Fossil Group, Inc. has shown resilience in the face of challenging times, as it managed to narrow its losses despite a decrease in sales. The Richardson, Texas-based watch and accessory company reported a net loss of $4.0 million for the fourth quarter of 2020, an improvement from the previous year’s loss of $6.9 million. Quarterly net sales decreased by 26% year over year, to $528.1 million, reflecting the impact of Covid-19 on foot traffic at both owned stores and wholesale doors.
To combat the impact of the pandemic, Fossil took steps to reduce selling, general, and administrative expenses, resulting in a 24% decrease from the prior year. The company also saw a growth of 25% in its digital channels, which helped offset the decline in brick-and-mortar sales.
For the full year 2020, Fossil’s net sales fell by 27% to $1.6 billion, with an annual net loss of $96.1 million. Despite these challenges, CEO Kosta Karsotis commended the teams for their resilience and strategic focus, particularly in enhancing digital capabilities to meet the surge in online demand.
In a strategic move to further strengthen its leadership team, Fossil announced the appointment of Sunil Doshi as the new CFO, effective March 29, 2021. With over 20 years of experience in senior finance roles, including a previous role as CFO for Fossil Group’s Americas region from 2012 to 2015, Doshi’s appointment aligns with Fossil’s goal to adapt to market changes and drive future growth.
Looking ahead, Fossil anticipates a decline in net sales of 12% to 17% in the first quarter of 2021 but expects a 10% to 15% increase for the full fiscal year. The company plans to reduce its store count by about 65 to 75 locations in 2021 as part of its strategy to adapt to changing retail landscapes and prioritize digital innovation for sustained growth and profitability in the future.
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