Shares of Michael Kors stormed ahead in Monday trading after the company reported its second quarter earnings and offered an outlook higher for 2018.
For the quarter, the company reported net income of $202.9 million, or $1.32 per share. This was higher than the 95 cents in the year ago period and the $160.9 million in net income. $1.33 per share in the second quarter was way higher than the 83 cents that analysts had been expecting. Total sales at $1.15 billion was also higher than the $1.05 billion that Wall Street was waiting for.
The designer retailer just recently completed its acquisition of Jimmy Choo, the luxury shoe company, helping Michael Kors raise its expected total revenue for fiscal 2018 to $4.59 billon. Adjusted earnings per share are expected to be in the range of $3.85 and $3.95. Previously the company had called for $4.28 billion in revenues.
“Our second quarter results were better than expected, and we are pleased with our continued progress executing on our strategic plan, Runway 2020,” said Chief Executive John Idol.
“The positive signs that we are seeing in our business illustrate that our efforts across product innovation, brand engagement and our customer experience are beginning to take hold,” he continued.
“Michael Kors has been on a long journey of reinvention, but these latest numbers suggest the brand is starting to reach its destination of reestablishing itself as a well-regarded premium player,” wrote GlobalData Retail managing director Neil Saunders.
“Strategically, the decision to buy Jimmy Choo along with the latest collections, suggests that Michael Kors is looking to move into a more exclusive and distinct part of the luxury market,” he also wrote in his note to clients.
Shares this year have climbed 25% so far. The stock had climbed 14% in Monday trading after the news.
Disclaimer: We have no position in Michael Kors Holdings Ltd. (NYSE: KORS) and have not been compensated for this article.