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Jul 05
Fossil Q2 2025 Earnings Report
Fossil posted a second quarter net loss of $2.3 million despite achieving positive operating income of $8.5 million and a higher gross margin.
Key Takeaways
Fossil reported a net sales decline of 15% in Q2 2025, impacted by softness in key categories and store closures. Despite the sales drop, the company achieved positive operating income and expanded its gross margin to 57.5%. SG&A expenses dropped significantly as restructuring efforts took hold.
Net sales declined to $220.4 million, primarily due to weak consumer demand and exit from smartwatches.
Gross margin improved significantly to 57.5%, driven by product mix and cost controls.
Operating income reached $8.5 million, marking a turnaround from the $34 million loss in Q2 2024.
Adjusted net loss was $5.6 million; GAAP net loss was $2.3 million.
Fossil
Fossil
Fossil Revenue by Segment
Fossil Revenue by Geographic Location
Revenue by Segment
Watches Revenue
CapyFin.comLeathers Revenue
CapyFin.comJewelry Revenue
CapyFin.comOther Revenue
CapyFin.comRevenue by Geographic Location
Americas Revenue
CapyFin.comEurope Revenue
CapyFin.comAsia Revenue
CapyFin.comCorporate Revenue
CapyFin.com Forward Guidance
Fossil raised its full-year 2025 guidance based on strong year-to-date performance and improving margins.
Positive Outlook
- Raised full-year 2025 guidance due to stronger-than-expected results.
- Expecting break-even to slightly positive adjusted operating margin.
- Gross margin strength expected to continue.
- Refinancing plan expected to improve liquidity.
- Operational momentum seen across key turnaround pillars.
Challenges Ahead
- Mid-teens decline in net sales still expected for full-year.
- Retail store closures expected to impact sales by $45 million.
- Consumer demand and category softness remain concerns.
- Adjusted margin guidance excludes foreign currency effects.
- Smartwatch category exit reduces diversification.
Revenue & Expenses
Visualization of income flow from segment revenue to net income