We last wrote about Movado Group , Inc. ( MOV ) in September of last year, when we maintained our 'Hold' rating on the worldwide watch distributor. Shares were trading at $18.48 at the time and had just broken belowIndividual investor with a keen interest in deriving income from investment setups. We do this by buying undervalued profitable stocks with strong balance sheets & minimal debt. Furthermore, when the opportunity arises, we like to write calls against our positions to bring in additional income. R ...

Financial Data and Key Metrics Changes - Revenue growth of 3.1% to $186.1 million, with a 5.9% increase excluding the Middle East [4][14] - Gross margin improved by 80 basis points to 54.3% compared to 53.5% last year, despite a $4.5 million impact from U.S. tariffs [5][15] - Adjusted operating income grew over 40% to $12.6 million, with positive operating cash flow of $1.3 million for the first nine months [5][16] - Net income for the third quarter was $10.2 million, or $0.45 per diluted share, compared to $8.5 million, or $0.37 per diluted share in the previous year [17] Business Line Data and Key Metrics Changes - Movado brand sales grew 17.7% on a comparable store basis, with overall sales in Movado company stores increasing by 9.4% [9] - Licensed brands saw a 6.4% growth overall, with a 2.9% increase on a constant currency basis [10] - Strong performance in jewelry and watches, particularly from brands like Coach and Hugo Boss [10][11] Market Data and Key Metrics Changes - U.S. net sales increased by 6.9%, while international net sales increased by 0.6%, with strong performances in Europe and Latin America [15] - The Middle East showed softer results, but the company is working on rebuilding its strategy in that region [4][15] Company Strategy and Development Direction - Focus on building brands sustainably, driving innovation, and improving financial results [4][6] - Plans to return to growth in the Middle East next year and continue to invest in brand-building efforts while improving profitability [4][25] - Emphasis on capturing momentum from younger consumers embracing analog watches [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving dynamics in the fashion and accessible luxury watch categories [6] - Acknowledgment of ongoing global economic and political uncertainty, leading to no fiscal 2026 outlook provided [20] Other Important Information - The company ended the quarter with $183.9 million in cash and no debt, and a quarterly dividend of $0.35 per share was approved [6][19] - Recent trade agreements are expected to lower U.S. tariff rates on Swiss watches, allowing for better planning and reduced price-based mitigation [5][20] Q&A Session Summary Question: Is the success of watches and brands due to influencers or design trends with Gen Z? - Management indicated it is a combination of both increased social media coverage and innovative designs resonating with younger consumers [22] Question: Does having sold-out conditions impair sales? - Management clarified that sold-out conditions are planned for select product families and that they expect to replenish styles soon [23] Question: Will the success in sales change spending levels for the fiscal year? - Management emphasized a balance between investing in brand-building and improving profitability [25]

Financial Data and Key Metrics Changes - Revenue growth of 3.1% to $186.1 million for the third quarter, with a 5.9% increase excluding the Middle East [4][5] - Gross margin improved by 80 basis points to 54.3% compared to 53.5% last year, despite a $4.5 million impact from U.S. tariffs [5][15] - Adjusted operating income grew over 40% to $12.6 million, with positive operating cash flow of $1.3 million for the first nine months [5][17] - Net income for the third quarter was $10.2 million, or $0.45 per diluted share, compared to $8.5 million, or $0.37 per diluted share in the previous year [17] Business Line Data and Key Metrics Changes - Movado brand sales grew 17.7%, with overall sales in Movado company stores increasing by 9.4% on a comparable store basis [9] - Licensed brands saw a 6.4% growth overall, with a 2.9% increase on a constant currency basis [10] - Strong performance in specific collections such as Coach's Sammy Collection and Tommy Hilfiger's TH Oxford family [10][11] Market Data and Key Metrics Changes - U.S. net sales increased by 6.9%, while international net sales increased by 0.6%, with strong performances in Europe and Latin America [14][15] - The Middle East market showed softer results, but the company is working on rebuilding its strategy in that region [4][15] Company Strategy and Development Direction - Focus on building brands sustainably, driving innovation, and improving financial results [4][6] - Plans to return to growth in the Middle East next year and continue to invest in brand-building efforts while improving profitability [4][25] - Emphasis on capturing momentum from younger consumers embracing analog watches [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving dynamics in the fashion and accessible luxury watch categories, driven by innovation and interest from younger consumers [6][12] - The company is not providing a fiscal 2026 outlook due to current economic uncertainty and unpredictable tariff developments [20] Other Important Information - The company ended the quarter with $183.9 million in cash and no debt, and a quarterly dividend of $0.35 per share was approved [6][19] - Capital expenditures for the first nine months were $3.5 million, with approximately 100,000 shares repurchased under the share repurchase program [19] Q&A Session Summary Question: Is the success in sales due to influencers or design trends with Gen Z? - Management indicated it is a combination of both increased social media coverage and innovative designs resonating with younger consumers [22] Question: Does having sold-out conditions impair sales? - Management clarified that sold-out conditions are planned for select product families and that they expect to replenish styles soon [23] Question: Will the success in sales change spending levels for the fiscal year? - Management emphasized a balance between investing in brand-building and improving profitability [25]

Financial Data and Key Metrics Changes - Revenue growth of 3.1% to $186.1 million in Q3 2026, with a 5.9% increase excluding the Middle East [4][5] - Gross margin improved by 80 basis points to 54.3% compared to 53.5% last year, despite a $4.5 million impact from U.S. tariffs [5][15] - Adjusted operating income grew over 40% to $12.6 million, with positive operating cash flow of $1.3 million for the first nine months [5][17] - Net income for Q3 was $10.2 million, or $0.45 per diluted share, compared to $8.5 million, or $0.37 per diluted share in the previous year [17][18] Business Line Data and Key Metrics Changes - Movado brand sales grew 17.7%, with overall sales in Movado company stores increasing by 9.4% on a comparable store basis [9] - Licensed brands saw a 6.4% growth overall, with Coach driving double-digit growth among Gen Z consumers [10][11] - Strong performance in the Museum Collection and new product launches, including the Bangle Collection and Style Set with Lab-Grown Diamonds [7][8] Market Data and Key Metrics Changes - U.S. net sales increased by 6.9%, with strong growth in the fashion brand business and direct-to-consumer channels [6][14] - International net sales increased by 0.6%, with strong performances in Europe and Latin America, offset by weaker results in the Middle East [14][15] Company Strategy and Development Direction - Focus on building brands sustainably, driving innovation, and improving financial results [5][6] - Plans to return to growth in the Middle East next year after rebuilding the team and refining strategy [4][5] - Emphasis on capturing momentum among younger consumers embracing analog watches for their design and quality [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improving dynamics in the fashion and accessible luxury watch categories despite global economic uncertainties [6][12] - No fiscal 2026 outlook provided due to current economic uncertainty and unpredictable tariff developments [20] Other Important Information - The company ended the quarter with $183.9 million in cash and no debt, and a quarterly dividend of $0.35 per share was approved [6][19] - Capital expenditures for the first nine months were $3.5 million, with approximately 100,000 shares repurchased under the share repurchase program [19] Q&A Session Questions and Answers Question: Is the success seen with many watches and brands due to influencers or design trends with Gen Z? - The success is attributed to a combination of increased social media coverage and innovative designs resonating with younger consumers [22] Question: Does having sold-out conditions impair sales? - Sold-out conditions are seen as a balance of supply and demand, with plans to replenish styles in early Q1 [23] Question: Will the success in sales change spending levels for the fiscal year? - The focus remains on improving profitability while continuing to invest in brand-building efforts [24]

Financial Performance - Net sales for the three months ended October 31, 2025, were $186.1 million, representing a $5.6 million or 3.1% increase from the prior year period[129]. - The Watch and Accessory Brands segment net sales for the same period were $162.7 million, an increase of $3.1 million or 1.9% compared to the prior year[130]. - In the licensed brands category, net sales increased by $7.0 million or 6.4%, while owned brands category net sales decreased by $4.3 million or 8.5%[130]. - U.S. net sales in the Watch and Accessory Brands segment were $54.2 million, up $2.6 million or 5.0% from the prior year[131]. - Net sales for the three months ended October 31, 2025, in the International locations of the Watch and Accessory Brands segment were $108.5 million, a 0.4% increase from the prior year, with a $3.4 million positive impact from foreign currency exchange rates[132]. - Net sales for the Company Stores segment for the three months ended October 31, 2025, were $23.4 million, representing a 12.2% increase from the prior year, driven by higher foot traffic and online sales[133]. - For the nine months ended October 31, 2025, net sales were $479.7 million, a 1.7% increase from the prior year, with foreign currency fluctuations positively impacting sales by $4.8 million[149]. - The Watch and Accessory Brands segment net sales for the nine months ended October 31, 2025, were $413.2 million, a 1.2% increase, with licensed brands up by $21.2 million, or 7.9%[150]. Profitability - Gross profit for the three months ended October 31, 2025, was $101.1 million, or 54.3% of net sales, an increase from 53.5% in the prior year, attributed to a favorable sales mix and reduced costs[134]. - Operating income for the Watch and Accessory Brands segment for the three months ended October 31, 2025, was $9.2 million, an increase of $4.4 million from the prior year, driven by higher gross profit and lower SG&A expenses[136]. - The Company recorded a net income attributable to Movado Group, Inc. of $9.6 million for the three months ended October 31, 2025, compared to $4.8 million in the prior year[146]. - Gross profit for the nine months ended October 31, 2025, was $260.0 million, or 54.2% of net sales, reflecting a slight increase in gross margin percentage from the prior year[154]. - Operating income in the Watch and Accessory Brands segment for the nine months ended October 31, 2025, was $9.0 million, an increase of $3.6 million from $5.4 million in the prior year, driven by a gross profit increase of $3.3 million[157]. - The Company recorded net income attributable to Movado Group, Inc. of $14.0 million for the nine months ended October 31, 2025, compared to $10.3 million in the prior year, reflecting an increase of $3.7 million[168]. Expenses and Cost Management - SG&A expenses for the three months ended October 31, 2025, were $89.3 million, a decrease of 1.4% from the prior year, primarily due to lower marketing and payroll expenses[135]. - SG&A expenses for the nine months ended October 31, 2025, were $243.9 million, a decrease of $0.1 million or 0.0% from the prior year, primarily due to lower marketing expenses of $8.2 million and a decrease in payroll-related expenses of $6.8 million[156]. - The Company recorded $4.6 million in accruals for severance and employee-related charges during fiscal year 2025 as part of a cost-savings initiative[124]. - The Company expects annual savings of approximately $10.0 million from the cost-savings initiatives[124]. Taxation - The effective tax rate for the three months ended October 31, 2025, was 25.3%, down from 31.9% in the prior year, influenced by changes in foreign currency gains and jurisdictional earnings[145]. - The effective tax rate was 29.5% for the nine months ended October 31, 2025, down from 32.8% in the prior year, influenced by changes in foreign valuation allowances and jurisdictional earnings[167]. Cash Flow and Investments - Cash and cash equivalents as of October 31, 2025, were $183.9 million, an increase from $181.5 million in the prior year, with $94.7 million held at foreign subsidiaries[169]. - Net cash provided by operating activities was $1.3 million for the nine months ended October 31, 2025, a significant improvement of approximately $41.9 million compared to net cash used of $40.6 million in the prior year[171]. - Cash used in investing activities was $6.3 million for the nine months ended October 31, 2025, a decrease from $11.9 million in the prior year, primarily due to capital expenditures related to Company stores[174]. - Cash used in financing activities was $25.4 million for the nine months ended October 31, 2025, compared to $27.0 million in the prior year, including $23.3 million in dividends paid[175]. - The Company declared and paid cash dividends of $23.3 million during the nine months ended October 31, 2025, consistent with the previous year[185]. - A share repurchase program authorized the Company to buy back up to $50.0 million of its common stock, with $48.4 million remaining available as of October 31, 2025[186]. Foreign Currency and Tariffs - Fluctuations in foreign currency exchange rates positively impacted net sales by $3.4 million for the three months ended October 31, 2025[129]. - The Company anticipates that tariffs will have a material impact on its U.S. operations despite mitigation efforts[123]. - The Company has implemented selective price increases in response to incremental tariffs, which include a 20% tariff on U.S. imports of China-origin goods[120][123]. - The Company manages foreign currency exchange risk through a hedging program, primarily involving the Swiss Franc, Euro, and British Pound[189]. - The Company did not hold any futures contracts in its gold hedge portfolio as of October 31, 2025, meaning changes in gold purchase prices will directly affect its cost of sales[194]. Other Financial Information - The One Big Beautiful Bill Act signed into law on July 4, 2025, is not expected to have a material impact on the Company's Consolidated Financial Statements[125]. - The Company recorded a non-cash impairment charge of $0.4 million related to a venture capital fund investment due to a decline in fair value[184]. - As of October 31, 2025, the Company's net forward contracts hedging portfolio included 28.0 million Swiss Francs and 37.4 million U.S. dollars equivalent, with a potential loss of $0.2 million if settled[193]. - The Company had no floating rate debt as of October 31, 2025, and reported no weighted average borrowings during the nine months ended October 31, 2025[195]. - The Company does not hedge interest rate risks and considers its exposure to commodity price fluctuations primarily related to gold used in manufacturing[194]. - The Company will continue to evaluate the carrying value of its investments regularly[184].

Core Insights - Movado (MOV) reported quarterly earnings of $0.45 per share, missing the Zacks Consensus Estimate of $0.57 per share, but showing an increase from $0.37 per share a year ago, resulting in an earnings surprise of -21.05% [1] - The company posted revenues of $186.13 million for the quarter ended October 2025, slightly surpassing the Zacks Consensus Estimate by 0.13% and showing growth from $182.73 million year-over-year [2] - Movado has surpassed consensus revenue estimates two times over the last four quarters, while it has only exceeded consensus EPS estimates once in the same period [2] Earnings Outlook - The sustainability of Movado's stock price movement will largely depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.67 on revenues of $180.22 million, and for the current fiscal year, it is $1.44 on revenues of $659.71 million [7] Industry Context - The Retail - Jewelry industry, to which Movado belongs, is currently ranked in the top 22% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Movado's stock performance [5][6]

Financial Performance - Net sales for the third quarter of fiscal 2026 were $186.1 million, representing a 3.1% increase from $180.5 million in the same quarter of fiscal 2025[4] - Gross margin expanded by 80 basis points to 54.3% compared to 53.5% in the third quarter of fiscal 2025[4] - Operating income nearly doubled to $11.7 million from $6.0 million in the third quarter of fiscal 2025[4] - Diluted earnings per share (EPS) increased to $0.42, doubling from $0.21 in the third quarter of fiscal 2025[4] - For the first nine months of fiscal 2026, net sales increased by 1.7% to $479.7 million compared to $471.9 million in the same period of fiscal 2025[13] - Adjusted net income for the third quarter of fiscal 2026 was $10.2 million, or $0.45 per diluted share, compared to $8.5 million, or $0.37 per diluted share, in the prior year period[13] - Net income attributable to Movado Group, Inc. for the three months ended October 31, 2025, was $9,583,000, a significant increase from $4,827,000 in the prior year[24] - Net income for the nine months ended October 31, 2025, was $14,079 million, an increase from $10,751 million in 2024, representing a growth of approximately 30.5%[34] Cash and Debt Management - The company ended the quarter with cash of $183.9 million and no debt, providing a strong foundation for growth initiatives[5] - Cash and cash equivalents as of October 31, 2025, were $183,876,000, a decrease from $208,501,000 at the beginning of the year, indicating cash flow management challenges[32] - Cash, cash equivalents, and restricted cash at the end of the period totaled $184,684 million, slightly up from $182,301 million in the prior year[34] - The company experienced a net change in cash of $(24,530) million, an improvement from $(80,513) million in the previous year[34] - Cash and cash equivalents at the end of the period were $183,876 million, compared to $181,548 million in the previous year, indicating a slight increase[34] Sales Performance - U.S. net sales increased by 6.9% compared to the third quarter of fiscal 2025, while international net sales increased by 0.6%[13] - Total net sales for the nine months ended October 31, 2025, were $479,730,000, a 1.7% increase from $471,903,000 in the same period of 2024[26] - Net sales for the three months ended October 31, 2025, were $186,132,000, representing a 3.1% increase compared to $180,524,000 for the same period in 2024[24] Operating Efficiency - Total operating expenses for the three months ended October 31, 2025, were $89,331,000, slightly down from $90,597,000 in the previous year, indicating cost control measures[24] - Operating income increased to $11,725,000 for the three months ended October 31, 2025, compared to $6,033,000 for the same period in 2024, reflecting improved operational efficiency[24] Tax and Provision - The company reported a provision for income taxes of $3,275,000 for the three months ended October 31, 2025, compared to $2,365,000 in the prior year, reflecting higher taxable income[24] Capital Management - Capital expenditures decreased to $3,512 million from $6,368 million, indicating a reduction in investment spending[34] - Net cash used in investing activities was $6,297 million, down from $11,921 million, reflecting improved cash management[34] - Dividends paid remained relatively stable at $23,306 million compared to $23,319 million in the prior year[34] - Stock repurchases decreased to $1,594 million from $2,628 million, suggesting a more conservative approach to share buybacks[34] Economic Outlook - The company is not providing a fiscal 2026 outlook due to current economic uncertainty and unpredictable tariff impacts[16] - The company expects the recently announced trade agreement to reduce U.S. tariff rates on Swiss watches to 15%, significantly lower than previous rates[5] Asset Management - Total assets increased to $751,899,000 as of October 31, 2025, compared to $729,231,000 at the beginning of the year, reflecting growth in the company's asset base[32] Exchange Rate Impact - The effect of exchange rate changes resulted in a positive cash impact of $5,875 million, contrasting with a negative impact of $917 million in the previous year[34]

Core Insights - Movado Group, Inc. reported third quarter net sales of $186.1 million, reflecting a 3.1% increase from $180.5 million in the same quarter of fiscal 2025 [1] - The company achieved a gross margin of 54.3%, which is an expansion of 80 basis points compared to 53.5% in the third quarter of fiscal 2025 [1] - Operating income for the third quarter reached $11.7 million, nearly doubling from $6.0 million in the prior year’s third quarter [1]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Core Viewpoint - Movado Group, Inc. is set to discuss its third quarter fiscal year 2026 earnings results in a conference call scheduled for November 25, 2025, at 9:00 a.m. Eastern Time [1] Company Information - The conference call will be hosted by Efraim Grinberg, Chairman and Chief Executive Officer, along with Salli [1] - A press release detailing the third quarter fiscal year 2026 results will be issued before the market opens and prior to the call [1]