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What changed in MOVADO GROUP INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of MOVADO GROUP INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+310 added−222 removedSource: 10-K (2025-04-16) vs 10-K (2024-03-26)

Top changes in MOVADO GROUP INC's 2025 10-K

310 paragraphs added · 222 removed · 197 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

47 edited+3 added−10 removed68 unchanged
Biggest changeOn March 17, 2022, the Company entered into an amended and restated license agreement with Hugo Boss Trade Mark Management GmbH & Co. that extended the term and made certain other changes to the license agreement originally entered into by the parties on December 15, 2004, as previously amended, under which the Company received a worldwide exclusive license to use trademarks containing the names “HUGO” or “BOSS”, in connection with the production, promotion and sale of watches.
Biggest changeUnder a license agreement with Hugo Boss Trade Mark Management GmbH & Co., the Company has exclusive worldwide licenses to use trademarks containing the names “HUGO” or “BOSS” in connection with the production, promotion and sale of watches and to use trademarks containing the name “BOSS” in connection with the production, promotion and sale of jewelry.
Market leaders for smartwatches include Apple, Samsung and Huawei. Mass Market Watches Mass market watches typically consist of digital watches and analog watches made from stainless steel, brass and/or plastic and are manufactured in Asia. Well-known brands include Casio, Pulsar, Seiko and Timex. The Company does not compete in the mass market watch category.
Market leaders for smartwatches include Apple, Huawei and Samsung. Mass Market Watches Mass market watches typically consist of digital watches and analog watches made from stainless steel, brass and/or plastic and are manufactured in Asia. Well-known brands include Casio, Pulsar, Seiko and Timex. The Company does not compete in the mass market watch category.
The Company generally does not have long-term supply commitments with any of its component parts suppliers. Movado (with the exception of certain Movado collections), EBEL and Concord watches, as well as certain Calvin Klein watch styles, are manufactured in Switzerland by independent third-party assemblers using Swiss movements and other parts sourced by the 7 Company’s Swiss operations.
The Company generally does not have long-term supply commitments with any of its component parts suppliers. Movado (with the exception of certain Movado collections), EBEL and Concord watches, as well as certain Calvin Klein watch styles, are manufactured in Switzerland by independent third-party assemblers using Swiss movements and other parts sourced by the Company’s Swiss operations.
All watches sold by the Company come with limited warranties covering the movement against defects in material and workmanship for periods ranging from two to three years from the date of purchase. Products that are returned under warranty to the Company are generally serviced by the Company’s employees at its service facilities.
All watches sold by the Company come with limited contractual warranties covering the movement against defects in material and workmanship for periods ranging from two to three years from the date of purchase. Products that are returned under warranty to the Company are generally serviced by the Company’s employees at its service facilities.
The Swiss watch movements used in the manufacture of Movado, EBEL and Concord watches are purchased from three suppliers, with all mechanical movements coming from a single supplier. The Company obtains other watch components for all of its brands, including, cases, hands, dials, bracelets, straps and non-Swiss movements from a number of other suppliers.
The Swiss watch movements used in the manufacture of Movado, EBEL and Concord watches are purchased from three suppliers, with all mechanical movements coming from a single supplier. The Company obtains other watch components for all of its brands, including, 9 cases, hands, dials, bracelets, straps and non-Swiss movements from a number of other suppliers.
Changes in such laws and regulations could have a material adverse effect on our results of operations and financial condition, although the Company is not aware of any such pending changes that would have a material adverse effect on the Company's capital expenditures, including capital expenditures for environmental control facilities, earnings or competitive position.
Changes in such laws and regulations could have a material adverse effect on the Company's results of operations and financial condition, although the Company is not aware of any such pending changes that would have a material adverse effect on the Company’s capital expenditures, including capital expenditures for environmental control facilities, earnings or competitive position.
Jewelry and Other Fashion Accessories In addition to its core watch business, the Company also designs, sources, markets and distributes jewelry and, to a lesser extent, other fashion accessories such as sunglasses. The Company’s jewelry offerings consist mostly of fashion jewelry, although some fine jewelry 3 pieces are also included in certain collections.
Jewelry and Other Fashion Accessories In addition to its core watch business, the Company also designs, sources, markets and distributes jewelry and, to a lesser extent, other fashion accessories such as sunglasses. The Company’s jewelry offerings consist mostly of fashion jewelry, although some fine jewelry pieces are also included in certain collections.
All of the Company’s products are manufactured using components obtained from third party suppliers. Certain Movado collections of watches are manufactured by independent contractors in Asia using Swiss movements. Coach, Hugo Boss, Lacoste, Olivia Burton, MVMT, Tommy Hilfiger and most Calvin Klein watches are manufactured by independent contractors in Asia.
All of the Company’s products are manufactured using components obtained from third party suppliers. Certain Movado collections of watches are manufactured by independent contractors in Switzerland and Asia using Swiss movements. Coach, Hugo Boss, Lacoste, Olivia Burton, MVMT, Tommy Hilfiger and most Calvin Klein watches are manufactured by independent contractors in Asia.
Brand Licensor Calendar Year Launched COACH Tapestry, Inc. 1999 TOMMY HILFIGER Tommy Hilfiger Licensing LLC 2001 HUGO BOSS Hugo Boss Trade Mark Management GmbH & Co 2006 LACOSTE Lacoste S.A., Sporloisirs S.A. and Lacoste Alligator S.A. 2007 CALVIN KLEIN Calvin Klein, Inc. 2022 2 INDUSTRY OVERVIEW The largest markets for watches are North America, Europe, the Middle East, Latin America and Asia.
Brand Licensor Calendar Year Launched COACH Tapestry, Inc. 1999 TOMMY HILFIGER Tommy Hilfiger Licensing LLC 2001 HUGO BOSS Hugo Boss Trade Mark Management GmbH & Co 2006 LACOSTE Lacoste S.A., Sporloisirs S.A. and Lacoste Alligator S.A. 2007 CALVIN KLEIN Calvin Klein, Inc. 2022 4 INDUSTRY OVERVIEW The largest markets for watches are North America, Europe, the Middle East, Latin America and Asia.
Watch and Accessory Brands market primarily to department stores, such as Macy’s and Nordstrom; major jewelry store chains, such as Signet Jewelers, Ltd. and Helzberg Diamonds Corp.; independent jewelers; and third-party e-commerce retailers, such as Amazon; as well as directly to consumers through the Company’s owned e-commerce websites, such as www.movado.com and www.mvmt.com .
Watch and Accessory Brands market primarily to department stores, including Macy’s and Nordstrom; major jewelry store chains, including Signet Jewelers, Ltd. and Helzberg Diamonds Corp.; independent jewelers; and third-party e-commerce retailers, including Amazon; as well as directly to consumers through the Company’s owned e-commerce websites, including www.movado.com and www.mvmt.com .
These stores serve as effective channels to sell current and discontinued models and factory seconds of the Company’s watches, jewelry, and other accessories. 6 SEASONALITY The Company’s sales are traditionally greater during the Christmas and holiday season. Consequently, the Company’s net sales historically have been higher during the second half of its fiscal year.
These stores 8 serve as effective channels to sell current and discontinued models and factory seconds of the Company’s watches, jewelry, and other accessories. SEASONALITY The Company’s sales are traditionally greater during the Christmas and holiday season. Consequently, the Company’s net sales historically have been higher during the second half of its fiscal year.
The Company’s jewelry and other accessories are designed by in-house design teams in cooperation with outside sources and are manufactured by independent contractors in Asia and, to a lesser extent, the United States. 5 MARKETING The Company’s marketing strategy is to communicate a consistent, brand-specific message to the consumer.
The Company’s jewelry and other accessories are designed by in-house design teams in cooperation with outside sources and are manufactured by independent contractors in Asia and, to a lesser extent, the United States. 7 MARKETING The Company’s marketing strategy is to communicate a consistent, brand-specific message to the consumer.
Watch and Accessory Brands Business in International Markets Internationally, the Company’s brands are sold to department stores, jewelry chains, independent jewelers and third-party e-commerce retailers, as well as directly to consumers through the Company’s owned e-commerce websites, such as www.oliviaburton.com .
Watch and Accessory Brands Business in International Markets Internationally, the Company’s brands are sold to department stores, jewelry chains, independent jewelers and third-party e-commerce retailers, as well as directly to consumers through the Company’s owned e-commerce websites, including www.oliviaburton.com .
The Company recognizes that embracing an inclusive workforce leads to greater innovation, increased productivity, and higher job satisfaction. Accordingly, the Company strives to welcome and foster ideas and to create workplaces that bring together people with diverse perspectives.
The Company recognizes that embracing an inclusive workforce leads to greater innovation, increased productivity, and higher job satisfaction. Accordingly, the Company strives to welcome and foster ideas and to create workplaces that bring together people with different perspectives.
Company Stores The Company’s subsidiary, Movado Retail Group, Inc., operates 51 retail outlet locations in outlet centers across the United States and four retail outlet locations in outlet centers in Canada, as well as an online outlet store at www.movadocompanystore.com.
Company Stores The Company’s subsidiary, Movado Retail Group, Inc., operates 52 retail outlet locations in outlet centers across the United States and four retail outlet locations in outlet centers in Canada, as well as an online outlet store at www.movadocompanystore.com.
In addition to a majority of the Company’s EBEL and Concord watches, well-known brand names of luxury watches include Baume & Mercier, Breitling, Cartier, Omega and TAG Heuer. Accessible Luxury Watches The majority of accessible luxury watches are quartz-analog watches, occasionally including connected technology for transmitting data wirelessly between the watch and a smartphone or other device.
In addition to a majority of the Company’s EBEL and Concord watches, well-known brand names of luxury watches include Rolex, Breitling, Cartier, Omega and TAG Heuer. Accessible Luxury Watches The majority of accessible luxury watches are quartz-analog watches, occasionally including connected technology for transmitting data wirelessly between the watch and a smartphone or other device.
As the consumer footprint continues to evolve, the Company is increasingly focused on its digital marketing and online reach, including expanding and improving its social media channels and its messaging through individuals with significant social media followings (i.e., “influencers”), as well as elevating its customers’ digital experience globally through innovative technologies and consumer-facing initiatives.
As the consumer footprint continues to evolve, the Company continues to focus on its digital marketing and online reach, including expanding and improving its social media channels and its messaging through individuals with significant social media followings (i.e., “influencers”), as well as elevating its customers’ digital experience globally through innovative technologies and consumer-facing initiatives.
More recently, to mark its 110 th anniversary, Concord introduced a new logo depicting a knot. The knot signifies the brand’s foundation through harmonious unity and its laudable technical achievements and distinctive designs. The contemporary Mariner SL watch embodies this spirit and contributes to Concord’s strong legacy.
To mark its 110 th anniversary, Concord introduced a new logo depicting a knot in 2018. The knot signifies the brand’s foundation through harmonious unity and its laudable technical achievements and distinctive designs. The contemporary Mariner SL watch embodies this spirit and contributes to Concord’s strong legacy.
OPERATING SEGMENTS The Company conducts its business primarily in two operating segments: Watch and Accessory Brands and Company Stores. For operating segment data and geographic segment data for the years ended January 31, 2024, 2023 and 2022, see Note 18 to the Consolidated Financial Statements regarding Segment and Geographic Information.
OPERATING SEGMENTS The Company conducts its business primarily in two operating segments: Watch and Accessory Brands and Company Stores. For operating segment data and geographic segment data for the years ended January 31, 2025, 2024 and 2023, see Note 19 to the Consolidated Financial Statements regarding Segment and Geographic Information.
For the Company’s EBEL and Concord watch brands and various Movado brand watch styles, the watch design phase is performed by a combination of in-house and freelance designers in Europe and the United States while product development is carried out in the Company’s Swiss operations.
For the Company’s EBEL and Concord watch brands and various Movado brand watch styles, the watch design phase is performed by a combination of in-house and freelance designers in Europe and the United States, while product development is managed through the Company’s Swiss operations.
Item 1. Business GENERAL In this Form 10-K, all references to the “Company,” “Movado Group,” "we," "us" or "our" include Movado Group, Inc. and its subsidiaries, unless the context requires otherwise. The Company’s common stock is traded on the NYSE under the trading symbol MOV. Movado Group designs, sources, markets and distributes quality watches globally.
Item 1. Business GENERAL In this Form 10-K, all references to the “Company,” “Movado Group,” “we,” “us” or “our” include Movado Group, Inc. and its subsidiaries, unless the context requires otherwise. The Company’s common stock is traded on the NYSE under the trading symbol MOV. Movado Group designs, sources, markets and distributes quality watches globally.
The Company’s licensed brand watches, Olivia Burton watches, MVMT watches and certain Movado brand watch styles are designed by in-house design teams in cooperation with outside sources, including (in the case of the licensed brands) licensors’ design teams. Watch product development for these brands takes place in the Company’s Asia operations.
The Company’s licensed brand watches, Olivia Burton watches, MVMT watches and certain Movado brand watch styles are designed by in-house design teams in cooperation with outside sources, including (in the case of the licensed brands) licensors’ design teams. Watch product development for these brands is managed through the Company’s Asia operations.
The term of the Agreement continues until December 31, 2026, and may be renewed by the Company for an additional five years, subject to certain conditions, including the achievement of specified minimum sales.
The term of the license continues through December 31, 2026, and may be renewed by the Company for an additional five years, subject to certain conditions, including the achievement of specified minimum sales.
Accordingly, investors should monitor the investor relations webpage, in addition to following the Company’s press releases, SEC filings and public conference calls and webcasts.
Accordingly, investors should monitor the Investor section, in addition to following the Company’s press releases, SEC filings and public conference calls and webcasts.
REGULATION We are subject to laws and regulations regarding customs (including tariffs and retaliatory tariffs), tax, employment, privacy, data protection, truth-in-advertising, consumer product safety, environmental, waste management, zoning and occupancy and other laws and regulations that regulate and/or govern the importation, packaging, promotion, sale and disposal of consumer products and our corporate, retail and distribution operations.
REGULATION The Company is subject to laws and regulations regarding customs (including tariffs and retaliatory tariffs), tax, employment, privacy, data protection, truth-in-advertising, consumer product safety, the environment, waste management, zoning and occupancy and other laws and regulations that regulate and/or govern the importation, packaging, promotion, sale and disposal of consumer products and its corporate, retail and distribution operations.
Major selling seasons in certain international markets center on significant local holidays that occur in late winter or early spring. The second half of each of the fiscal years ended January 31, 2024, 2023 and 2022 accounted for 54.6%, 54.0% and 57.9% of the Company’s net sales, respectively.
Major selling seasons in certain international markets center on significant local holidays that occur in late winter or early spring. The second half of each of the fiscal years ended January 31, 2025, 2024 and 2023 accounted for 55.4%, 54.2% and 54.0% of the Company’s net sales, respectively.
Approximately 29% of the Company’s non-retail employees have been with the Company for more than 10 years, and approximately 51% have been with the Company for at least five years.
Approximately 35% of the Company’s non-retail employees have been with the Company for more than 10 years, and approximately 60% have been with the Company for at least five years.
The Company intends to also use its investor relations webpage at https://www.movadogroup.com/investors/overview as a means of disclosing information about the Company, its services and other matters and for complying with its disclosure obligations under Regulation FD. The information the Company posts on its investor relations webpage may be deemed material.
The Company intends to also use the “Investors” section of its corporate website at https://www.movadogroup.com as a means of disclosing information about the Company, its services and other matters and for complying with its disclosure obligations under Regulation FD. The information the Company posts on the Investors section of its corporate website may be deemed material.
With an expanding presence globally, the Coach brand exemplifies modern luxury. As an extension of the brand, Coach watches offer a fresh and compelling assortment of timepieces for women and men, with a wide variety of metal bracelets and genuine Coach leather straps.
As an extension of the brand, Coach watches offer a fresh and compelling assortment of timepieces for women and men, with a wide variety of metal bracelets and genuine Coach leather straps.
Tuition reimbursement is available to full-time employees in the United States. 9 Diversity & Inclusion The Company seeks to provide a work environment in which all employees are treated with dignity and respect and are not discriminated against on the basis of age, color, disability, marital or parental status, national origin, race, religious beliefs, sexual orientation, gender identity, veteran status, or any other legally protected status.
Inclusion The Company seeks to provide a work environment in which all employees are treated with dignity and respect and are not discriminated against on the basis of age, color, disability, marital or parental status, national origin, race, religious beliefs, sexual orientation, gender 11 identity, veteran status, or any other legally protected status.
The Company licenses the trademark COACH ® and related trademarks on an exclusive worldwide basis for use in connection with the manufacture, distribution, advertising and sale of watches pursuant to an amended license agreement with Tapestry, Inc. scheduled to expire on June 30, 2025.
The Company licenses the trademark COACH ® and related trademarks on an exclusive worldwide basis for use in connection with the manufacture, distribution, advertising and sale of watches pursuant to a license agreement with Tapestry, Inc. with a term through June 30, 2028.
Many factors affecting business activities outside the United States could adversely impact this business”, “Regulatory restrictions and a changing marketing environment could materially and adversely affect the Company's ability to penetrate key market segments, resulting in the loss of market share and revenue”, “Failure to meet environmental, social and governance regulations, expectations or standards could adversely affect the Company's business, reputation, results of operations and financial condition”, “The Company’s e-commerce business is subject to numerous risks that could have an adverse effect on the Company’s business and results of operations”, “Changes to laws or regulations impacting the industries in which the Company operates could require it to alter its business practices which could have a material adverse effect on its results of operations”, “Changes to tax laws or regulations could have a material adverse effect on the Company’s financial condition and results of operations” and “The Company is subject to complex and evolving laws and regulations regarding privacy and data protection that could result in legal claims, changes to business practices and increased costs that could materially and adversely affect the Company’s results of operations”, under Item 1A.
Special Tariffs or other restrictions placed on imports, and any retaliatory trade measures taken by other countries, may have a material adverse impact on the Company's financial condition and results of operations”, “Regulatory restrictions and a changing marketing environment could materially and adversely affect the Company's ability to penetrate key market segments, resulting in the loss of market share and revenue”, “Failure to meet environmental, social and governance regulations, expectations or standards could adversely affect the Company's business, reputation, results of operations and financial condition”, “The Company’s e-commerce business is subject to numerous risks that could have an adverse effect on the Company’s business and results of operations”, “Changes to laws or regulations impacting the industries in which the Company operates could require it to alter its business practices which could have a material adverse effect on its results of operations”, “Changes to tax laws or regulations could have a material adverse effect on the Company’s financial condition and results of operations” and “The Company is subject to complex and evolving laws and regulations regarding privacy and data protection that could result in legal claims, changes to business practices and increased costs that could materially and adversely affect the Company’s results of operations”, under Item 1A.
BACKLOG At March 20, 2024, the Company had unfilled orders of $41.0 million compared to $40.7 million at March 20, 2023 and $60.9 million at March 21, 2022. Unfilled orders include both confirmed orders and orders that the Company believes will be confirmed based on the historical experience with the customers.
BACKLOG At April 11, 2025, the Company had unfilled orders of $56.8 million compared to $41.0 million at March 20, 2024 and $40.7 million at March 20, 2023. Unfilled orders include both confirmed orders and orders that the Company believes will be confirmed based on the historical experience with the customers.
Company advertising is placed in magazines and other print media, on radio and television, online, including websites and social media platforms, in catalogs, on outdoor signs and through other promotional materials. Marketing expenses totaled 19.2%, 16.8%, and 16.3% of net sales in fiscal 2024, 2023 and 2022, respectively.
Company advertising is placed in magazines and other print media, on radio and television, online, including websites and social media platforms, in catalogs, on outdoor signs and through other promotional materials. Marketing expenses totaled 22.4%, 19.4%, and 17.0% of net sales in fiscal 2025, 2024 and 2023, respectively.
The current license agreement expands the arrangement to include BOSS-branded jewelry and continues the relationship through December 31, 2026, subject to certain rights of the Company to extend for an additional five years upon satisfaction of specified conditions.
The license agreement continues through December 31, 2026, subject to certain rights of the Company to extend for an additional five years upon satisfaction of specified conditions.
(“CKI”) entered into a trademark license agreement under which CKI granted the Company a worldwide license to use the trademarks CALVIN KLEIN and CK/CALVIN KLEIN in connection with the development, manufacture, distribution, advertising, promotion and sale of watches and jewelry commencing January 1, 2022. The license is exclusive, subject to limited exceptions.
Under a license agreement with Calvin Klein, Inc., the Company has a worldwide license to use the trademarks CALVIN KLEIN and CK/CALVIN KLEIN in connection with the development, manufacture, distribution, advertising, promotion and sale of watches and jewelry. The license is exclusive, subject to limited exceptions.
We generally market our fashion accessories through the same distribution channels as our watches and use similar marketing approaches. Sales of jewelry accounted for 7.5% of our consolidated net sales in fiscal year 2024.
The Company generally markets its fashion accessories through the same distribution 5 channels as its watches and use similar marketing approaches. Sales of jewelry accounted for 8.9% of its consolidated net sales in fiscal year 2025.
For a discussion of certain risks related to compliance with laws and regulations, see “A significant portion of the Company’s business is conducted outside of the United States.
For a discussion of certain risks related to compliance with laws and regulations, see “A significant portion of the Company’s business is conducted outside of the United States. Many factors affecting business activities outside the United States could adversely impact this business”, “Additional U.S.
Demographics The following table summarizes the Company’s global workforce as of January 31, 2024: Full-Time Employees Part-Time Employees Temporary Employees Total Global 1,089 387 72 1,548 Americas 582 341 59 982 Asia-Pacific 209 - 5 214 Europe, Middle East & Africa 298 46 8 352 Attraction and Retention of Employees The Company strives to attract and retain a highly talented and engaged workforce and believes that its supportive culture, dedication to employee well-being, competitive compensation and benefits programs, employee development and training offerings, diversity and inclusion initiatives, and philanthropic and community engagement help in this endeavor.
Demographics The following table summarizes the Company’s global workforce as of January 31, 2025: Full-Time Employees Part-Time Employees Temporary Employees Total Global 1,009 402 45 1,456 Americas 596 370 34 1,000 Asia-Pacific 166 1 1 168 Europe, Middle East & Africa 247 31 10 288 Attraction and Retention of Employees The Company strives to attract and retain a highly talented and engaged workforce and believes that its supportive culture, dedication to employee well-being, competitive compensation and benefits programs, employee development and training offerings, inclusion initiatives, and philanthropic and community engagement help in this endeavor.
A majority of the Company’s arrangements with its international distributors are long-term, generally require certain minimum purchases and minimum advertising expenditures and impose restrictions on the distributor’s sale of competitive products.
In addition, the Company sells all of its brands through a network of independent distributors operating in numerous countries around the world. A majority of the Company’s arrangements with its international distributors are long-term, generally require certain minimum purchases and minimum advertising expenditures and impose restrictions on the distributor’s sale of competitive products.
The Company employs its own international sales force operating at the Company’s sales and distribution offices in Australia, Canada, Mainland China, France, Germany, Hong Kong, India, Spain, Switzerland, the United Kingdom, Mexico and the United Arab Emirates. In addition, the Company sells all of its brands through a network of independent distributors operating in numerous countries around the world.
The Company employs its own international sales force operating at the Company’s sales and distribution offices in Australia, Canada, Mainland China, France, Germany, Hong Kong, India, Malaysia, Mexico, Singapore, Spain, Switzerland, the United Kingdom and the United Arab Emirates.
Under an amended and restated license agreement with Tommy Hilfiger Licensing LLC ("Tommy Hilfiger") entered into on March 20, 2020 and effective as of January 1, 2020 (the “Tommy Hilfiger License Agreement”), the Company has the exclusive license to use the trademark TOMMY HILFIGER ® and related trademarks in connection with the manufacture, marketing, advertising, sale and distribution of watches and jewelry worldwide (excluding sales to certain accounts in Japan).
Under a license agreement with Tommy Hilfiger Licensing LLC ("Tommy Hilfiger"), the Company has the exclusive license to use the trademark TOMMY HILFIGER ® and related trademarks in connection with the manufacture, marketing, advertising, sale and distribution of watches and jewelry worldwide (excluding sales to certain accounts in Japan) through December 31, 2029.
The brand’s design catalogue has since expanded to include numerous unique watch collections, sunglasses, blue light blocking eyewear and jewelry. 4 Olivia Burton Olivia Burton is a brand founded by two friends who started out as fashion buyers who recognized a gap in the market for unique and feminine women’s watch styles.
MVMT’s designs and messaging embody the spirit of adventuring, creating, and daring to disrupt the norm. The brand’s design catalogue has since expanded to include numerous unique watch collections, sunglasses, blue light blocking eyewear and jewelry. 6 Olivia Burton Olivia Burton was founded in London by two friends who recognized a gap in the market for unique, feminine women's watches.
The Company also partners with local colleges to promote deeper learning on specific topics.
The Company also partners with local colleges to promote deeper learning on specific topics. Tuition reimbursement is available to full-time employees in the United States.
The information posted on the investor relations webpage is not a part of this Annual Report or any other document we file with the SEC, and its inclusion is as an inactive textual reference only. 10 The Company has adopted a Code of Business Conduct and Ethics that applies to all directors, officers and employees, including the Company’s Chief Executive Officer, Chief Financial Officer and principal accounting and financial officers, which is posted on the Company’s website.
The Company has adopted a Code of Business Conduct and Ethics that applies to all directors, officers and employees, including the Company’s Chief Executive Officer, Chief Financial Officer and principal accounting and financial officers, which is posted on the Company’s website.
The Company’s future success will depend, to a significant degree, upon its continued ability to compete effectively 8 regarding, among other things, the style, quality, price, advertising, marketing, distribution and availability of supply of the Company’s watches and other products.
The Company’s future success will depend, to a significant degree, upon its continued ability to compete effectively regarding, among other things, the style, quality, price, advertising, marketing, distribution and availability of supply of the Company’s watches and other products. 10 HUMAN CAPITAL The Company believes that trust, respect, ethical conduct, passion, creativity, ambition, innovation, determination, action and teamwork are critical to achieving its goals and therefore promotes a culture built around these values.
(the “Lacoste License Agreement”), extending the term and making certain other changes to the license agreement originally entered into by the parties in 2006 as previously extended in 2014, under which the Company received a worldwide exclusive license to use the LACOSTE ® name and the distinctive “crocodile” logo to design, produce, market and distribute watches.
Under a license agreement with Lacoste S.A., Sporloisirs S.A. and Lacoste Alligator S.A. the Company has a worldwide exclusive license to use the LACOSTE ® name and the distinctive “crocodile” logo to design, produce, market and distribute watches and jewelry through December 31, 2031.
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MVMT’s designs and messaging embody the spirit of adventuring, creating, and daring to disrupt the norm.
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Inspired by the eclecticism of British culture and design, the Olivia Burton team takes inspiration from contemporary trends, vintage designs, architecture and nature to create beautiful watch and jewelry collections. With a sophisticated, feminine aesthetic, special details and an uplifting approach to life, the brand aims to surprise and delight with pieces that will be enjoyed for years to come.
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Inspired by vintage, fashion trends and nature, the Olivia Burton design team blends contemporary and vintage styles to conceive new collections. As well as innovative timepieces, including unisex collections, Olivia Burton has a large and growing collection of jewelry styles that exhibit the same attention to detail seen in its watches.
Added
Licensed Brands Below is a description of the Company’s licensed brands. Coach Watches Coach is a global fashion house founded in New York City in 1941. This ever-expanding global brand is known for making beautiful pieces, crafted to last, for everyone to be themselves in. Coach defines expressive luxury.
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Licensed Brands Below is a description of the Company’s licensed brands. Coach Watches Coach watches reflect the Coach brand image and classic American style. The Coach brand stands for authenticity, innovation, and relevance, as well as effortless New York style. It is an integral part of the American luxury landscape.
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The information posted on the Investors section of its corporate website is not a part of this Annual Report or any other document the Company files with the SEC, and its inclusion is as an inactive textual reference only.
Removed
The Tommy Hilfiger License Agreement expires December 31, 2024 and may be extended by the Company for an additional five years ending on December 31, 2029, subject to the satisfaction of minimum sales requirements and approval of a new business plan in the licensor’s reasonable discretion.
Removed
The Company has notified Tommy Hilfiger of its intent to extend the agreement and will submit a new business plan for Tommy Hilfiger's approval in the first half of fiscal 2025.
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On August 30, 2022, the Company entered into an amended and restated license agreement with Lacoste S.A., Sporloisirs S.A. and Lacoste Alligator S.A.
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The amended Lacoste License Agreement, which has an effective date of January 1, 2022, continues through December 31, 2031, and authorizes the Company to produce and sell jewelry in addition to watches. Effective August 19, 2020, the Company and Calvin Klein, Inc.
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HUMAN CAPITAL The Company believes that trust, respect, passion, creativity, ambition, and teamwork are critical to achieving its goals and therefore promotes a culture built around these values.
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As of January 31, 2024, the Company had an eight-member Board of Directors, including two female Board members and three Board members from underrepresented minorities.
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As of January 31, 2024, women represented approximately 62% of the Company's global employees, and underrepresented minorities (defined as those who identify as Black/African American, Hispanic, Native American, Asian, Pacific Islander and/or two or more races) represented approximately 55% of the Company's U.S. employees.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

63 edited+43 added−4 removed126 unchanged
Biggest changeThe Company’s sales are seasonal by nature. The Company’s U.S. sales are traditionally greater during the Christmas and holiday season. Internationally, major selling seasons center on significant local holidays that occur in late winter or early spring.
Biggest changeThe Company’s business is seasonal, so events and circumstances that adversely affect holiday consumer spending will have a disproportionately adverse effect on the Company’s results of operations. The Company’s sales are seasonal by nature. The Company’s U.S. sales are traditionally greater during the Christmas and holiday season.
Factors that could affect this business activity vary by region and market and generally include, without limitation: • instability or changes in social, political, public health, environmental, and/or economic conditions that could disrupt the production or trade activity in the countries where the Company’s manufacturers, suppliers and customers are located; • supply chain disruptions related to global, regional or local circumstance that fall outside of the Company's control; • the imposition of additional duties, taxes and other charges on imports and exports; • changes in foreign laws and regulations; • inflation and increases in commodity prices (including energy); • the adoption or expansion of trade sanctions; • recessions in foreign economies; and • a significant change in currency valuation in specific countries or markets.
Factors that could affect this business activity vary by region and market and generally include, without limitation: • instability or changes in social, political, public health, environmental, and/or economic conditions that could disrupt the production or trade activity in the countries where the Company’s manufacturers, suppliers and customers are located; • supply chain disruptions related to global, regional or local circumstance that fall outside of the Company's control; • the imposition of additional trade restrictions, duties, taxes and other charges on imports and exports; • changes in foreign laws and regulations; • inflation and increases in commodity prices (including energy); • the adoption or expansion of trade sanctions; • recessions in foreign economies; and • a significant change in currency valuation in specific countries or markets.
Although the Company believes it has taken reasonable and appropriate actions to protect the security of this information, if the Company were to experience a security breach, acts of vandalism, ransomware attacks, computer viruses, misplaced or lost data, programming and/or human errors or other similar events, it could result in government enforcement actions and private 20 litigation, attract a substantial amount of media attention, and damage the Company’s reputation and its relationships with its customers and employees, materially adversely affecting the Company’s sales and results of operations.
Although the Company believes it has taken reasonable and appropriate actions to protect the security of this information, if the Company were to experience a security breach, acts of vandalism, ransomware attacks, computer viruses, misplaced or lost data, programming and/or human errors or other similar events, it could result in government enforcement actions and private litigation, attract a substantial amount of media attention, and damage the Company’s reputation and its relationships with its customers and employees, materially adversely affecting the Company’s sales and results of operations.
Any failure on the Company’s part to provide attractive, effective, reliable, user-friendly e-commerce platforms that offer a wide assortment of merchandise with rapid delivery options and that continually meet the changing expectations of online shoppers could place the Company at a competitive disadvantage, result in the loss of e-commerce and other sales, harm the Company’s reputation with customers, and have a material adverse impact on the growth of the Company’s e-commerce business globally and its results of operations.
Any failure on the Company’s part to provide attractive, effective, reliable, user-friendly e-commerce platforms that offer a wide assortment of merchandise with rapid delivery options and that continually meet the changing expectations of online shoppers could place the Company at a competitive disadvantage, result in the loss of e-commerce and other sales, harm the Company’s reputation with 18 customers, and have a material adverse impact on the growth of the Company’s e-commerce business globally and its results of operations.
Although the Company is not currently manufacturing new smart watch models, to the extent the Company elects to launch or maintain smart watch offerings, important differences in the way smart watches are designed, sourced, marketed, distributed, and serviced as compared to traditional watches may make it more difficult to compete successfully in the smart watch market, particularly for competitors such as the Company that must rely on the expertise of third parties who are active in this market.
Although the Company is not currently manufacturing new smart watch models, to the extent the Company elects to launch or maintain smart watch offerings, important differences in the way smart watches are designed, sourced, marketed, distributed, and serviced as 15 compared to traditional watches may make it more difficult to compete successfully in the smart watch market, particularly for competitors such as the Company that must rely on the expertise of third parties who are active in this market.
Foreign countries may decide to enact tax laws that may negatively affect the Company’s foreign tax liabilities in response to any real or perceived negative effects of the U.S. tax changes on their countries, and/or states or local governments may decide to enact additional tax laws that may increase tax liabilities for companies doing business in those jurisdictions as they see opportunities to capitalize on the reduction in the federal corporate tax rate.
Foreign countries may decide to enact tax laws 22 that may negatively affect the Company’s foreign tax liabilities in response to any real or perceived negative effects of the U.S. tax changes on their countries, and/or states or local governments may decide to enact additional tax laws that may increase tax liabilities for companies doing business in those jurisdictions as they see opportunities to capitalize on the reduction in the federal corporate tax rate.
If the Company cannot efficiently respond to disruptions in our operations, for example, by finding alternative suppliers or distributors or quickly repairing damaged systems, it may be late in fulfilling customer orders, thereby resulting in reputational damage, lost sales, or cancellation charges, any of which could materially harm its financial condition and results of operations.
If the Company cannot efficiently respond to disruptions in its operations, for example, by finding alternative suppliers or distributors or quickly repairing damaged systems, it may be late in fulfilling customer orders, thereby resulting in reputational damage, lost sales, or cancellation charges, any of which could materially harm its financial condition and results of operations.
Factors that can affect customer foot traffic include: • changes in consumer discretionary spending; • the location of the outlet center; • the location of the Company’s store within the outlet center; • the other tenants in the outlet center; • the occupancy rate of the outlet center; • the success of the outlet center and tenant advertising to attract customers; • changes in competition in areas surrounding the outlet center; • increased competition from shopping over the internet and other alternatives such as mail-order; and • desirability of the Company’s brands and products.
Factors that can affect customer foot traffic include: • changes in consumer discretionary spending; • the location of the outlet center; • the location of the Company’s store within the outlet center; • the other tenants in the outlet center; • the occupancy rate of the outlet center; 17 • the success of the outlet center and tenant advertising to attract customers; • changes in competition in areas surrounding the outlet center; • increased competition from shopping over the internet and other alternatives such as mail-order; and • desirability of the Company’s brands and products.
Regulatory restrictions and a changing marketing environment could materially and adversely affect the Company's ability to penetrate key market segments, resulting in the loss of market share and revenue. The Company utilizes various marketing service providers and technologies, including third-party cookies, pixels, and other automated means (“Third-Party Cookies”), to provide a data-driven, personalized consumer experience.
Regulatory restrictions and a changing marketing environment could materially and adversely affect the Company's ability to penetrate key market segments, resulting in the loss of market share and revenue. The Company utilizes various marketing service providers and technologies, including third-party cookies, pixels, and other automated means (“Third-Party Cookies”), to provide a data-driven, personalized consumer experience online.
There is a risk that the Company will not properly perceive changes in trends or tastes, which may result in the failure to adapt the Company’s products accordingly. In addition, new model designs are regularly introduced 13 into the market for all brands to keep ahead of evolving fashion trends as well as to initiate new trends.
There is a risk that the Company will not properly perceive changes in trends or tastes, which may result in the failure to adapt the Company’s products accordingly. In addition, new model designs are regularly introduced into the market for all brands to keep ahead of evolving fashion trends as well as to initiate new trends.
The Company cannot guarantee that it will be able to attract and retain the talent and skills needed in the future. If the Company cannot secure and maintain financing and credit on favorable terms, the Company’s financial condition and results of operations may be materially adversely affected. Credit and equity markets remain sensitive to world events and macro-economic developments.
The Company cannot guarantee that it will be able to attract and retain the talent and skills needed in the future. 23 If the Company cannot secure and maintain financing and credit on favorable terms, the Company’s financial condition and results of operations may be materially adversely affected. Credit and equity markets remain sensitive to world events and macro-economic developments.
This could also result in the potential for impairment surrounding our long-lived assets. A significant portion of the Company’s business is conducted outside of the United States. Many factors affecting business activities outside the United States could adversely impact this business. Over 80% of the Company's product unit volume originates from Asia, with the vast majority coming from China.
This could also result in the potential for impairment surrounding the Company's long-lived assets. A significant portion of the Company’s business is conducted outside of the United States. Many factors affecting business activities outside the United States could adversely impact this business. Over 80% of the Company's product unit volume originates from Asia, with the vast majority coming from China.
Conversely, if consumer demand is higher than expected, insufficient inventory levels could result in unfilled customer orders, loss of revenue and an unfavorable impact on customer relationships. Volatility and uncertainty related to macro-economic factors make it difficult for the Company to forecast 16 customer demand in its various markets.
Conversely, if consumer demand is higher than expected, insufficient inventory levels could result in unfilled customer orders, loss of revenue and an unfavorable impact on customer relationships. Volatility and uncertainty related to macro-economic factors make it difficult for the Company to forecast customer demand in its various markets.
In addition, the Company’s New Jersey warehouse and distribution facility is operated in a special purpose sub-zone established by the U.S. Department of Commerce Foreign Trade Zone Board and is highly regulated by U.S. Customs and Border Protection, which, under certain circumstances, has the right to shut down the entire sub-zone and, therefore, the entire warehouse and distribution facility.
In addition, the Company’s New Jersey warehouse and distribution facility is operated in a special purpose sub-zone established by the U.S. Department of Commerce Foreign Trade Zone Board and is highly regulated by U.S. Customs and Border Protection, which, under certain circumstances, has the right to shut down the entire sub-zone and, therefore, the 20 entire warehouse and distribution facility.
Any loss of an independent manufacturer or disruption in the supply chain with respect to critical component parts may result in the Company’s inability to deliver quality goods in a timely manner and could have an adverse effect on customer 17 relations, brand image, net sales and results of operations.
Any loss of an independent manufacturer or disruption in the supply chain with respect to critical component parts may result in the Company’s inability to deliver quality goods in a timely manner and could have an adverse effect on customer relations, brand image, net sales and results of operations.
Additionally, if the Company cannot complete construction in new stores within the planned timeframes, cost overruns and lost revenue could adversely affect the profitability of the Company Stores segment. 15 The Company’s e-commerce business is subject to numerous risks that could have an adverse effect on the Company’s business and results of operations.
Additionally, if the Company cannot complete construction in new stores within the planned timeframes, cost overruns and lost revenue could adversely affect the profitability of the Company Stores segment. The Company’s e-commerce business is subject to numerous risks that could have an adverse effect on the Company’s business and results of operations.
Any of these factors could result in a material adverse effect on the Company's results of operations and financial condition. 11 The Company’s business is subject to foreign currency exchange rate risk. A significant portion of the Company’s inventory purchases are denominated in Swiss Francs and, to a lesser extent, the Japanese Yen.
Any of these factors could result in a material adverse effect on the Company's results of operations and financial condition. The Company’s business is subject to foreign currency exchange rate risk. A significant portion of the Company’s inventory purchases are denominated in Swiss Francs and, to a lesser extent, the Japanese Yen.
If the Company does not utilize hedge instruments or if such instruments are unsuccessful at minimizing the risk or are deemed ineffective, any fluctuation of the Swiss Franc, Euro, British Pound, Chinese Yuan, Hong Kong Dollar or Japanese Yen exchange rates could impact the future results of operations.
If the Company does not utilize hedge instruments or if such instruments are unsuccessful at minimizing the risk or are 13 deemed ineffective, any fluctuation of the Swiss Franc, Euro, British Pound, Chinese Yuan, Hong Kong Dollar or Japanese Yen exchange rates could impact the future results of operations.
Many governments, regulators, investors, employees, customers, and other stakeholders are increasingly focused on the environmental, social and governance (ESG) performance of companies, including climate change, greenhouse gas emissions, human and civil rights, diversity, equity and inclusion initiatives, and supply chain conditions.
Many governments, regulators, investors, employees, customers, and other stakeholders are focused on the environmental, social and governance (ESG) performance of companies, including climate change, greenhouse gas emissions, human and civil rights, diversity, equity and inclusion initiatives, and supply chain conditions.
Should the value of our finite-lived intangible assets, property, plant and equipment and other long-lived assets become impaired, it could have a material adverse effect on our results of operations. The loss or infringement of the Company’s trademarks or other intellectual property rights could have an adverse effect on future results of operations.
Should the value of the Company's finite-lived intangible assets, property, plant and equipment and other long-lived assets become impaired, it could have a material adverse effect on the Company's results of operations. The loss or infringement of the Company’s trademarks or other intellectual property rights could have an adverse effect on future results of operations.
Item 1A. Risk Factors The following risk factors should be read carefully in connection with evaluating Movado Group’s business. These risks and uncertainties could cause actual results and events to differ materially from those anticipated.
Item 1A. Risk Factors 12 The following risk factors should be read carefully in connection with evaluating Movado Group’s business. These risks and uncertainties could cause actual results and events to differ materially from those anticipated.
Any material disruption or slowdown of the Company’s information systems could result in the loss of critical data, the inability to process and properly record transactions and the 18 material impairment of the Company’s ability to conduct business, leading to cancelled orders and lost sales.
Any material disruption or slowdown of the Company’s information systems could result in the loss of critical data, the inability to process and properly record transactions and the material impairment of the Company’s ability to conduct business, leading to cancelled orders and lost sales.
Starting in July 2018, the U.S. government announced a series of lists covering thousands of categories of Chinese origin products subject to potential U.S. special tariffs in addition to the regular tariffs that have historically applied to such products.
Starting in July 2018, the U.S. government announced a series of lists covering thousands of categories of Chinese origin products subject to U.S. special tariffs in addition to the regular tariffs that have historically applied to such products.
In addition to the rapidly developing legal obligations imposed by governmental and self-regulatory organizations, a variety of third-party bodies and institutional investors evaluate the performance of companies on ESG topics.
In addition to the rapidly developing legal obligations imposed by governmental and self-regulatory organizations, a variety of third-party bodies and institutional investors evaluate the performance of 16 companies on ESG topics.
Risks Related to Macroeconomic Conditions and our International Operations Adverse economic conditions in key markets, and the resulting declines in consumer confidence and spending, could have a material adverse effect on the Company’s operating results.
Risks Related to Macroeconomic Conditions and International Operations Adverse economic conditions in key markets, and the resulting declines in consumer confidence and spending, could have a material adverse effect on the Company’s operating results.
The Company’s inability to obtain or maintain rights in its trademarks, or the inability of 19 the Company’s licensors to obtain or maintain rights in their trademarks, could have an adverse effect on brand image and future results of operations.
The Company’s inability to obtain or maintain rights in its trademarks, or the inability of the Company’s licensors to obtain or maintain rights in their trademarks, could have an adverse effect on brand image and future results of operations.
Any of the following risks associated with our past acquisitions or future acquisitions, individually or in aggregate, may have a material adverse effect on our business, financial condition and operating results: • difficulties in realizing anticipated financial or strategic benefits of such acquisition; • diversion of capital from other uses and potential dilution of stockholder ownership; • risks related to increased indebtedness; • significant capital and other expenditures may be required to integrate the acquired business into our operations; • disruption of our ongoing business or the ongoing acquired business, including impairment or loss of existing relationships with our employees, distributors, suppliers or customers or those of the acquired companies; • diversion of management’s attention and other resources from current operations, including potential strain on financial and managerial controls and reporting systems and procedures; • difficulty in integrating acquired operations, including restructuring and realigning activities, personnel, technologies and products; • assumption of known and unknown liabilities, some of which may be difficult or impossible to quantify; and • non-cash impairment charges or other accounting charges relating to the acquired assets.
Any of the following risks associated with the Company's past acquisitions or future acquisitions, individually or in aggregate, may have a material adverse effect on its business, financial condition and operating results: • difficulties in realizing anticipated financial or strategic benefits of such acquisition; • diversion of capital from other uses and potential dilution of stockholder ownership; 21 • risks related to increased indebtedness; • significant capital and other expenditures may be required to integrate the acquired business into the Company's operations; • disruption of the Company's ongoing business or the ongoing acquired business, including impairment or loss of existing relationships with its employees, distributors, suppliers or customers or those of the acquired companies; • diversion of management’s attention and other resources from current operations, including potential strain on financial and managerial controls and reporting systems and procedures; • difficulty in integrating acquired operations, including restructuring and realigning activities, personnel, technologies and products; • assumption of known and unknown liabilities, some of which may be difficult or impossible to quantify; and • non-cash impairment charges or other accounting charges relating to the acquired assets.
Changes in U.S. federal, state and international tax laws and regulations, including changes suggested by the U.S. presidential administration, could have an adverse impact on our tax liabilities and effective tax rate. In addition, the overall tax environment has made it increasingly challenging for multinational corporations to operate with certainty around taxation in many jurisdictions.
Changes in U.S. federal, state and international tax laws and regulations, including changes suggested by the U.S. presidential administration, could have an adverse impact on the Company's tax liabilities and effective tax rate. In addition, the overall tax environment has made it increasingly challenging for multinational corporations to operate with certainty around taxation in many jurisdictions.
Although the Company maintains an information security risk insurance policy to address many of these risks, such policy may not suffice to prevent a cyber-incident from resulting in a material adverse effect on our business, financial condition and operating results due to various policy limitations and exclusions.
Although the Company maintains an information security risk insurance policy to address many of these risks, such policy may not suffice to prevent a cyber-incident from resulting in a material adverse effect on its business, financial condition and operating results due to various policy limitations and exclusions.
If adverse changes in product mix or pricing were to reduce the average sales price of our products, or if the average number of units per transaction were to decrease, whether due to a reduction in sales to volume buyers who resell our products or otherwise, there could be a material adverse effect on our Company Stores segment.
If adverse changes in product mix or pricing were to reduce the average sales price of the Company's products, or if the average number of units per transaction were to decrease, whether due to a reduction in sales to volume buyers who resell the Company's products or otherwise, there could be a material adverse effect on the Company Stores segment.
In addition, natural disasters may disrupt purchasing behaviors, negatively impacting revenue generation. Risks Related to our Business 12 The Company’s wholesale business could be negatively affected by the consumer shift toward online shopping, as well as by further changes of ownership, contraction and consolidation in the retail industry.
In addition, natural disasters may disrupt purchasing behaviors, negatively impacting revenue generation. Risks Related to the Company's Business The Company’s wholesale business could be negatively affected by the consumer shift toward online shopping, as well as by further changes of ownership, contraction and consolidation in the retail industry.
Future closures of the Company’s retail stores or reductions in foot traffic could have a material adverse effect on retail sales and the profitability of the Company Stores segment. The success of the Company’s retail outlet locations is also dependent, to a certain extent, upon the average order size at our outlet stores.
Future closures of the Company’s retail stores or reductions in foot traffic could have a material adverse effect on retail sales and the profitability of the Company Stores segment. The success of the Company’s retail outlet locations is also dependent, to a certain extent, upon the average order size at its outlet stores.
The Company’s information systems could also experience system failures, viruses, power outages, network and telecommunications failures, usage errors our employees, or other events which could disable or significantly impair the systems’ functionality. Additionally, the Company’s systems may fail to operate properly or effectively, experience problems transitioning to upgraded or replacement systems or difficulties in integrating new systems.
The Company’s information systems could also experience system failures, viruses, power outages, network and telecommunications failures, usage errors by its employees, or other events which could disable or significantly impair the systems’ functionality. Additionally, the Company’s systems may fail to operate properly or effectively, experience problems transitioning to upgraded or replacement systems or difficulties in integrating new systems.
Increased advertising costs could materially and adversely affect the Company's profitability and results of operations. Failure to meet environmental, social and governance regulations, expectations or standards could adversely affect the Company’s business, reputation, results of operations and financial condition.
Increased advertising costs could materially and adversely affect the Company's profitability and results of operations. Requirements to meet environmental, social and governance regulations, expectations or standards could adversely affect the Company’s business, reputation, results of operations and financial condition.
Impairment may result from any number of factors, including adverse changes in assumptions used for valuation purposes, such as actual or projected net sales, growth rates, profitability or discount rates, or other variables. If testing indicates that impairment has occurred, we are required to record a non-cash impairment charge.
Impairment may result from any number of factors, including adverse changes in assumptions used for valuation purposes, such as actual or projected net sales, growth rates, profitability or discount rates, or other variables. If testing indicates that impairment has occurred, the Company is required to record a non-cash impairment charge.
Although we anticipate that these cloud migrations will increase efficiency and functionality, such migrations entail risks in implementation and make the Company more reliant on third party service providers.
Although the Company anticipates that these cloud migrations will increase efficiency and functionality, such migrations entail risks in implementation and make the Company more reliant on third party service providers.
Additionally, after the term of any license agreement has concluded, the licensor may decide not to renew with the Company. For the fiscal year ended January 31, 2024, the Company's licensed brands represented 53.9% of the Company’s net sales.
Additionally, after the term of any license agreement has concluded, the licensor may decide not to renew with the Company. For the fiscal year ended January 31, 2025, the Company's licensed brands represented 55.9% of the Company’s net sales.
The recent tightening of monetary policies of countries throughout the world in response to inflationary pressures have resulted in interest rate increases and could reduce availability of credit. An increase in product returns or lost product could negatively impact the Company’s operating results and profitability.
The tightening of monetary policies of countries throughout the world in recent years in response to inflationary pressures have resulted in elevated interest rates and could reduce availability of credit. An increase in product returns or lost product could negatively impact the Company’s operating results and profitability.
In that regard, we are currently migrating many of our IT systems and applications to the cloud, including our global enterprise resource planning system, which is designed to efficiently maintain our financial records and provide information important to the operation of our business.
In that regard, the Company is currently migrating many of its IT systems and applications to the cloud, including its global enterprise resource planning system, which is designed to efficiently maintain its financial records and provide information important to the operation of its business.
The second half of each of the fiscal years ended January 31, 2024, 2023 and 2022 accounted for 54.6%, 54.0% and 57.9% of the Company’s net sales, respectively. If events or circumstances were to occur that negatively impact consumer spending during such holiday seasons, it could have a material adverse effect on the Company’s sales, profitability and results of operations.
The second half of each of the fiscal years ended January 31, 2025, 2024 and 2023 accounted for 55.4%, 54.2% and 54.0% of the Company’s net sales, respectively. If events or circumstances were to occur that negatively impact consumer spending during such holiday seasons, it could have a material adverse effect on the Company’s sales, profitability and results of operations.
In addition, foreign court decisions and regulatory actions could impact our ability to receive, transfer and process personal data relating to our employees and direct and indirect customers.
In addition, foreign court decisions and regulatory actions could impact the Company's ability to receive, transfer and process personal data relating to its employees and direct and indirect customers.
The shift in our business toward e-commerce, and the expansion of our business in certain jurisdictions, and our greater reliance on cloud services may subject us to additional such laws and regulations.
The shift in the Company's business toward e-commerce, and the expansion of its business in certain jurisdictions, and its greater reliance on cloud services may subject it to additional such laws and regulations.
Special Tariffs or other restrictions placed on imports from China, and any retaliatory trade measures taken by China, may have a material adverse impact on the Company’s financial condition and results of operations.
Special Tariffs or other restrictions placed on imports, retaliatory trade measures taken by other countries and resulting trade wars may have a material adverse impact on the Company’s financial condition and results of operations.
Substantially all of the remaining products originate from Europe. The Company also generates approximately 56.8% of its revenue from international sources.
Substantially all of the remaining products originate from Europe. The Company also generates approximately 57.4% of its revenue from international sources.
The Company's failure or perceived failure to achieve such goals or to meet ESG expectations could harm the Company's reputation, adversely impact its ability to attract and retain customers and talent, impair its access to or cost of capital, and expose it to legal and regulatory proceedings and increased scrutiny, thereby adversely affecting the Company’s business, results of operations and financial condition.
The Company's failure or perceived failure to comply with any such ESG or “anti-ESG” framework could harm the Company's reputation, adversely impact its ability to attract and retain customers and talent, impair its access to or cost of capital, and expose it to legal and regulatory proceedings and increased scrutiny thereby adversely affecting the Company’s business, results of operations and financial condition.
If the U.S. special tariffs were to increase, the Company may seek to raise prices for watches sold in the United States, which is the Company’s single largest market, which could result in the loss of customers and harm its operating performance.
As a result of the 2025 increases in the U.S. special tariffs, the Company may seek to raise prices for products sold in the United States, which is the Company’s single largest market, which could result in the loss of customers and harm its operating performance.
As a responsible corporate citizen, the Company actively manages ESG issues and makes statements about its ESG policies and initiatives through its annual Corporate Responsibility Report and various other communications; however, the Company cannot guarantee that it will achieve its announced goals.
As a responsible corporate citizen, the Company actively evaluates the impacts, risks and opportunities that ESG issues may present and makes statements about its ESG policies and initiatives through its annual Corporate Responsibility Report and various other communications; however, the Company cannot guarantee that it will achieve any goals it may announce.
Acquisitions inherently involve significant risks and uncertainties. We continually review acquisition opportunities that will enhance our market position, expand our product lines and provide synergies.
Acquisitions inherently involve significant risks and uncertainties. The Company continually reviews acquisition opportunities that will enhance its market position, expand its product lines and provide synergies.
Although the Company generally renews its agreements with most of its distributors at the end of the then-current contractual term, if the Company elects not to renew its distribution agreements with large distributors or with multiple smaller distributors, it may be required to make material termination payments to such distributors, which would have an adverse effect on its operating results.
Although the Company generally renews its agreements with most of its distributors at the end of the then-current contractual term, if the Company elects not to renew its distribution agreements with large distributors or with multiple smaller distributors, it may be required to make material termination payments to such distributors, which would have an adverse effect on its operating results. 19 The inability or difficulty of the Company’s customers, suppliers and business partners to obtain credit could materially and adversely affect its results of operations and liquidity.
The Company contractually obligates its independent finished goods manufacturers to adhere to the Company’s vendor code of conduct and similar codes of conduct adopted by the Company’s trademark licensors, and the Company monitors for compliance by conducting periodic factory audits.
The Company expects its independent finished goods manufacturers to adhere to the Company’s vendor code of conduct and similar codes of conduct adopted by the Company’s trademark licensors, and the Company monitors for compliance following a risk-based model that may include conducting periodic factory audits.
Hackers and data thieves are increasingly sophisticated and operate large-scale and complex attacks that may include computer viruses or other malicious codes, ransomware, unauthorized access attempts, denial of service attacks and large-scale automated attacks, phishing, social engineering, hacking and other cyber-attacks. These risks may increase as the Company continues to expand its reliance on cloud services.
Hackers and data thieves are increasingly sophisticated and operate large-scale and complex attacks that may include computer viruses or other malicious codes, ransomware, unauthorized access attempts, denial of service attacks and large-scale automated attacks, phishing, social engineering, hacking and other cyber-attacks.
Many of these companies have significantly greater financial, distribution, advertising and marketing resources than does the Company. The sale of these new smart products could materially adversely impact the traditional watch market and the Company’s results of operations and financial condition.
Many of these companies have significantly greater financial, distribution, advertising and marketing resources than does the Company. The sale of these smart products could materially adversely impact the traditional watch market and the Company’s results of operations and financial condition. The design, sourcing, marketing, distribution and after-sales servicing of smart watches involve additional challenges to those applicable to traditional watches.
If the Company’s sales mix shifts unfavorably toward brands with lower gross profit margins than the Company’s historical consolidated gross profit margin or if a greater proportion of liquidation sales are made, it could have an adverse effect on the results of operations. 14 The Company’s business is seasonal, so events and circumstances that adversely affect holiday consumer spending will have a disproportionately adverse effect on the Company’s results of operations.
If the Company’s sales mix shifts unfavorably toward brands with lower gross profit margins than the Company’s historical consolidated gross profit margin or if a greater proportion of liquidation sales are made, it could have an adverse effect on the results of operations.
Most of the Company’s packaging products are made in China and became subject to a U.S. special 10% tariff in September 2018, which was increased to 25% effective May 10, 2019.
Most of the Company’s packaging products are made in China and have been subject to a U.S. special 25% tariff since May 2019.
The amount of net sales and operating income generated during these seasons depends upon the general level of retail sales at such times, as well as economic conditions and other factors beyond the Company’s control.
Internationally, major selling seasons center on significant local holidays that occur in late winter or early spring. The amount of net sales and operating income generated during these seasons depends upon the general level of retail sales at such times, as well as economic conditions and other factors beyond the Company’s control.
Alternatively, the Company may seek to shift production outside of China, resulting in significant costs and disruption to the Company’s operations and materially and adversely affecting its, costs, sales and results of operations.
Alternatively, the Company may seek to shift production outside of China, resulting in significant costs and disruption to the Company’s operations and materially and adversely affecting its, costs, sales and results of operations. Additional tariff increases or trade restrictions imposed by the United States could materially adversely effect the results of operations of the Company's U.S. business.
The Company operates a smaller, similar facility in Bienne, Switzerland for the distribution of its Swiss watch brands throughout Europe and the Middle East, and in Australia and India through its joint ventures there.
The Company operates a smaller, similar facility in Bienne, Switzerland for the distribution of its Swiss watch brands throughout Europe and the Middle East, and in Australia and India through its joint ventures there. In addition, the Company has contracted with third-party warehouse and fulfillment providers in the Netherlands, Hong Kong, mainland China, Czech Republic, the U.K and Mexico.
In addition, most of the bands used in the production of the Company’s traditional watches are made in China and became subject to the U.S. special 15% tariff effective September 1, 2019, although the tariff rate was decreased to 7.5% effective February 14, 2020.
In addition, most of the bands used in the production of the Company’s traditional watches, as well as most of the Company's jewelry, are made in China and have been subject to a U.S. special 7.5% tariff since February 2020.
Risks Related to an Investment in our Common Stock The Grinberg family owns a majority of the voting power of the Company’s stock. Each share of common stock of the Company is entitled to one vote per share while each share of class A common stock of the Company is entitled to ten votes per share.
Each share of common stock of the Company is entitled to one vote per share while each share of class A common stock of the Company is entitled to ten votes per share.
Impairment charges could have an adverse impact on our results of operations. We are required to test property plant and equipment and other long-lived assets for impairment as facts and circumstances warrant. Such long-lived assets include significant minority investments by the Company in early-stage growth companies and venture capital funds that invest in such companies, which investments are highly unpredictable.
Impairment charges could have an adverse impact on the Company's results of operations. The Company is required to test property plant and equipment and other long-lived assets for impairment as facts and circumstances warrant.
The Company’s revenue, results of operations and cash flows can be affected by several factors, some of which are not within its control.
The Company’s revenue, results of operations and cash flows can be affected by several factors, some of which are not within its control. Those factors include, but are not limited to, those described as risk factors in this Item 1A. and under “Forward-Looking Statements” on page 1.
If the Company’s earnings failed to meet the expectations of the investing public in any given period, the Company’s stock price could fluctuate and decline.
Any or all of these factors could cause a decline in revenues or an increase in expenses, either of which would have an adverse effect on the results of operations. If the Company’s earnings failed to meet the expectations of the investing public in any given period, the Company’s stock price could fluctuate and decline.
In addition, the Company’s business may be impacted by retaliatory trade measures taken by China or other countries in response to existing or future tariffs, causing the Company to raise prices or make changes to its operations, any of which could materially harm its financial condition and results of operations.
Trade restrictions implemented by the United States, China or other countries in connection with a global trade war could result in the Company needing to raise prices or make changes to its operations, any of which could result in a material adverse effect on its financial condition and results of operations.
Removed
The design, sourcing, marketing, distribution and after-sales servicing of smart watches involve additional challenges to those applicable to traditional watches.
Added
In March and April 2025, the Trump Administration announced a series of additional special tariffs, some of which have been temporarily paused.
Removed
The inability or difficulty of the Company’s customers, suppliers and business partners to obtain credit could materially and adversely affect its results of operations and liquidity.
Added
The additional special tariffs already in effect as of the date of this annual report on Form 10-K are tariffs of 10% on most products (including all or substantially all products imported by the Company) from all countries worldwide, and a 145% tariff on substantially all products of Chinese origin.
Removed
In addition, the Company has contracted with third-party warehouse and fulfillment providers in the Netherlands, Hong Kong, mainland China, Czech Republic, the U.K, Mexico and the United States.
Added
Together with the special tariffs applicable to Chinese products implemented in 2018, the special tariffs on Chinese products implemented in 2025 have increased the total U.S. special tariff on Chinese packaging materials to 170% and on Chinese watch bands and jewelry to 152.5%.
Removed
Those factors include, but are not limited to, those described as risk factors in this Item 1A. and under “Forward-Looking Statements” on page 1. 21 Any or all of these factors could cause a decline in revenues or an increase in expenses, either of which would have an adverse effect on the results of operations.
Added
In addition, the special 10% tariff applicable to all other countries applies to substantially all other products imported by the Company, including all Swiss watches as well as all watch heads (i.e., the entirety of a watch other than the watch band) produced in the Far East (which generally have Japanese movements and are therefore considered products of Japan for U.S. customs purposes).
Added
For example, in April 2025, the Trump Administration announced a series of so-called “reciprocal” tariffs on dozens of countries with which the U.S. has a trade deficit, including special incremental tariffs of 32% on Swiss goods, 24% on Japanese goods, and 34% on Chinese goods.
Added
On April 9, the Trump Administration a 90-day pause in the implementation of these “reciprocal” tariffs. However, the Company could experience a material adverse effect on its financial condition and results of operations if these incremental tariffs go into effect.
Added
There is also a concern that the imposition of additional tariffs by the United States could result in the adoption of tariffs by China and other countries, leading to a global trade war. For example, in April 2025, China announced tariffs of 125% on all imports from the United States.
Added
There are inherent limitations in all control systems, and misstatements due to error or fraud may occur and not be detected. The Company is subject to the ongoing internal control provisions of Section 404 of the Sarbanes-Oxley Act of 2002.
Added
These provisions provide for the identification of material weaknesses in internal control over financial reporting, which is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America.
Added
The Company’s management does not expect that our internal controls and disclosure controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
Added
In addition, the design of a control system must reflect the fact that there are resource constraints and the benefit of controls must be relative to their costs.
Added
Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, in the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns 14 can occur because of simple errors or mistakes.
Added
Further, controls can be circumvented by individual acts, by collusion of two or more persons, or by management override of the controls.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of January 31, 2024, the Company’s leased facilities individually comprising more than 20,000 square feet were as follows: Location Function Square Footage Lease Expiration Moonachie, New Jersey Watch distribution and repair 100,000 August 2035 Paramus, New Jersey Executive offices 90,100 June 2030 Bienne, Switzerland Corporate and sales functions and watch distribution, assembly and repair 56,700 December 2032 Hong Kong Watch distribution 44,800 April 2024 The foregoing facilities, as well as 12 additional leased facilities worldwide averaging approximately 5,000 square feet, are used exclusively in connection with the Watch and Accessory Brands segment of the Company’s business except that a portion of the Company’s executive office space in Paramus, New Jersey is used in connection with management of its retail business.
Biggest changeAs of January 31, 2025, the Company’s leased facilities individually comprising more than 20,000 square feet were as follows: Location Function Square Footage Lease Expiration Moonachie, New Jersey Watch distribution and repair 100,000 August 2035 Paramus, New Jersey Executive offices 90,100 June 2030 Bienne, Switzerland Corporate and sales functions and watch distribution, assembly and repair 56,700 December 2032 Hong Kong Watch distribution 44,800 April 2027 The foregoing facilities, as well as 15 additional leased facilities worldwide averaging approximately 4,000 square feet, are used exclusively in connection with the Watch and Accessory Brands segment of the Company’s business except that a portion of the Company’s executive office space in Paramus, New Jersey is used in connection with management of its retail business.
Since acquiring EBEL in 2004, the Company owns an architecturally significant building in La Chaux-de-Fonds, Switzerland. The Company also leases retail space averaging 1,700 square feet per store with leases expiring with various dates through September 2032 for the operation of the Company’s 55 retail outlet locations.
Since acquiring EBEL in 2004, the Company owns an architecturally significant building in La Chaux-de-Fonds, Switzerland. The Company also leases retail space averaging 1,700 square feet per store with leases expiring with various dates through August 2034 for the operation of the Company’s 56 retail outlet locations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeCustoms’ alternative duty methodology and estimate are not consistent with the Company’s facts and circumstances and has consistently disputed U.S. Customs’ position, the Company established reserves for a portion of the alleged underpayment indicated in the audit report. Between February 2017 and January 2021, the Company made numerous submissions to U.S.
Biggest changeCustoms’ alternative duty methodology and estimate were not consistent with the Company’s facts and circumstances and consistently disputed U.S. Customs’ position, the Company previously established reserves for a portion of the alleged underpayment indicated in the audit report. Between February 2017 and January 2021, the Company made numerous submissions to U.S.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Repurchase of Equity Securities Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Amount that May Yet Be Purchased Under the Plans or Programs November 1, 2023 – November 30, 2023 — — — $ 18,639,162 December 1, 2023 – December 31, 2023 25,576 $ 27.39 7,000 $ 18,423,900 January 1, 2024 – January 31, 2024 19,659 $ 29.04 19,000 $ 17,872,716 Total 45,235 $ 28.10 26,000 $ 17,872,716 25 PERFORMANCE GRAPH The performance graph set forth below compares the cumulative total shareholder return of the Company’s shares of common stock for the last five fiscal years through the fiscal year ended January 31, 2024 with that of the S&P SmallCap 600 Index, the Broad Market (NYSE Stock Market – U.S.
Biggest changeThe December 5, 2024, share repurchase program in the original amount of up to $50.0 million is scheduled to expire on December 5, 2027. 28 PERFORMANCE GRAPH The performance graph set forth below compares the cumulative total shareholder return of the Company’s shares of common stock for the last five fiscal years through the fiscal year ended January 31, 2025 with that of the S&P SmallCap 600 Index, the Broad Market (NYSE Stock Market – U.S.
Companies) and the Russell 2000 Index. Each index assumes an initial investment of $100 on January 31, 2019 and the reinvestment of dividends (where applicable). Comparison of Cumulative Five Year Total Return $250 $200 $150 $100 $50 $0 01/31/16 01/31/17 01/31/18 01/31/19 01/31/20 01/31/21 Movado Group, Inc.
Companies) and the Russell 2000 Index. Each index assumes an initial investment of $100 on January 31, 2020 and the reinvestment of dividends (where applicable). Comparison of Cumulative Five Year Total Return $250 $200 $150 $100 $50 $0 01/31/16 01/31/17 01/31/18 01/31/19 01/31/20 01/31/21 Movado Group, Inc.
There is currently no established public trading market for the class A common stock. During each quarter of fiscal 2024, the Company declared cash dividends on its common stock and class A common stock.
There is currently no established public trading market for the class A common stock. During each quarter of fiscal 2025, the Company declared cash dividends on its common stock and class A common stock.
For dividends declared and paid during fiscal 2024, see Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources." On November 23, 2021, the Board approved a share repurchase program under which the Company is authorized to purchase up to $50.0 million of its outstanding common stock from time to time through November 23, 2024, depending on market conditions, share price and other factors.
For dividends declared and paid during fiscal 2025, see Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources." On November 23, 2021, the Board approved a share repurchase program under which the Company was authorized to purchase up to $50.0 million of its outstanding common stock through November 23, 2024, depending on market conditions, share price and other factors.
An aggregate of 22,034 shares were repurchased during the fiscal year ended January 31, 2024 as a result of the surrender of shares of common stock in connection with the vesting of restricted stock awards or stock options. The following table summarizes information about the Company’s purchases of shares of its common stock in the fourth quarter of fiscal 2024.
An aggregate of 42,388 shares were repurchased during the fiscal year ended January 31, 2025, as a result of the surrender of shares of common stock in connection with the vesting of restricted stock awards or stock options. The following table summarizes information about the Company’s purchases of shares of its common stock in the fourth quarter of fiscal 2025.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities As of March 20, 2024, there were 40 holders of record of the Company’s class A common stock and 295 holders of record of the Company’s common stock (including nominee holders such as banks and brokerage firms who hold shares for beneficial owners), although we believe that the number of beneficial owners is much higher.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities As of April 11, 2025, there were 39 holders of record of the Company’s class A common stock and 348 holders of record of the Company’s common stock (including nominee holders such as banks and brokerage firms who hold shares for beneficial owners), although the Company believes that the number of beneficial owners is much higher.
The Company’s common stock is traded on the New York Stock Exchange under the symbol “MOV” and on March 20, 2024, the closing price of the Company’s common stock was $26.85.
The Company’s common stock is traded on the New York Stock Exchange under the symbol “MOV” and on April 11, 2025, the closing price of the Company’s common stock was $13.56.
Under the share repurchase program, the Company is permitted to purchase shares of its common stock through open market purchases, repurchase plans, block trades or otherwise. During the fiscal year ended January 31, 2024, the Company repurchased a total of 111,722 shares of its common stock at a total cost of $3.1 million, or an average of $27.89 per share.
During the fiscal year ended January 31, 2025, the Company repurchased a total of 120,000 shares of its common stock at a total cost of $2.6 million, or an average of $21.90 per share.
Removed
S&P SmallCap 600 Index NYSE Composite Index Russell 2000 Index Company Name / Index 1/31/19 1/31/20 1/31/21 1/31/22 1/31/23 1/31/24 Movado Group, Inc. 100.00 55.70 67.14 123.61 122.84 104.56 S&P SmallCap 600 Index 100.00 106.57 131.27 145.25 143.89 146.49 NYSE (U.S. Companies) 100.00 113.57 123.05 145.40 143.43 155.04 Russell 2000 Index 100.00 109.21 142.16 140.45 135.70 138.96
Added
On December 5, 2024, the Board approved a new share repurchase program under which the Company is authorized to purchase up to $50.0 million of its outstanding stock through December 5, 2027, depending on market conditions, share price and other factors. These repurchases may be made through open market purchases, repurchase plans, block trades or otherwise.
Added
Issuer Repurchase of Equity Securities Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Amount that May Yet Be Purchased Under the Plans or Programs November 1, 2024 – November 30, 2024 — — — $ 15,245,148 December 1, 2024 – December 31, 2024 — — — 50,000,000 January 1, 2025 – January 31, 2025 — — — 50,000,000 Total — — — $ 50,000,000 The November 23, 2021, share repurchase program in the original amount of up to $50.0 million expired on November 23, 2024.
Added
S&P SmallCap 600 Index NYSE Composite Index Russell 2000 Index Company Name / Index 1/31/20 1/31/21 1/31/22 1/31/23 1/31/24 1/31/25 Movado Group, Inc. 100.00 120.55 221.92 220.54 187.72 138.44 S&P SmallCap 600 Index 100.00 123.18 136.29 135.02 137.46 160.08 NYSE (U.S. Companies) 100.00 108.35 128.03 126.30 136.52 164.96 Russell 2000 Index 100.00 130.17 128.60 124.26 127.24 151.53

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

69 edited+63 added−8 removed75 unchanged
Biggest changeThe Company paid cash dividends of $0.35 per share, or $7.9 million, during the three months ended April 30, 2022; $0.35 per share, or $7.9 million, during the three months ended July 31, 2022; $0.35 per share, or $7.8 million, during the three months ended October 31, 2022; and $0.35 per share, or $7.8 million, during the three months ended January 31, 2023. 35 Although the Company currently expects to continue to declare cash dividends in the future, the decision of whether to declare any future cash dividend, including the amount of any such dividend and the establishment of record and payment dates, will be determined, in each quarter, by the Board of Directors, in its sole discretion.
Biggest changeAlthough the Company currently expects to continue to declare cash dividends in the future, the decision of whether to declare any future cash dividend, including the amount of any such dividend and the establishment of record and payment dates, will be determined, in each quarter, by the Board of Directors, in its sole discretion.
Changes in useful lives are made on a prospective basis unless factors indicate the carrying amounts of the assets may not be recoverable and an impairment is necessary. 29 The Company performs an impairment review of its long-lived assets once events or changes in circumstances indicate, in management’s judgment, that the carrying value of such assets may not be recoverable.
Changes in useful lives are made on a prospective basis unless factors indicate the carrying amounts of the assets may not be recoverable and an impairment is necessary. The Company performs an impairment review of its long-lived assets once events or changes in circumstances indicate, in management’s judgment, that the carrying value of such assets may not be recoverable.
Gross margins for the Company may not be comparable to those of other companies, since some companies include all the costs related to their distribution networks in cost of sales whereas the Company does not include the costs associated with its warehousing and distribution facilities nor the occupancy costs for the Company Stores segment in the cost of sales line item.
Gross margins for the Company may not be comparable to those of other companies, since some companies include all the costs related to their distribution networks in cost of sales whereas the Company does not include 30 the costs associated with its warehousing and distribution facilities nor the occupancy costs for the Company Stores segment in the cost of sales line item.
The Company retains adequate levels of component parts to facilitate both the manufacturing of its watches as well as the after-sales service of its watches for an extended period of time after the discontinuance of the manufacturing of such watches.
The Company retains adequate levels of component parts to facilitate both the manufacturing of its watches as well as the after-sales service of its watches for an extended period of time after the 32 discontinuance of the manufacturing of such watches.
The effective tax rate for fiscal 2023 was 20.4% and differed from the U.S. statutory tax rate of 21.0% primarily due to foreign profits being taxed in lower taxing jurisdictions and the release of certain foreign valuation allowances, partially offset by U.S. state and local taxes, net of the federal benefit. Net Income Attributable to Movado Group, Inc.
The effective tax rate for fiscal 2023 was 20.7% and differed from the U.S. statutory tax rate of 21.0% primarily due to foreign profits being taxed in lower taxing jurisdictions and the release of certain foreign valuation allowances, partially offset by U.S. state and local taxes, net of the federal benefit. Net Income Attributable to Movado Group, Inc.
The Company had weighted average borrowings under the Facility of zero during both fiscal 2024 and fiscal 2023, respectively. Borrowings under the Credit Agreement bear interest at rates generally based on either the Term Secured Overnight Financing Rate ("SOFR") as administered by the Federal Reserve Bank of New York or a specified base rate, as selected periodically by the Company.
The Company had weighted average borrowings under the Facility of zero during both fiscal 2025 and fiscal 2024, respectively. Borrowings under the Credit Agreement bear interest at rates generally based on either the Term Secured Overnight Financing Rate ("SOFR") as administered by the Federal Reserve Bank of New York or a specified base rate, as selected periodically by the Company.
This decrease is attributable to the Watch and Accessory Brands segment and, to a lesser extent, the Company Stores segment. For fiscal 2024, fluctuations in foreign currency exchange rates positively impacted net sales by $8.6 million when compared to the prior year. Excluding this $8.6 million impact, net sales would have decreased by 11.7% as compared to the prior year.
This decrease is attributable to the Watch and Accessory Brands segment and, to a lesser extent, the Company Stores segment. For fiscal 2024, fluctuations in foreign currency exchange rates positively impacted net sales by $8.6 million when compared to the prior year. Excluding this $8.6 million impact, net sales would have decreased by 11.9% as compared to the prior year.
The Credit Agreement provides for a $100.0 million 34 senior secured revolving credit facility (the “Facility”) and has a maturity date of October 28, 2026.
The Credit Agreement provides for a $100.0 million senior secured revolving credit facility (the “Facility”) and has a maturity date of October 28, 2026.
Availability under the Facility was reduced by the aggregate amount of letters of credit outstanding, issued in connection with retail and operating facility leases to various landlords and for Canadian payroll to the Royal Bank of Canada, totaling approximately $0.3 million at both January 31, 2024, and January 31, 2023.
Availability under the Facility was reduced by the aggregate amount of letters of credit outstanding, issued in connection with retail and operating facility leases to various landlords and for Canadian payroll to the Royal Bank of Canada, totaling approximately $0.3 million at both January 31, 2025, and January 31, 2024.
The excess of the carrying value over the fair value, if any, is recognized as a loss during that period. The impairment is calculated as the difference between asset carrying values and their estimated fair values. No impairment charge was recorded in fiscal 2024, fiscal 2023 or fiscal 2022.
The excess of the carrying value over the fair value, if any, is recognized as a loss during that period. The impairment is calculated as the difference between asset carrying values and their estimated fair values. No impairment charge was recorded in fiscal 2025, fiscal 2024 or fiscal 2023.
On November 23, 2021, the Board approved a share repurchase program under which the Company is authorized to purchase up to $50.0 million of its outstanding common stock through November 23, 2024, depending on market conditions, share price and other factors.
On November 23, 2021, the Board approved a share repurchase program under which the Company was authorized to purchase up to $50.0 million of its outstanding common stock through November 23, 2024, depending on market conditions, share price and other factors.
As of both January 31, 2024, and 2023, the Company’s spreads were 1.00% over SOFR and 0% over the base rate. The Company's Swiss subsidiary maintains unsecured lines of credit with a Swiss bank that are subject to repayment upon demand.
As of both January 31, 2025, and 2024, the Company’s spreads were 1.00% over SOFR and 0% over the base rate. The Company's Swiss subsidiary maintains unsecured lines of credit with a Swiss bank that are subject to repayment upon demand.
The Company’s hedging program mitigated the impact of the exchange rate fluctuations on product costs and gross margins for fiscal years 2024 and 2023. Selling, General and Administrative (“SG&A”) Expenses The Company’s SG&A expenses consist primarily of marketing, selling, distribution, general and administrative expenses.
The Company’s hedging program mitigated the impact of the exchange rate fluctuations on product costs and gross margins for fiscal years 2025 and 2024. Selling, General and Administrative (“SG&A”) Expenses The Company’s SG&A expenses consist primarily of marketing, selling, distribution, general and administrative expenses.
The cash used in fiscal 2024 included $53.1 million in dividends paid, which included a special cash dividend of $1.00 per share, $3.1 million in stock repurchased in the open market and $1.4 million paid for the distribution of noncontrolling interest earnings.
Cash used in financing activities in fiscal 2024 included $53.1 million in dividends paid, which included a special cash dividend of $1.00 per share, $3.1 million in stock repurchased in the open market and $1.4 million paid for the distribution of noncontrolling interest earnings.
As of January 31, 2024, and 2023, these lines of credit totaled 6.5 million Swiss Francs for both periods, with a dollar equivalent of $7.5 million and $7.1 million, respectively. As of January 31, 2024, and 2023, there were no borrowings against these lines.
As of January 31, 2025, and 2024, these lines of credit totaled 6.5 million Swiss Francs for both periods, with a dollar equivalent of $7.1 million and $7.5 million, respectively. As of January 31, 2025, and 2024, there were no borrowings against these lines.
The Company’s retail operations consist of 51 retail outlet locations in the United States and four locations in Canada. The significant factors that influence annual sales volumes in the Company’s retail operations are similar to those that influence U.S. wholesale sales.
The Company’s retail operations consist of 52 retail outlet locations in the United States and four locations in Canada. The significant factors that influence annual sales volumes in the Company’s retail operations are similar to those that influence U.S. wholesale sales.
The Company determined that there was no impairment in fiscal 2024, fiscal 2023 or in fiscal 2022. Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is determined using the average cost method.
The Company determined that there was no impairment in fiscal 2025, fiscal 2024 or in fiscal 2023. Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is determined using the average cost method.
For fiscal 2023, the Company recorded operating income of $95.0 million in the Watch and Accessory Brands segment which included $37.0 million of unallocated corporate expenses as well as $81.0 million of certain intercompany profits related to the Company’s supply chain operations.
For fiscal 2023, the Company recorded operating income of $90.3 million in the Watch and Accessory Brands segment which included $37.0 million of unallocated corporate expenses as well as $81.0 million of certain intercompany profits related to the Company’s supply chain operations.
RESULTS OF OPERATIONS The following is a discussion of the results of operations for fiscal 2024 compared to fiscal 2023 along with a discussion of the changes in financial condition during fiscal 2024.
RESULTS OF OPERATIONS The following is a discussion of the results of operations for fiscal 2025 compared to fiscal 2024 and fiscal 2024 compared to fiscal 2023 along with a discussion of the changes in financial condition during fiscal 2025.
The decrease in gross profit of $26.1 million was primarily the result of lower net sales, combined with a lower gross margin percentage primarily due to an unfavorable impact of sales mix, the decreased leveraging of higher fixed costs over lower sales and a negative impact of fluctuations in foreign exchange rates, partially offset by lower shipping costs.
The decrease in gross profit of $27.6 million was primarily the result of lower net sales, combined with a lower gross margin percentage primarily due to an unfavorable impact of sales mix, the decreased leveraging of higher fixed costs over lower sales and a negative impact of fluctuations in foreign exchange rates, partially offset by lower shipping costs.
Watch and Accessory Brands Operating Income 32 For fiscal 2024, the Company recorded operating income of $37.5 million in the Watch and Accessory Brands segment which includes $30.8 million of unallocated corporate expenses as well as $71.5 million of certain intercompany profits related to the Company’s supply chain operations.
Watch and Accessory Brands Operating Income For fiscal 2024, the Company recorded operating income of $31.3 million in the Watch and Accessory Brands segment which includes $30.8 million of unallocated corporate expenses as well as $71.5 million of certain intercompany profits related to the Company’s supply chain operations.
International Watch and Accessory Brands Operating Income In the International locations of the Watch and Accessory Brands segment, for the twelve months ended January 31, 2024, the Company recorded operating income of $67.6 million which includes $71.5 million of certain intercompany profits related to the Company’s International supply chain operations.
International Watch and Accessory Brands Operating Income In the International locations of the Watch and Accessory Brands segment, for the twelve months ended January 31, 2024, the Company recorded operating income of $61.3 million which includes $71.5 million of certain intercompany profits related to the Company’s International supply chain operations.
For the twelve months ended January 31, 2023 the Company recorded operating income of $98.1 million in the International locations of the Watch and Accessory Brands segment which included $81.0 million of certain intercompany profits related to the Company’s supply chain operations.
For the twelve months ended January 31, 2023 the Company recorded operating income of $93.3 million in the International locations of the Watch and Accessory Brands segment which included $81.0 million of certain intercompany profits related to the Company’s supply chain operations.
The decrease in operating income was the result of a decrease in gross profit of $56.0 million combined with higher SG&A expenses of $1.5 million when compared to the prior year.
The decrease in operating income was the result of a decrease in gross profit of $57.5 million combined with higher SG&A expenses of $1.5 million when compared to the prior year.
As of both January 31, 2024, and January 31, 2023, there were no amounts of loans outstanding under the Facility.
As of both January 31, 2025, and January 31, 2024, there were no amounts of loans outstanding under the Facility.
The primary factors that influence annual sales are general economic conditions in the Company’s U.S. and international markets, new product introductions, the level and effectiveness of advertising and marketing expenditures and product pricing decisions. 56.8% of the Company’s total sales are from international markets (see Note 18 to the Consolidated Financial Statements), and therefore reported sales made in those markets are affected by foreign exchange rates.
The primary factors that influence annual sales are general economic conditions in the Company’s U.S. and international markets, new product introductions, the level and effectiveness of advertising and marketing expenditures and product pricing decisions. 57.4% of the Company’s total sales are from international markets (see Note 19 to the Consolidated Financial Statements), and therefore reported sales made in those markets are affected by foreign exchange rates.
The net sales decrease in the licensed brands category was $28.5 million, or 8.2%, primarily due to net sales decreases in Europe and the Americas (excluding the United States), partially offset by net sales increases in the Middle East and Asia.
The net sales decrease in the licensed brands category was $29.1 million, or 8.5%, primarily due to net sales decreases in Europe and the Americas (excluding the United States), partially offset by net sales increases in the Middle East and Asia.
As of January 31, 2024, and 2023, two European banks had guaranteed obligations to third parties on behalf of two of the Company’s foreign subsidiaries in the dollar equivalent of $1.4 million and $1.2 million, respectively, in various foreign currencies, of which $0.8 million and $0.6 million, respectively, was a restricted deposit as it relates to lease agreements.
As of January 31, 2025, and 2024, two European banks had guaranteed obligations to third parties on behalf of two of the Company’s foreign subsidiaries in the dollar equivalent of $1.3 million and $1.4 million, respectively, in various foreign currencies, of which $0.7 million and $0.8 million, respectively, was a restricted deposit as it relates to lease agreements.
At January 31, 2024, the letters of credit have expiration dates through May 31, 2024. As of both January 31, 2024, and January 31, 2023, availability under the Facility was $99.7 million. For additional information regarding the Facility, see Note 7 – Debt and Lines of Credit to the Consolidated Financial Statements.
At January 31, 2025, the letters of credit have expiration dates through June 2, 2025. As of both January 31, 2025, and January 31, 2024, availability under the Facility was $99.7 million. For additional information regarding the Facility, see Note 8 – Debt and Lines of Credit to the Consolidated Financial Statements.
The Company funded approximately $5.3 million of these commitments through fiscal 2023 and an additional $3.1 million during fiscal 2024 and may be called upon to satisfy capital calls in respect of the remaining $13.1 million in such commitments at any time during a period generally ending ten years after the first capital call in respect of a given commitment.
The Company funded approximately $8.4 million of these commitments through fiscal 2024 and an additional $5.7 million during fiscal 2025 and may be called upon to satisfy capital calls in respect of the remaining $7.5 million in such commitments at any time during a period generally ending ten years after the first capital call in respect of a given commitment.
The Company’s International operations in Europe, the Americas (excluding the United States), the Middle East and Asia account for 30.5%, 9.3%, 9.0% and 8.0%, respectively, of the Company’s total net sales for fiscal 2024. A vast majority of the Company’s tangible International assets are owned by the Company’s Swiss and Hong Kong subsidiaries. The Company’s business is seasonal.
The Company’s International operations in Europe, the Americas (excluding the United States), Asia and the Middle East account for 31.0%, 9.9%, 8.9% and 7.6%, respectively, of the Company’s total net sales for fiscal 2025. A vast majority of the Company’s tangible International assets are owned by the Company’s Swiss and Hong Kong subsidiaries. The Company’s business is seasonal.
The decrease in operating income was the result of lower gross profit of $26.1 million combined with higher SG&A expenses of $4.4 million.
The decrease in operating income was the result of lower gross profit of $27.6 million combined with higher SG&A expenses of $4.4 million.
International Watch and Accessory Brands Net Sales Net sales for fiscal 2024 in the International locations of the Watch and Accessory Brands segment were $377.4 million, below the prior year by $35.7 million, or 8.6%, which included fluctuations in foreign currency exchange rates that positively impacted net sales by $8.6 million when compared to the prior year.
International Watch and Accessory Brands Net Sales Net sales for fiscal 2024 in the International locations of the Watch and Accessory Brands segment were $369.2 million, below the prior year by $36.2 million, or 8.9%, which included fluctuations in foreign currency exchange rates that positively impacted net sales by $8.6 million when compared to the prior year.
The effective tax rate for fiscal 2024 was 21.0% and was essentially equivalent to the U.S. statutory tax rate of 21.0% primarily due to foreign profits being taxed in lower taxing jurisdictions, partially offset by U.S. state and local taxes, net of the federal benefit.
The effective tax rate for fiscal 2024 was 21.8% and differed from the U.S. statutory tax rate of 21.0% primarily due to foreign profits being taxed in lower taxing jurisdictions, partially offset by cross-border tax effects and U.S. state and local taxes, net of the federal benefit.
Of this total, $176.1 million and $114.0 million, respectively, consisted of cash and cash equivalents at the Company’s foreign subsidiaries.
Of this total, $83.3 million and $176.1 million, respectively, consisted of cash and cash equivalents at the Company’s foreign subsidiaries.
In addition, for the fiscal year ended January 31, 2024, the Company recorded an impairment related to an equity investment in a consumer products company that sold its business and assets in which the Company expects to receive little or no return on its investment.
In addition, for the fiscal year ended January 31, 2024, the Company recorded an impairment related to an equity investment in a consumer products company that sold its business and assets in which the Company expects to receive little or no return on its investment. 31 Interest Expense To the extent it borrows, the Company records interest expense on its revolving credit facility.
The decrease in gross profit of $63.5 million was primarily due to lower net sales combined with a lower gross margin percentage.
The decrease in gross profit of $11.1 million was due to lower net sales combined with a lower gross margin percentage.
The Company’s net sales historically have been higher during the second half of the fiscal year. The second half of each fiscal year accounted for 54.6% and 54.0% of the Company’s net sales for the fiscal years ended January 31, 2024 and 2023, respectively.
The Company’s net sales historically have been higher during the second half of the fiscal year. The second half of each fiscal year accounted for 55.4% and 54.2% of the Company’s net sales for the fiscal years ended January 31, 2025 and 2024, respectively.
As of January 31, 2024 and 2023, the Company operated 55 retail outlet locations. Gross Profit Gross profit for fiscal 2024 was $370.4 million or 55.1% of net sales as compared to $433.9 million or 57.7% of net sales in the prior year.
As of January 31, 2024 and 2023, the Company operated 55 retail outlet locations. Gross Profit Gross profit for fiscal 2024 was $364.2 million or 54.8% of net sales as compared to $429.1 million or 57.7% of net sales in the prior year.
For the twelve months ended January 31, 2023, the Company recorded other income of $2.1 million primarily due to interest income. Interest Expense Interest expense was $0.5 million primarily due to the payment of unused commitment fees for fiscal 2024 and 2023.
For the twelve months ended January 31, 2023, the Company recorded other income of $2.1 million primarily due to interest income. Interest Expense Interest expense was $0.5 million primarily due to the payment of unused commitment fees for fiscal 2024 and 2023. There were no borrowings under the Company's revolving credit facility during fiscal 2024 and 2023.
Watch and Accessory Brands Net Sales Net sales for fiscal 2024 in the Watch and Accessory Brands segment were $568.7 million, below the prior year by $71.7 million, or 11.2%.
Watch and Accessory Brands Net Sales Net sales for fiscal 2024 in the Watch and Accessory Brands segment were $560.5 million, below the prior year by $72.2 million, or 11.4%.
Products in the licensed brands category include the following brands manufactured and distributed under license agreements with the respective brand owners: Coach®, Tommy Hilfiger®, Hugo Boss®, Lacoste® and Calvin Klein®.
The owned brands category consists of the Movado®, Concord®, EBEL®, Olivia Burton® and MVMT® brands. Products in the licensed brands category include the following brands manufactured and distributed under license agreements with the respective brand owners: Coach®, Tommy Hilfiger®, Hugo Boss®, Lacoste® and Calvin Klein®.
At January 31, 2024 the Company had working capital of $430.8 million as compared to $424.8 million at January 31, 2023. The increase in working capital was primarily the result of an increase in cash and trade receivables and a decrease in income taxes payable, accrued liabilities and accrued payroll and benefits, partially offset by a decrease in inventories.
At January 31, 2025 the Company had working capital of $377.0 million as compared to $419.9 million at January 31, 2024. The decrease in working capital was primarily the result of a decrease in cash and an increase in accrued liabilities, partially offset by an increase in trade receivables and a decrease in income taxes payable.
The Company recorded net income attributable to Movado Group, Inc. of $46.7 million and $94.5 million for fiscal 2024 and 2023, respectively. LIQUIDITY AND CAPITAL RESOURCES At January 31, 2024 and January 31, 2023, the Company had $262.1 million and $251.6 million, respectively, of cash and cash equivalents.
The Company recorded net income attributable to Movado Group, Inc. of $41.3 million and $90.4 million for fiscal 2024 and 2023, respectively. LIQUIDITY AND CAPITAL RESOURCES At January 31, 2025 and January 31, 2024, the Company had $208.5 million and $262.1 million, respectively, of cash and cash equivalents.
The following are net sales by business segment and geographic location (in thousands): Fiscal Year Ended January 31, 2024 2023 Watch and Accessory Brands: United States $ 191,266 $ 227,268 International 377,400 413,071 Total Watch and Accessory Brands 568,666 640,339 Company Stores United States 98,990 106,645 International 4,945 4,914 Total Company Stores 103,935 111,559 Net sales $ 672,601 $ 751,898 The following are net sales by category (in thousands): Fiscal Year Ended January 31, 2024 2023 Watch and Accessory Brands: Owned brands category $ 198,612 $ 230,277 Licensed brands category 362,311 399,556 After-sales service and all other 7,743 10,506 Total Watch and Accessory Brands 568,666 640,339 Company Stores 103,935 111,559 Consolidated total $ 672,601 $ 751,898 The following table presents the Company’s results of operations expressed as a percentage of net sales for the fiscal years indicated: Fiscal Year Ended January 31, 2024 2023 Net sales 100.0 % 100.0 % Gross margin 55.1 % 57.7 % Selling, general and administrative expenses 46.9 % 41.7 % Operating income 8.1 % 16.0 % Other income, net 0.9 % 0.3 % Interest expense 0.1 % 0.1 % Provision for income taxes 1.9 % 3.3 % Noncontrolling interests 0.1 % 0.3 % Net income attributable to Movado Group, Inc. 6.9 % 12.6 % 31 Fiscal 2024 Compared to Fiscal 2023 Net Sales Net sales for fiscal 2024 were $672.6 million, representing a $79.3 million or 10.5% decrease from the prior year.
Fiscal 2024 (As Restated) Compared to Fiscal 2023 (As Restated) The following are net sales by business segment and geographic location (in thousands): Fiscal Year Ended January 31, 2024 2023 (As Restated) (As Restated) Watch and Accessory Brands: United States $ 191,266 $ 227,268 International 369,188 405,382 Total Watch and Accessory Brands 560,454 632,650 Company Stores United States 98,990 106,645 International 4,945 4,914 Total Company Stores 103,935 111,559 Net sales $ 664,389 $ 744,209 The following are net sales by category (in thousands): Fiscal Year Ended January 31, 2024 2023 (As Restated) (As Restated) Watch and Accessory Brands: Owned brands category $ 198,612 $ 230,277 Licensed brands category 354,099 391,867 After-sales service and all other 7,743 10,506 Total Watch and Accessory Brands 560,454 632,650 Company Stores 103,935 111,559 Consolidated total $ 664,389 $ 744,209 38 The following table presents the Company’s results of operations expressed as a percentage of net sales for the fiscal years indicated: Fiscal Year Ended January 31, 2024 2023 (As Restated) (As Restated) Net sales 100.0 % 100.0 % Gross margin 54.8 % 57.7 % Selling, general and administrative expenses 47.5 % 42.1 % Operating income 7.3 % 15.5 % Other income, net 0.9 % 0.3 % Interest expense 0.1 % 0.1 % Provision for income taxes 1.8 % 3.3 % Noncontrolling interests 0.1 % 0.3 % Net income attributable to Movado Group, Inc. 6.2 % 12.1 % Net Sales Net sales for fiscal 2024 were $664.4 million, representing a $79.8 million or 10.7% decrease from the prior year.
The decrease in the gross margin percentage of approximately 260 basis points for fiscal 2024 reflected an unfavorable impact of sales mix of approximately 180 basis points, the decreased leveraging of higher fixed costs over lower sales of approximately 90 basis points and a negative impact of fluctuations in foreign exchange rates of approximately 30 basis points, partially offset by decreased shipping costs of approximately 40 basis points.
The decrease in the gross margin percentage of approximately 80 basis points for fiscal 2025 reflected an unfavorable impact of sales mix of approximately 50 basis points, the decreased leveraging of certain fixed costs as a result of lower sales of approximately 30 basis points and a negative impact of fluctuations in foreign exchange rates of approximately 10 basis points, partially offset by decreased shipping costs of approximately 10 basis points.
From time to time the Company may make minority investments in growth companies in the consumer products sector and other sectors relevant to its business, including certain of the Company's suppliers and customers, as well as in venture capital funds that invest in companies in media, entertainment, information technology and technology-related fields and in digital assets.
Cash paid for interest, including unused commitments fees, was $0.3 million during both fiscal 2025 and 2024, respectively. 42 From time to time, the Company may make minority investments in growth companies in the consumer products sector and other sectors relevant to its business, including certain of the Company's suppliers and customers, as well as in venture capital funds that invest in companies in media, entertainment, information technology and technology-related fields and in digital assets.
The increase in SG&A expenses of $4.4 million was primarily due to the following factors: an increase in payroll related expenses of $4.3 million; higher marketing expenses of $1.5 million; and an increase in travel and entertainment expenses of $0.5 million. These increases in SG&A expenses were partially offset by a decrease in performance-based compensation of $2.7 million.
The increase in SG&A expenses of $4.4 million was primarily due to the following factors: an increase in payroll related expenses of $4.3 million; higher marketing expenses of $1.5 million; and an increase in travel and entertainment expenses of $0.5 million.
Cash provided by operating activities for fiscal 2024 included a $37.7 million decrease in investment in inventories primarily due to timing of receipts to align with sales levels, partially offset by a change in payments related to income taxes of $16.7 million primarily due to timing, a decrease in accrued payroll and benefits of $9.9 million primarily as a result of payments of fiscal year 2023 performance-based compensation and an increase of $9.1 million in trade receivables as a result of timing of receipts and change in sales mix.
Cash provided by operating activities for fiscal 2024 included a $35.7 million decrease in investment in inventories primarily due to timing of receipts to align with sales levels, partially offset by a change in payments related to income taxes of $17.6 million primarily due to timing and a decrease in accrued payroll and benefits of $9.9 million primarily as a result of payments of fiscal year 2023 performance-based compensation. 41 Cash used in investing was $13.7 million for fiscal 2025 as compared to $11.5 million for fiscal 2024.
Cash used in investing was $11.5 million for fiscal 2024 as compared to $10.6 million for fiscal 2023. The cash used in fiscal 2024 was primarily related to capital expenditures of $8.2 million primarily due to new computer software and leasehold improvements and $3.1 million of long-term investments.
The cash used in fiscal 2025 was primarily related to capital expenditures of $8.0 million mainly due to expenditures for computer software, shop-in-shops and leasehold improvements and $5.7 million of long-term investments. Cash used in investing activities for fiscal 2024 included $8.2 million of capital expenditures and $3.1 million of long-term investments.
The Company’s ability to improve margins through price increases is therefore, to some extent, constrained by competitors’ actions. 27 Cost of sales of the Company’s products consists primarily of costs for raw materials, component costs, royalties, depreciation, amortization, assembly costs, shipping to customers, design costs and unit overhead costs associated with the Company’s supply chain operations predominately in Switzerland and Asia.
Cost of sales of the Company’s products consists primarily of costs for raw materials, component costs, royalties, depreciation, amortization, assembly costs, shipping to customers, import duties, design costs and unit overhead costs associated with the Company’s supply chain operations predominately in Switzerland and Asia.
One consumer products company in which the Company made an equity investment in fiscal year 2022 sold its business and assets in the first quarter of fiscal 2024 in a transaction that is expected to yield little or no return for equity holders.
One consumer products company in which the Company made an equity investment in fiscal year 2022 sold its business and assets in the first quarter of fiscal 2024 in a transaction that yielded little return for equity holders. As a result, the Company fully impaired its $0.5 million investment in this entity in fiscal 2024.
Cash provided by operating activities for fiscal 2023 included net income of $97.0 million, positively adjusted by $20.3 million related to non-cash items.
Cash provided by operating activities for fiscal 2024 included net income of $42.2 million, positively adjusted by $24.6 million related to non-cash items.
The Company defines working capital as the difference between current assets and current liabilities. The Company had $76.8 million of cash provided by operating activities for fiscal 2024 as compared to $54.3 million for fiscal 2023. Cash provided by operating activities for fiscal 2024 included net income of $47.5 million, positively adjusted by $24.6 million related to non-cash items.
The Company defines working capital as the difference between current assets and current liabilities. The Company had $1.5 million of cash used in operating activities for fiscal 2025 as compared to $76.8 million of cash provided by operating activities for fiscal 2024.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations GENERAL Net Sales The Company operates and manages its business in two principal business segments: Watch and Accessory Brands and Company Stores. The Company also operates in two geographic locations: United States and International.
GENERAL Net Sales The Company operates and manages its business in two principal business segments: Watch and Accessory Brands and Company Stores. The Company also operates in two geographic locations: United States and International. The Company divides its watch and accessory business into two principal categories: the owned brands category and the licensed brands category.
The Company has various contractual obligations as part of its ordinary course of business. The Company's obligations include operating lease obligations (see Note 11- Leases), licensing agreements (see Note 10 - Commitments and Contingencies), purchase obligations (see Note 10 - Commitments and Contingencies) and transition tax obligation (see Note 10 - Commitments and Contingencies).
The Company's obligations include operating lease obligations (see Note 12- Leases), licensing agreements (see Note 11 - Commitments and Contingencies), purchase obligations (see Note 11 - Commitments and Contingencies) and transition tax obligation (see Note 11 - Commitments and Contingencies).
All of the Company’s brands compete with a number of other brands not only on styling but also on wholesale and retail price.
All of the Company’s brands compete with a number of other brands not only on styling but also on wholesale and retail price. The Company’s ability to improve margins through price increases is therefore, to some extent, constrained by competitors’ actions.
While the U.S. has not yet adopted the Pillar Two rules, several other countries have adopted and enacted changes to their legislation in response to Pillar Two. The Company's turnover currently does not meet the minimum requirements that were set by OECD inclusive framework and rules.
While several countries have adopted and enacted changes to their legislation in response to Pillar Two, in January 2025, the President of the United States issued an executive order announcing the United States’ opposition to aspects of these rules. The Company's revenue currently does not meet the minimum requirements that were set by OECD inclusive framework and rules.
Company Stores Operating Income The Company recorded operating income of $17.2 million and $25.3 million in the Company Stores segment for fiscal 2024 and 2023, respectively.
These increases in SG&A expenses were partially offset by a decrease in performance-based compensation of $2.7 million. 40 Company Stores Operating Income The Company recorded operating income of $17.2 million and $25.3 million in the Company Stores segment for fiscal 2024 and 2023, respectively.
The capital spending will be primarily for projects in the ordinary course of business including facilities improvements, shop-in-shops, website development, computer hardware and software and tooling costs. The Company has the ability to manage its capital expenditures on discretionary projects. Cash used in financing activities was $57.6 million for fiscal 2024 as compared to $65.3 million for fiscal 2023.
The Company expects that capital expenditures in fiscal 2026 will be approximately $10.0 million as compared to $8.0 million in fiscal 2025. The capital spending will be primarily for projects in the ordinary course of business including facilities improvements, shop-in-shops, website development, computer hardware and software and tooling costs.
ASC Topic 740 requires the Company to recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts and tax bases of existing assets and liabilities. 28 CRITICAL ACCOUNTING POLICIES AND ESTIMATES The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States and those significant policies are more fully described in Note 1 to the Company’s Consolidated Financial Statements.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States and those significant policies are more fully described in Note 1 to the Company’s Consolidated Financial Statements.
There were no borrowings under the Company's revolving credit facility during fiscal 2024 and 2023. 33 Income Taxes The Company recorded an income tax provision of $12.7 million and $24.9 million for fiscal 2024 and 2023, respectively.
Interest Expense Interest expense was $0.5 million primarily due to the payment of unused commitment fees for both fiscal 2025 and 2024. There were no borrowings under the Company's revolving credit facility during fiscal 2025 and 2024. 37 Income Taxes The Company recorded an income tax provision of $7.4 million and $11.8 million for fiscal 2025 and 2024, respectively.
Under the share repurchase program, the Company is permitted to purchase shares of its common stock from time to time through open market purchases, repurchase plans, block trades or otherwise. During fiscal 2024, the Company repurchased a total of 111,722 shares of its common stock at a total cost of $3.1 million, or an average of $27.89 per share.
During fiscal 2025, the Company repurchased a total of 120,000 shares of its common stock at a total cost of $2.6 million, or an average of $21.90 per share. During fiscal 2024, the Company repurchased a total of 111,722 shares of its common stock at a total cost of $3.1 million, or an average of $27.89 per share.
Although the Company is continuing to evaluate the IR Act and its potential impact on future periods, at this time the Company does not expect the IR Act to have a material impact on its Consolidated Financial Statements. 30 The OECD has issued Pillar Two model rules implementing a new global minimum tax of 15%, which is intended to be effective on January 1, 2024.
The Organization for Economic Cooperation and Development ("OECD") has issued Pillar Two model rules implementing a new global minimum tax of 15%, which was intended to be effective on January 1, 2024.
This guidance also provides guidance for de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions. RECENT DEVELOPMENTS AND INITIATIVES The Inflation Reduction Act of 2022 In August 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into law by President Biden.
This 33 guidance also provides guidance for de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions.
On March 23, 2023, the Company declared a special cash dividend of $1.00 per share, as well as a quarterly cash dividend of $0.35 per share, both paid on April 19, 2023, to shareholders of record on April 5, 2023. The total dividends of $29.9 million were paid on April 19, 2023.
During fiscal 2025, the Company has declared and paid a total of four separate cash dividends of $0.35 per share aggregating to $31.1 million. During fiscal 2024, the Company declared and paid four separate cash dividends of $0.35 per share and a special cash dividend of $1.00 per share aggregating to $53.1 million.
For a discussion of our results of operations in fiscal year 2023 compared to fiscal year 2022, please see “Results of Operations” in Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) of our Annual Report on Form 10-K for the fiscal year ended January 31, 2023, filed with the SEC on March 23, 2023.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS The Company has restated our previously issued Consolidated Financial Statements contained in this Annual Report on Form 10-K.
At January 31, 2024, $17.9 million remains available for purchase under the Company's November 23, 2021 repurchase program.
At January 31, 2025, all $50.0 million remains available for purchase under the Company's December 5, 2024 repurchase program. The Company has various contractual obligations as part of its ordinary course of business.
Cash used in financing activities in fiscal 2023 included $31.4 million in stock repurchased in the open market and $31.4 million in dividends paid.
The cash used in fiscal 2025 included $31.1 million in dividends paid, $2.6 million in stock repurchased in the open market, $1.2 million of shares repurchased as a result of the surrender of shares by employees in connection with the vesting of certain stock awards and $0.6 million paid for the distribution of noncontrolling interest earnings.
Removed
The Company divides its watch and accessory business into two principal categories: the owned brands category and the licensed brands category. The owned brands category consists of the Movado®, Concord®, EBEL®, Olivia Burton® and MVMT® brands.
Added
Refer to the "Explanatory Note" preceding Item 1, Business, for background on the restatement, the fiscal periods impacted, control considerations and other information.
Removed
Also, for the fiscal year ended January 31, 2022, the Company recorded other non-operating income due to the final settlement related to a sale of a building in an international location in the prior year period. Interest Expense To the extent it borrows, the Company records interest expense on its revolving credit facility.
Added
In addition, we have restated certain previously reported financial information at January 31, 2024 and for the fiscal years ended January 31, 2024 and January 31, 2023 in this Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations , including but not limited to information within the Results of Operations and Liquidity and Capital Resources.
Removed
Cash used in operating activities for fiscal 2023 was impacted by a $28.9 million increase in investment in inventories primarily due to timing of receipts, a decrease of $13.7 million in accounts payable primarily due to timing of payments and a decrease in accrued payroll of $7.7 million primarily as a result of payments of fiscal year 2022 performance-based compensation, net of fiscal year 2023 accrual.
Added
See Note 1A - Restatement of Previously Issued Consolidated Financial Statements , in Item 8, Financial Statements and Supplementary Data , for additional information related to the restatement, including descriptions of the misstatements and the impacts on our Consolidated Financial Statements.
Removed
Cash used in investing activities for fiscal 2023 included $7.1 million of capital expenditures and $3.3 million of long-term investments. The Company expects that capital expenditures in fiscal 2025 will be approximately $11.0 million as compared to $8.2 million in fiscal 2024.
Added
ASC Topic 740 requires the Company to recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts and tax bases of existing assets and liabilities.
Removed
Cash paid for interest, including unused commitments fees and amortization of debt fees, was $0.3 million during both fiscal 2024 and 2023, respectively.
Added
RECENT DEVELOPMENTS AND INITIATIVES Tariffs Most of the bands used in the production of the Company’s traditional watches, as well as most of the Company’s jewelry, are made in China and have been subject to a U.S. special 7.5% tariff since February 2020.
Removed
As a result, the Company fully impaired its $0.5 million investment in this entity in the first quarter of fiscal 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+1 added−2 removed8 unchanged
Biggest changeDollar forward contracts had no gain or loss. 36 Commodity Risk The Company considers its exposure to fluctuations in commodity prices to be primarily related to gold used in the manufacturing of the Company’s watches. Under its hedging program, the Company can purchase various commodity derivative instruments, primarily futures contracts.
Biggest changeAs of January 31, 2025, the Company’s British Pound, Chinese Yuan, U.S. Dollar and Euro forward contracts had no gain or loss. Commodity Risk The Company considers its exposure to fluctuations in commodity prices to be primarily related to gold used in the manufacturing of the Company’s watches.
The Company did not hold any future contracts in its gold hedge portfolio as of January 31, 2024 and 2023; thus, any changes in the gold purchase price will have an equal effect on the Company’s cost of sales. Debt and Interest Rate Risk Floating rate debt at January 31, 2024 and 2023 was zero for both periods.
The Company did not hold any future contracts in its gold hedge portfolio as of January 31, 2025 and 2024; thus, any changes in the gold purchase price will have an equal effect on the Company’s cost of sales. Debt and Interest Rate Risk Floating rate debt at January 31, 2025 and 2024 was zero for both periods.
Item 7A. Quantitative and Qualitative Disclosure about Market Risk Foreign Currency Exchange Rate Risk The Company’s primary market risk exposure relates to foreign currency exchange risk (see Note 8 – Derivative Financial Instruments to the Consolidated Financial Statements). A significant portion of the Company’s purchases are denominated in Swiss Francs and, to a lesser extent, the Japanese Yen.
Item 7A. Quantitative and Qualitative Disclosure about Market Risk Foreign Currency Exchange Rate Risk The Company’s primary market risk exposure relates to foreign currency exchange risk (see Note 9 – Derivative Financial Instruments to the Consolidated Financial Statements). A significant portion of the Company’s purchases are denominated in Swiss Francs and, to a lesser extent, the Japanese Yen.
Dollars equivalent, 22.8 million Euros equivalent (including 3.0 million Euros designated as cash flow hedges) and 0.6 million British Pounds equivalent with various expiry dates ranging through June 1, 2023, as of January 31, 2023. If the Company were to settle its Swiss Franc forward contracts at January 31, 2024, the result would be a $0.5 million gain.
Dollars equivalent, 26.2 million Euros equivalent (including 9.0 million Euros designated as cash flow hedges) and 1.4 million British Pounds equivalent with various expiry dates ranging through June 13, 2024, as of January 31, 2024. If the Company were to settle its Swiss Franc forward contracts at January 31, 2025, the result would be a $1.1 million loss.
During fiscal 2024, the Company had no borrowings. The Company does not hedge these interest rate risks. 37
During fiscal 2025, the Company had no borrowings. The Company does not hedge interest rate risks. 44
These forward contracts are not designated as qualified hedges and, therefore, changes in the fair value of these derivatives are recognized in earnings in the period they arise, thereby offsetting the current earnings effect resulting from the revaluation of the related foreign currency receivables and liabilities.
These forward contracts are not designated as qualified hedges and, therefore, changes in the fair value of these derivatives are recognized in earnings in the period they arise, thereby offsetting the current earnings effect resulting from the revaluation of the related foreign currency receivables and liabilities. 43 As of January 31, 2025, the Company’s entire net forward contracts hedging portfolio consisted of 28.0 million Swiss Francs equivalent, 32.5 million U.S.
Dollars equivalent, 26.2 million Euros equivalent (including 9.0 million Euros designated as cash flow hedges) and 1.4 million British Pounds equivalent with various expiry dates ranging through June 13, 2024, compared to a portfolio of 14.7 million Chinese Yuan equivalent, 30.0 million Swiss Francs equivalent, 15.7 million U.S.
Dollars equivalent, 25.3 million Euros equivalent (none designated as cash flow hedges) and 1.5 million British Pounds equivalent with various expiry dates ranging through July 17, 2025, compared to a portfolio of 8.3 million Chinese Yuan equivalent, 20.0 million Swiss Francs equivalent, 18.7 million U.S.
Removed
As of January 31, 2024, the Company’s entire net forward contracts hedging portfolio consisted of 8.3 million Chinese Yuan equivalent, 20.0 million Swiss Francs equivalent, 18.7 million U.S.
Added
Under its hedging program, the Company can purchase various commodity derivative instruments, primarily futures contracts.
Removed
If the Company were to settle its Euro forward contracts at January 31, 2024, the result would be an immaterial gain. As of January 31, 2024, the Company’s British Pound, Chinese Yuan and U.S.

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