How do I factory reset my Apple Watch?

See: What to do before you sell, give away, or trade in your Apple Watch, or buy one from someone else - Apple Support

To unpair and erase watch and remove Activation Lock

From a web browser,sign in to iCloud.com with your Apple ID.

Go to Find iPhone.

Click All Devices at the top of the screen.

Click your Apple Watch.

Click Erase [device]. Select Next until the device is erased.

Click Remove from Account.