Zara owner Inditex has reported a significant rebound in sales for its autumn-winter collections, countering a slowdown experienced earlier in the year. The fashion retail giant revealed a notable 11% increase in sales between August 1 and September 8, measured in constant currency, which has helped offset the previous sluggishness in growth.
Despite a slowdown in the first half of the year, Inditex achieved a 10% rise in profit, driven by a 7.2% increase in sales. This growth rate, while slower than last year’s figures, aligned with analysts’ forecasts amid challenging conditions for fashion retailers in Europe. Early summer’s wetter-than-expected weather had previously dampened sales, particularly impacting Zara’s performance.
For the first half of the year ending in July, Inditex posted a net income of 2.8 billion euros ($3.09 billion) on sales of 18.1 billion euros. These figures exceeded analysts’ expectations, which had predicted a profit of 2.77 billion euros and sales of 18 billion euros.
In response to earlier sales challenges, analysts had anticipated a strong rebound for Zara’s third-quarter sales, which began in August. Despite the adverse weather conditions that impacted its performance in June, Zara’s recent sales surge has been promising.
Inditex continues to strengthen its market position by investing in logistics and technology to quickly deliver fashion trends while minimizing price increases on everyday items. This strategic approach has helped the company stay competitive against rivals like H&M and the burgeoning Chinese competitor Shein.
In contrast, H&M reported a likely 6% drop in local currency sales for June, while Primark also faced challenges due to poor weather conditions in Britain. Fund manager Vera Diehl of Union Investment praised Inditex’s performance, highlighting the company’s strong position both in physical retail and online compared to its competitors.
Overall, Inditex’s recent sales performance demonstrates its resilience and ability to adapt to market fluctuations, reinforcing its leading position in the global fashion retail industry.
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