Kathryn Hallberg

Katy Hallberg, on behalf of Oliver Chen at TD Cowen, asked about the specific actions within Capri's control to drive traffic and conversion in its retail channels amidst a volatile consumer environment.

Answer

Chairman and CEO John Idol explained that Capri is focusing on marketing initiatives, brand storytelling, and data analytics to engage consumers and drive store traffic. He acknowledged that while traffic has not yet turned positive, the rate of decline has significantly decelerated, particularly at full-price stores. Idol emphasized that brand desirability, or 'brand heat,' is the key to influencing traffic, and noted that conversion rates have historically been strong once customers are in the store. He expressed confidence that the current strategies are beginning to show positive results.

Katy Hallberg, on behalf of Oliver Chen at TD Cowen, asked about the specific actions within Capri's control that are helping to drive traffic and conversion in its retail channels, especially given the volatile consumer backdrop.

Answer

Chairman & CEO John Idol explained that the company is focused on influencing traffic through targeted marketing, enhanced storytelling, and data analytics to engage new and existing consumers. He noted that while traffic has not yet turned positive, the rate of decline has decelerated significantly, and full-price AURs have turned positive. Idol emphasized that Michael Kors has historically maintained strong conversion rates, so the primary focus is on driving footfall by increasing brand desirability and 'brand heat' through these strategic initiatives.

Kathryn Hallberg, on for Oliver Chen, asked about the owned brand strategy for the second half of the year, including any potential delays due to the macro environment, and sought more detail on the drivers of savings in selling and distribution expenses.

Answer

Co-CEO Michael Mente confirmed that while adjustments have been made, the company is proceeding with 'very, very, very exciting' owned brand launches in H2 2025. CFO Jesse Timmermans attributed the selling and distribution efficiency primarily to a lower product return rate, but cautioned that they anticipate some pressure from lower average order values going forward.

Kathryn Hallberg from TD Cowen, on for Oliver Chen, asked about the key drivers of Zegna's strong growth in the U.S., the relative health of the U.S. consumer, and expectations for tourism from China.

Answer

Group CEO Gildo Zegna attributed U.S. success to a focus on high-end luxury leisurewear, converting wholesale to retail, strong branding, and a customer-centric local team. Group COO and CFO Gianluca Tagliabue added that growth includes very positive like-for-like comps. Regarding tourism, Gianluca noted a strong presence of Americans and Middle Easterners in Europe and Chinese tourists in Japan.