Fossil Group (FOSL) Q2 2022 Earnings Highlights

By Amit Chowdhry ● Aug 13, 2022
  • Fossil Group (FOSL) recently announced its Q2 2022 earnings results. These are the details.

Fossil Group (FOSL) recently announced its Q2 2022 earnings results. Below are the highlights.

Q2 Summary

– Second quarter worldwide net sales decreased to $371 million, down 10% on a reported basis and 5% in constant currency, reflecting declines across all three regions.

– FOSSIL brand sales increased 7% in constant currency with double-digit growth in traditional watches, jewelry and leathers partially offset by declines in smartwatches.

– Direct-to-consumer net sales increased 5% in constant currency, led by 26% growth in store sales largely offset by decreased e-commerce sales.

– Operating loss of $11 million compared to operating income of $14 million a year ago. Adjusted operating loss of $8 million compared to adjusted operating income of $21 million last year.

– As of July 2, 2022, cash and cash equivalents of $167 million.


The company is updating its guidance for full-year 2022 to reflect a more cautious outlook on global markets, including a slowdown in consumer spending in our categories, the likelihood of ongoing COVID-19-related restrictions in mainland China, and the estimated impact of prevailing foreign currency translation.

For the fiscal year 2022, the company now expects worldwide net sales declines of approximately 8% to 4% versus prior guidance of net sales growth of flat to 3%.   This updated guidance includes an estimated foreign currency negative impact of 450 basis points, which compares to our prior estimate of 350 basis points for the full year.

The company is reducing adjusted operating margin(1) guidance for the full year and now expects an adjusted operating margin of 2% to 4% compared to prior guidance of 5.5% to 6.5%.


“During the second quarter, global operating conditions remained challenging. We saw softening consumer demand during the quarter, reflecting ongoing inflationary pressure and continued pandemic-related restrictions in China. Additionally, the slowdown in consumer purchasing led to fewer inventory replenishment orders from our wholesale partners. While this macro backdrop impacted our core traditional watch category, our jewelry and leathers businesses grew at double digit rates in the quarter.”

“We believe consumer sentiment will continue to be pressured in the second half of the year and have adjusted our full year outlook to reflect moderating demand globally. Our teams are remaining agile while focusing on our core initiatives in digital and brand heat, and we are confident that our strategies will maximize shareholder value over the long term.”

– Kosta Kartsotis, Chairman and CEO