Thread regarding Fossil Inc. layoffs

Fossil is not good for shareholders or employees

Fossil has never returned value to its shareholders. Never offered a dividend and any stock buybacks were cut short. It’s never used excess or financing capital properly during growth years either to acquire talent or intellectual property. It’s never managed talent well and retained it (building a reputation that hurts it to this day). Any acquisitions at this point have been a net loss over the premium paid considering what they’ve returned. Could have had cheaper and better acquisitions if it made big bets early in the smartwatch market cycle, it used the cash to buy traditional watch brands instead. The company is replete with brown nose hustlers living off of a socially awkward guy, it’s no wonder the culture is unbearable. If it never returned value to shareholders it will never return value use to employees.

Originally posted by @5qiq+1900nimS.

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| 1691 views | | 10 replies (last January 28, 2021) | Reply
Post ID: @OP+196Q7Mji

10 replies (most recent on top)

I find the “look, we returned to profit” comments laughable. Totally agree with the poster who pointed out that it’s easy to profit when you can people. Some obviously missed the implication they were making....it’s not profit from improved sales it it’s just money saved that you otherwise would’ve paid employees in salary. Ludicrous. But then again, this era of management has always loved dressing up cost cutting as an uptick in business.

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Post ID: @2xjc+196Q7Mji

Delusional

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Post ID: @1bqy+196Q7Mji

You can't win with the board of bashers...Fossil is bad, look the stock is down...Fossil is bad, look the stock is way up! How about.. as bad as Fossil management may be, the company is in decent financial shape and if the share price is up that is good news for everyone, should Fossil need to raise fresh capital and reinvest it to grow and hire more people back going forward?!? It is easy to say management took bad decisions when it is not you making these calls...I don't agree with everything that has been done but I stay positive and try look forward. As long as I am here I prefer to support the management, my colleagues and the product rather than play the victim and pass along blame and point fingers.

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Post ID: @1vwe+196Q7Mji

The mob has got a hold of this one too. What a group to be associated with the poor soles are buying “blockbuster video” completely unlinked from fundamentals. Really bad for the market to have these absurd swings, don’t be the last one holding the bag. It’s quality employees who drive a business, period. The company can survive sure but it will never regain broad admiration because it pushed out good people and that’s some bad juju. I think many are missing this point.

It’s settled, bad management and not market conditions also lead to repercussive effects such as layoffs. Buying back stock at all time highs with borrowed money is financial mismanagement. Not paying a dividend means you found a better investment, but growth still slowed, that’s bad investment management. The owner himself sells when the price is in the lows, can’t even manage his own money. Check the SEC files.

Better management would not have straddled itself with debt and poor acquisitions freeing up cash for good investments. It makes the mind wonder what exactly a board of directors think.

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Post ID: @1gdq+196Q7Mji

@Spring ...profit over people huh? Funny when people helped to achieve the profit in the first place...I don't support and never will support that one-sided "school" of thought.
I won't mention the companies that while they must release employees to increase their profit base, they make sure they're not only focused on the needs of the company, but have plans in place to ensure their employees...who at one time helped them in their efforts to reach profitability are effectively trained, and taken care of as a result.
Get out of here with your psuedo ratios , talk of percentages and gross margin "assumptions" trying to rationalize the actions of a company that obviously made poor management decisions!!

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Post ID: @1wcp+196Q7Mji

The comment "it s easy to become profitable after you cut 10% of employees" proves the point: the company revenue has declined, the cost base had been set up in 2014 to reach 5$bn in revenue and it ain't going to happen. So yes, people need to go as well as many stores etc. Sad? Maybe. Wrong? Not really and in fact it appears to be working - shift of sales online is happening, balance sheet is good and there are pockets of growth outside of the US. If it was easy there would be plenty of jobs to grab at some of the others US based watch companies...Timex, Movado, Shinola...but in fact they are all doing the same thing that Fossil is doing. A more interesting discussion here would be: given the way the market has changed, can they all survive alone or, as it often happens when the pie is shrinking, should they start merging: should Fossil and Timex tie up, should Fossil and Movado merge? What would be pros and cons. Personally I am surprised it did not happen already. Thoughtful comments are welcome.

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Post ID: @1cep+196Q7Mji

Yeah given the fact that every time Fossil produces somewhat of a profit it usually means employees....albeit now former employees or those that are unfortunately still there...received the short end of the stick.....layoffs...10% pay cut...reduced hours at a Corporate level, mind you.

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Post ID: @1kcx+196Q7Mji

Yeah, when you lay-off a bunch of people on Jun 30, it makes profitability in Q3 a tad more achievable. So...there’s that.

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Post ID: @1pea+196Q7Mji

“Fossil did quite well for shareholders...”
Until they didn’t. 😂

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Post ID: @1gke+196Q7Mji

you should move this to Reddit - you may have better luck in driving the mobs shorting the stock. Fossil did quite well for shareholders for quite a while until growth was there and paying no dividends (and no CEO salary) was a sign of virtue rather than a sin as long as there were better options to reinvest the cash...until fashion watches were in vogue buying Skagen with stock and cash was not that bad of an idea as well as Misfit when the Smartwatch threat became apparent, although i agree that they clearly way overpaid...but the company never had a big enough moat to counter the sudden rise of the Apple watch and the equally rapid deterioration of retail stores ... another management could have done somewhat better but let s be honest here...not that much better with the cards in hand. And let s not forget what a huge let down Google has been by never really committing to Wear OS and lagging the competition. Do management get bigger salaries than they deserve?! For sure...but welcome to America...if you put that in context of other companies in the consumer space of similar size, Fossil executives are probably well below average. Finally, let s look at some of the positives... the company has dramatically improved its balance sheet in spite of plummeting sales and underperforming stores, it does have a credible (albeit not amazing) place in the smartwatch market, and it is surviving (with some pain for everyone) COVID and actually returned to profit in Q3, while expanding in some critical markets for long term growth such as China and India AND it is probably well ahead its direct competitors (Timex, Movado etc) when it comes to digital penetration and infrastructure. Is it perfect?! Far from it but it could be way worse and my two cents are that Fossil can survive and come out smaller and leaner but still a respectable and profitable company from what were unquestionably extremely challenging times by all measures.

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Post ID: @whl+196Q7Mji

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