Fossil Group Inc. (NASDAQ: FOSL) reported its fourth quarter and full year financial results for fiscal year 2017. The company beat analysts’ estimates in both earnings and revenue for the quarter, sending shares up 80 percent during Wednesday’s pre-market hours.
For the fourth quarter, Fossil reported revenue of $921 million, falling 4 percent year over year, but beating analysts’ estimates of $889.8 million. The company reported an adjusted EPS of $0.64, beating analysts’ estimates of $0.37.
Americas’ revenue fell by 8 percent year over year, as all business segments reported declining growth as well. Fossil reported $728 million in watch revenue, falling 3 percent year over year.
Same-stores rose 2 percent in the fourth quarter, as the company launched 14 new watch brands from hybrid to display smartwatches. E-commerce sales grew by 31 percent in the quarter.
Fossil’s sale of wearable devices nearly doubled since year to over $300 million, accounting for 14 percent of watch sales. The watches are similar to the Apple Watch and Fitbit devices. The company intends to sell more smart products that allows users to track heart rates and steps.
For the fiscal year, Fossil reported revenue of $2.8 billion, falling 8 percent year over year. The company reported an adjusted EPS of $0.05.
“I am proud of our team as their combined efforts, focus and passion led to significant accomplishments toward each of our objectives, giving us a stronger platform from which to continue our progress in fiscal 2018." said Kosta Kartsotis, Fossil Group, Chairman and CEO.
“We generated progress toward our objectives that include: driving growth in wearables across our portfolio of powerful brands, leveraging our scale to lower supply chain costs, increasing our digital capabilities, and continuing the transformation of our business through New World Fossil.” added Kartsotis.
For 2018, Kartsotis says Fossil’s priorities are focused on delivering innovative watch styles while improving performance in handbag and jewelry categories and increasing digital sales. He says North America sales will be challenging, but with the New World Fossil initiative, the company expects to deliver more profit to the bottom line.
On a GAAP-basis, Fossil forecasts revenue to fall in the range of 14 percent to 6 percent for the fiscal year and fall 12 percent to 6 percent in the first quarter. The company forecasts a net loss before taxes for 2018 of $13 million compared to a net loss of $454 million in 2017.