Revenue and profitability:
- Q2 2026 net sales: $161.8 million, up 3.1% YoY; constant-currency growth approximately 1.4%.
- Gross margin: 54.1% (vs. 54.3% in Q2 2025), a 2 bps margin headwind from tariffs and FX.
- Operating income: $7.0 million; operating margin ≈ 4.3% for the quarter (7.0m / 161.8m).
- Net income: $2.99 million; net margin 1.84%; EPS $0.13.
Year-to-date (6 months ended 2025-07-31):
- Net sales: $293.6 million, up 0.8% YoY; constant dollars up 0.3%.
- Gross profit: $158.9 million; gross margin 54.1% (54.3% prior year).
- Operating income: $7.9 million; net income: $7.2 million; diluted EPS $0.32.
Geography and channel mix:
- U.S. net sales: down 1.6% YoY in Q2; international net sales up 6.9% (CC: up 3.9%).
- Licensed brands: +9.5% (reported), +6.5% CC. Movado brand revenue declined 5.6% in the quarter, offset by licensing growth and a rebound in wholesale/distribution.
- Outlet/online: outlet channel grew 2.4% in the quarter; Movado.com and digital partners showed solid momentum (6% growth on the company’s own site).
Balance sheet and liquidity:
- Cash and equivalents: ~$180.5 million; net debt: none.
- Inventory: up $28.3 million (15.5% YoY); approximately $16 million of the increase is US-inventory; $5.1 million FX impact; $4.6 million reciprocal tariffs embedded in on-hand inventory.
- Share repurchase: ~100,000 shares bought in Q2; remaining authorization ~$48.4 million.
Tariffs and pricing actions:
- Tariff headwinds persisted with a 39% tariff rate on Swiss imports noted; $2.2 million tariff impact in the quarter; pricing actions to offset tariffs began effective July 1, 2025.
Strategic initiatives and product highlights:
- Brand strategy focused on trend-right products; notable performance in Women’s watches and Movado BOLD/Verso/Quest lines; new campaigns featuring Ludacris, Jessica Alba, Julianne Moore, Christian McCaffrey, and Tyrese Haliburton; fall introductions include Museum Imperio and Heritage 1917.
- Licensed brands showing resilience and growth in a digital-driven environment (TikTok, Reels, YouTube).
Outlook:
- Management elected not to provide fiscal 2026 outlook due to tariff and macro retail uncertainty. Anticipated annualized savings of about $10 million from cost-reduction actions to be realized over the year. Inventory readiness and ongoing tariff mitigation efforts remain critical near-term considerations.