Fossil is getting creamed after missing big on earnings
Fossil's stock is getting hammered on Wednesday, down more than 22% after reporting another disappointing quarter.
The watchmaker reported a loss of $0.65 per share on sales of $581.8 million. According to Reuters, analysts were expecting a loss of $0.34 a share on revenue of $591 million.
The company expects next quarter's sales to decline between 8% and 11.5%.
Fossil has been trying, but failing to keep up with changes in consumer preferences for watches. Wearable technology is becoming more and more popular every year and Fossil is not keeping up.
The company has been struggling to replace their out of date products with more high-tech options, but management admitted on their conference call that they are not quite where they want to be just yet.
"Our results for the quarter, while largely in line with our expectations, continue to reflect a challenging retail environment and the watch category undergoing significant change," Fossil CEO Kosta Kartsotis said on the earnings call. "The strategies we are pursuing in the midst of these headwinds enable us to better compete in the environment and capitalize on the growing importance of technology to the watch."
Chief Financial Officer Dennis Secor added, "With our ambitious plans, we don't expect we will get all the distribution we had initially anticipated in place this year, though with the expansion of wearables across a larger portion of our brand portfolio, we continue to expect that we could roughly triple our penetration of wearables revenues, which represented roughly 5% of last year sales."
Fossil has lost about 90% of its value since 2012, the stock is sitting near post great recession lows.
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