter last year, it had posted $179 million in net income or $1.18 per share. On an adjusted basis, the multinational earned $2.22 per share in the recent quarter.

The New York-headquartered firm generated $1.609 billion in revenue that represents a year-over-year growth of 24%. According to FactSet, experts had forecast $1.69 of adjusted EPS on $1.470 billion in revenue.

Revenue was up 20% at Michael Kors, 47% at Jimmy Choo, and 29% at Versace. In the earnings press release, CEO John Idol said:

Future guidance

For Q4, Capri forecasts 80 cents of EPS on $1.4 billion in revenue. This compares to the FactSet consensus for 73 cents of per-share earnings on $1.391 billion in revenue.

The NYSE-listed company expects $5.56 billion in revenue this year and a record $6.00 of EPS versus $5.413 billion and $5.34 that analysts had predicted. CEO Idol added:

Adjusted gross margin jumped 40 basis points. Capri spent $200 million on stock buyback in Q3 and has another $800 million pending under current authorisation.