Movado (MOV) 5 Dec 24 2025 Q3 Earnings call transcript

Movado Group, a leading watch and jewelry company, recently held its third quarter earnings call, shedding light on its performance and strategic initiatives amid a challenging environment. The call, led by CEO Efraim Grinberg and COO/CFO Sallie DeMarsilis, provided insights into the company's financial health, growth prospects, and strategic directions.

Financial Performance and Strategic Initiatives

Movado Group reported a decrease in net sales for the third quarter, with a 2.6% decline in sales compared to the same period last year. However, the company remains optimistic, citing significant progress in strategic initiatives such as the introduction of new product families across its brand portfolio and revitalizing marketing efforts. Despite the sales decline, Movado Group maintains a strong balance sheet, with a cash position of $182 million and no debt.

Market Trends and Product Performance

The call highlighted the challenges in the retail environment, particularly in the U.S. and Europe, which have pressured sales. However, Movado Group has seen strong performance in some product categories, such as Movado's iconic Bold and Heritage watch collections, Tommy Hilfiger's automatic charter collection, and the new Lacoste LC 33 collection. The company also reported growth in licensed brands, especially Coach, Lacoste, Calvin Klein, and HUGO BOSS.

Cost Reduction and Future Outlook

In response to the challenging environment, Movado Group is taking steps to reduce costs and improve financial performance. This includes reducing operating costs during the third quarter and a new $50 million share repurchase plan. The company is also focused on increasing operational efficiencies and returning North America and the Movado brand to higher levels of profitability.

Key Themes and Trends

The earnings call underscored Movado Group's resilience in the face of market challenges. The company's strategic initiatives, particularly in product innovation and marketing, position it well for future growth. However, the focus on cost reduction and efficiency highlights the challenges in the current retail environment. Despite these challenges, Movado Group remains optimistic about its prospects, with a strong balance sheet and a clear focus on improving profitability.

Investor Insights

Key shareholders and investors showed keen interest in Movado Group's marketing strategies, particularly in the context of digital marketing and the impact of the election on costs. The company's responses highlighted the importance of adapting to changing market dynamics and the role of digital platforms in driving sales.

Sectoral Trends and Competitive Landscape

The call provided insights into sector-specific trends, such as the growing importance of digital marketing and the impact of tighter inventory management on sales. The company's performance in the face of these trends underscores the need for agility and adaptability in the watch and jewelry industry.

Conclusion

Movado Group's third quarter earnings call painted a picture of a company navigating a challenging environment with strategic initiatives and a focus on cost reduction. The company's performance and outlook highlight the complexities of the watch and jewelry industry, with a clear emphasis on innovation, marketing, and operational efficiency. As Movado Group looks to the future, it faces both challenges and opportunities, underscoring the importance of strategic decision-making and adaptability in a dynamic market.