Michael Kors Holdings Ltd, best known for its handbags, reported better-than-expected first-quarter sales and profit, citing "solid" demand for accessories and footwear.
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The company's shares jumped more than 8 percent in premarket trading on Thursday.
Michael Kors, once among the hottest names in the "affordable luxury" sector, has been focusing more on accessories such as watches as demand for handbags slows.
The company has also been offering heavy discounts on handbags to try to win back shoppers who have been turning to more exclusive brands such as Tory Burch.
The U.S. handbag market has also become saturated, forcing Kors as well as rivals Coach Inc and Kate Spade & Co to offer discounts.
Moreover, the market has been hit by a drop in tourists from China and Japan who typically buy luxury products.
Coach reported better-than-expected quarterly sales and profit on Tuesday, helped by the acquisition of luxury shoe brand Stuart Weitzman Holdings.
Michael Kors' same-store sales fell of 9.5 percent in the first quarter ended June 27.
But that was better than the 11.3 percent decline expected by analysts polled by research firm Consensus Metrix.
Revenue rose 7.3 percent to $986 million, led by a 6.2 percent rise in North American retail sales.
Net income fell to $174.4 million, or 87 cents per share, in the period, from $187.7 million, or 91 cents per shares, a year earlier.
Analysts on average had expected earnings of 75 cents per share and revenue of $944 million, according to Thomson Reuters I/B/E/S.
Up to Wednesday's close of $39.49, Michael Kors' stock had fallen by almost half this year.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Don Sebastian and Ted Kerr)