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What: Shares of fashion company Fossil (NASDAQ:FOSL) slumped in November, falling 29.3%, according to S&P Capital IQ data. The company reported lower revenue than analysts were expecting during the third quarter, and its guidance for the full year was slashed.

So what: Fossil reported third-quarter revenue of $771.3 million, down 13.8% year over year and about $23 million below the average analyst estimate. Sales of watches, which account for the majority of the company's revenue, slumped 17% year over year, or 11% adjusting for currency. Sales fell in every region by double-digit percentages, and operating income was cut in half compared with the same period last year.

CEO Kosta Kartsotis was not pleased with the company's results:

While our results for the third quarter were within our expectations, we are not satisfied with our overall performance. Currency aside, our Skagen and Fossil brands performed well in a challenging environment as our initiatives in branding and innovation resonated with consumers around the world. Our branded jewelry and leathers business increased but were more than offset by a decline in our watch business, reflecting general weakness in the category.

Now what: Fossil isn't expecting things to get better anytime soon. The company's guidance for the fourth quarter was well below expectations, and full-year guidance was slashed. Fossil expects sales to decline by 7% to 16% during the fourth quarter, with EPS between $1.05 and $1.65 far short of the average analyst estimate of $2.14.

For the full year, revenue is now expected to decline by 8% to 10.5%, with EPS between $4.15 and $4.75. This range compares with previous guidance calling for a revenue decline between 4% and 8%, and EPS between $4.80 and $5.60.

In an effort to incorporate technology into its products, Fossil also announced the $260 million acquisition of Misfit, a company that makes fitness trackers. With smartwatches and other wearables posing a threat to the traditional watch industry, Fossil is repositioning itself to better compete. Fossil stock has lost about two-thirds of its value so far this year, with a big chunk disappearing in November, and the company will need to prove to investors that it can turn things around.

Timothy Green has no position in any stocks mentioned. The Motley Fool recommends Fossil. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.