Group 1 - U.S. stock futures are higher, with Dow futures gaining approximately 0.2% [1] - Booz Allen Hamilton Holding Corporation shares fell 2.9% to $105.66 in pre-market trading after a downgrade from Goldman Sachs [1] - Goldman Sachs analyst Noah Poponak downgraded Booz Allen Hamilton from Buy to Neutral and reduced the price target from $150 to $109 [1] Group 2 - Nexa Resources S.A. shares dropped 32% to $4.01 in pre-market trading [2] - Betterware de México, S.A.P.I. de C.V. shares declined 24% to $8.21, with earnings results expected after market close on April 24 [2] - Solaris Resources Inc. shares fell 22.3% to $2.20 in pre-market trading [2] - InnovAge Holding Corp. shares decreased by 14.9% to $2.35 in pre-market trading [2] - Costamare Inc. shares fell 14.3% to $7.42 after a 5% decline on Thursday [2] - Maze Therapeutics, Inc. shares tumbled 12.8% to $6.62 after a 5% drop on Thursday [2] - Mesoblast Limited shares dipped 9.5% to $9.41 after a 6% decline on Thursday [2] - Dyne Therapeutics, Inc. shares fell 6.2% to $6.55 after an 8% dip on Thursday [2] - Movado Group, Inc. shares decreased by 4.9% to $13.14, with earnings results expected on April 16 [2]

Company Overview - Movado (MOV) shares increased by 7.4% to close at $14.49, supported by higher trading volume compared to normal sessions, despite a 25.1% decline over the past four weeks [1] - The upcoming quarterly earnings for Movado are projected at $0.39 per share, reflecting a year-over-year decrease of 29.1%, with expected revenues of $181.63 million, a slight increase of 1.1% from the previous year [2] - The consensus EPS estimate for Movado has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [3] Industry Insights - Movado operates within the Zacks Retail - Jewelry industry, which includes other companies like Brilliant Earth Group, Inc. (BRLT), whose stock rose by 5.1% to $1.45, with a 4.6% return over the past month [3] - Brilliant Earth Group's consensus EPS estimate has seen a significant change of -166.7% over the past month, now projected at -$0.01, which is a 133.3% decline from the previous year's report [4] - Both Movado and Brilliant Earth Group currently hold a Zacks Rank of 3 (Hold), indicating a neutral outlook for these stocks [3][4]

Group 1 - The Culture Makers event was created and launched in 2023 to unite and celebrate the Hispanic and Latin community [1] - Jessica Alba expressed excitement about the growth of the Culture Makers event and emphasized its purpose of fostering culture, collaboration, community, and connection [1] - The event featured notable attendees including Eva Longoria, Danny Ramirez, and Robert Rodriguez, and included food from Tacos 1986 and cocktails curated by Don Julio [1]

Core Insights - Movado Group, Inc. has launched a new Artist Series collaboration with Derrick Adams, a prominent Black artist, focusing on the celebration of the Black experience through contemporary cubism and vibrant colors [1][2][3] - The limited-edition collection includes five watch designs, each with 125 pieces, and a total of 25 collectors sets, marking the first time Movado has designed a clock in an Artist Series collaboration [2][3] Company Overview - Movado Group, Inc. designs, sources, and globally distributes a variety of watch brands including MOVADO®, MVMT®, OLIVIA BURTON®, and others, while also operating Movado Company Stores in the U.S. and Canada [5] Artist Profile - Derrick Adams is a multidisciplinary artist based in Brooklyn, New York, recognized for his vibrant and contemporary-cubist style that reflects the richness of Black culture [4]

Financial Data and Key Metrics - Net sales for the third quarter decreased by 2.6% to $187.7 million compared to the same period last year [20] - Gross profit margin for the quarter was 53.8%, down from 54.5% in the prior year, primarily due to unfavorable channel and product mix [21] - Operating income decreased to $9.3 million from $20.7 million in the third quarter of fiscal 2024, driven by lower sales and higher operating expenses [22] - Net income for the quarter was $8.3 million, or $0.37 per diluted share, compared to $17.4 million, or $0.77 per diluted share, in the year-ago period [23] - Year-to-date sales for the nine-month period ended October 31, 2024, were $478.7 million, a decrease of 2.9% compared to the same period last year [24] - Gross profit for the nine-month period was $260.3 million, or 54.4% of sales, down from $273.6 million, or 55.5% of sales, in the prior year [25] - Net income for the nine-month period was $14.9 million, or $0.66 per diluted share, compared to $34.6 million, or $1.53 per diluted share, in the year-ago period [26] Business Line Performance - Movado brand sales on the company's website increased by 16.9% in the quarter, with September and October sales growing by over 25% [7] - Licensed brands sales grew by 3.8% in the third quarter, driven by strong performance in Coach, Lacoste, Calvin Klein, and HUGO BOSS [9] - Coach brand performed well, driven by new product introductions, including the Sammy collection, which resonated with Gen Z consumers [9] - Tommy Hilfiger sales were led by the TH 85 Chronograph and the new Henry family of automatic watches [10] - HUGO BOSS returned to growth in the quarter, with strong sales of the Time Traveler collection and the new Bossmatic family [11] - Lacoste saw strong sales growth, particularly in its jewelry collection, with the Metropole Bracelet continuing to grow at a double-digit rate [12] - Calvin Klein brand grew overall, driven by strong sales in jewelry and the introduction of the new Pulse family for women's watches [13] Regional Performance - US net sales decreased by 7.1% in the third quarter, while international markets grew by 0.4%, with growth in Latin America, the Middle East, India, and Australia offsetting declines in Europe [14] - Movado brand performed well in India, with a 20% increase in sales, positioning it as a significant growth market [8] - Europe, the company's largest international market, continued to soften, contributing to a 1.1% decline in international sales on a constant currency basis [20] Strategic Initiatives and Industry Competition - The company has focused on introducing new product families and revitalizing marketing efforts across its brand portfolio [6] - Investments in marketing have been made to drive revenue growth and brand awareness, despite a 2.9% decline in net sales year-to-date [6] - The company is prioritizing cost reduction, brand-building initiatives, and rationalizing marketing investments to improve profitability [6] - Movado is targeting growth opportunities in jewelry and emerging markets like India and Southeast Asia, while aiming to return North America and the Movado brand to higher profitability [6] - The company has a strong balance sheet with $182 million in cash and no debt, and has announced a new $50 million share repurchase plan [6] Management Commentary on Operating Environment and Future Outlook - The retail environment in the US and Europe remains challenging, with retailers tightly managing inventories [7] - The company expects a strong holiday season, supported by the launch of its Amazon Premiere platform and a new marketing campaign [8] - Management is optimistic about the long-term potential of the Movado brand in India and other growth markets [8] - The company is focused on reducing operating costs and improving profitability, with $6.5 million in annualized savings expected from recent cost-saving initiatives [30] - For fiscal 2025, the company expects net sales of approximately $665 million, gross profit of 54% of sales, and operating income of $23 million [29] Other Important Information - The company repurchased approximately 120,000 shares under its share repurchase program in the first nine months of fiscal 2025 [27] - A new three-year $50 million share buyback program has been approved by the Board of Directors [28] Q&A Session Summary Question: New stock buyback authorization usage - The company plans to use the new buyback authorization primarily to offset dilution, with potential changes depending on cash generation [33][34] Question: Retail inventory levels and leading indicators - Retail inventory levels in the US and Europe are historically low, and the company expects a rebound as economic conditions improve [37][38] - E-commerce businesses typically carry less inventory than in-store businesses, but they represent no more than 20-25% of a retailer's overall business [39]

Financial Performance - Net sales for the three months ended October 31, 2024 were $182.7 million, representing a $5.0 million or 2.6% decrease from the prior year period[117]. - The Watch and Accessory Brands segment net sales were $161.9 million, down $3.3 million or 2.0% compared to the prior year period, primarily due to unfavorable sales mix and decreased volumes[118]. - In the United States, net sales for the Watch and Accessory Brands segment were $51.6 million, a decrease of $3.7 million or 6.7%, with owned brands category sales down $5.4 million or 13.1%[120]. - International net sales for the Watch and Accessory Brands segment were $110.3 million, an increase of $0.4 million or 0.4%, positively impacted by foreign currency exchange rates[121]. - Net sales for the nine months ended October 31, 2024 were $478.7 million, a decrease of $14.3 million or 2.9% from the prior year[136]. - Net sales in the Watch and Accessory Brands segment for the nine months ended October 31, 2024 were $415.2 million, down $9.6 million or 2.3% from the prior year[137]. - The U.S. locations of the Watch and Accessory Brands segment experienced net sales of $137.2 million for the nine months ended October 31, 2024, a decrease of $4.7 million or 3.3%[138]. Profitability - Gross profit for the three months ended October 31, 2024 was $98.4 million, or 53.8% of net sales, compared to $102.3 million or 54.5% in the prior year[123]. - Operating income in the Watch and Accessory Brands segment for the three months ended October 31, 2024 was $5.3 million, down $13.2 million from $18.5 million in the prior year period[125]. - Net income attributable to Movado Group, Inc. for the three months ended October 31, 2024 was $5.1 million, down from $17.4 million in the prior year[133]. - For the nine months ended October 31, 2024, the Company recorded operating income of $7.5 million in the Watch and Accessory Brands segment, a decrease from $31.9 million in the same period of 2023[145]. - The Company Stores segment recorded operating income of $5.4 million for the nine months ended October 31, 2024, a decrease from $9.3 million in the same period of 2023[149]. - Net income attributable to Movado Group, Inc. was $11.7 million for the nine months ended October 31, 2024, down from $34.6 million in 2023[153]. Expenses - SG&A expenses for the three months ended October 31, 2024 were $91.8 million, an increase of $10.2 million or 12.5% from the prior year period[124]. - SG&A expenses for the nine months ended October 31, 2024 were $247.4 million, an increase of $15.0 million or 6.5% from the prior year[144]. Cash Flow and Capital Management - The Company had cash and cash equivalents of $181.5 million as of October 31, 2024, compared to $201.0 million in the prior year[154]. - Working capital decreased to $398.4 million as of October 31, 2024, from $412.1 million in 2023[155]. - Cash used in operating activities was $40.6 million for the nine months ended October 31, 2024, compared to cash provided of $7.4 million in the same period of 2023[157]. - Cash used in investing activities increased to $11.9 million for the nine months ended October 31, 2024, from $8.8 million in 2023[158]. - The Company declared and paid cash dividends totaling $23.3 million for the nine months ended October 31, 2024, compared to $45.4 million in the same period of 2023[168]. - The Company has authorized a total of $100.0 million for share repurchase programs, with $15.2 million remaining under the November 23, 2021 program and the full $50.0 million available under the December 5, 2024 program[169]. - During the nine months ended October 31, 2024, the Company repurchased 120,000 shares at an average cost of $21.90 per share, totaling $2.6 million, compared to 85,722 shares at an average cost of $27.40 per share, totaling $2.3 million in the same period of 2023[169]. Risk Management - The Company employs a hedging program to manage foreign currency exchange risks, particularly with Swiss Francs, Euros, and British Pounds[172]. - The Company uses forward exchange contracts to offset exposure to foreign currency receivables and liabilities, with changes in fair value recognized in earnings[174]. - The Company has a comprehensive risk management strategy that includes hedging against currency fluctuations and commodity price changes[172]. - As of October 31, 2024, the Company's net forward contracts hedging portfolio included 30.0 million Swiss Francs and 33.0 million Euros, with various expiry dates through April 10, 2025[175]. - The Company reported a potential gain of $0.1 million if Swiss Franc forward contracts were settled as of October 31, 2024, and a $0.2 million gain for Euro forward contracts[175]. - The Company did not hold any futures contracts in its gold hedge portfolio as of October 31, 2024, meaning fluctuations in gold prices will directly affect the cost of sales[176]. - The Company had zero floating rate debt as of October 31, 2024, and 2023, with no weighted average borrowings during the nine months ended October 31, 2024[177]. - The Company has no off-balance sheet financing or unconsolidated special-purpose entities, indicating a straightforward financial structure[170].

Financial Performance - Net sales for Q3 fiscal 2025 were $182.7 million, a decrease of 2.6% from $187.7 million in Q3 fiscal 2024[4]. - Operating income for Q3 fiscal 2025 was $6.6 million, down from $20.7 million in the prior year, with adjusted operating income at $9.3 million[4][8]. - Diluted earnings per share (EPS) for Q3 fiscal 2025 were $0.22, compared to $0.77 in Q3 fiscal 2024; adjusted EPS was $0.37[4][8]. - Total net sales for the three months ended October 31, 2024, were $182.727 million, a decrease of 2.6% compared to $187.686 million in the same period of 2023[22]. - Gross profit for the three months ended October 31, 2024, was $98.396 million, down from $102.328 million in the prior year, reflecting a gross margin of 53.9%[22]. - Operating income for the three months ended October 31, 2024, was $6.550 million, significantly lower than $20.692 million reported in the same quarter of 2023[22]. - Net income attributable to Movado Group, Inc. for the three months ended October 31, 2024, was $5.050 million, compared to $17.389 million in the same period last year, resulting in diluted earnings per share of $0.22[22][28]. - For the nine months ended October 31, 2024, total net sales were $478.709 million, a decrease of 2.9% from $492.981 million in the same period of 2023[25]. - The adjusted net income for the three months ended October 31, 2024, was $8.315 million, with an adjusted diluted EPS of $0.37[28]. Financial Position - The company ended Q3 fiscal 2025 with $181.5 million in cash and no debt, maintaining a strong financial position[4][3]. - Total current assets decreased to $520,187 thousand from $538,445 thousand year-over-year, a decline of 3.5%[32]. - Cash and cash equivalents at the end of the period were $181,548 thousand, down 9.7% from $200,965 thousand a year ago[34]. - Shareholders' equity decreased to $503,583 thousand from $500,439 thousand year-over-year, reflecting a slight increase of 0.2%[32]. - Total liabilities increased slightly to $259,424 thousand from $258,000 thousand year-over-year[32]. - Total assets remained relatively stable at $765,876 thousand compared to $763,397 thousand a year ago[32]. Cost Management and Initiatives - The company plans to implement a cost-savings initiative expected to generate approximately $6.5 million in annualized savings[3][13]. - The company is focusing on improving profitability and streamlining expenses in preparation for fiscal 2026[3][13]. Tax and Other Financial Metrics - The effective tax rate for Q3 fiscal 2025 was 31.5%, compared to 20.4% in the prior year[8]. - The provision for income taxes for the three months ended October 31, 2024, was $2.495 million, compared to $4.519 million in the same period of 2023[22]. Shareholder Actions - The board approved a new share repurchase program allowing for the purchase of up to $50 million of outstanding common shares[16]. Economic Challenges - Movado Group, Inc. continues to face challenges from economic conditions, including inflation and increased commodity prices, which may impact future performance[20]. - The company experienced a decrease in sales on a constant dollar basis, with a decline of 3.5% for the three months ended October 31, 2024[24]. Cash Flow and Expenditures - Net cash used in operating activities was $(40,627) thousand, a significant decrease from $7,368 thousand provided in the same period last year[34]. - Capital expenditures for the period were $(6,368) thousand, a minor decrease from $(6,627) thousand in the previous year[34]. - The company paid dividends of $(23,319) thousand, down from $(45,399) thousand in the same period last year[34]. - The effect of exchange rate changes on cash was $(917) thousand, compared to $(377) thousand in the previous year[34].

Group 1 - Amentum Holdings Inc. will be added to the S&P 500 effective prior to the open of trading on September 30, 2024, replacing Bath & Body Works, Inc. [1][2] - Bath & Body Works will move to the S&P SmallCap 600 effective prior to the open of trading on October 1, 2024, replacing Movado Group, Inc. [1][2] - Jacob's Solutions Inc. is spinning off its Critical Mission Solutions and Cyber Intelligence business, which will merge with private Amentum to create the newly publicly traded Amentum Holdings [1] Group 2 - The changes in the S&P indices reflect that Bath & Body Works is no longer representative of the large-cap market space, while Movado is no longer representative of the small-cap market space [1]

Core Viewpoint - Movado Group, Inc. reported disappointing Q2 results, leading to a significant stock decline of -15% and a downward revision of its FY2025 outlook, indicating ongoing brand weakness and ineffective marketing efforts [1][2][9] Financial Performance - Q2 revenues were $159.3 million, a slight decline of -0.7%, but exceeded Wall Street's expectations by $8.8 million; however, they fell short of the company's own forecasts [2][3] - Operating expenses increased by $3.7 million to $83.3 million, resulting in a shallow operating income of $3.0 million and an EPS of $0.16, missing consensus estimates by $0.03 [3][4] - The gross margin decreased by 1.5 percentage points to 54.2%, attributed partly to the lower-priced Movado Bold Quest series [3] Revised Guidance - The company revised its FY2025 sales guidance to $665-675 million, a decrease of -0.4% year-on-year at the mid-point, down from a previous range of $700-710 million [3][9] - Operating income expectations were also lowered to $23-26 million from $32-35 million, with $20 million in earnings pressure due to increased marketing spend [3][9] Marketing Strategy - Movado launched a new marketing campaign featuring five brand ambassadors, which requires successful execution to justify the increased marketing expenditure [4][9] - The campaign's effectiveness is questioned due to the perceived decline in cultural relevance of some ambassadors, raising concerns about its potential impact on sales [4] Valuation and Investment Outlook - Updated DCF model estimates Movado's fair value at $16.31, indicating a 13% downside from the current stock price, with a more conservative sales outlook post-FY2025 [5][6] - The company's capital allocation strategy, characterized by high cash reserves, contributes to an unattractive investment case, suggesting a potential 45% downside instead of 13% [6] Market Context - The luxury watch market is facing challenges, with competitors like LVMH reporting a -3% decline in watch and jewelry sales, reflecting broader macroeconomic pressures [3][9] - Despite increased marketing efforts, Movado's sales performance remains weak, indicating that the current strategy has not yet yielded positive results [2][9]

Eroding financials and lowered guidance didn't make for a beneficial combination. Many of Movado Group's (MOV -14.66%) goods are quite attractive, but the company's stock wasn't looking too pretty on Thursday. On the back of dispiriting quarterly results, investors peeled away from the stock, leaving it nearly 15% down in price at market close. The benchmark S&P 500 index did much better by comparison, "only" shedding 0.3% during the session. Revenue and profitability declines Movado's second quarter of fis ...