Fossil Group reported third‑quarter 2025 revenue of $270.2 million, a 6.1% decline from the $287.8 million earned in the same period last year. The figure still surpassed the consensus estimate of $233.32 million, giving the company a revenue beat of $36.9 million, or roughly 15% above expectations. The upside was driven by stronger sales in the core watch and jewelry categories, which offset declines in traditional leather goods and other accessories, and by a modest rebound in direct‑to‑consumer traffic after a period of store closures.
The company’s adjusted earnings per diluted share were a loss of $0.63, missing the consensus expectation of a $0.25 loss by $0.38. The wider‑than‑expected loss reflects a combination of higher interest expense from the $32.5 million of new financing that extended senior note maturities, ongoing operating‑expense reductions that have yet to fully offset the cost base, and a net loss per diluted share of $0.76 versus $0.60 in the prior year’s third quarter. The adjusted loss signals that the turnaround plan is still in the early stages of translating cost discipline into profitability.
Management reiterated its full‑year 2025 guidance, projecting worldwide net sales to decline in the mid‑teens and an adjusted operating margin that will range from break‑even to slightly positive. The guidance includes an estimated $45 million impact from the closure of retail stores, underscoring the company’s focus on a leaner, brand‑centric model. The unchanged outlook indicates cautious confidence that the company can stabilize margins while navigating a challenging retail environment.
The balance‑sheet transformation completed in early November added $32.5 million of new financing and extended the maturity of senior notes by three years, a move sanctioned by the UK High Court on November 10. CEO Franco Fogliato described the restructuring as a “pivotal milestone” that improves liquidity but also increases interest costs. The shift is intended to provide the financial flexibility needed to support the company’s long‑term growth strategy.
Investors reacted negatively to the earnings miss, reflecting concerns that the company’s profitability has not yet improved to the level required to support its turnaround narrative. The market’s focus on the adjusted loss, despite a revenue beat, highlights the priority placed on earnings performance over top‑line growth in the current environment.
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