Fossil Group, Inc. (NASDAQ: FOSL) shares fell more than 17 percent after the watch and accessories company posted fourth quarter sales that fell short of analysts estimates, due to currency headwinds and a decline in its traditional watches sales.
The company said revenue fell 3 percent to $33.3 million in the fourth quarter as the weakness in its multi-brand licensed watch portfolio. The company also cited that $18.3 million net sales were negatively impact by the stronger dollar.
For the quarter ended December 31, 2016, the company posted a profit of $49.7 million, or $1.03 a share, down from $70.4 million, or $1.46 a share, a year earlier.
Analysts polled by Thomson Reuters had projected adjusted earnings of $1.18 per share on $977.13 million in sales.
Kosta Kartsotis, Chief Executive Officer, said: “The fourth quarter of 2016 was pivotal for Fossil Group with our wearable launches demonstrating they could be the catalyst to drive growth in the watch category. Delivering some stability in the watch category during the quarter reinforces our belief that with our technology capabilities, we can turn what was once a headwind into a tailwind.”
For the year, Fossil expects net sales to be a range between a 6.5% decline of $2.84 billion and a breakeven result of $3.04 billion.