Nov 10 (Reuters) - Watchmaker Fossil Inc (FOSL.O) reported a third-quarter profit that outpaced market expectations and its own forecast, buoyed by stronger sales at company-owned stores and at its domestic wholesale watch business, and raised it fourth-quarter outlook.

The company, which competes with Quiksilver Inc (ZQK.N), Movado Group Inc (MOV.N) and Coach Inc (COH.N) among others, said third-quarter profit was also driven by a more favorable product sales mix and increased expense leverage.

Fossil raised its fourth-quarter profit view to between 82 cents a share and 86 cents a share, citing positive momentum at its direct to consumer and watch segments, coupled with a better currency environment.

It had earlier forecast fourth-quarter profit of between 74 cents a share and 80 cents a share.

Analysts were looking for a fourth-quarter profit of 78 cents a share, according to Thomson Reuters I/B/E/S.

Known for its namesake watches, the company reported a marginal drop in quarterly profit to $35.3 million, or 52 cents a share, down from $36.5 million, or 54 cents a share, a year earlier.

Revenue at Fossil, which sells jewelry, leather goods, sunglasses and apparel, fell 7 percent to $381.4 million.

Analysts were expecting a profit of 42 cents a share, on revenue of $376.9 million.

Shares of the Richardson, Texas-based company closed at $28.91 Monday 9 November on Nasdaq.

For the alerts, double-click (Reporting by Shradhha Sharma in Bangalore; Editing by Aradhana Aravindan)