VOGUE BUSINESS | MALIHA SHOAIB

Joshua Schulman, the Michael Kors CEO next in line to lead parent company Capri, is exiting. John Idol is staying on amid a turnaround.

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Michael Kors CEO Joshua Schulman stepped down in a surprise exit, disrupting parent company Capri’s succession plan and sending shares down 15 per cent on Monday. What comes next for Capri?

Current CEO John Idol will stay at his post, according to a company statement. Schulman was slated to take over as CEO of Capri in September, replacing Idol a year after stepping into the role as CEO of Michael Kors. Capri has not yet announced a further succession plan for Idol, who has been CEO of Michael Kors since 2003 and chairman since 2011. A new CEO at Michael Kors has not been named.

“The announcement of Josh Schulman’s departure was surprising as we view Mr Schulman as a strong leader across strategy and merchandising,” Cowen said in an analyst note. “Unfortunately the succession plan did not work out as planned.” Cowen added that key priorities for the company include innovating signature logo products, optimising marketing strategies and intensifying collaborations and partnerships.

In the third quarter of 2021, Capri Holdings sales increased 24 per cent to $1.6 billion, beating analyst expectations despite supply chain disruption, with momentum remaining strong across the US, Europe and the Middle East. The company also announced plans to increase prices across all three brands.

Idol is credited for establishing Michael Kors into a leading accessible luxury label, and took the company public in 2012. The executive has since led a charge to create a US luxury conglomerate that can compete with European giants LVMH and Kering, with Michael Kors Holdings acquiring luxury footwear brand Jimmy Choo for $1.2 billion in 2017. The group became Capri Holdings when it completed the purchase of Italian luxury house Versace, a $2.1 billion deal, in 2019. Idol was set to take a step back as CEO in September 2022.

Luxury analyst Robert Burke notes that Idol’s business strategies were performing well following the decline during the pandemic. Despite this, positioning itself as a more upmarket luxury conglomerate comes with challenges. “Luxury and accessories have been dominated by European companies,” says Burke. “That doesn’t mean there can’t be an American player, but the recent history is that [luxury] has been very strong in Europe.”

“At Capri Holdings, we are executing against our clear strategic vision for growing our three powerful fashion luxury brands and seeing strong results. We remain well-positioned to achieve meaningful long-term revenue and earnings growth as well as deliver increased value for our shareholders,” Idol said in a statement. “I am fully committed to continuing to lead Capri Holdings and driving our future success.”