Fossil Group Swings to First Quarterly Profit in Years After Margin Surge and Raised Full-Year Guidance

Fossil Group reported third-quarter 2026 results on November 10 that beat expectations and marked the watchmaker's first quarterly profit in years, sending shares surging more than 26% the following session and touching a four-year intraday high of $10.55 before settling around $9.98. Worldwide net sales for the quarter ended October 3 came in at $271 million, up 0.4% as reported and 2.0% in constant currency. The headline figure was gross margin, which expanded 10.8 percentage points to 59.8%, while third-quarter operating income reached $25 million for a 9% operating margin. On a constant-currency adjusted basis, operating income was $30 million and the adjusted operating margin was 11%.

Fossil brand sales grew 14% year over year, and traditional watch sales rose 6% across all brands. The company also announced a five-year extension of its global Diesel watch and jewelry licensing agreement, now running through 2032.

Management raised full-year 2026 guidance on both the top and bottom lines. The new net sales outlook is $980 million to $990 million, up from a prior range of $955 million to $975 million, and the adjusted operating margin target was lifted to 5.5%-6.5% from 4%-6%. CEO Franco Fogliato credited the company's three-pillar turnaround plan and said the strong year-to-date results give the company confidence in its long-term growth trajectory. The stock's move drew significant options activity as it reached levels not seen in four years.