Hoping to Not Become a Fossil

-By Sam B | [email protected]

Fossil Group, Inc. reported earnings last month, and the stock has declined nearly 28% since the release; it is down close to 70% year to date. Its Q2 results saw sales decrease by 13% or $88.6M. Sales were down in each of its product categories: watches down 9%, Leathers down 25% and Jewelry down 22%. Sales, also, decreased in each of its three main geographies. The company lost $-344.7 million in Q2. However, the majority of this loss was due to a write-down of its intangible assets. Diluted loss per share was $(7.11) and included the non-cash intangible asset impairment charges of $6.50 and a restructuring charge of $0.13 per diluted share. Fossil also gave a forecast for its Q3 results. It expects that sales will drop by 8% to 14% and that its operating margin will be close to break even.

The company's stock hit a low of $6.8 on the year, but is currently around $8 and off its 52 week lows. The company is betting on Android focused watches for 2018. Many of its new watches feature AMOLED displays that offer a perfectly circular touchscreen interface. Amoled watches from Fossil

Fossil faces headwinds from changing consumer shopping habits. However, its sales and stock has fallen far more than its competitor Movado, a watch maker. Therefore, there are other missteps that Fossil has made along the way. Fossil will need to make adjustments in order to grow in 2018.

Join the best Message Board on the internet to rate and comment on this article and others

comments powered by Disqus