Fossil Q1 2025 Earnings Report
Key Takeaways
Fossil Group reported Q1 2025 revenue of $233.3 million, down 8.5% year-over-year, but achieved significant improvements in gross margin and reduced net loss through restructuring and cost efficiencies.
Revenue fell 8.5% year-over-year to $233.3 million, impacted by smartwatch decline and store rationalization.
Gross margin expanded 890 basis points to 61.3%, driven by favorable mix and reduced freight costs.
Net loss narrowed to $17.6 million from $24.3 million in the prior year.
Adjusted EPS improved to a loss of $0.10 from $0.30 last year.
Fossil
Fossil
Fossil Revenue by Segment
Fossil Revenue by Geographic Location
Forward Guidance
Fossil reaffirmed its full-year guidance, expecting net sales to decline in the mid to high teens and adjusted operating margins in the negative low single digits.
Positive Outlook
- Reaffirmed full-year 2025 guidance.
- Expected retail store closures already included in guidance.
- Healthy gross margin expected to be maintained through mitigation strategies.
- Improved product mix after exiting smartwatch category.
- Cost efficiencies continue to support adjusted profitability.
Challenges Ahead
- Retail store closures will reduce sales by $45 million.
- Uncertainty remains around macroeconomic and consumer demand.
- Sales declines across most geographies and product segments.
- Net losses and negative margins still persist.
- Foreign exchange fluctuations continue to impact results.
Revenue & Expenses
Visualization of income flow from segment revenue to net income