Zalando revises outlook for the full year 2022 as macroeconomic conditions deteriorate further

• Gross Merchandise Volume (GMV) expected to increase by 3%-7% to 14.8-15.3 billion euros in financial year 2022
• Second quarter is profitable but weaker than expected  
• Company taking decisive actions to adapt to current challenges and improve profitability

BERLIN, June 23, 2022 // Zalando SE, a leading online platform for fashion and lifestyle in Europe, issued an update for the second quarter 2022 and revised its guidance for the financial year 2022 as macroeconomic conditions have further deteriorated during the second quarter of 2022 with the EU consumer confidence index decreasing further in June.

The company’s previous outlook, from early May, pointed to the lower end of full year guidance based on anticipated challenges but also early signs of a potential recovery. Management now expects macroeconomic challenges to be longer lasting and more intense than previously anticipated. For the second quarter 2022, management expects Gross Merchandise Volume (GMV) growth, revenue growth and adjusted EBIT to be significantly below analyst estimates (company-compiled median analyst estimates as of 31 May 2022: 5.0% GMV growth, 1.5% revenue growth, and a 104 million euros adjusted EBIT). The second quarter is profitable but weaker than expected.

As the company no longer assumes a rebound of consumer confidence in the short-term, it is updating its guidance for the full year 2022. The company now expects Gross Merchandise Volume (GMV) to grow 3%-7% to 14.8-15.3 billion euros for the financial year 2022. Revenue is expected to grow 0%-3% to 10.4-10.7 billion euros with an adjusted EBIT of 180-260 million euros in the same period. Capital expenditure is expected to be in the range of 350-400 million euros.

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 wide effort to adjust the offer to changing customer demand and to drive efficiencies across all cost lines. First key efficiency measures were successfully implemented in the second quarter, including reducing the marketing investments to increase return on investments, adjusting logistics infrastructure investments to drive utilization, as well as the introduction of a Minimum Order Value (MOV) in additional 15 markets.

Robert Gentz, Co-CEO, 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."

The company will publish its financial figures for the second quarter on August 4, 2022.