Fossil Group Inc. FOSL, -20.90% shares plummeted 20.4% in Thursday trading after the watchmaker reported a quarterly loss, explained why headwinds would continue, and was downgraded at KeyBanc Capital Markets. Among the challenges that Chief Executive Kosta Kartsotis outlined on the earnings call, according to a FactSet transcript: a tough consumer environment, difficult sales trends at wholesale channels in developed markets, and lack of interest in traditional watches. “Based on these factors, we’ve lowered our sales expectations for Q4,” he said. “[G]iven the trends we saw in the third quarter, we think it’s prudent to plan our sales number assuming these trends don’t change near term. We’re also adjusting our Q4 gross margin guidance to include the impact of tariffs, which will begin to have a larger impact in the quarter due to the implementation of List 4 in early September.” The bad news drove the KeyBanc downgrade to sector weight from overweight. “[C]ompetitors continue to drive the preponderance of growth in the wearable category,” analysts led by Edward Yruma wrote. “The traditional category is seeing a slower rate of decline, but has not yet stabilized.” Fossil stock has lost more than 51% of its value in the last year while the S&P 500 index SPX, +0.50% is up nearly 10% for the period.