Aug 26, 2026 earnings call — Margin improvement and product-driven growth
Sales increased 4.9% to $169.8 million; adjusted EPS rose to $0.54, including $0.11 per share from IEEPA duty refunds.
Revenue $0.2B (est $0.2B) · EPS $0.54 (est $0.35)
Key quotes
"Across our portfolio, innovation and compelling storytelling allows our brands to connect with customers, particularly younger consumers as they increase their engagement with traditional watches and learn more about the category."
"As mentioned, excluding the IEEPA duty refunds, gross margin for the second quarter improved 340 basis points, reflecting improved sales mix, strategic pricing actions and reduced promotional activity."
"We also ended the quarter with a very strong balance sheet with $212 million of cash and no debt."
Analyst Q&A 1
Gross margin drivers and shipping costs
Q (Owen Rickert · Northland): He asked how much of the gross-margin improvement is structural versus temporary and whether the back-half guidance reflects inventory effects. He also asked how big the shipping-cost headwind is and if freight rates are locked, and about watch and jewelry trends.
A: Management said it is a mix of improved pricing and better average selling prices plus a one-time benefit from reversing an IEEPA tariff on legacy inventory that helped Q1 and Q2. They said the back-half margin step-down is due to that inventory effect ("100%."). On shipping, they cited higher fuel surcharges and more e-commerce (Mother's Day) shipping as the drivers and said those factors are built into the back half. Management also said younger consumers in the United States, Mexico, Brazil and India are returning to traditional watches as fashion accessories and will move into higher-end watches over time.
"So it's a mix of improved pricing and better average selling prices across the board." — Efraim Grinberg (CEO·CHAIR)