Fossil 3Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

10% growth isn’t bad

“For the quarter, sales increased 10%, reflecting growth across all regions with Europe and Asia leading the way. Europe’s solid performance for the quarter reflected balanced growth with all major markets increasing over last year. In our most matured market, North America, we were pleased with the sequential improvement in the growth rate for the region.”

Partnering with Intel

“On the wearable technology front, we announced the partnership with Intel during the quarter which will allow us to work with them to identify emerging technologies and to be involved with early-stage development of ideas and concepts that can be used in developing connected fashion accessories. This is a very exciting category that is rapidly evolving and we are very excited about the potential for our brands to be actively involved in this space.’

China is still a compelling opportunity

“The fact remains is that there is literally hundreds of millions of people that are going to join the middle class in the next 10 to 15 years. It’s a very compelling long-term opportunity for us and we’re building it out and someday it will be very significant, just probably will not be linear growth.”

Jewelry is a long term opportunity

“As we’ve always said, jewelry is very similar to our watch business, largely the same characteristics in terms of timing, margin, same distribution channel, it’s actually a way of leveraging our entire global infrastructure and it’s lifestyle branded and it fits into our global profile. So one way to look at it is if the potential size of the Company with just watches is X, with jewelry it’s X+ and that’s the way to look at it, but it is a long-term opportunity for us.”

In position to put more technology into watches

“We do think that the traditional watch business will continue to grow and we are going to gain share, but as the technology gets better we think that we can add more and more technology to our products. So we think our position, especially with our partnership with the Intel and Google, we’re in a place where we can bring well-designed branded smart fashion accessories to market wherever the technology goes, and we think it’s an additional opportunity to us over the long term”