Online fashion platform Zalando has released its financial results for the first quarter of this year. Its revenue decreased 0.6 percent, to 2.2 billion euros. In 2023, the revenue in the first quarter came to 2.3 billion euros. However, the platform’s adjusted EBIT rose to 28.3 million euros, representing a margin of 1.3 percent.
The results are in line with Zalando’s year results in 2023. Its revenue decreased, while its EBIT almost doubled. The company then announced that it would focus on providing support to other ecommerce companies. To do that, it opened up its logistics infrastructure, software and service capabilities. As a result, five partners came on board for ZEOS multi-channel fulfillment in the first quarter. This brings the total to 27 merchants.
GMV reached 3.3 billion euros
In the first quarter of this year, Zalando’s gross merchandise volume (GMV) increased 1.3 percent, to 3.3 billion euros. The company’s significant increase in its adjusted EBIT was driven by lower fulfillment costs and more efficient inventory management. This led to an improved gross margin.
Zalando’s net loss in the first quarter was 8.9 million euros.
However, while Zalando’s adjusted EBIT increased, the company is still operating at a loss. Its net loss in the first quarter was 8.9 million euros. This is a significant improvement compared to that period last year, when its net loss was 38.5 million euros.
Fewer active customers
The company’s decrease in revenue seems to be caused by a decrease in active customers. In the last twelve months, this amount decreased from 51.2 million to 49.5 million. The number of orders also decreased slightly, from 56.7 million to 55.2 million. However, the average basket size increased from 57.3 to 60.4 euros.
‘We are returning to growth.’
“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”, said Dr. Sandra Dembeck, Zalando CFO. “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.”
Expectations for 2024
For the rest of this year, Zalando expects to grow its GMV and revenue between 0 and 5 percent. It wants to focus on profitable growth, with margin progression. It expects that the adjusted EBIT will reach between 380 and 450 million euros by the end of the year.
