FinancialsMay 18, 2023
Watches of Switzerland’s Full-Year U.S. Sales Climb 52%FinancialsMay 26, 2023
Movado Sales Slip in Q1 Amid Inflation Woes, Tough Comps
The company has plans to revamp the Movado brand and offer less expensive watches this year.
A campaign image from last year’s spring/summer Calvin Klein watch and jewelry collection, a licensed brand in Movado’s portfolio. The company posted an 11 percent net sales decline year-over-year in the first quarter.
Paramus, N.J.—Movado Group had a rough start to its fiscal year 2024 with first-quarter sales down double digits.
The New Jersey-based company said it faced a “challenging macro environment” and tough comparables after a record first quarter last year.
“Despite this backdrop, our teams continued to execute against our strategic priorities to maximize the power of our brands with exceptional innovation,” said CEO Efraim Grinberg in a statement.
Here are five takeaways from Movado’s recent earnings report.
First-quarter sales were down but still better than expected.
In the first quarter ending April 30, net sales fell 11 percent year-over-year to $144.9 million, which the company attributed to declines in wholesale to its customers’ physical stores, online retail, and its own stores.
The sales came in just ahead of Movado’s prior guidance of a 12 to 15 percent sales decline.
Gross profit was $82 million, or 57 percent of net sales, compared with $96.7 million, or 59 percent of net sales in the previous first quarter.
The decline in gross margin was due to “unfavorable changes in channel and product mix” and the impact of foreign currency exchange rates, said Movado, which was partially offset by reduced shipping costs.
Grinberg noted its outlet business saw a 4 percent decline in Q1 amid a “highly promotional U.S. environment.”
Inflation and rising interest rates have impacted sales.
“As we had expected, the macroeconomic environment remained challenging during the beginning of the year with inflation and rising interest rates continuing to affect purchases made by consumers of discretionary products in our key markets, the U.S. and Europe,” Grinberg said on an earnings call Thursday.
In the U.S., Movado’s quarterly sales were down 16 percent year-over-year.
Internationally, net sales were down 8 percent in the first quarter.
The company noted strong growth in Brazil, the Middle East, and China, as well as in travel retail, which somewhat offset its decline in Europe.
“As retailers in key markets deal with slowing economic growth, they are very focused on making sure they control their inventories. From a brand perspective, we are laying the foundation for an improving second half,” said Grinberg.
Grinberg noted consumers have pulled back on discretionary purchases as the basics become more expensive.
Related stories will be right here …
The New Jersey-based company said it faced a “challenging macro environment” and tough comparables after a record first quarter last year.
“Despite this backdrop, our teams continued to execute against our strategic priorities to maximize the power of our brands with exceptional innovation,” said CEO Efraim Grinberg in a statement.
Here are five takeaways from Movado’s recent earnings report.
First-quarter sales were down but still better than expected.
In the first quarter ending April 30, net sales fell 11 percent year-over-year to $144.9 million, which the company attributed to declines in wholesale to its customers’ physical stores, online retail, and its own stores.
The sales came in just ahead of Movado’s prior guidance of a 12 to 15 percent sales decline.
Gross profit was $82 million, or 57 percent of net sales, compared with $96.7 million, or 59 percent of net sales in the previous first quarter.
The decline in gross margin was due to “unfavorable changes in channel and product mix” and the impact of foreign currency exchange rates, said Movado, which was partially offset by reduced shipping costs.
Grinberg noted its outlet business saw a 4 percent decline in Q1 amid a “highly promotional U.S. environment.”
Inflation and rising interest rates have impacted sales.
“As we had expected, the macroeconomic environment remained challenging during the beginning of the year with inflation and rising interest rates continuing to affect purchases made by consumers of discretionary products in our key markets, the U.S. and Europe,” Grinberg said on an earnings call Thursday.
In the U.S., Movado’s quarterly sales were down 16 percent year-over-year.
Internationally, net sales were down 8 percent in the first quarter.
The company noted strong growth in Brazil, the Middle East, and China, as well as in travel retail, which somewhat offset its decline in Europe.
“As retailers in key markets deal with slowing economic growth, they are very focused on making sure they control their inventories. From a brand perspective, we are laying the foundation for an improving second half,” said Grinberg.
Grinberg noted consumers have pulled back on discretionary purchases as the basics become more expensive.
The Movado brand is getting a refresh.
Movado will be revamping the image of its eponymous watch brand.
“Throughout the year, we will invest in refreshing the Movado brand image in a bolder and more impactful way and we are excited to make this investment behind our most important brand,” said Grinberg, adding it will begin in the second half of the fiscal year.
Its Mother’s Day marketing produced positive results, he said, particularly its TV ads. For Father’s Day, it has both TV and digital ads in the works.
Movado said its “Bold” collection is performing well, as is the newly added “Bold Horizon” watches, which Grinberg said are filling previously vacated price points.
It starts at $695 and has elicited a “good response” from consumers.
Its elevated and more expensive automatic models have also been doing well, especially through wholesale and on Movado’s website.
There’s newness for its licensed brands, including some less expensive watches.
Movado’s brand portfolio includes its eponymous brand as well as in-house and licensed brands, like Coach and Tommy Hilfiger.
“We’re reintroducing some opening price points, particularly in our licensed brand portfolio as consumers become stressed in other areas,” said Grinberg. “And we've seen some very good initial responses to some of the things that we've brought to the market quickly.”
Tommy Hilfiger is offering lower opening price points via its “Pippa” and “Norris” models.
Hugo Boss is following suit via the sporty “Trophy” collection and the “Gregor” collection, with both opening at $279.
The brand is partnering with English actress Suki Waterhouse in the fall for its jewelry and watch campaign.
For Coach, the “signature C” style watches are performing well, with Movado noting renewed demand for the brand in China amid the country’s reopening after COVID-19 restrictions.
Lacoste has a new interpretation of its “L.12.12” polo shirt as a watch, offering an aluminum version in new colors.
The brand will also introduce watches inspired by three Netflix series, “Stranger Things,” “Sex Education,” and “Lupin.”
The Calvin Klein brand, launched under Movado last year, also has been doing well, particularly the newly introduced “CK Sensation” watch and the all-black “Ambitious” watch.
Movado sees the “difficult consumer environment” continuing.
“As we look ahead, we continue to believe we will face a difficult consumer environment in the U.S. and Europe, our two largest regions,” said Grinberg.
“However, we believe we are well positioned to capture the opportunities in the marketplace and will continue to execute with discipline,” he said.
Grinberg highlighted his excitement about the company’s product innovation and “refreshed” marketing.
“We will do all this while controlling costs and leveraging the strength of our balance sheet with $198 million in cash and no debt as of quarter end.”
Movado maintained its prior guidance, expecting full-year net sales to be in the range of $725 million to $750 million.
Gross profit is forecast to be 56 percent of net sales while operating income may be in the range of $80 million to $85 million.
In the first half of the fiscal year, Movado expects sales to decline 9 to 12 percent year-over-year, noting its record first-half results in the previous year.
Editors' Picks
Sponsored by
More on Financials
The Latest
MajorsMar 13, 2025
Tanishq Opens 2 New Stores in the U.S.The Indian jewelry brand recently opened stores in Atlanta and Seattle.
CollectionsMar 13, 2025
Chopard Unveils High Jewelry Collection Created From 6,225-Carat Emerald The 15 pieces were crafted from the “Insofu” emerald, discovered in Zambia in 2010.
MajorsMar 13, 2025
Jewelers Mutual Names New CFO, TreasurerChris Anderson is joining the insurance provider as the new chief financial officer and treasurer.
Brought to you by
Watch: GIA Field Gemology at the One-Hundredth Expedition: A Look Back and to the FutureSupplier Spotlight Sponsored by GIA
Lab-GrownMar 13, 2025
JA Offering Some ‘Counter Intelligence’ on Diamonds Jewelers of America is distributing a brochure for retailers to use when discussing the differences between natural and lab-grown diamonds.
Weekly QuizMar 06, 2025
This Week’s QuizTest your jewelry news knowledge by answering these questions.
SourcingMar 12, 2025
5 Factors That Will Impact the Diamond Industry in 2025The industry is changing as it grapples with new realities around distribution, supply, and the need for consistent, effective marketing.
SourcingMar 12, 2025
Q&A: New GJEPC Chairman Kirit BhansaliBhansali discusses the potential impact of U.S. tariffs, demand for diamonds by market, and the “cautious confidence” in India right now.
Brought to you by
Natural Diamonds Should Mean MoreNatural diamonds mean more than lab-grown, but when every cut is ideal, they all look the same. Customers want more—Facets of Fire delivers.
Lab-GrownMar 12, 2025
Beyond Jewelry: Possibilities in the Lab-Grown Diamond SectorAs lab-grown diamond brands pop up across India, academics are researching how to grow demand outside of the jewelry industry.
SourcingMar 12, 2025
Indian Leader, Retailer Among 2025 DDG Honorees Govind Dholakia and Tanishq will be recognized for their contributions to the industry at the Diamonds Do Good Awards in Las Vegas.
IndependentsMar 12, 2025
Marla Aaron Migrates to LondonThe New York City-based brand has opened its first U.K. location with a permanent shop-in-shop at Liberty in London.
AuctionsMar 12, 2025
A Medieval Bishop’s Sapphire Ring Is Going Up for SaleA metal detectorist discovered the ring that is believed to have belonged to a bishop in the late 12th to early 13th century.
Events & AwardsMar 12, 2025
JA New York Announces Education, Live Demo LineupsOrganizers looked to new partnerships and interactive experiences to enhance the spring show, set for March 16 to 18.
Events & AwardsMar 12, 2025
Bogolo Joy Kenewendo to Speak at Annual JVC LuncheonKenewendo, Botswana’s minister of minerals and energy, will discuss the future of diamonds.
CrimeMar 11, 2025
Man in Florida Swallows Allegedly Stolen Tiffany & Co. Jewelry The suspect allegedly stole almost $800,000 worth of diamond jewelry from a store in Orlando and then swallowed it during a traffic stop.
ColumnistsMar 11, 2025
Creative Connecting: How to Pose on the Red CarpetAhead of the Gem Awards on Friday, Jen Cullen Williams and Duvall O’Steen share pro tips for taking the best photos.
CollectionsMar 11, 2025
Marco Bicego Celebrates 25 Years With Collection, CampaignFounded in 2000, Marco Bicego is commemorating its milestone anniversary with a “25 Best” collection and campaigns honoring its heritage.
TechnologyMar 11, 2025
Hill & Co. Launches New B2B Buyer DatabaseThose attending the company’s upcoming Zoom workshop will receive early access to “The List,” its new resource for finding buyers.
Events & AwardsMar 11, 2025
JSA to Honor GIA Employee at Annual LuncheonThe organization will present an award to Amy-Elise Signeavsky, law enforcement and diamond recovery manager at GIA.
MajorsMar 10, 2025
Terry Chandler to Retire After 24 Years as Head of DCA Chandler started his jewelry career at Michelson Jewelers, joining the Diamond Council of America as president and CEO in 2001.
CollectionsMar 10, 2025
MaeVona Co-Founder Debuts 3D-Printed ‘Tùsaire’ CollectionScottish American designer Maeve Gillies collaborated with Platinum Guild International on jewelry created by direct metal 3D printing.
Events & AwardsMar 10, 2025
The Jewelry Symposium Announces 2025 Scholarship WinnersAhead of its trade show in May, TJS awarded free registration and accommodations to five up-and-coming jewelry industry professionals.
Events & AwardsMar 10, 2025
These Designers, Journalists, and Retailers Are Up for a Gem Award The 2025 Gem Awards are set to take place Friday at Cipriani 42nd Street in New York City.
MajorsMar 07, 2025
Jane Fonda, Mariska Hargitay Star in Pomellato’s IWD CampaignThe annual star-studded campaign for International Women’s Day encourages collective action against domestic violence.
CollectionsMar 07, 2025
Piece of the Week: Yeprem’s ‘Golden Strada’ NecklaceThe statement piece is seen in Yeprem’s new “You Play the Game” campaign, created for International Women’s Day.
MajorsMar 07, 2025
Borsheims Names New Senior Security and Facilities ManagerLongtime employee Kyle Slosson has been promoted to the role.
IndependentsMar 06, 2025
Wixon Jewelers to Close After 37 YearsFirst-generation jewelers Dan and Hope Wixon are retiring and will close their Minneapolis-area jewelry store in May.
