Movado Group sees Q2 net sales rise, driven by licensed brands

Movado Group, Inc., a US-based watch and jewellery company, has reported a 3.1 percent increase in net sales to 161.8 million dollars for its second quarter of fiscal year 2026, up from 157.0 million dollars in the prior-year period. This growth was led by the performance of its licensed brands and company-owned stores, a result which chairman and chief executive officer Efraim Grinberg called "pleasing".

International markets were a key driver of the performance, with net sales increasing by 6.9 percent. In contrast, US net sales decreased by 1.6 percent.

Profitability shows mixed results

Gross profit for the quarter was 87.6 million dollars, representing a gross margin of 54.1 percent. This was a slight decrease from the 54.3 percent gross margin recorded in the second quarter of fiscal 2025. According to the press release, the decline in gross margin was primarily due to increased US tariffs and fluctuations in foreign exchange rates, which were partially offset by positive changes in channel and product mix.

Operating expenses as a percentage of sales decreased to 51.6 percent, down from 52.6 percent in the prior-year period, driven by higher sales. Adjusted operating expenses were 80.6 million dollars, or 49.8 percent of sales, a decrease from the same period last year due to lower marketing expenses.

The company reported operating income of 4.0 million dollars for the quarter, an increase from 2.6 million dollars in the prior-year period. However, net income was 3.0 million dollars, or 13 cents per diluted share, a decrease from 3.5 million dollars, or 15 cents per diluted share, in the same period last year.

Grinberg points to ‘dynamic’ environment; suspends outlook

Grinberg noted that while the company is "pleased with our second quarter results," it remains "cognizant that the environment remains dynamic and that tariff uncertainty continues." Due to these factors, Movado Group is not providing a financial outlook for fiscal year 2026.

As of July 31, 2025, Movado Group ended the quarter with 180.5 million dollars in cash and no debt. The board of directors has also declared a quarterly cash dividend of thirty-five cents per share, payable on September 22, 2025.

This article was written with the help of AI.