MOV

Image source: The Motley Fool. Wednesday, Aug. 26, 2026 at 9:00 a.m. ET Chairman and Chief Executive Officer - Efraim Grinberg Executive Vice President and Chief Financial Officer - Sallie DeMarsilis Operator: Good day, everyone, and welcome to Movado Group, Inc. Second Quarter Fiscal 2027 Earnings Conference Call. As a reminder, today's call is being recorded and may not be reproduced in full or in part without permission from the company. At this time, I would like to turn the conference over to Allison Malkin of ICR. Please go ahead. Allison Malkin: Thank you. Good morning, everyone. With me on the call today are Efraim Grinberg, Chairman and Chief Executive Officer; and Sallie DeMarsilis, Executive Vice President and Chief Financial Officer. Before we get started, I would like to remind you of the company's safe harbor language, which I'm sure you're all familiar with. The statements contained in this conference call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release. If any non-GAAP financial measure is used on this call, a presentation of the most directly comparable GAAP financial measure to this non-GAAP financial measure will be provided as supplemental financial information in our press release. Now I would like to turn the call over to Efraim Grinberg, Chairman and Chief Executive Officer of Movado Group. Efraim Grinberg: Good morning. Thank you for joining us, and welcome to Movado Group's second quarter conference call. With me today is Sallie DeMarsilis, our Executive Vice President and Chief Financial Officer. Following our prepared remarks, we'll be happy to take your questions. We were very pleased with our results for the quarter and the first half of the year. We continue to see momentum across our business and strength in consumer demand despite the ongoing challenges related to the conflict in the Middle East, which reflects meaningful progress advancing our strategy and favorable trends in our categories. For the quarter, sales increased 4.9% to $169.8 million. Adjusted operating profit increased to $15.1 million from $7 million last year and included $3.2 million of IEEPA duty refunds received in the quarter. Adjusted EPS increased to $0.54 from $0.23 last year and included $0.11 per share attributed to the IEEPA duty refunds. As I've done on previous calls, I'd like to reiterate our 4 key strategic priorities. First, putting the consumer at the center of our universe, learning more about who they are, how they relate to our brands and how we build long-lasting emotional connections across our portfolio. Second, driving innovation and delivering trend-right products while remaining true to each brand's DNA and their unique target customer. Third, connecting with those consumers through compelling content and digital storytelling. There has never been a greater opportunity to tell our brand stories directly to customers. And fourth, driving profitability and strengthening gross margin through higher average selling prices, greater full price selling penetration and a more optimized product assortment and supply base. Our teams continue to make progress against these priorities during the quarter with sales growth in the U.S. and across our principal international markets. In the U.S., we saw increased sell-through rates in both Movado and our licensed brands. Internationally, we delivered strong growth in Latin America and India and low single-digit growth in Europe. This was partially offset by a decline in the Middle East, where the region continues to face headwinds, particularly in the markets that rely heavily on international tourism. Gross margin for the quarter improved to 59.4% from 54.1%. Excluding the IEEPA duty refunds received, gross margin for the second quarter of fiscal 2027 would have been 57.5%, a 340 basis point improvement. Gross margin benefited from business mix and strategic pricing initiatives we implemented during the first quarter. I will go into this in further detail after I update you on our brands. We also ended the quarter with a very strong balance sheet with $212 million of cash and no debt. And year-to-date, we returned over $16 million to shareholders through quarterly dividend payments. We continue to see strong results from our customer-centric approach, particularly from trend-right products in new shapes and sizes that are resonating with younger consumers as they increasingly engage with traditional watches. A great example is the Movado spring launch of our Baby Face mini strap watch. The product sold out quickly with more than 400 units sold on movado.com in less than a month. We plan to follow that success with new fall colorways available both on our website and through a limited group of retail partners where we would expect a similarly strong response. As I review our brands, I'll highlight both the product innovation we're bringing to market and how we're connecting with today's consumers through storytelling initiatives, predominantly across digital platforms. Across our portfolio, we are seeing consumers respond to innovation that's both trend right and authentic to each brand. At Movado, 2 of our recent women's collections, Museum Bangle and Velura, are great examples of this strength. Velura is a beautiful new round Museum watch on a classic Milanese bracelet with and without lab-grown diamonds. On the men's side, this spring, we introduced the new BOLD Verso S and have quickly seen a strong customer response. We will expand Verso S' collection over the next several quarters, including the introduction of the Verso S Chronograph during the third quarter. On the marketing front, we're elevating our engagement with consumers as we celebrate Movado's 145th anniversary. We have launched a compelling collection of digital content, highlighting Movado's heritage, iconic design and Swiss craftsmanship. As we move into the second half, we will further amplify our consumer engagement and storytelling through our 145th anniversary content as well as through our Movado ambassadors, including Ludacris, Christian McCaffrey, Julianne Moore and Tyrese Haliburton. movado.com and our Movado outlet stores also continue to perform extremely well, with sales increasing 8% and 3%, respectively, as we continue to elevate average selling prices and drive improving margins. Consumer-focused innovation is also helping drive growth across our fashion brands. We have seen very strong momentum in Coach watches, particularly with Gen Z consumers driven by the continued success of Sammy and the recent introduction of Iris, a mini round jewelry-inspired collection. We will continue that innovation in the second half with a new mini Sammy and the addition of Greta, a new Tonneau shaped collection for Coach. This fall, our marketing campaign will feature Lola Tung, star of "The Summer I Turned Pretty," helping us further connect the Coach brand with a younger generation of consumers. Innovation also continues to drive success at Tommy Hilfiger, led by the T.H. Oxford family, which offers a tailored look designed for today's customer. We also recently introduced the Bryant family of men's chronographs with beautiful dials and a 38-millimeter case size. Bryant is receiving a strong response from consumers. As we continue to innovate within our women's assortment, we have seen women's watch penetration increase around the world. Collections such as Mia and Nora are now proven successes. On the jewelry side for Tommy Hilfiger, our heart charms continue to drive sales. Bryant, T.H. Oxford and Mia will be featured prominently in our Tommy Hilfiger storytelling this fall. At Lacoste, we continue to see success in our rugged LC33 collection while also driving innovation through new introductions that elevate average selling prices through a combination of materials, including rubber and metal. Our Lacoste jewelry business also continues to perform very well, led by the success of the Metropole collection, which will expand with new designs and feature crystals. Our fall Lacoste content will feature both LC33 and Metropole jewelry across digital channels and at the point of sale. I am also encouraged by the improvement we are seeing in Calvin Klein watches, particularly in women's. Our new sophisticated square watch collection sold out quickly this spring across markets around the world. It is a great complement to our already successful Twisted Bezel collection and CK Pulse. We are equally committed to growing our Calvin Klein men's business and are excited by the response to our new cushion shape collection, aptly named Shape, which will be featured prominently in our upcoming campaign. We have also received a strong response from retailers to the introduction of our new Command jewelry collection for men. At BOSS, we will continue to support our 2 leading hero collections, Grand Prix and Sky Traveler, while introducing the new Grand Prix Vitesse, which will be the focus of our fall campaign. We're also excited about the introduction of Archer jewelry collection for men. For women, we have received a strong response to Violet. Its distinctive shape and 21-millimeter size are right on trend, and it will be the focus of our women's marketing this fall. At Olivia Burton, our strategy of focusing on the United Kingdom and the United States is working with sales increasing 23% for the quarter. Small shaped watches continue to drive the business, led by key collections, including Mini Grove and Mini Grosvenor. Our campaign watch for the fall will be the new Cambridge family, our first tonneau-shaped collection for the brand. The Olivia Burton campaign will evolve from our successful Mini to the Max concept with a new message, "Mini is more," further solidifying Olivia Burton's position as an authority in smaller women's watches. Across our portfolio, innovation and compelling storytelling allows our brands to connect with customers, particularly younger consumers as they increase their engagement with traditional watches and learn more about the category. In that regard, we are excited to be expanding our long-term partnership with Tapestry. And beginning next fiscal year, we'll be launching Kate Spade watches. We have already begun to preview our introductory collection and are receiving a strong response from partners around the world. We are excited by the resurgence that we see in the watch category, and we believe our brands are well positioned to capitalize on it. As I previously mentioned, our fourth strategic priority is to expand margins and drive greater profitability. As mentioned, excluding the IEEPA duty refunds, gross margin for the second quarter improved 340 basis points, reflecting improved sales mix, strategic pricing actions and reduced promotional activity. Gross margin also benefited from a favorable mix of inventory sold during the period, including inventory carrying lower duty rates following the repeal of IEEPA tariffs in February 2026. We continue to streamline our assortments, reducing SKU counts and improve efficiency across our value chain. We are driving higher levels of full price selling through stronger brand positioning while reducing promotional activity. At the same time, our brands remain focused on increasing average selling prices where appropriate while continuing to offer consumers compelling value. As we look ahead, we remain pleased with the performance of our business and the positive trends we have now delivered for 5 consecutive quarters. We believe this momentum reflects the successful execution of our strategy and the strength of our brands, our teams and our consumer-focused approach. Going forward, we remain committed to providing transparency and meaningful insight into our business, our markets and the trends we are seeing. At the same time, we have decided to discontinue providing an annual outlook. We believe our focus is better served by executing our long-term strategy and making the right decisions to drive sustainable, profitable growth and create increased value. We entered the second half encouraged by the momentum in our business, excited about the innovation and storytelling we have planned across our portfolio, and we are focused on continuing to execute against our strategic priorities. With that, I'll turn the call over to Sallie to review our financial results in greater detail. Sallie DeMarsilis: Thank you, Efraim, and good morning, everyone. For today's call, I will review our financial results for the second quarter and year-to-date period of fiscal 2027. My comments today will focus on adjusted results. Please refer to the description of the special items included in our results for the second quarter and first 6 months of fiscal 2027 in our press release issued earlier today, which also includes a reconciliation table of GAAP and non-GAAP measures. Turning to a review of the quarter. Overall, we were pleased with our performance for the second quarter of fiscal 2027. The execution of our strategy drove increases across our key financial metrics, while we maintained a strong balance sheet and generated positive cash flow. Sales were $169.8 million as compared to $161.8 million last year, an increase of 4.9%. In constant dollars, the increase in net sales was 4.4%. Net sales increased across licensed brands, company stores and owned brands. By geography, U.S. net sales increased 4.9% as compared to the second quarter of last year. International net sales also increased 4.9%. On a constant currency basis, international net sales increased 4.1% with strong performances in certain markets such as Asia, Europe and Latin America. Gross profit as a percent of sales was 59.4% compared to 54.1% in the second quarter of last year. This quarter, we received $3.2 million of IEEPA duty refunds, which favorably increased our gross margin by 190 basis points. Excluding the IEEPA duty refunds, the second quarter gross margin would have been 57.5%, an increase of 340 basis points over the same period of last year. This 340 basis point increase was primarily driven by favorable channel and product mix, partially offset by higher shipping costs. Similar to the first quarter, the second quarter of fiscal 2027 gross margin benefited from a favorable mix of inventory sold during the period, including inventory carrying lower duty rates following the repeal of IEEPA tariffs in February of 2026. This benefit is expected to be temporary and is not anticipated to continue in the second half of the fiscal year. In addition, we are pursuing refunds and expect to recover the remaining $6.8 million of IEEPA duties we had previously paid. However, we have elected to not recognize the gain until the cash refund is received. Operating expenses were $85.7 million as compared to $80.6 million for the second quarter of last year. The $5.2 million increase was driven by higher performance-based compensation and increased selling and marketing expenses to support the higher sales. The combination of higher revenue and gross profit, including the IEEPA duty refunds, more than offset the increase in operating expenses and drove operating income to $15.1 million, an $8.1 million improvement from $7 million in the second quarter of fiscal 2026. We recorded approximately $1.1 million of other nonoperating income in the second quarter of both fiscal 2027 and fiscal 2026. Other nonoperating income is primarily comprised of interest earned on our global cash position. Income tax expense totaled $3.6 million in the second quarter of fiscal 2027 as compared to $2.7 million in the second quarter of fiscal 2026. Net income in the second quarter was $12.5 million or $0.54 per diluted share, including a $2.5 million or $0.11 per diluted share after-tax benefit from the IEEPA duty refund, compared to $5.3 million or $0.23 per diluted share in the year ago period. Now to review the highlights of our year-to-date results. Sales for the 6-month period ended July 31, 2026, increased 6.3% to $312.2 million as compared to $293.6 million last year. Gross profit was $182.4 million or 58.4% of sales as compared to $158.9 million or 54.1% of sales last year. Excluding the IEEPA duty refunds, gross margin for the first 6 months of fiscal 2027 would have been 57.4%, an increase of 330 basis points over the same period of last year. Operating expenses for the first half of 2027 were $159.9 million and included higher performance-based compensation and increased selling and marketing expenses to support the higher sales. For the 6 months ended July 31, 2026, operating income, which included $3.2 million in IEEPA duty refunds, was $22.6 million as compared to $7.9 million in fiscal 2026. Net income was $19.7 million or $0.86 per diluted share, including a $2.5 million or $0.11 per diluted share after-tax benefit from the IEEPA duty refunds, as compared to $7.2 million or $0.32 per diluted share in the year ago period. Now turning to our balance sheet. Cash at the end of the second quarter was $211.6 million as compared to $180.5 million at the same period of last year. Accounts receivable was $94.3 million, flat to the same period of last year, primarily due to timing and mix of business. Inventory at the end of the quarter was down $15 million or 7.1% below the same period of last year due to timing of receipts. With top sellers being replenished to support our third and fourth quarter top line, we feel comfortable with the composition and level of our inventory position. In the first 6 months of fiscal 2027, capital expenditures were $2.3 million, and we repurchased approximately $61,000 under our share repurchase program. As of July 31, 2026, we had paid $44.6 million remaining -- we had $44.6 million remaining under our authorized share repurchase program. Subject to prevailing market conditions and the business environment, we plan to utilize our share repurchase plan to offset dilution in fiscal 2027. As Efraim mentioned, we have decided to discontinue providing an annual outlook. We do, however, remain committed to providing transparency and insight into our business. As such, consistent with the first half results, the company expects top line growth in the mid-single-digit range for the remainder of this fiscal year and second half gross margin to be in a range of 55% to 56%. I would now like to open the call up for questions. Operator: [Operator Instructions] Our first question is from Owen Rickert with Northland Capital Markets. Owen Rickert: Congrats on a great quarter. First for me, gross margin expanded 340 bps, excluding IEEPA benefit year-over-year. That was great to see. How much of that improvement is structural, maybe mix and pricing power versus transitory favorable FX, onetime cost reductions? Anything to call out there? Efraim Grinberg: Well, I would think it's a mix of both, okay? So it's a mix of improved pricing and better average selling prices across the board. But it's also -- we did have a benefit of legacy inventory that was in our warehouses that we had accrued an IEEPA tariff on, and we immediately were able to reverse that during the first quarter. And so that benefited both the first and the second quarter. It's a little harder to understand, but because it's not -- it's inventory that was in our warehouse, and we were already anticipating having IEEPA tariff against it, and it was immediately removed. And so it had no -- we paid duties on it, but it had no incremental tariffs. We're back now on current inventories and incoming inventory have now new tariffs. And that affects all companies, not just us. Owen Rickert: Right. Got it. Okay. So yes, that kind of leads to my second question just on the back half of the year gross margin guidance of 55% to 56%, a little step down from 2Q performance. Is that just due to what you just mentioned on the inventory? Efraim Grinberg: 100%. Owen Rickert: Okay. Perfect. Perfect. And then you guys cited some higher shipping costs as a partial offset to that margin improvement. How significant is this headwind? Are you locked into current freight rates? Or do you have some flexibility to renegotiate? Sallie DeMarsilis: Well, we always operate tightly and we try to get the best shipping costs. But what transpired in the second quarter was a few things, some fuel surcharges resulting from, obviously, what's happening in the Middle East, and we'll better be prepared to manage that. The other was because our e-com business was up and a lot of it was shipping related to Mother's Day and things like that. So good business sometimes creates a little bit more expense. So we have that all of those factors built into the back half of the year as well. Owen Rickert: Okay. Super helpful. Super helpful. And then lastly for me, more of a fun question. You did allude to it a lot on the prepared remarks, but can you just speak to some of those broader trends you're seeing across the fashion watch and jewelry category right now and how those trends are shaping your strategy going forward? Efraim Grinberg: So we're seeing some real momentum in the category on -- particularly in the United States and then markets like Mexico and Brazil and India, where younger consumers are coming back pretty seriously into traditional watches, beginning again to collect traditional watches and have multiple products. So it's a really nice trend to see. And that means that the Gen Z consumer as they become more mature and older and get -- and have higher availability of income, we will move into better watches as well. And so you're seeing it across social media channels. You're seeing an interest from the press and from retailers. So our retailers are seeing that momentum as well. And I think it was -- there was a period of time coming with the introduction of the Apple Watch in the mid -- around 2015 that there was a lot of question marks about the fashion watch category. And what we've seen is that younger consumers are wearing other kinds of wearables and not watches as wearables. They're wearing watches as accessories and fashion statements. Owen Rickert: Great. Super helpful. Operator: There are no further questions at this time. I would like to turn the conference back over to management for closing remarks. Efraim Grinberg: Okay. Thank you. We're very -- as you can tell, we're very pleased with our results, are optimistic about the journey that we're on for the future and how our teams are executing on a global basis. So we're very pleased with the results and look forward to continued success. With that, I want to wish everybody a very happy end of the summer, and thank you very much for attending today. Operator: Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your participation. Before you buy stock in Movado Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Movado Group wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $437,097!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,355,077!* That performance is why people listen. With a track record of beating the S&P 500 by nearly 5x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of September 2, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Movado (MOV) Q2 2027 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: $169.8 million, a 4.9% increase from $161.8 million in the prior year quarter. Gross Margin: Improved to 59.4% from 54.1% in the prior year quarter; excluding IEEPA duty refunds, gross margin would have been 57.5%, a 340 basis point improvement. Operating Income: $15.1 million, up from $7 million in the prior year quarter, including $3.2 million of IEEPA duty refunds. Net Income: $12.5 million, or $0.54 per diluted share, compared to $5.3 million, or $0.23 per diluted share, in the prior year quarter. Adjusted EPS: $0.54, including $0.11 per share attributed to IEEPA duty refunds. Cash Position: $211.6 million in cash with no debt at the end of the quarter. Inventory: Down $15 million, or 7.1%, below the same period last year. Shareholder Returns: Returned over $16 million to shareholders through quarterly dividend payments year-to-date. Segment Performance: U.S. net sales increased 4.9%; international net sales increased 4.9% (4.1% on a constant currency basis). Brand Performance: Olivia Burton sales increased 23% for the quarter; Movado.com sales increased 8% and Movado outlet stores sales increased 3%. Warning! GuruFocus has detected 4 Warning Signs with MOV. Is MOV fairly valued? Test your thesis with our free DCF calculator. Release Date: August 26, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Sales increased 4.9% to $169.8 million, with growth in the U.S. and key international markets like Latin America and India. Gross margin improved significantly to 59.4% (57.5% excluding IEEPA refunds), a 340 basis point increase year-over-year. Adjusted EPS rose to $0.54 from $0.23, driven by higher sales and improved profitability. Strong balance sheet with $212 million in cash and no debt, supporting shareholder returns through dividends. Product innovation, such as the Movado Baby Face mini strap watch and Coach Iris, is resonating with younger consumers, driving sell-through rates. Sales declined in the Middle East due to ongoing geopolitical headwinds and reduced international tourism. Gross margin benefit from lower duty rates on legacy inventory is temporary and not expected to continue in the second half. Higher shipping costs, including fuel surcharges from Middle East conflict, partially offset margin improvements. Operating expenses increased by $5.2 million due to higher performance-based compensation and marketing spend. Company discontinued providing an annual outlook, reducing forward guidance transparency for investors. Q: How much of the 340 basis point gross margin expansion (excluding IEEPA benefit) is structural versus transitory?A: Efraim Grinberg (Chairman and CEO) stated the improvement is a mix of both. It reflects improved pricing and higher average selling prices, but also benefited from a one-time reversal of IEEPA tariffs accrued on legacy inventory. This transitory benefit is not expected to continue in the second half. Q: Is the step-down in second-half gross margin guidance to 55%-56% solely due to the inventory benefit fading?A: Efraim Grinberg (Chairman and CEO) confirmed this is 100% the reason. The favorable impact from selling inventory carrying lower duty rates is temporary and will not persist. Q: How significant is the higher shipping cost headwind, and are you locked into current freight rates?A: Sallie DeMarsilis (EVP and CFO) explained the increase was due to fuel surcharges from Middle East conflicts and higher e-commerce shipping related to events like Mother's Day. These factors are already built into the back-half guidance. Q: Can you speak to broader trends in the fashion watch and jewelry category and how they are shaping strategy?A: Efraim Grinberg (Chairman and CEO) noted strong momentum, especially in the U.S., Mexico, Brazil, and India, where younger consumers are returning to traditional watches as fashion accessories. This trend is driving innovation in new shapes and sizes, positioning the company well for future growth. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Movado Group, Inc. (NYSE:MOV) shares gained 3% on Wednesday after the watchmaker reported fiscal second-quarter 2027 results that comfortably exceeded analysts’ expectations for both earnings and revenue. Adjusted earnings came in at $0.54 per share, well ahead of the consensus estimate of $0.35. Revenue increased 4.9% year-over-year to $169.8 million from $161.8 million, also beating the $164.17 million analyst forecast. Movado’s adjusted earnings of $0.54 per share included an $0.11 contribution from IEEPA duty refunds. Excluding that benefit, adjusted EPS still increased by approximately 87% from the same period last year. Gross margin, excluding the impact of the duty refund, expanded by 340 basis points to 57.5%. The improvement reflected a more favourable mix of sales channels and products. “I am pleased to report strong top- and bottom-line results for the second quarter, capping an excellent first half for Movado Group,” said Efraim Grinberg, Chairman and Chief Executive Officer. “This performance reflected broad-based increases across our owned and licensed brands, our direct and wholesale channels, and key geographies led by the U.S. and Europe.” Movado recorded higher sales across both its domestic and international businesses during the quarter. U.S. net sales increased 4.9%, while international revenue also advanced 4.9%. On a constant-currency basis, international sales were 4.1% higher. The stronger revenue performance translated into a substantial improvement in operating profitability. Operating income reached $14.9 million, compared with $4.0 million in the prior-year quarter. Adjusted operating income was $15.1 million, equivalent to 8.9% of net sales. For the second half of fiscal 2027, Movado expects revenue to increase at a mid-single-digit percentage rate. Gross margin is forecast at between 55% and 56%, excluding any additional benefits from IEEPA duty refunds. The company has discontinued annual guidance as management concentrates on executing its longer-term strategic priorities. Movado’s board declared a quarterly dividend of $0.40 per share, payable on September 22, 2026. The company finished the quarter with $211.6 million of cash and no debt, providing a strong financial position as it enters the second half of the fiscal year. The combination of stronger-than-expected earnings, improving margins and broad-based sales growth helped support the positive reaction in Movado shares following the results. Movado Group stock price

Movado (MOV) came out with quarterly earnings of $0.54 per share, beating the Zacks Consensus Estimate of $0.36 per share. This compares to earnings of $0.23 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +50.00%. A quarter ago, it was expected that this watchmaker would post earnings of $0.06 per share when it actually produced earnings of $0.32, delivering a surprise of +433.33%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Movado, which belongs to the Zacks Retail - Jewelry industry, posted revenues of $169.75 million for the quarter ended July 2026, surpassing the Zacks Consensus Estimate by 3.40%. This compares to year-ago revenues of $161.83 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Movado shares have added about 69.6% since the beginning of the year versus the S&P 500's gain of 12.2%. While Movado has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Movado was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #1 (Strong Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.64 on $189.86 million in revenues for the coming quarter and $1.87 on $688.11 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Jewelry is currently in the top 20% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Signet (SIG), has yet to report results for the quarter ended July 2026. The results are expected to be released on September 9. This jewelry company is expected to post quarterly earnings of $1.69 per share in its upcoming report, which represents a year-over-year change of +5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Signet's revenues are expected to be $1.53 billion, down 0.4% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Movado Group Inc. (MOV) : Free Stock Analysis Report Signet Jewelers Limited (SIG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

~ Net Sales of $169.8 million ~ ~ Operating Income of $14.9 million and Adjusted Operating Income of $15.1 million, which include $3.2 million in IEEPA duty refunds ~ ~ EPS of $0.53 and Adjusted EPS of $0.54, which include $0.11 resulting from IEEPA duty refunds ~ ~ Board Declares Quarterly Dividend of $0.40 per share ~ PARAMUS, N.J., August 26, 2026--(BUSINESS WIRE)--Movado Group, Inc. (NYSE: MOV) today announced second quarter and six-month results for the periods ended July 31, 2026. Second Quarter Fiscal 2027 Highlights* Net sales of $169.8 million versus $161.8 million in the second quarter of fiscal 2026; Gross margin of 59.4%, or 57.5% excluding $3.2 million of IEEPA duty refunds, compared to 54.1% in the second quarter of fiscal 2026; Operating income of $14.9 million compared to $4.0 million in the second quarter of fiscal 2026; Adjusted operating income of $15.1 million compared to $7.0 million in the second quarter of fiscal 2026; Diluted earnings per share of $0.53 compared to $0.13 in the second quarter of fiscal 2026; Adjusted diluted earnings per share of $0.54 compared to $0.23 in the second quarter of fiscal 2026; and The quarter ended with $211.6 million in cash and no debt. Efraim Grinberg, Chairman and Chief Executive Officer, stated: "I am pleased to report strong top- and bottom-line results for the second quarter, capping an excellent first half for Movado Group. In the second quarter of fiscal 2027, net sales grew 4.9%, or 4.4% in constant currency. Gross profit margin expanded by 340 basis points and adjusted diluted earnings per share increased by approximately 87%, in each case excluding the impact of IEEPA duty refunds. This performance reflected broad-based increases across our owned and licensed brands, our direct and wholesale channels, and key geographies led by the U.S. and Europe, underscoring the strength of our business model and the successful execution of our strategy. We drove demand for our portfolio of watch and jewelry brands worldwide by placing the consumer at the center of everything we do, delivering high-impact innovation and deepening customer engagement across our brand portfolio." "We also ended the first half of the year with a strong balance sheet, including a higher cash balance than at the same time last year and no debt. At quarter-end, cash totaled $211.6 million after investing to support our long-term growth and returning $16.6 million to shareholders through year-to-date dividend payments," Mr. Grinberg continued. "We enter the third quarter excited about our business prospects, with compelling innovation and marketing efforts set to build on the momentum we're seeing across our fashion watch and jewelry brands, particularly in smaller-sized watches and distinctive shapes. Combined with our sharp focus on execution, we believe we are well positioned to navigate the dynamic environment, advance our strategic priorities, and generate long-term profitable growth and value creation for our shareholders," Mr. Grinberg concluded. Non-GAAP Items (See attached table for GAAP and Non-GAAP measures) Second quarter fiscal 2027 results of operations included a $0.2 million pre-tax charge, or $0.1 million after tax, representing $0.01 per diluted share, related to the investigation of misconduct within the Dubai branch of the Company's Swiss subsidiary. Second quarter fiscal 2026 results of operations included a $2.1 million pre-tax charge, or $1.6 million after tax, representing $0.07 per diluted share, related to the investigation of misconduct within the Dubai branch of the Company’s Swiss subsidiary and a $0.9 million pre-tax charge, or $0.7 million after tax, representing $0.03 per diluted share, associated with expenses related to a corporate cost-savings initiative. In this press release, references to "adjusted" results exclude the impact of the above charges and the impact of the items described in the Non-GAAP Items section of the Company’s earnings release for the first quarter of fiscal 2027. Please refer to the attached GAAP and Non-GAAP measures table for a detailed reconciliation of the Company’s reported results to its adjusted, non-GAAP results. Second Quarter Fiscal 2027 Results (See attached table for GAAP and Non-GAAP measures) Net sales increased 4.9% to $169.8 million, or increased 4.4% on a constant-dollar basis, compared to $161.8 million in the second quarter of fiscal 2026. The increase in net sales reflected increases across the Company’s owned and licensed brands and its Movado Company Stores. U.S. net sales increased 4.9% as compared to the second quarter of last year. International net sales also increased 4.9% (4.1% on a constant-dollar basis) as compared to the second quarter of last year. Gross profit was $100.8 million, or 59.4% of net sales, compared to $87.6 million, or 54.1% of net sales, in the second quarter of fiscal 2026. The 530 basis-point improvement in gross margin included $3.2 million, or 190 basis points, from IEEPA duty refunds in the quarter, as well as the positive impact of changes in channel and product mix, partially offset by higher shipping costs. Operating expenses were $85.9 million in the second quarter of fiscal 2027 compared to $83.6 million in the second quarter of fiscal 2026. This increase was primarily due to higher performance-based compensation and increased selling and marketing expenses to support higher sales. As a percentage of net sales, operating expenses decreased to 50.6% of net sales from 51.6% in the prior-year period primarily due to leverage of expenses given the increase in net sales. Adjusted operating expenses were $85.7 million, or 50.5% of net sales, compared to $80.6 million, or 49.8% of net sales, in the second quarter of fiscal 2026. Operating income was $14.9 million compared to $4.0 million in the second quarter of fiscal 2026. Adjusted operating income was $15.1 million, or 8.9% of net sales, compared to $7.0 million, or 4.3% of net sales, in the second quarter of fiscal 2026. Both operating income and adjusted operating income in the second quarter of fiscal 2027 included $3.2 million in IEEPA duty refunds. The Company recorded a tax provision of $3.5 million in the second quarter of fiscal 2027 compared to $2.0 million in the second quarter of fiscal 2026. Based on adjusted pre-tax income, the adjusted tax provision in the second quarter of fiscal 2027 was $3.6 million, or an adjusted tax rate of 22.1%. This compares to an adjusted tax provision of $2.7 million, or an adjusted tax rate of 32.9%, in the second quarter of fiscal 2026. Net income for the second quarter of fiscal 2027 was $12.3 million, or $0.53 per diluted share, compared to $3.0 million, or $0.13 per diluted share, in the second quarter of fiscal 2026. Adjusted net income was $12.5 million, or $0.54 per diluted share, compared to $5.3 million, or $0.23 per diluted share, in the second quarter of fiscal 2026. Both net income and adjusted net income in the second quarter of fiscal 2027 included $2.5 million in IEEPA duty refunds plus interest thereon, net of taxes. First Half Fiscal 2027 Results (See attached table for GAAP and Non-GAAP measures) Net sales for the first six months of fiscal 2027 increased 6.3% to $312.2 million, or increased 4.5% on a constant-dollar basis, compared to $293.6 million in the first six months of fiscal 2026. The increase in net sales reflected increases across the Company’s owned and licensed brands and its Movado Company Stores. U.S. net sales increased 6.6% as compared to the first six months of last year. International net sales increased 6.1% (2.9% on a constant-dollar basis) as compared to the first six months of last year. Gross profit was $182.4 million, or 58.4% of net sales, compared to $158.9 million, or 54.1% of net sales, in the first six months of fiscal 2026. The 430-basis-point improvement in gross margin included $3.2 million, or 100 basis points, from IEEPA duty refunds, as well as the positive impact of changes in channel and product mix. Operating expenses were $160.5 million, as compared to $154.6 million in the first six months of fiscal 2026. As a percentage of sales, operating expenses were 51.4% of net sales versus 52.7% of net sales in the first six months last year. Adjusted operating expenses for the first six months of fiscal 2027 were $159.9 million, or 51.2% of net sales, versus $151.0 million, or 51.4% of net sales, for the first six months of fiscal 2026. The increase in adjusted operating expenses versus the same period of last year was primarily due to higher performance-based compensation and increased marketing and selling expenses to support the increased sales. Operating income was $21.9 million compared to operating income of $4.3 million in the first six months of fiscal 2026. Adjusted operating income was $22.6 million for the first six months of fiscal 2027 compared to $7.9 million in the first six months of fiscal 2026. Both operating income and adjusted operating income for the first six months of fiscal 2027 included $3.2 million in IEEPA duty refunds. The Company recorded a tax provision of $5.5 million as compared to a tax provision of $2.6 million in the first six months of fiscal 2026. Based on adjusted pre-tax income, the adjusted tax provision for the first six months of fiscal 2027 was $5.6 million, or an adjusted tax rate of 22.1%. This compares to an adjusted tax provision of $3.4 million, or an adjusted tax rate of 32.4%, in the first six months of fiscal 2026. Net income was $19.2 million, or $0.84 per diluted share, compared to net income of $4.4 million, or $0.20 per diluted share, in the first six months of last year. Adjusted net income for the first six months of fiscal 2027 was $19.7 million, or $0.86 per diluted share, compared to adjusted net income of $7.2 million, or $0.32 per diluted share, in the first six months of fiscal 2026. Both net income and adjusted net income for the first six months of fiscal 2027 included $2.5 million in IEEPA duty refunds plus interest thereon, net of taxes. Quarterly Dividend and Share Repurchase Program The Company also announced that on August 26, 2026, the Board of Directors declared the payment on September 22, 2026, of a cash dividend in the amount of $0.40 for each share of the Company’s outstanding common stock and class A common stock held by shareholders of record as of the close of business on September 8, 2026. During the first six months of fiscal 2027, the Company repurchased 61,000 shares under its December 5, 2024, share repurchase program. As of July 31, 2026, the Company had $44.6 million remaining available under the share repurchase program. IEEPA Duty Refunds The Company is pursuing refunds of approximately $10.0 million for the International Emergency Economic Powers Act ("IEEPA") duties previously paid and expects to recover these amounts. As of July 31, 2026, the Company received $3.3 million in cash in respect of the refunds, including $0.1 million in interest. The underlying IEEPA duty amounts were recognized in cost of sales within the Company’s Consolidated Statements of Operations for inventory sold between February 2025 and May 2026. The $3.2 million IEEPA duty refund was reflected as a benefit to cost of sales in the second quarter of fiscal 2027, while the $0.1 million interest payment was reflected in other income, net. Outlook Going forward, the Company remains committed to providing transparency and insight into its business, markets, and current trends. However, the Company has chosen to discontinue providing an annual outlook as it believes its focus is better served on the execution of its long-term strategy, which is expected to drive profitable growth and increased value for shareholders. As it relates to the second half of fiscal 2027, the Company expects to build on the momentum of the first half of the year to deliver topline growth in the mid-single-digit range and gross margin in a range of 55% to 56%, excluding any additional IEEPA duty refunds. Conference Call The Company’s management will host a conference call and audio webcast to discuss its results today, August 26, 2026, at 9:00 a.m. Eastern Time. The conference call may be accessed by dialing (877) 407-0784. Additionally, a live webcast of the call can be accessed at www.movadogroup.com. The webcast will be archived on the Company’s website approximately one hour after the conclusion of the call. Additionally, a telephonic replay of the call will be available at 1:00 p.m. ET on August 26, 2026, until 11:59 p.m. ET on September 9, 2026, and can be accessed by dialing (844) 512-2921 and entering replay number 13762314. Movado Group, Inc. designs, sources, and distributes MOVADO®, MVMT®, OLIVIA BURTON®, EBEL®, CONCORD®, CALVIN KLEIN®, COACH®, TOMMY HILFIGER®, HUGO BOSS®, and LACOSTE® watches, and, to a lesser extent, jewelry and other accessories, and operates Movado Company Stores in the United States and Canada. In this release, the Company presents certain financial measures that are not calculated according to generally accepted accounting principles in the United States ("GAAP"). Specifically, the Company is presenting adjusted operating expenses, adjusted operating income, adjusted pre-tax income, adjusted tax provision, adjusted net income and adjusted diluted earnings per share, which are operating expenses, operating income, pre-tax income, tax provision, net income and diluted earnings per share, respectively, under GAAP, adjusted to eliminate costs due to the investigation referred to above and the establishment of a provision for a cost-savings initiative. The Company believes the adjusted measures are useful because they give investors information about the Company’s financial performance without the effect of certain items that the Company believes are not characteristic of its usual operations. Additionally, the Company is presenting constant-currency information to provide a framework to assess how its business performed excluding the effects of foreign currency exchange rate fluctuations in the current period. Comparisons of financial results on a constant-dollar basis are calculated by translating each foreign currency at the same U.S. dollar exchange rate as in effect for the prior-year period for both periods being compared. The Company believes this information is useful to investors to facilitate comparisons of operating results. These non-GAAP financial measures are designed to complement the GAAP financial information presented in this release. The non-GAAP financial measures presented should not be considered in isolation from or as a substitute for the comparable GAAP financial measures, and the methods of their calculation may differ substantially from similarly titled measures used by other companies. This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company has tried, whenever possible, to identify these forward-looking statements using words such as "expects," "anticipates," "believes," "targets," "goals," "projects," "intends," "plans," "seeks," "estimates," "may," "will," "should" and variations of such words and similar expressions. Similarly, statements in this press release that describe the Company's business strategy, outlook, objectives, plans, intentions or goals are also forward-looking statements. Accordingly, such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the Company's actual results, performance or achievements and levels of future dividends to differ materially from those expressed in, or implied by, these statements. These risks and uncertainties may include, but are not limited to the Company’s ability to maintain effective internal control over financial reporting in the future, general economic and business conditions which may impact disposable income of consumers in the United States and the other significant markets (including Europe) where the Company’s products are sold, uncertainty regarding such economic and business conditions, including inflation, elevated interest rates, increased commodity prices and tightness in the labor market, trends in consumer debt levels and bad debt write-offs, general uncertainty related to geopolitical concerns, the increase in tariffs and other trade barriers, the impact of international hostilities, including the Russian invasion of Ukraine and war in the Middle East, on global markets, economies and consumer spending, on energy and shipping costs, and on the Company’s supply chain and suppliers, supply disruptions, delivery delays and increased shipping costs, defaults on or downgrades of sovereign debt and the impact of any of those events on consumer spending, evolving stakeholder expectations and emerging complex laws on environmental, social, and governance matters, changes in consumer preferences and popularity of particular designs, new product development and introduction, decrease in mall traffic and increase in e-commerce, the ability of the Company to successfully implement its business strategies, competitive products and pricing, including price increases to offset increased costs, the impact of "smart" watches and other wearable tech products on the traditional watch market, seasonality, availability of alternative sources of supply in the case of the loss of any significant supplier or any supplier’s inability to fulfill the Company’s orders, the loss of or curtailed sales to significant customers, the Company’s dependence on key employees and officers, the ability to successfully integrate the operations of acquired businesses without disruption to other business activities, the possible impairment of acquired intangible assets, including long-lived assets, risks associated with the Company’s minority investments in early-stage growth companies and venture capital funds that invest in such companies, the continuation of the Company’s major warehouse and distribution centers, the continuation of licensing arrangements with third parties, losses possible from pending or future litigation and administrative proceedings, the ability to secure and protect trademarks, patents and other intellectual property rights, the ability to lease new stores on suitable terms in desired markets and to complete construction on a timely basis, the ability of the Company to successfully manage its expenses on a continuing basis, information systems failure or breaches of network security, including cybersecurity risks posed by increasing reliance on cloud services and generative artificial intelligence, complex and quickly-evolving regulations regarding privacy and data protection, regulatory restrictions and a changing marketing environment, including the movement toward a cookieless future and increased digital advertising costs, requirements to meet environmental, social and governance regulations, expectations or standards, including climate change-related risks and regulatory requirements, the impact of current or future cost reduction, streamlining, restructuring or business optimization initiatives, risks associated with laws and regulations relating to supply chain transparency and forced labor, changes to existing laws or regulations, including changes to tax laws or regulations, the continued availability to the Company of financing and credit on favorable terms, business disruptions, and general risks associated with doing business internationally, including, without limitation, import duties, tariffs (including retaliatory tariffs, the potential imposition of tariffs under alternative statutory authorities and the Company’s ability to receive additional refunds for IEEPA duties previously paid), quotas, political and economic stability, anti-corruption and anti-bribery laws, changes to existing laws or regulations, and impacts of currency exchange rate fluctuations and the success of hedging strategies related thereto, and the other factors discussed in the Company’s Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. These statements reflect the Company's current beliefs and are based upon information currently available to it. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated with the passage of time. The Company assumes no duty to update its forward-looking statements and this release shall not be construed to indicate the assumption by the Company of any duty to update its outlook in the future. (Tables to follow) View source version on businesswire.com: https://www.businesswire.com/news/home/20260826462349/en/ Contacts ICR, Inc.Allison Malkin203-682-8200

Interested in Movado Group Inc.? Here are five stocks we like better. Movado reported strong fiscal Q2 results: Sales rose 4.9% to $169.8 million, adjusted operating income more than doubled to $15.1 million, and diluted EPS increased to $0.54 from $0.23. Growth was broad-based across the U.S. and international markets, supported by stronger demand, product launches, pricing and lower promotions. However, the Middle East remained a weakness, while younger consumers showed renewed interest in traditional watches. Margin gains included temporary benefits: Gross margin reached 59.4%, helped by $3.2 million in IEEPA duty refunds and lower-duty inventory; management expects second-half gross margin of 55%–56% as those benefits fade. The company expects mid-single-digit sales growth for the remainder of fiscal 2027 and will no longer provide an annual outlook. 3 Underfollowed Stocks Wall Street Still Likes—And for Good Reason Movado Group (NYSE:MOV) reported higher sales, profit and margins for its fiscal 2027 second quarter, as demand improved across its U.S. and principal international markets and the company benefited from product mix, pricing actions and lower promotional activity. Sales rose 4.9% to $169.8 million in the quarter from $161.8 million a year earlier, or 4.4% on a constant-currency basis. Adjusted operating income increased to $15.1 million from $7 million, while diluted earnings per share rose to $0.54 from $0.23. → What Rising Delivery Forecasts Say About Rivian's Stock Prospects Movado Group, Inc. Is Leveraging The Omnichannel Experience The quarter's results included $3.2 million in refunds of duties paid under the International Emergency Economic Powers Act, or IEEPA. The refunds added $0.11 per diluted share after tax. Excluding that benefit, the company said gross margin improved 340 basis points year over year. Chairman and Chief Executive Officer Efraim Grinberg said sales growth was supported by increased sell-through for both the Movado brand and licensed brands in the United States. U.S. net sales increased 4.9% from the prior-year quarter. → NVIDIA Reveals $21 Billion SpaceX Stake: Signal of Confidence or Circular Financing? Movado Group Incorporated Pulls Back After Robust Results International net sales also increased 4.9%, or 4.1% in constant currency. Grinberg cited strong growth in Latin America and India, as well as low-single-digit growth in Europe. The Middle East remained a drag on results because of ongoing regional challenges, particularly in markets dependent on international tourism. Grinberg said the company is seeing increased engagement with traditional watches among younger consumers, especially in the U.S., Mexico, Brazil and India. He said consumers are increasingly treating watches as accessories and fashion statements rather than as wearable technology. → Berkshire Boosts Its Bet: This AI Hyperscaler Is Now a Top-3 Holding “Younger consumers are coming back pretty seriously into traditional watches,” Grinberg said during the question-and-answer session. “Beginning again to collect traditional watches and have multiple products.” Movado.com sales increased 8% in the quarter, while sales at Movado outlet stores increased 3%. Grinberg said those businesses benefited from higher average selling prices and improving margins. Gross margin was 59.4% in the second quarter, compared with 54.1% a year earlier. The IEEPA duty refunds contributed 190 basis points to the reported result. Excluding the refunds, gross margin was 57.5%. Chief Financial Officer Sallie DeMarsilis said the underlying margin improvement reflected favorable channel and product mix, partially offset by higher shipping costs. The company also benefited from selling inventory that carried lower duty rates following the repeal of IEEPA tariffs in February 2026. Management said that inventory-related duty benefit is temporary and is not expected to continue during the second half of the fiscal year. In response to an analyst question, Grinberg said the lower expected second-half gross margin is “100%” attributable to the return to current inventory and incoming inventory subject to newer tariffs. The company expects to recover an additional $6.8 million in IEEPA duties it previously paid, but has not recognized a gain for those potential refunds because it will wait until cash is received. Operating expenses increased to $85.7 million from $80.6 million, driven by higher performance-based compensation and greater selling and marketing spending to support sales growth. The company also cited fuel surcharges tied to conditions in the Middle East and higher e-commerce shipping activity around Mother’s Day as contributors to increased shipping costs. Movado highlighted new product launches across its portfolio, with an emphasis on smaller and shaped watches, jewelry-inspired designs and products targeted toward younger consumers. At Movado, the company cited demand for the Baby Face mini strap watch, which sold more than 400 units on movado.com in less than a month and sold out quickly. It also highlighted women’s Museum Bangle and Velura collections, as well as the men’s BOLD Verso S line. Coach watches continued to show momentum with Gen Z consumers, led by the Sammy collection and the new Iris jewelry-inspired collection. Coach will introduce Mini Sammy and the tonneau-shaped Greta collection in the second half. Tommy Hilfiger reported demand for the TH Oxford family and the Bryant men’s chronograph. The company also said women’s watch penetration has increased globally, with Mia and Nora among the successful collections. Olivia Burton sales increased 23% in the quarter as the brand focused on the United Kingdom and U.S. markets. The company said smaller shaped watches, including Mini Grove and Mini Grosvenor, were driving performance. Calvin Klein saw improvement in watches, particularly women’s styles. A new square watch collection sold out quickly in markets globally, according to Grinberg. The company also said it will expand its long-term partnership with Tapestry and begin launching Kate Spade watches in the next fiscal year. Grinberg said the introductory collection has received a strong response from partners globally. For the first six months ended July 31, 2026, sales increased 6.3% to $312.2 million. Net income was $19.7 million, or $0.86 per diluted share, compared with $7.2 million, or $0.32 per diluted share, in the prior-year period. First-half operating income was $22.6 million, including the $3.2 million in IEEPA duty refunds, compared with $7.9 million a year earlier. Cash totaled $211.6 million at quarter-end, up from $180.5 million a year earlier, and the company had no debt. Inventory declined $15 million, or 7.1%, from the prior-year level, which DeMarsilis attributed to the timing of receipts. She said Movado was comfortable with the composition and level of inventory as it replenishes top-selling products for the third and fourth quarters. Movado returned more than $16 million to shareholders through quarterly dividend payments year to date. It repurchased approximately $61,000 of stock in the first half and had $44.6 million remaining under its authorized share repurchase program as of July 31. The company said it will discontinue providing an annual outlook, arguing that its focus is better served by executing its long-term strategy. However, it expects mid-single-digit top-line growth for the remainder of fiscal 2027 and second-half gross margin in a range of 55% to 56%. Movado Group, Inc is a global designer, manufacturer and distributor of watches and related jewelry products. The company's portfolio encompasses both owned and licensed brands, offering a wide range of timepieces from luxury to accessible price points. Major owned brands include Movado, Concord, and Ebel, alongside newer acquisitions such as MVMT and Olivia Burton. In addition, Movado Group holds licensing agreements to produce watches under fashion names like Hugo Boss, Tommy Hilfiger, Coach, Lacoste and Scuderia Ferrari. Movado Group's product line spans classic dress watches, sport and dive models, fashion-forward designs and limited-edition collections. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Movado Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by a resurgence in the watch category, particularly among Gen Z consumers who are increasingly adopting traditional watches as fashion accessories rather than wearables. Strategic pricing initiatives and a shift toward higher average selling prices (ASPs) significantly contributed to gross margin expansion, alongside a reduction in promotional activity. Growth was geographically broad-based with strength in the U.S., Latin America, and India, though partially offset by tourism-related headwinds in the Middle East due to regional conflict. The company is successfully executing a 'mini' trend strategy, where smaller-scale watch faces like the Movado Baby Face and Olivia Burton Mini collections are seeing rapid sell-through. Operational efficiency improved through SKU count reductions and a more optimized supply base, allowing for greater full-price selling penetration across the brand portfolio. Management attributed the 340 basis point adjusted gross margin improvement to a favorable channel mix and the immediate benefit of reversing IEEPA tariff accruals on legacy inventory. Management expects top-line growth to remain in the mid-single-digit range for the remainder of the fiscal year, supported by five consecutive quarters of positive momentum. Second-half gross margin is projected to normalize between 55% and 56% as the temporary benefit from legacy inventory carrying lower duty rates dissipates. The company will launch Kate Spade watches beginning next fiscal year, expanding its long-term partnership with Tapestry following positive initial previews with global retail partners. Marketing efforts will intensify in the second half through digital storytelling centered on Movado's 145th anniversary and high-profile brand ambassadors like Ludacris and Christian McCaffrey. Management has decided to discontinue providing specific annual guidance to focus on long-term strategic execution and sustainable value creation. The quarter included a $3.2 million benefit from IEEPA duty refunds, with an additional $6.8 million in pending refunds expected but not yet recognized until cash is received. Inventory levels decreased 7.1% year-over-year due to the timing of receipts, though management expressed confidence in replenishment levels for the upcoming holiday season. Higher shipping costs, driven by fuel surcharges in the Middle East and increased e-commerce volume, acted as a partial headwind to gross margin expansion. The balance sheet remains debt-free with $211.6 million in cash, providing flexibility for continued quarterly dividends and share repurchases to offset dilution. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management clarified that margin gains are a mix of structural improvements in pricing power and transitory benefits from legacy inventory. The immediate reversal of IEEPA tariff accruals on warehouse inventory provided a significant but temporary boost that will not repeat in the second half. Increased costs were attributed to Middle East fuel surcharges and higher shipping volume from a growing e-commerce business. Management has factored these elevated freight rates into their second-half margin expectations of 55% to 56%. Management noted a distinct shift where younger consumers are choosing traditional watches as fashion statements while wearing other devices for utility. This trend is driving increased interest from retailers and press, signaling a recovery for the fashion watch category after years of pressure from smartwatches.

With earnings season winding down, Movado Group MOV) and Nutanix NTNX) stand out as two highly ranked stocks worth watching ahead of their quarterly reports this week. Both stocks currently sport a Zacks Rank #1 (Strong Buy), reflecting favorable earnings estimate revisions, and are scheduled to report on Wednesday, August 26. Movado, one of the world’s premier watchmakers, will report its Q2 results before the market opens on Wednesday. The Zacks Consensus is calling for quarterly EPS of $0.36, which would be an impressive 56% year-over-year increase, with Q2 revenue expected to be up over 1% to $164.18 million. The luxury watchmaker is coming off an encouraging Q1 in which sales increased 8% YoY to $142.4 million, adjusted EPS surged to $0.32 from $0.08 a year ago, and gross margin expanded 320 basis points to 57.3%. Movado also finished Q1 with $225.3 million in cash and no long-term debt, giving the company considerable financial flexibility. Reflecting its strong Q1 results and improving outlook, MOV has been one of the market’s better performers, with shares surging more than 60% year to date. Image Source: Zacks Investment Research Income investors have another reason to take notice. Movado recently raised its quarterly dividend 14% to $0.40 per share, or $1.60 annually. That equates to a lofty dividend yield of roughly 4.6%, with MOV trading at around $34 a share and at a reasonable 18X forward earnings multiple. Image Source: Zacks Investment Research Nutanix will release results for its fiscal fourth quarter after the closing bell on Wednesday. The innovative tech company provides an enterprise cloud platform that combines compute, storage, virtualization, and networking into one integrated solution. Q4 EPS is expected at $0.48, representing nearly 30% growth from the prior-year quarter, while revenue is projected to rise roughly 13% to $737.89 million. The Zacks Consensus also calls for full-year EPS of $1.93, up 19%, on more than 11% revenue growth to $2.83 billion. Image Source: Zacks Investment Research Nutanix's recurring-revenue momentum remains particularly attractive. Fiscal Q3 annual recurring revenue (ARR) climbed 15% YoY to $2.43 billion, while quarterly revenue rose 10% and non-GAAP operating margin expanded to 22.3% from 21.5%. Management subsequently raised its fiscal 2026 outlook to $2.82-$2.84 billion in revenue and $760-$780 million in free cash flow. Wall Street will be looking for more of the same Wednesday, as Q4 ARR is expected to reach roughly $2.51 billion, compared with $2.22 billion a year ago. Adding to Nutanix’s growth story is rising enterprise AI spending, with its hybrid-cloud infrastructure increasingly being used to deploy and manage GPU-powered generative and agentic AI workloads. That expanding opportunity is helping justify NTNX’s 30X forward earnings multiple, with shares trading above $60 and up around 30% YTD to handily outperform many of its IT-services peers. Image Source: Zacks Investment Research Movado and Nutanix offer two different but attractive growth stories heading into earnings. NTNX provides exposure to durable hybrid-cloud and recurring-revenue growth, while MOV combines a sharp earnings recovery with a compelling dividend yield and a virtually debt-free balance sheet. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Movado Group Inc. (MOV) : Free Stock Analysis Report Nutanix (NTNX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: Modest increase reported despite subdued trading conditions, driven by a stronger second half. Normalized Earnings Before Tax: Returned to a positive result of $1.6 million, an $11.6 million improvement year-on-year. Profit After Tax: Improved by $15.7 million year-on-year, returning to profit. Gross Margin: Gross margin dollars and percentage both reached their highest levels in three years. Operating Cash Flow: Increased by $7.3 million year-on-year. Free Cash Flow: Improved by $4.2 million to $6.3 million. Net Debt: Reduced by $6.3 million to $10.4 million, down almost 40% year-on-year. Return on Invested Capital: Increased to 10.6%, a significant improvement on prior years. Leverage: Improved to 1.02 times. Total Expenses: Remained broadly in line with the prior year despite inflationary pressure and higher activity levels. Transport Costs: Increased due to transition towards an owner-driver model and higher fuel prices, offset by lower people costs. Trading Costs: Increased year-on-year, driven by growth in shipping services. Deferred Tax Asset: Unrecognized deferred tax asset of $15.6 million, providing potential future value. Warning! GuruFocus has detected 5 Warning Signs with ASX:MOV. Is ASX:MOV fairly valued? Test your thesis with our free DCF calculator. Release Date: August 24, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Returned to positive normalized earnings of $1.6 million, a significant milestone after two years of restructuring. Reported positive free cash flow of $6.3 million and reduced net debt by nearly 40% year-on-year. Gross margin dollars and percentage reached their highest levels in three years, driven by better pricing discipline and productivity gains. Three of four business divisions delivered profitable earnings, with Specialist achieving its strongest result in three years. Successfully extended ANZ facility to August 2027 and secured a new BNZ invoice finance facility to reduce finance costs. Warehousing continues to perform below expectations, with revenue rebuilding as the absolute priority. Customer demand remained inconsistent and competition for available work intense, with pricing pressure across the industry. Higher fuel prices in H2 impacted demand in sectors like hospitality and FMCG, reducing disposable income. Legacy lease costs, particularly in Auckland and Christchurch, continue to pressure warehousing profitability. The pace and timing of economic recovery remain uncertain, with fuel price volatility creating ongoing demand pressure. Q: What were the key financial highlights for FY26, and how did the company perform against its strategic goals?A: CEO Paul Millward reported that FY26 marked a significant milestone, with the company delivering on its commitment to return to positive normalized earnings, reporting positive free cash flow of $6.3 million, and a return to profit after tax. Revenue increased slightly despite subdued trading conditions, and normalized earnings improved by $11.6 million. The company also reduced net debt by almost 40% year-on-year to $10.4 million, and return on invested capital increased to 10.6%. This performance demonstrates that the structural changes made over the past two years are delivering tangible benefits. Q: Can you provide more detail on the performance of the Warehousing division, which continues to underperform?A: Paul Millward acknowledged that Warehousing remains below expectations. The sector has changed dramatically, with massive investment in domestic warehousing during COVID leading to excess fixed capacity as international supply chains reopened. Customers have also reduced stock holdings and moved back to just-in-time models or taken warehousing in-house. The company's focus is on rebuilding revenue as the absolute priority, improving utilization through expanding and diversifying the customer base, and continuing site productivity improvements. There is also significant cost pressure from legacy leases, particularly in Auckland and Christchurch. Q: How did the Freight division perform, and what is the outlook for its growth?A: The Freight division's turnaround has been successful, with growing revenue translating into positive earnings. Customer relationships have been strengthened, and disciplined cost management and operational improvements have driven increased profitability. While the business remains sensitive to economic conditions, it is significantly better positioned than two years ago. The focus is now on strengthening the core business, particularly efficiency and utilization, given cost pressures. The company is also launching a new customer portal in H1 FY27 to improve customer visibility and reduce inquiries. Q: What were the main drivers behind the improvement in gross margin dollars and percentage?A: CFO Lee Banks explained that gross margin dollars and percentage reached their highest levels in three years, reflecting better pricing discipline, productivity gains, and a more efficient cost base. These gains were achieved despite cost inflation pressure in the second half, which was linked to the Middle East conflict. The company has been disciplined around pricing, even as competitors take market share at what MOVE views as unsustainable pricing. Q: How did the company manage its costs and what is the status of its lease portfolio?A: The cost-focused transformation program was completed in FY25, with structural savings now embedded. Total expenses for FY26 remained broadly in line with the prior year despite inflationary pressure and higher activity levels. Approximately 75% of the lease portfolio is property, and while most leases are competitive, there are legacy issues in Auckland and Christchurch. In the last year, the company successfully exited two leases and reshaped a few others. Transport costs increased due to the transition towards an owner-driver model and higher fuel prices, offset by lower people costs. Q: Can you elaborate on the company's cash flow performance and balance sheet strength?A: Lee Banks highlighted that operating cash flow increased by $7.3 million, free cash flow improved by $4.2 million to $6.3 million, and net debt reduced by $6.3 million. These outcomes reflect disciplined working capital management, cost control, and the disposal of surplus assets. The company extended its ANZ facility through to August 2027 and agreed a new BNZ invoice finance facility to reduce ongoing finance costs. Leverage improved to 1.02 times, and there is an unrecognized deferred tax asset of $15.6 million providing potential future value. Q: What is the company's outlook for FY27, and what are the key priorities?A: Paul Millward stated that while there are signs economic conditions are beginning to improve, the pace and timing of recovery remain uncertain. The company is focusing on things it can control, with growing revenue as a key focus. There is good operating leverage with limited incremental overhead required to scale, so increased revenue should translate into higher margin earnings. Warehousing is a critical priority to build revenue and utilize excess capacity. The goals are to deliver increased positive normalized earnings, positive cash flow, and a stronger balance sheet. Q: How did the Specialist and International divisions perform during the year?A: The Specialist division delivered its strongest result in three years, with a lighter first half offset by a stronger second half as larger projects commenced. The pipeline of work remains encouraging, and the division will move to a new improved site this calendar year. The International division delivered a material year-on-year earnings uplift, with the ocean shipping service now delivering consistent profitability. The freight forwarding and agency businesses are well positioned to benefit as international trade and investment activity strengthens. Q: What is the company's strategy regarding pricing and competition in the current market?A: Lee Banks noted that the company is being very disciplined around pricing to ensure acceptable margins, even as competitors take market share at what MOVE views as unsustainable pricing. The reset phase and cost-out program have made the business more scalable, positioning it to benefit as demand returns. The company is focused on providing customer value through its expert team, strategic locations, and access to its freight network. Q: Can you provide an update on the progress of the New Horizons road map?A: Paul Millward confirmed that the reset phase of the four-year New Horizons road map is now complete. The company has simplified the business, significantly reduced costs, strengthened the balance sheet, optimized its network, improved productivity, and embedded greater commercial discipline. The focus has now shifted from structural change to value creation, with the primary goals being customer value, operational excellence, and smart profitable business growth. Normalized earnings before tax have increased by $27 million over the two years since the road map was launched. For the complete transcript of the earnings call, please refer to the full earnings call transcript.