Farfetch revenues surge but losses also increase

Revenues at online luxury fashion platform Farfetch rocketed from £87m to £151.3m in 2016, according to its latest accounts filed at Companies House.

Gross merchandise value was up from £302m to £548m, however losses at the business which was established in 2007, also increased. In 2015 the business posted an operating loss of £26.5m but this was up to £33.5m by the end of 2016.

CEO and co-chairman José Neves said the losses were due to the business investing heavily in people and technology: "Our programme of investment is designed to support the company’s ambitious growth plans, and over the year we focused our investments on technology, as well as customer acquisition and hiring to support our growth. We have very strong foundations in place and will continue to invest and grow our business as we build the definitive technology platform for the luxury industry."

Farfetch also owns iconic London luxury boutique Browns, which it bought in 2015 and is using as a test bed for its Store of the Future technology, and earlier this year it acquired Vogue publisher Conde Nast's e-commerce platform Style.com and merged it into Farfetch. The accounts reveal that the business was acquired for a consideration of $12m.

The report also revealed that Farfetch now attracts 21m visits a month and hosts a network of 500 boutiques globally offering more than 115,000 products.

During 2016 Farfetch completed a Series F funding round led by new investors Temasek, IDG Capital Partners and Eurazeo with existing investor Vitruvian Partners also taking part. Earlier this year it formed a partnership with Chinese retail and etail giant JD.com, which invested $397m in Farfetch thus becoming its largest shareholder.

Rumours abound that Farfetch is preparing the ground for an IPO. They first surfaced back in June when Neves said an IPO was a long-term aim for the business but industry watchers believe the move could now be imminent.