Welcome to the Capri Holdings Limited first quarter fiscal 2027 financial results conference call. At this time, all participants are in listen-only mode. A Q&A session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Jennifer Davis, Vice President of Investor Relations. Thank you, Jennifer. You may begin. Good morning, everyone, thank you for joining us on Capri Holdings Limited first quarter fiscal 2027 conference call. With me this morning are John Idol, Capri's Chairman and Chief Executive Officer, and Tyler Reddien, Capri's Chief Financial and Chief Operating Officer. Before we begin, let me remind you that certain statements made on today's call may constitute forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ from those we expect. Those risks and uncertainties are described in today's press release and in the company's SEC filings, which are available on the company's website. Investors should not assume that the statements made during this call will remain operative at a later time, and the company undertakes no obligation to update any information discussed on today's call. Unless otherwise noted, all financial information on today's call will be presented on a non-GAAP basis. These non-GAAP measures exclude certain items associated with store renovation plan costs, transaction-related costs, Capri transformation costs, as well as restructuring and other charges. To view the corresponding GAAP measures and related reconciliation, please review our latest earnings release posted to our website earlier today at capriholdings.com. I would like to turn the call over to Mr. John Idol, Chairman and Chief Executive Officer. John? Thank you, Jennifer, good morning, everyone. We are encouraged by our first quarter results, which exceeded our expectations and demonstrated the progress we are making to build a stronger and more profitable business. Our strategic initiatives across both Michael Kors and Jimmy Choo are driving deeper consumer engagement through enhanced brand storytelling and compelling product innovation. As we look at the balance of fiscal 2027, we expect to make further progress executing against our strategic initiatives. First, strengthening brand desirability through compelling storytelling that deepens emotional connections and resonates with both new and existing consumers. Second, creating exciting luxury fashion product that reflects each brand's heritage while clearly leading with design and innovation. Third, delivering elevated and differentiated customer experiences across all touchpoints, including digital, stores, and wholesale. Fourth, leveraging our data analytics across the consumer journey to gain deeper insights and drive more personalized interactions. Fifth, utilizing our increasing cash flow to support brand momentum, including investments in store renovations, as well as ongoing investment in IT and digital enhancements while continuing to return capital to shareholders through our share repurchase program. While we remain focused on executing against our strategic initiatives, certain headwinds, including lower than anticipated inventory levels at Michael Kors in the second quarter, softer trends in EMEA, and updated foreign currency exchange rate assumptions, are having an impact on our revenue outlook. As a result, we now anticipate fiscal 2027 revenue of approximately $3.4 billion. Based on our revised revenue expectations, we are taking actions to reduce operating expenses, which are enabling us to maintain our fiscal 2027 earnings per share outlook of approximately $2.15, representing a 40% growth over the prior year. Now, turning to our first quarter results. We were pleased to deliver revenue, operating income, and earnings per share above our expectations. Total company revenue was $769 million, down 3.5% versus last year, while operating income increased approximately 40%. This strong profit growth drove earnings per share of $0.67, up approximately 30% compared to the prior year. Looking at first quarter performance by brand, starting with Michael Kors, revenue decreased 7% year-over-year, slightly above our expectations. More broadly, our results at Michael Kors continue to be impacted by our quality of sale initiatives as we reduced promotional activity third-party sales, and off-price shipments. While these actions are deliberate steps to strengthen the long-term foundation of the brand, they are creating near-term pressure on revenue. Turning to Michael Kors revenue by channel. In our own retail channel, sales declined high single digits, modestly below our expectations due to softer trends in EMEA at the end of the quarter, and the impact of our strategic decision to reduce markdown inventory levels. Overall, we were encouraged by continued improvement in the quality of our sales during the quarter, including higher full price sell-throughs, growth in AURs, and gross margin expansion. These are important indicators of a strong business model and support our confidence in more profitable growth as sales recover. Looking at Michael Kors retail sales by region. In the Americas, trends were similar to the prior quarter, with continued positive comparable store sales in our full price channel. In EMEA, trends declined, impacted by the ongoing conflict in the Middle East and reduced tourist traffic in Europe. While trends in Asia declined slightly, we were pleased that full price comparable sales remained positive in China. In our wholesale channel, revenue exceeded our expectations, declining low single digits. At point of sale, we were pleased to see positive comparable store trends with our wholesale partners, led by a double-digit increase in accessories. Turning to brand awareness and consumer engagement. We continue to reinforce Michael Kors' modern Jet Set lifestyle positioning through immersive storytelling, global events, and destination-driven experiences that capture the essence of our brand vision, traveling the world in style. Building on the momentum of Hotel Stories, our summer campaign captured the spirit of Saint-Tropez, featuring Suki Waterhouse, Dani Ramirez, and our brand ambassador, JCT. The campaign highlighted the season's most compelling styles while reinforcing our modern Jet Set lifestyle positioning. We further extended the reach of the campaign through an immersive Saint-Tropez Hotel Stories experience, bringing together a curated group of 14 global influencers to showcase our collection. Through authentic brand storytelling, the event generated over 100 million impressions, further amplifying awareness and consumer engagement around the world. Beyond our seasonal campaigns, an important highlight of our brand-building efforts was the Met Gala. At this year's event, a number of celebrities wore custom Michael Kors designs, including Anne Hathaway, as well as brand ambassadors Suki Waterhouse and Dani Ramirez, among others. As one of the fashion industry's most visible cultural moments, the event helped amplify brand awareness, elevate desirability, and reinforce Michael Kors' authority in fashion luxury. Collectively, these activities helped drive an 8% year-over-year increase in the Michael Kors global consumer database. Through our analytics capabilities, we are leveraging the strength of our extensive database to create deeper and more personal connections with consumers. Turning to product. Our strategy remains centered on delivering exciting fashion with standout style while celebrating our iconic brand codes. Guided by Michael's creative vision, our summer assortment blended classic French elegance with modern ease. New product designs and our broader pricing architecture are continuing to drive stronger full-price sell-throughs. In accessories, consumers continued to respond positively to on-trend styles that align with our broader pricing architecture. Our core icons, Hamilton, Laila, and Nolita, continued to perform well with smaller silhouettes introduced for summer, helping to expand consumer reach and attract younger customers. In footwear, we are beginning to see encouraging traction from new on-trend casual styles that reflect Michael's signature blend of Jet Set glamour and modern versatility. Notable styles included the Nolan sneaker, Pixie Jelly ballet flat, and the JC floral embellished sandal, which resonated with consumers and helped drive improved trends across the category. Looking at ready-to-wear, consumers responded to seasonal styles that captured Michael's effortless glamour. Our summer collection balanced modern fashion designs with timeless wardrobe staples, drawing inspiration from the relaxed sophistication of the south of France. Now, I would like to discuss the progress we are making with our store renovation program, as our retail locations remain an important pillar of the brand's expression and a driver of our sales recovery. Through our renovations, we are continuing to evolve the Michael Kors Jet Set lifestyle with elevated and more immersive customer experiences. During the quarter, we opened two new flagship stores in key international markets, including Beijing, China World, and Pavilion in Kuala Lumpur. These locations featured our Jet Set lounge, an immersive experience designed to deepen customer engagement and increase store dwell time. We see meaningful opportunity to build on this innovation and expand Jet Set lounges across flagship locations globally. We believe that our store renovation plan will further strengthen brand desirability and drive higher sales productivity. Early results are encouraging, with renovated locations generating significant sales increases versus prior year. Overall, at Michael Kors, we are encouraged by our first quarter performance, which reflected our efforts to enhance brand desirability and consumer engagement. While we are disappointed with our second quarter outlook, we expect Michael Kors revenue to return to growth in the back half of fiscal 2027, driven by new product introductions, increased marketing investments, the beginning of a normalization in promotional activity, and the increasing benefit from our store renovation program. Looking beyond fiscal 2027, we remain excited about the long-term growth potential of Michael Kors. By building on the brand's 45-year heritage as a global fashion luxury house and modernizing the Jet Set lifestyle for today's consumer, we are strengthening brand desirability. This positioning is resonating with consumers, our marketing investments are driving stronger customer engagement, and our new product introductions are performing well. We remain confident in our ability to achieve $4 billion in revenue and low 20% operating margins over time. Now, turning to Jimmy Choo. We were pleased with the brand's continued momentum. First quarter revenue exceeded our expectations, increasing 10.5% over last year. Growth was broad-based across channels, regions, and categories, driven by strong brand momentum and the continued success of our strategic initiatives. Our marketing initiatives are strengthening brand desirability, while our product initiatives are attracting new and younger consumers and creating additional purchase opportunities for existing clients. In our own retail channel, we were pleased with the sequential improvement in trends, with sales increasing low double digits and growing across all regions. Turning to wholesale, revenue also grew low double digits. Trends at point of sale remain strong, driven by continued double-digit increases in North American department stores. The performance across both retail and wholesale gives us confidence that the momentum behind the brand is both broad-based and sustainable. Turning to brand awareness and consumer engagement. Our storytelling continued to highlight the effortlessly alluring essence of Jimmy Choo and the sense of joy and confidence the brand inspires. In the first quarter, our marketing and communication strategy remained focused on strengthening brand heat, driving client acquisition, and expanding global cultural relevance. For summer, we introduced our Natural Reflection campaign, which reinforced Jimmy Choo's distinctive blend of glamour and craftsmanship, set against a striking desert backdrop. The campaign highlights new hero products, including the sculptural Glace mule, the playful Jelly Drop sandal, and the continued evolution of the Cinch bag. Beyond our seasonal campaigns, regional brand ambassadors are playing an increasingly important role in expanding our global cultural relevance. Campaigns featuring our brand ambassadors Wang Yibo and Bai Lu generated strong engagement across key markets and helped strengthen the brand's visibility with consumers in Asia. We are also increasingly leveraging influencers and immersive brand experiences to expand Jimmy Choo's global reach and connect with consumers in a more meaningful way. A great example was our global influencer trip to Nice, where we brought together a carefully curated group of 16 content creators from around the world with a combined following of more than 36 million people. The event generated nearly 50 million impressions across key markets while showcasing Jimmy Choo through aspirational content-rich experiences. Just as importantly, it helped drive increased interest in featured products and delivered measurable sales results. Additionally, creating distinctive experiences for our VICs remains an important part of our marketing strategy. The third installment of the From the Atelier Bon Bon series celebrated Jimmy Choo's commitment to craftsmanship and creative collaboration through limited edition Bon Bon bags inspired by the four seasons. The collection served as the foundation for curated client events across key markets, pairing rich storytelling with exclusive experiences that deepened engagement among our top clients and drove a 40% increase in VIC sales. Taken together, these initiatives are driving increased desirability and deepening consumer reach, contributing to a 7% increase in Jimmy Choo's global consumer database year-over-year. Turning to product. Jimmy Choo's product strategy remains focused on further developing accessories and expanding our casual footwear offering to support sustainable long-term revenue growth and margin expansion. Accessories continued to be an area of strength, with sales increasing double digits versus last year. Our iconic Bon Bon and Cinch franchises performed exceptionally well. During the quarter, we saw outsized growth in day bags, driven by the continued success of the Cinch collection and strong consumer response to new seasonal styles. In evening bags, Bon Bon maintained its strong momentum. Additionally, newer groups such as Bar and Curve are resonating with consumers and broadening the reach of the brand. We remain encouraged by the success of our expanded pricing architecture, which is helping attract new and younger clients without compromising the luxury positioning of the brand. Turning to footwear, results were encouraging across both dress and casual. In dress footwear, new styles such as Faye lace pump complemented iconic franchises like Sakura, underscoring our ability to balance seasonal updates with timeless designs. In casual footwear, our expanded assortment gained further momentum with strong performance from new seasonal styles, including our Margot flat, while established franchises such as our Sunny sneaker continued to perform well. We believe casual footwear represents a long-term growth opportunity, enabling us to increase purchase frequency among existing consumers while attracting new clients to the brand. Finally, I would like to congratulate Sandra Choi for being appointed an Officer of the Order of the British Empire, in recognition of her services to the fashion industry. This prestigious honor is a testament to Sandra's extraordinary creative vision, leadership, and lasting contributions. She continues to embody the very best of British design while helping shape Jimmy Choo's influence on the global luxury landscape. Looking ahead, we are increasingly confident in Jimmy Choo's trajectory. The brand is strengthening its connection with consumers, our marketing initiatives are resonating, and our product strategies are creating new avenues for growth. Jimmy Choo is well-positioned to return to profitability in fiscal 2027, driven by strong revenue growth, gross margin expansion, and disciplined expense management. Longer term, we are optimistic about our growth opportunities and confident that we can increase revenue to $800 million as well as expand operating margins to the low double-digit range. In conclusion, we remain optimistic about Capri Holdings' future. Across Michael Kors and Jimmy Choo, we have clear strategies focused on elevating brand desirability, deepening consumer engagement, strengthening product innovation, and improving the quality of our sales. As we build upon the momentum generated by our strategic actions, we believe Capri Holdings is well-positioned to drive sustainable growth, expand profitability, and create meaningful long-term value for our shareholders. In closing, I would like to thank our approximately 11,000 employees around the world whose dedication, focus, and talent continue to drive our progress. Now Tyler will take us through our first quarter results and guidance in more detail. Thank you, John, and good morning, everyone. Our first quarter performance reflects the progress we are making to build a stronger and more profitable business. We improved the quality of our sales, generated gross margin and operating margin expansion, and grew earnings per share while continuing to invest in our brands. We delivered revenue, operating income, and earnings per share above our expectations, driven by better than anticipated results at both Michael Kors and Jimmy Choo. These results are beginning to position Capri Holdings for more profitable growth. Looking at our first quarter results in more detail, total company revenue of $769 million decreased 3.5% on a reported basis and 4.1% in constant currency compared to the prior year. Looking at revenue performance by brand, Michael Kors revenue of $590 million decreased 7.1% on a reported basis and 7.6% in constant currency compared to the prior year. Revenue was above our expectation, partially due to the timing of wholesale shipments, more than offsetting modestly softer than anticipated retail performance. Our retail results were impacted by softening trends in EMEA at the end of the quarter and by our continued quality of sales initiatives, including a larger than expected impact from our strategic decision to reduce marked down inventory levels. Additionally, store closures negatively impacted retail sales in the low single-digit range, similar to prior quarters. As a result, global retail sales declined high single digits. Looking at total Michael Kors revenue by geography, revenue in the Americas decreased 10%, reflecting a sequential improvement relative to the fourth quarter, aided by earlier than anticipated wholesale shipments. In EMEA, revenue declined 5% as retail trends slowed toward the end of the quarter. In Asia, trends remained positive with revenue increasing 6%. Turning to Jimmy Choo, revenue of $179 million increased 10.5% on a reported basis and 9.3% in constant currency compared to the prior year. Global retail sales increased low double digits versus prior year, with particular strength in the Americas. Wholesale revenue also increased low double digits, reflecting strong demand for the brand. Looking at total Jimmy Choo revenue by geography, sales increased across all regions, with the Americas up 26%, EMEA up 5%, and Asia increasing 3%. Looking at total company margin performance, gross margin of 65% increased 200 basis points versus last year, driven primarily by higher full price sell-throughs, as well as lower tariff rates versus the first quarter of fiscal 2026. By brand, Michael Kors gross margin of 63.9% increased 280 basis points versus last year, driven primarily by higher full price sell-throughs and lower tariff rates, partially offset by channel mix. Jimmy Choo gross margin of 68.7% compared to 70.4% last year, lower primarily due to channel mix. Total company operating expenses decreased $10 million due primarily to cost savings initiatives, more than offsetting inflationary cost pressures. As a percent of revenue, operating expense was 61.4% compared to 60.5% last year, reflecting expense deleverage on lower revenue. Total company operating income of $28 million represented operating margin expansion of 110 basis points to 3.6%, ahead of our expectations. Looking at operating margin by brand, Michael Kors operating margin of 9.3% was slightly above our expectations. Compared to last year, operating margin declined 60 basis points, with higher gross margins more than offset by expense deleverage on lower revenue. Jimmy Choo operating margin of 7.3% was above our expectations and increased 480 basis points compared to the prior year, primarily driven by expense leverage on better than anticipated revenue and cost containment actions. Net income was $76 million, or $0.67 per diluted share. Turning to our balance sheet and cash flows. Our balance sheet remains strong, and we ended the quarter with cash of $114 million and debt of $338 million, resulting in net debt of $224 million, down from approximately $1.5 billion last year. During the quarter, we extended our revolving credit facility through 2031. We also executed against our commitment to return cash to shareholders, repurchasing approximately $50 million worth of shares during the quarter. We have an additional $871 million of availability remaining under our share repurchase authorization. Inventory at quarter end was $624 million, a 20% decline year-over-year. This decrease reflected an approximately 25% decline at Michael Kors, driven by a planned reduction in markdown inventory levels as well as in-transit delays. Second quarter inventory is now expected to decline high single digits, reflecting continued delays. We are taking actions to accelerate inventory receipts, including increased use of air freight. We expect inventory trends to normalize and build through the back half of the year to support our revenue growth. Turning to guidance, we are taking a more conservative view of our revenue outlook for the remainder of fiscal 2027 and now anticipate revenue of approximately $3.4 billion. By brand, we now expect Michael Kors' revenue of approximately $2.765 billion, impacted by $50 million from lower than anticipated second quarter revenue due to later than planned arrival of inventory receipts, $50 million from softer trends in EMEA, and $35 million from foreign currency headwinds. We still expect revenue to return to growth in the second half of the year, supported by new product introductions, increased marketing investments, and as promotional level comparisons begin to normalize. At Jimmy Choo, we anticipate revenue of approximately $635 million. For the year, we now anticipate gross margin of approximately 64% compared to 62.3% last year. Our guidance now assumes 10%-12.5% tariff rates on product imported into the United States. as of July 24, and we continue to monitor the evolving tariff situation. We now expect operating expenses of approximately $2 billion. This is a $70 million reduction versus our prior outlook, reflecting our disciplined approach to expense management. Accordingly, we now expect full-year operating income to be approximately $170 million, a 40% increase over last year. By brand, we continue to anticipate Michael Kors' operating margin to be in the low double-digit range and Jimmy Choo returning to profitability with operating margin in the low single-digit range. Turning to our expectations around certain non-operating items, we now expect net interest and other income of approximately $100 million. We continue to anticipate an effective tax rate in the low teens range, with fluctuations in quarterly tax rates due to our valuation allowance position. We now anticipate weighted average shares outstanding of approximately 110 million, assuming share repurchases of $200 million during fiscal 2027. Based on these assumptions, we continue to expect to generate diluted earnings per share of approximately $2.15, representing 40% growth over the prior year. Turning to second quarter guidance, we now expect total company revenue of approximately $780 million. By brand, we anticipate Michael Kors revenue of approximately $645 million. Our revised outlook now reflects several factors, including an estimated $50 million reduction in revenue resulting from the lower than anticipated inventory levels, $15 million from softer than previously anticipated trends in EMEA, $10 million from foreign currency headwinds relative to our prior expectations, and $10 million related to the timing shift of wholesale shipments that benefited the first quarter. We anticipate Jimmy Choo revenue of approximately $135 million, driven by continued brand momentum and the early positive response to our autumn collection. We expect second quarter operating income of approximately $10 million. In terms of operating margin by brand, we anticipate Michael Kors operating margin in the high single-digit percent range and Jimmy Choo operating margin in the negative mid-single-digit percent range. Turning to our expectations around certain non-operating items, we expect second quarter net interest and other income of approximately $25 million. We anticipate an effective tax rate in the mid 30% range and weighted average shares outstanding of approximately 112 million. As a result, we expect to generate diluted earnings per share of approximately $0.20, significantly above last year. In closing, we delivered meaningful progress in the first quarter, improving the quality of our sales, expanding gross margin, operating margin, and earnings per share, and continuing our share repurchase program. While near-term inventory delays are impacting our second quarter outlook, we expect revenue to return to growth in the second half of the year. As we move through fiscal 2027, we remain focused on driving higher profitability while continuing to invest in our brands. We are confident that the actions we are taking today position us to deliver sustainable long-term value for our shareholders. Now we will open up the line for questions. Thank you. We will now be conducting a Q&A session. We ask that you please limit yourself to one question. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. Our first question is from Matthew Boss with JP Morgan. Please proceed with your question. Great. Thanks. John, could you help break down the high single-digit retail sales decline at Michael Kors this quarter? What was performance at full price versus outlet in the quarter that made up that high single-digit decline? I guess my question is, what should we expect for second quarter retail sales in Michael Kors versus that high single decline in the first quarter? For the back half, has anything at all in your Michael Kors retail sales outlook changed at full price versus outlet, other than your view on EMEA macro? Thank you, good morning, Matt. I want to first start out by saying we were pleased with the results in our first quarter. As I had said in my prepared remarks, we are building a stronger and more profitable business. I think the results indicated that. We continue on our journey to first and foremost, look at the quality of sale in both Jimmy Choo and at Michael Kors. I think we're making very strong strides forward in that area. Our full price sell-throughs at both companies were up. Our AURs at both companies were up. When I look at the health of the sale to the customer, it's getting better each quarter. We think that that's a very strong indicator of what the future is for Capri and for Jimmy Choo and Michael Kors. In terms of Michael Kors, the retail sales in our full price channel comped positively in both North America and in Asia, consistent with prior quarter. Unfortunately, in EMEA, we did see as we moved through the quarter, revenues start to be impacted by the conflict and the lack of tourism in the EMEA region. Of course, we do have a business, although that's licensed in the territory itself, in the Middle East, which has been significantly impacted and remains significantly impacted. That's why we've taken a more cautious view to what that's going to mean for the balance of the year. I would say that in our full price channel, we were pleased with how the results came out during the quarter, consistent with the progress we're making. We've shipped new product into that channel. We realigned our pricing architecture. Consumers are responding very positively to that. I would also add that consistent with that, you heard us talk about our wholesale business turning positive at our retail partners. That's a very big moment for us. There's been three years, four years of decline in that business. We're finally starting to see that turn. The last thing I would say is, while still negative, our footwear business did start to see a sequential improvement. Some of the new product has begun to arrive in the store. Some of it was there for February, March. We're starting to see some much better sell-throughs, both in our own retail stores as well as our wholesale distribution. We're very encouraged by what's happening with the full price part of our business and what we think we're going to see throughout the balance of the fiscal year. In our outlet business, I would say that trends were consistent, remain down. We have not really seen any significant change there. That was, as we've said before, due to the fact we really have limited new product into that channel. It's disappointing. We thought we would begin to have a little bit more. In particular in the second quarter, we thought we would start to flow a significant amount of new product that will be here for the third quarter. We feel very confident that we'll be, as I've said previously, around 75%, in particular in the accessories world. It's going to take us a little longer on the footwear side of things to get the product flowed into outlet. We feel quite confident that when that new product arrives, we will have the ability to really start to see the same type of changes that we've seen in the full price business in the outlet channel. I want to remind you all two things. Number one, I had said this previously, in Q2, in our full price business, we are going to take one final step back on the clearance and markdown inventory. We are at historical lows for the company. The company has never owned this less amount of inventory in clearance and markdown. That will have an impact on retail sales, both in full price and in outlet in Q2. That's planned. We anticipated that. That will be somewhat amplified by the fact that we will not have the amount of inventory in new full price product arriving as early as we had anticipated. That will have an impact on that side of the business. I think we, besides the inventory issue, feel that we are tracking on plan and the consumer is responding to the new product, to the new marketing initiatives, we're getting the results that we had more or less anticipated. We're feeling that we're on track. Our next question is from Paul Lejuez with Citigroup. Please proceed with your question. Hey, thanks guys. I'm curious if you could talk a little bit more about the expense management that you're able to put in place to help hold the P&L together this year. Curious if we should think of that as more one-time adjustments or if we build that into the go-forward expense base. Then just a little bit more detail on the interest income and other line. Can you talk about what changed on that line? Thanks. Happy to, Paul, and thanks. When we look at our full-year SG&A, we are reducing our expectations for spend by $70 million relative to our prior guidance. We are taking targeted expense reduction actions across the SG&A pool in order to ensure that we are driving down our overall SG&A level. That said, we are protecting investments to support the business, including marketing, store refurbishments, as well as digital and IT investments. So we are ensuring that we are maintaining the investment in what is for the longer-term health of the brand. But we will continue to evaluate opportunities to improve efficiency across the cost base in the longer term and continue to invest for the future growth. As it relates to interest income, we are just revising our interest income guidance on a full-year basis, reflecting where we landed in the first quarter. This is just a slight change to our expectation for overall interest income for the year. Our next question is from Simeon Siegel with Guggenheim Partners. Please proceed with your question. Thanks. Hey. Morning, everyone. Hope you are having a nice summer. Tyler, can you elaborate just a little bit more on the lower than anticipated inventory? Maybe discuss both what happened and the why within that inventory. How much of that is reduction in markdown versus full price? How much is seasonal sales that you will lose with the delay versus maybe sales you expect to recoup once the product comes in? And then just higher level, John, kind of piggybacking on what you were just talking about. Any way you could just help us frame where you think you sit on that quality of sales journey? I know you mentioned there is one more, but just what percent of the business is at full price now versus where that was historically and just really any way to help us think about that timeframe. Thanks, guys. Thanks, Simeon. Inventory at Michael Kors is lower than we anticipated. Towards the end of the first quarter, we started to see receipts be delayed with longer transit times, due primarily to congestion at certain ports in Asia. We are taking action to accelerate receipts where possible, including selective use of air freight. Ultimately, we are landing lower than we anticipated, and that is impacting sales. This situation is temporary, and we expect inventory levels to normalize as we progress through the second quarter and into the beginning of the second half of the year. It is going to impact our second quarter sales. We do anticipate that when we get back to the back half of the year and our inventory levels have normalized, that we will be able to deliver on our expectation of growth for both Michael Kors and Jimmy Choo. Simeon, thanks for your question. Let me start out. You had also asked about the difference between the lower inventory level as it relates to delays in delivery and how much of that was lower markdowns. It's about a 50/50 split, and it comes in at about $50 million in lower markdown inventory, just to give you a size of the magnitude of the reduction in markdown inventory. I think it's a very important thing to highlight because that is intentional. We've decided to be less promotional facing to the customer. That's everything from the types of promotions we're doing to the amount of discount we're offering, and then to the amount of product and SKUs available for the customer to see that. As you know, there have been other companies that have gone through this process. It takes time, and you have to be patient, and we think it's important that we started on a journey and that we don't all of a sudden start to change that vision of where we want to be long term. What I've said to you all on previous calls, we do anticipate Michael Kors to turn positive in the back half of the year, and that is both in full price and in outlet. Outlet might be up one or two points in Q3 or down a point or so, and then proceed to get a little bit better in Q4. In general, we think that Q3 is a pretty significant inflection point for the company. The other part about that is, I've said this to you on previous calls, around October, very early November is when we lapse certain third-party sales that we were conducting out of our outlet stores. I think we said on the last earnings call that it amounted to approximately between that and some other third-party sales, about $150 million for us. We will start to lapse that, and it's predominantly it will show up in our outlet channel. I think that's when I would look at the timing. We're already seeing AURs climb. We're already seeing full price sales climb. Both of those parts of what we put in place, we have the evidence that is saying that the customer is responding, and I would say more importantly, to the design of the product and the excitement of the product. You also heard me mention in my prepared remarks that the store renovation program is going really well, we're seeing strong double-digit increases in the stores that we're renovating. We're trying to move as fast as we possibly can on that, because that's going to be another positive for us. I think we'll see a much bigger lift from that next fiscal year than we will this fiscal year. Hopefully, we'll be able to, in the next call, start to talk about the amount of stores that we'll actually get in place. It's very limited right now. As you know, we've said we have a plan to renovate over 300 of our own stores and a significant amount of department stores. Our partners in the department stores have also been very supportive about that. I think, again, very disappointed about this situation around the second quarter. We view that as a near-term headwind. We know we're going to be able to get through it. As Tyler mentioned, we are going to use some air freight to move some of that delivery up. We're working very closely with our freight forwarders to help us mitigate and get on faster vessels, et cetera, to get the product here. I think we will be in a very good position in the third quarter, based on some of the things that I've said to you, we're feeling still very constructive and positive on our ability to return to growth in the back half of the year. Then, of course, I want to mention, because this is a total Capri, Jimmy Choo is positive again this quarter. That's the third consecutive quarter that Jimmy Choo has been positive, including comp stores. We feel very good about what's happening at Jimmy Choo and the ability for that brand to continue to grow along with Michael Kors. Thank you very much, Simeon. Great. Thanks, guys. Best of luck for the year. Our next question is from Rick Patel with Raymond James. Please proceed with your question. Thank you. Good morning, everyone. You talked about headwinds at Michael Kors, including reducing markdowns and lower sales to daigou and off-price. Can you give us your updated thoughts on how long you expect those headwinds to persist as we think about Q2 versus the back half? Secondly, as we think about Michael Kors returning to growth in the back half, can you paint a picture for what that looks like from a geographic perspective, given the softness you're seeing in EMEA? Hello? Oh, sorry. I don't know if you heard me. I'll start again. Rick, I think we addressed part of the daigou or the third-party sales in the previous question. That ran about $150 million for the company approximately last year. We do have still headwinds in the first and second quarters and a little bit of the third quarter on that. Post-October, November, that should start to mitigate for us as a headwind. Additionally, we will have entered Q2 as we did Q1, with historic lows on our markdown and clearance inventories. That's planned. There was a business there. That is a business that we will not vacate, and we obviously will have markdown and clearance, but it will be at a much lower level than the company's had in the past. That will be, again, hopefully lesser of a headwind as we head into the third and fourth quarters. Lastly is the promotional activity, where we will be lapping some of the reductions that we've taken in terms of removing events and sizes of discounts. The second part of your question was Oh, geographic. Sorry. Related to- On- Yeah, from a geographic perspective, what the improvement could look like in the back half. That's right. Number one, I think the change, if I can say sitting here, is we would've anticipated. We've had a terrific run in Europe. It's been very strong for the company, even during some of our more difficult periods. That is a definitive change for us as we look at the back half of the year. We do not see that improving. Obviously, we've taken down our guidance given what we think is still happening. Hopefully, there will be some movement. Some of the conflict in the region will settle down, and we'll get the benefit of that. For right now, we can't count on that, so we've removed that from our future guidance. I would say the area where we see the biggest increase will be in North America. We're seeing that North America full price comps are once again comp positive. We told you that our wholesale business turned positive in North America at point of sale. That's the biggest market for us. We're feeling sufficiently confident that the initiatives that we've put in place will begin to see this marketplace turn positive. You saw that the overall Asia market did turn positive for us again this quarter in Michael Kors. We continue to see that market getting better in China in particular. We would look to see that as a positive for us in the back half of the year. Again, EMEA is the one that we are most disappointed about, and we think we've reflected that in our guidance. Thank you, Rick. Thank you, John. Our next question is from Brooke Roach with Goldman Sachs. Please proceed with your question. Good morning. Thank you for taking our question. John, I was hoping you could unpack the trends that you're seeing in Michael Kors Outlet in North America in a little bit more detail. What early reads are you seeing from some of the new product launches and reads that give you more confidence in that inflection to growth in that channel in the back half of the year outside of just cycling daigou? Are you seeing any change in traffic levels, consumer brand engagement, or net purchase intent or net promoter scores for that business? Thank you. Yeah. Good morning, Brooke. I would say North American outlet has not changed in terms of trend. It's been fairly similar over the past few quarters. We have delivered some newer styles into the store, which are getting very positive results from the consumer. I think I've said to you previously, they are at higher price points. We are actually raising prices in our outlet stores, both on an individual product basis and by lowering discounts. That's going to take some time for the customer to adjust to and absorb and accept. We have a new product that's just landed called Sammy, which is really getting some very strong traction for us. We have two new hero products, one called Ashton and one called Bailey, that will be in the stores in the early part of Q3. Then we have some additional styles that will be arriving throughout the fall season. So we're very hopeful that these new products will resonate with the consumer. At the same point in time, we're cycling out of older products, and we're kind of through that at this point in time. When I tell you that we're down in markdown and clearance, it's not just in our full-price stores, but it's also in our outlet stores as well. Again, this is part of the journey with the consumer to really position Michael Kors as a brand that has much higher perceived value with the customer. Then the last thing I'll say is we just completed a consumer research study on our customers. I was very pleased by the scores that came back on the brand and how the consumer perceived the brand. We know we have more work to do on the younger consumer, in particular in Gen Z. You're going to see some exciting things. We launched our new TikTok shop yesterday. We're in the middle of a very successful launch of a back-to-school activity with Amazon. We went live with Amazon a little over a year ago with a Michael Kors storefront. It's been very successful for us. We know that by being on platforms like Amazon, like TikTok, and as Tyler mentioned, we are increasing our marketing spend for the company. We're going to raise it by almost 200 basis points. We're getting close to 10% of sales, especially in the back half of the year. We're going to be able to focus a lot more initiative around the younger Gen Z consumer. We think that's also going to benefit us. So I would say to you that a lot's going to be happening for us in Q3 and Q4. If we've done our job right, we should be in a solid position to turn positive for the back half of the year. Thank you, Brooke. Great. Thank you so much, John. Our next question is from Oliver Chen with TD Cowen. Please proceed with your question. Hi, John and Tyler. Regarding pricing and where you are in the pricing journey on raising prices relative to the past, what's happening there by channel and interplays with quality of sales would be great to be briefed on. Thank you very much. Great. Thank you, Oliver. First, good morning. I want to start with Jimmy Choo. I think we're extremely pleased with the results that we've seen from Jimmy Choo for the last three quarters, both from a revenue standpoint and, as you've seen and Tyler discussed it, the brand is returning to profitability this year. We are one of the strongest brands in our department store partners here in North America. You saw the results that we delivered with Jimmy Choo in North America. They're quite exceptional. That's really a result of three things. Number one, our accessories business is getting stronger and stronger by the quarter. We have now department stores who are starting to commit to building shop-in-shops for us. That is a very big hurdle for us to get over. I think over the next few years, you're going to be looking at Jimmy Choo as a very strong and powerful accessories business, which will help drive profitability, and also growth for the company. When you look at our pricing architecture, as you know, we have everything from $5,000- $6,000 Bon Bon bags for the ultra-luxury VICs, to our new opening price points of between $1,500- $750 on bags like Bar. Of course, we have our very, very strong Cinch platform as well. We think we really have a great pricing architecture, and the product is resonating with consumers, and it's also driving a new consumer into the stores, which is excellent for us. You saw we had growth across all regions with Jimmy Choo. Our footwear business in Jimmy Choo has been also very strong. The casual part of our business continues. We've had amazing success with our sneaker program, especially some of the new lace and slim styles that we've had. Our casual program has also started to really take hold. Lastly, what's interesting is our pump business is starting to come back. There's a trend on pumps again, which for us at Jimmy Choo, always puts a big smile on our face. We feel good about what's happening there. Once again, we have a very, very broad pricing architecture. You look at things like our jellies, our trainers, our sneakers, our casual, then all the way up to our bridal product, which can be $2,000- $3,000 for shoes. We have things that open up at $350- $400. That is really working quite well for us. As I said earlier, full price sell-throughs are up at Jimmy Choo. AURs are up. The health of the business is quite good. At Michael Kors, again, to restate what we did in spring of last year, we actually lowered prices in the full price area, that was a result of we were taking too many markdowns, we saw what the customer was really willing to pay for the product. We went back to more historical prices. The second thing we did in accessories, in particular, we have a very, very broad range of under $200 bags today, or smaller bags. That is, first off, what is happening from a fashion trend standpoint, secondly, it's attracting a younger Gen Z customer in particular into the brand. We're really pleased with what's happening with our accessories. We see it in our full price stores. We see it in our wholesale distribution globally as well. In footwear, just to remind you, that's actually the business that's the most difficult across the company, in particular in our. Well, it's in both channels, full price and outlet. In full price, we've been able to land newer, I would say, more modern product into the channel, we saw a very big step change this quarter in terms of product and the sell-through. Pricing was never as much of an issue in footwear for us, it was really more of a product design. I think our teams are doing an extraordinary job of getting on-trend in that category. As I said to you in our last call, we lowered ready-to-wear prices by almost 40%, that's been one of the highest percentage increase businesses for us in our full price category. Then lastly, I have to give a shout-out to our watch business, which now has turned positive. We're quite pleased to see that that business is returning to growth in our own stores. In the outlet channel, as I mentioned before, we're actually raising prices. We had gotten too inexpensive for the value of the product that we were delivering. I'd say prices have been raised anywhere from 5% to sort of 10%. We will probably take another increase in prices sometime in the beginning of next calendar year. We're doing that with individual product itself, also we're raising AUR by the reduction in promotional activity. You're going to see a further step change in our outlet stores with percentage decline in promotional activity, as well as the amount of times that we actually do that, and we'll be focused more on individual price points. I'm also excited in our outlet channel. We're running anywhere between 5%- 6% of sales in the stores that we have our full-price product in the channel. We've put our icons in there. That's Hamilton, Nolita, and Laila. So we're really pleased with what's happening in that channel with our ability to sell full-price product. Again, we have a long way to go to show the customer that we have new and exciting product that warrants this higher price point. I think we're just really excited about what we think is going to happen starting in September, October, November, when what we think is kind of a new face on that product will be in place. The footwear part of outlet will not come until closer to the holiday season. That is something we've, I think, said on the calls previously. We are feeling better about what is coming now at that period of time. We should be about 70%- 75% complete in the outlet stores with new product by September, October, and that will reach a higher level, in particular, when the footwear arrives for the latter part of the calendar Q4. Thank you very much, Oliver. Thanks. Our next question is from Adrienne Yih with Barclays. Please proceed with your question. Great. Thank you very much. John, thanks so much for all of the detail, it's very helpful. Kind of staying on the different-- there's a lot of shifts going on between full-line and outlet. Staying with that theme, as you make these minor adjustments to pricing, how are you messaging those, first of all, and then how are you seeing customer acquisition shifting? Are you regaining your historical customer? How are they finding you? Then, I guess number two, you're lowering initial retails at full-line, raising them at outlet, you also have the promotional overlay, which is muddying, I'm assuming, the true demand reads. Is the spread between full-line and outlet now normalized? Was it just extremely get out of whack relative to history, are we going back to what you know to be that spread, that norm that should be? Thank you. Thank you, Adrienne. I think that's a good question to end on. Number one, in full price, in terms of the reduction in prices that we took, that was in February of last year. I would say we've anniversaried that at this point. That is like for like. In full price, as I said earlier, the one last step, well, there's two last steps. Number one, you will see one further step down in certain seasonal promotional activity that we have done historically for some 10+ years. That will change in Q4. That will be the final step down on that. In terms of markdown product, we have one last phase to go through in Q2. I've said this in previous calls and conferences, that we will have most likely negative comp store sales in Q2 for full price because of this very large reduction in markdown inventory that will occur in Q2. That's all behind us. In outlet, I would say we're at the very beginning of the price increases, even though we've taken a minor amount of them. The real full amount of product is arriving August, September into the stores. This is going to be the test with the consumer to say, "Are you going to accept this higher price from us?" Again, we've had some limited tests on it. The limited tests appear that has had little or no reaction to the customer. I do expect customers to come in and be looking for lower-priced things that they had historically seen from us, and we may lose some of that historic customer. We don't know that yet until we go through it. We're excited. That's why we're increasing our marketing spend to go out and attract new customers into both full price and outlet, in particular, younger customers who most likely were never shopping with us previously. We'll be very focused on our new customer acquisition. Of course, you asked how are we getting that message out there. We've hired a new gentleman, Corey Moran, who came to us from 10 years at Google, and he is working very diligently with our teams around all of the marketing initiatives that we're putting forth. I would say a great deal of the spend that we're adding to Michael Kors is around really top of the funnel marketing and brand engagement. We will actually reduce some of our more targeted performance marketing in favor of really talking about the brand story and engaging customers from a storytelling standpoint. Thank you for that question, Adrienne. Thank you very much. Thank you. I'd like to conclude the call today by saying thank you for all of you joining us. We are excited about our results for the first quarter. It clearly shows that we're building a stronger and more profitable business. While we're disappointed about our revenue outlook, we are excited about our ability to maintain our $2.15 guidance for the year on earnings per share, which shows our ability to be able to take swift and decisive actions around SG&A when needed without sacrificing any of the growth potential for the company with marketing and with capital expenditure to rebuild our stores. We're excited about the future for Capri. We're very pleased with what's happened with Jimmy Choo and the third quarter of consecutive growth. We look forward to the back half of the year for Michael Kors, in particular, returning to growth. Thank you for joining us today, and look forward to talking to you on our next call. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.