Versace clothing
(Picture: Versace)Luxury fashion businesses Ralph Lauren and Capri Holdings both posted first-quarter results that strode past analyst expectations as shoppers kept forking out for high end clothes, shoes and handbags despite soaring inflation and squeezed household budgets.
London-based Capri Holdings, owner of fashion brands Versace, Jimmy Choo and Michael Kors, reported an 8.5% boost in revenue to $1.4 billion (£1.1 billion) while its operating margin grew 18.5%. CEO John D. Idol was bullish about the company’s prospects despite fears of an imminent economic downturn.
“Better than anticipated results were driven by strong momentum across all three luxury houses reflecting the power of our brands as they continue to deepen consumer desire and engagement,” he said.
“With our portfolio of iconic, founder-led fashion luxury brands, Capri Holdings is positioned to deliver multiple years of revenue and earnings growth."
Meanwhile, US-based Ralph Lauren reported sales of $1.5 billion, a jump of 8% on the previous year and almost $100 million above analyst estimates, as executive chairman Ralph Lauren boasted the company’s “vision of timelessness and an authentic life well-lived continues to resonate around the world.”
The results from two of the world’s most popular luxury fashion brands, favourites of celebrities Kanye West, Anne Hathaway and Chance the Rapper, highlight continued demand for pricey goods among higher earners who racked up savings during the pandemic.
Shares in Ralph Lauren dropped almost 9% after the opening bell, however, after it said sales in China had fallen short because of lockdowns in the region, which had affected about half of stores, while it saw more modest growth in its outlet stores as a result of weaker sentiment among more value-conscious shoppers.
