Fossil spent $260M on smartwatches — then filed for Chapter 15

Fossil was founded in 1984 and grew into one of the world's largest watch companies, selling licensed watches for brands like Michael Kors, Burberry, Diesel, and Armani. At its peak in 2014, the company had over 10,200 employees and 400+ stores worldwide. Revenue exceeded $3.5 billion. But the rise of the smartwatch — particularly the Apple Watch, launched in 2015 — fundamentally changed the watch industry, and Fossil was slow to adapt.

Fossil's main response was to acquire Misfit, a fitness-tracker company, for $260 million in 2015. The plan was to integrate Misfit's technology into traditional-looking watches. Fossil also developed its own smartwatch platform using Wear OS (Google's operating system). Despite these efforts, Fossil never gained meaningful market share against Apple and Fitbit. The smartwatch division consistently lost money as Apple captured over 50% of the market.

By 2021, the company was in decline. It cut its workforce from 10,200 to 7,500 employees. Revenue continued to fall, and by 2024 it had dropped to $1.14 billion, down roughly 70% from its peak. The company reported an operating loss of $104 million and a net loss of $102.7 million in 2024. Employee count fell further to 5,200. In January 2024, Fossil announced it was leaving the smartwatch business entirely, admitting defeat.

In October 2025, Fossil placed its US business into Chapter 15 bankruptcy (a US recognition of a UK restructuring plan). The company's decline reflected the collision of two forces: the smartwatch revolution that made traditional watches less relevant, and the shift to direct-to-consumer sales that bypassed Fossil's licensed-brand model. The licensed-watch model — paying royalties to brand owners on declining revenue — became unsustainable.