Movado Group Inc (NYSE:MOV) Reports Mixed Q2 Results with Revenue Beat and Earnings Miss

Movado Group Inc (NYSE:MOV) reported fiscal second-quarter results that presented a mixed financial picture, with revenue exceeding analyst expectations while adjusted earnings fell short of projections. The watchmaker posted quarterly sales of $161.8 million, surpassing the estimated $158.4 million, representing a 3.1% increase from the prior year period. However, the company's adjusted earnings per share of $0.23 missed the consensus estimate of $0.31.

The market reaction appeared to reflect disappointment with the earnings performance, with shares declining approximately 8% in pre-market trading following the announcement. This negative sentiment contrasts with the stock's recent performance, which had shown modest gains over the past month with an increase of about 8.6%.

Key Financial Highlights from Q2 Fiscal 2026:

• Net sales increased to $161.8 million from $157.0 million in the comparable quarter last year, driven primarily by strength in international markets and licensed brands • Gross margin remained relatively stable at 54.1% compared to 54.3% in the prior year period, despite pressure from increased tariffs and foreign exchange fluctuations • Operating income improved to $4.0 million from $2.6 million year-over-year, though this figure included $2.1 million in professional fees related to an internal investigation and $0.9 million in costs associated with a corporate savings initiative • Adjusted operating income, which excludes these one-time items, reached $7.0 million • The company maintained a strong balance sheet with $180.5 million in cash and no debt outstanding

International markets led the company's performance, with sales growing 6.9% compared to a 1.6% decline in U.S. sales. Licensed brands and the company's stores segment showed particular strength, while owned brands experienced a decrease in sales. The digital business also demonstrated growth globally.

Chairman and CEO Efraim Grinberg expressed satisfaction with the quarterly results, highlighting the company's ability to grow sales and maintain healthy margins despite challenging market conditions and tariff impacts. He emphasized the strength of Movado's brand portfolio and innovation capabilities while acknowledging the ongoing dynamic environment and tariff uncertainties.

Looking ahead, Movado Group did not provide specific financial guidance for fiscal 2026, citing current economic uncertainty and unpredictable tariff impacts. This lack of forward guidance makes it challenging to compare management's expectations with analyst projections for full-year revenue of $658 million and earnings estimates.

The company also announced a quarterly dividend of $0.35 per share and reported repurchasing approximately 100,000 shares during the first six months of fiscal 2026 under its existing share repurchase program, with $48.4 million remaining available for additional buybacks.

For more detailed earnings information and future estimates, readers can review additional data on the company's earnings page.

Disclaimer: This article is not investment advice. Investors should conduct their own research and consult with financial advisors before making investment decisions.