Capri Holdings, the parent company of renowned fashion brands such as Versace, Michael Kors, and Jimmy Choo, has reported a substantial decline in its quarterly revenue, leading to a significant drop in its stock price. The company's financial results fell short of analysts' expectations, with a reported 16.4% decrease in net revenue to $1.08 billion, compared to the anticipated $1.18 billion. This disappointing performance has been attributed to a global slowdown in demand for luxury goods and execution missteps across its brands.

The company's shares fell approximately 6% in extended trading following the announcement, and further declined by about 9% the next day. This decline in stock value comes in the wake of a blocked merger deal with Tapestry, the parent company of Coach, which was expected to spearhead a turnaround for Capri. The Federal Trade Commission had previously blocked the $8.5 billion merger, citing concerns over reduced competition in the market for affordable luxury handbags.

Capri's CEO, John Idol, acknowledged the challenges faced by the company, citing "softening global demand for luxury fashion" as a key factor in the revenue decline. The company's flagship brand, Michael Kors, saw a 16% drop in revenue, while Versace's sales fell by 28%. In contrast, Jimmy Choo's revenue rose by 6%, offering a glimmer of hope amidst the otherwise bleak financial landscape.

The company's quarterly margin slightly decreased to 64.3% from 64.4% a year earlier, as Capri was forced to offer more discounts and manage higher expenses. Analysts have noted that Capri has struggled to implement a new e-commerce platform for Michael Kors and missed opportunities to revitalize its brands, potentially weakening its market position.

Despite the challenges, Capri remains committed to appealing the court's decision to block the merger with Tapestry. However, the market remains skeptical about the company's ability to execute a successful turnaround without the merger, as evidenced by the sharp decline in its stock price.