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Dec 28, 2024
Fossil Q4 2024 Earnings Report
Fossil reported a decline in revenue and net income for Q4 2024, but showed improvements in gross margin and adjusted operating income.
Key Takeaways
Fossil Group faced a revenue decline of 18.8% year-over-year in Q4 2024, with all segments and regions experiencing a downturn. However, the company managed to improve its gross margin by 630 basis points and generated positive free cash flow. Adjusted EPS was $0.39, contrasting with a GAAP loss per share of $0.14.
Revenue declined by 18.8% to $342.3 million due to weak consumer demand and store closures.
Gross margin increased to 53.9%, benefiting from product mix improvements and cost efficiencies.
Adjusted operating income improved to $20.1 million, compared to a loss of $8.5 million in Q4 2023.
The company ended the quarter with $123.6 million in cash and $177 million in total liquidity.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
Fossil expects a continued sales decline in 2025 but plans to improve profitability through cost reductions and store closures.
Positive Outlook
- Gross margin improvements expected to continue.
- SG&A savings of approximately $100 million planned for 2025.
- Strategic shift to core product categories to drive future growth.
- Ongoing transition to a more profitable wholesale and digital model.
- Enhanced liquidity position to support restructuring efforts.
Challenges Ahead
- Expected sales decline in the mid to high teens for 2025.
- Continued pressure on revenue due to store closures.
- Weak consumer demand across major markets.
- Currency headwinds may continue to impact profitability.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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