Fossil Group Stock Shines After Strong Q2, Raised FY21 Outlook

Fossil Group Inc (NASDAQ:FOSL) reported second-quarter FY21 sales growth of 58.7% year-on-year, to $410.9 million, beating the analyst consensus of $333.50 million. Net sales improved 51% on a constant currency basis.
Sales in the Americas increased 64% Y/Y, and mainland China saw a 38% rise on a constant currency basis.
Gross margin shrank 30 basis points to 54.0%, while gross profit increased 57.7% Y/Y to $221.8 million.
Operating expenses rose 16.9% Y/Y to $207.5 million.
The operating margin was 3.48%, and operating income for the quarter was $14.3 million.
The company held $252 million in cash and equivalents as of July 3, 2021.
Loss per share of $(0.02) included restructuring charges of $0.09 per share.
"We are encouraged by improving consumer demand in our largest markets and our core category of traditional watches," said CEO Kosta Kartsotis.
Outlook: Fossil raised FY21 sales growth outlook to 14%-17% Y/Y (prior 12% - 16%).
The company expects FY21 adjusted EBITDA margin growth of 6% - 8% (prior 5% - 7%).
For Q3, it expects worldwide net sales to increase 5% - 10% Y/Y.
Price Action: FOSL shares are trading higher by 8.67% at $13.91 on the last check Thursday.