German online retailer Zalando lowered its annual revenue forecast
03.11.2023 3053

German online retailer Zalando lowered its annual revenue forecast

German e-commerce company Zalando has revised down its full-year revenue forecast after the end of the third quarter, in which its sales fell 3,2% to 2,27 billion euros, fashionmagazine.it writes.

At the same time, the company's adjusted EBIT in the reporting period increased from 13,5 to 23,2 million (+72%), and the loss decreased from 35,4 to 8,2 million euros.

Among the key indicators of online sales, the number of orders stands out, which decreased from 58,8 million in the third quarter of 2022 to the current 54,5 million, and the average purchase size increased to 58,9 euros (over the last 12 months), from 56,2 euro from a year earlier.

The third quarter of 2023 was characterized by low consumption and an overall decline in online sales. Consumer sentiment was affected by a particularly hot autumn in Europe, which slowed down purchases of new collections.

Zalando estimates that future growth will be supported by three factors: storytelling, logistics (we are talking about the recent launch of B2B platform Zeos) and technology. However, management has revised its financial guidance for the full year. Zalando foresees a 2023% to 0,5% decline in revenue in 3, after previously forecasting a year-over-year trend of +4% to -1%. However, previous forecasts for adjusted EBIT are confirmed: it should be between 350 and 300 million euros, compared with 184,6 million in 2022.

Zalando shares fell 6,6% in afternoon trading at €20,79, valuing the company at around €5,5 billion. The group has suffered a -40% decline in the stock market since the start of the year, with significant devaluations affecting other online fashion and footwear players including Asos (-32% from early January to date), Farfetch (-63%) and Mytheresa ​​(- 66%).

Bernstein analysts have assigned Zalando shares an "underperform" rating with a target price of €21.

German e-commerce company Zalando revised down its full-year revenue forecast after the end of the third quarter, in which its sales fell 3,2% to 2,27 billion...
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