Zalando revises outlook for FY22 as macroeconomic conditions deteriorate

Zalando has issued an update for the second quarter of 2022, revising its guidance for the financial year as macroeconomic conditions have further deteriorated during Q2.

The company’s previous outlook from early May pointed to the lower end of its full year guidance based on anticipated challenges and early signs of recovery. However, Zalando now expects macroeconomic challenges to be longer lasting and more intense than previously anticipated.

For Q2, the retailer expects gross merchandise volume growth, revenue growth and adjusted EBIT to be "significantly below" previous estimates of 5% GMV growth, 1.5% revenue growth and a €104 million adjusted EBIT.

Zalando now expects GMV to grow 3%-7% between €14.8-€15.3 billion for FY22. Revenue is expected to grow 0%-3% between €10.4-€10.7 billion, with an adjusted EBIT of €180-€260 million.

The revised full year outlook implies an acceleration of growth and a significant improvement in profitability in the second half of 2022, based on an ongoing company effort to adjust the offer to changing customer demand and to drive efficiencies across all cost lines.

Robert Gentz, Co-CEO of Zalando, said: “While this new environment is creating a negative impact on our financial performance, our strategy and long term goals are unchanged.

"Our vision remains to be the starting point for fashion in Europe. There are many untapped opportunities in the fashion market that we can capture and are committed to change the industry for the better. By driving efficiencies across the company and selectively investing through-cycle, we will be even better positioned long-term to execute against our strategy. We are embracing the challenges and adapting to emerge stronger."