Zalando posts improved profitability in first quarter | Retail Bulletin

FASHION RETAIL NEWS UK

Zalando has confirmed its full year guidance as it announced growth in its first quarter gross merchandise volume and profitability.

The German online fashion retailer said trade was boosted by the quality of its assortment, growth in its lifestyle offerings, improvements to the customer experience, and the addition of more logistics partners.

Zalando increased its gross merchandise volume by 1.3% to €3.3 billion in the period, although revenue fell slightly to €2.2 billion from €2.3 billion in the prior year.

Meanwhile, adjusted EBIT rose to €28.3 million, representing a margin of 1.3%, compared to a negative €0.7 million at the same time last year. The improvement was driven by lower fulfilment costs and successful inventory management.

Sandra Dembeck, Zalando chief financial officer, said: “As we are executing our ecosystem strategy, we are excited by the positive response from customers and partners in the first quarter. We are returning to growth.

“B2C customers are showing increased interest in our quality assortment, digital tools, propositions and inspiring content.

“B2B customers are signing up for our unique offering. Both of our growth vectors are strong and contributing to results, demonstrating the strength of our plans.”

Zalando expects both its full year gross merchandise volume and revenue to grow by 0% to 5% this year compared to 2023. Meanwhile, adjusted EBIT is expected to come in between €380 million and €450 million.