Fossil reports smaller-than-expected Q2 adjusted net loss

Fossil

13/08/2025 21:18

Overview

Fossil Group Q2 sales decline 15.2% yr/yr to $220 mln, beat estimates, per LSEG data

Adjusted net income, EBITDA, and operating income all beat analyst expectations

Co raises full-year 2025 guidance, announces refinancing plan to strengthen balance sheet

Outlook

Fossil raises 2025 guidance, sees mid-teens sales decline

Company expects adjusted operating margin to be break even to positive

Fossil's 2025 sales guidance excludes $45 mln from store closures

Result Drivers

SALES DECLINE - Net sales fell 15.2% yr/yr due to category, consumer, and channel softness, exit from smartwatch category, and store rationalization

GROSS MARGIN IMPROVEMENT - Gross margin increased 490 basis points to 57.5% due to improved product margins, reduced freight costs, and sourcing initiatives

OPERATING EXPENSE REDUCTION - Operating expenses decreased 30.8% yr/yr, aided by a gain from the sale of a European warehouse and restructuring efforts

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Sales
Beat
$220 mln
$198 mln (1 Analyst)
Q2 Adjusted Net Income
Beat
-$5.60 mln
-$11.20 mln (1 Analyst)
Q2 Adjusted EBITDA
Beat
$7 mln
-$7.98 mln (1 Analyst)
Q2 Gross Margin
57.5%
Q2 Adjusted Operating Income
Beat
$4 mln
-$11.20 mln (1 Analyst)
Q2 Adjusted Operating Margin
1.7%


Analyst Coverage

The one available analyst rating on the shares is "buy"

The average consensus recommendation for the apparel & accessories peer group is "hold."

Wall Street's median 12-month price target for Fossil Group Inc is $5.00, about 65% above its August 12 closing price of $1.75

Press Release: ID:nGNX1mSsGg

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)