Shares dive at fashion house Michael Kors as sales miss expectations

Michael Kors' shares plunged by 15 per cent today after the luxury fashion group missed Wall Street revenue estimates for the first time in almost two years.

The owner of brands such as Jimmy Choo saw revenue come in flat year on year at $643.9m (£489.6m) as European store sales dropped 10 per cent in the three months to the end of September, leaving it below analyst expectations of $661m, according to Refinitiv data.

Like-for-like store sales at Kors fell 2.1 per cent, while operating income sank to $67.9m from $69m in the previous year.

Total revenue across the group climbed 9.3 per cent to $1.25bn, but missed market expectations of $1.26bn, while net income shrank by a third to $137.6m from $202.9m last year.

Kors agreed to stump up $2bn for fashion house Versace in September as it seeks to compete with its European rivals, and chairman John Idol said the acquisition will strengthen the business.

“With the acquisition of Versace we have built one of the world's leading fashion luxury groups in just one year, setting the stage for accelerated revenue and earnings growth," he said.

"This is a truly remarkable and historic moment for our company and we look forward to completing this transformational acquisition in the coming months."