Fossil’s share price tumbled again after it posted weaker than expected figures for the end of 2016, but there are signs that its smartwatch gamble is starting to pay off.
The Texan company’s share price tanked 20%, following a $33m decline in sales in Q3 and a 34% drop in share price last May. And back in December it led us to question whether wearables could save Fossil.
The company’s results show a decline in traditional watch sales that was largely offset by the growth of connected devices. Fossil Q and Skagen Connected were name-checked as the most successful lines, but there was also a mention for Michael Kors Access, which the company singled out as a driver for ‘significant improvement’ for the brand.
But wearables don’t seem to be the magic bullet for Fossil that many analysts and tech watchers predicted, and traction appears fairly muted – something that’s prevalent across wearables in general. But Fossil CEO Kosta Kartsotis confirmed that the company was planning even more smart devices.
It seems that the company is set to massively expand on the 100 wearables it promised in its first year – and is aiming to increase features and style of its connected products.
“We’ll double our efforts in wearables by launching over 300 skus,” Kartsotis said. “We’re introducing new brands to the platform and enhancing engineering to enable additional functionality in more stylish and slimmer cases.
“We grew our owned brands, Fossil and Skagen, with notable strength in wearables through the expansion of the Fossil Q assortment and the launch of Skagen Connected styles. We also saw a significant improvement in Michael Kors’ watch sales with the launch of Michael Kors Access,” he continued.
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