Capri Holdings Limited (NYSE: CPRI) reported third-quarter results that came in ahead of analyst expectations on both earnings and revenue, even as the company continued to face sales pressure across parts of its portfolio.

Despite the better-than-expected results, shares of the luxury fashion group fell more than 10% intraday following the announcement.

For the quarter ended December 27, 2025, Capri posted adjusted earnings per share of $0.81, topping the consensus estimate of $0.77. Revenue totaled $1.025 billion, exceeding analyst forecasts of $1.00 billion, though sales declined 4.0% year over year, or 5.9% on a constant-currency basis.

The company sharply reduced its net debt position to $80 million at quarter-end, down from $1.17 billion a year earlier, reflecting the proceeds from the sale of its Versace brand.

By brand, Michael Kors revenue declined 5.6% to $858 million, while Jimmy Choo posted revenue growth of 5.0% to $167 million. Gross margin fell to 60.8% from 63.1% in the prior-year quarter, primarily due to higher-than-expected tariff costs.

Looking ahead, Capri guided fiscal 2026 revenue of $3.45 billion to $3.475 billion, modestly below the $3.53 billion consensus estimate. The company projected diluted earnings per share of approximately $1.30 to $1.40 for the full year.