Zalando could see profits climb to a record €300 million (£272 million) after it emerged as one of the few winners of the major shift online during lockdown.
Europe’s largest fashion retailer raised its guidance for the full year today after preliminary figures suggested a revenue rise of between 26 and 28 per cent during its second quarter to €2.01 billion.
Zalando now says it expects gross merchandise volumes (GMV) to come in at 20 to 25 per cent for the full year, significantly above May’s estimates of between 10 and 20 per cent.
It also expected revenues to grow between 15 and 20 per cent for the full year, following the addition of three million new customers over the quarter.
A further 180 retailers had signed up to its partner programme during lockdown, including H&M Group’s Arket brand, which sees third-party retailers utilising its extensive European distribution network and sales platform.
This marks a dramatic turnaround for the retailer, which posted a record operating loss during its first quarter as the pandemic began to take hold, forcing it to write down €40 million worth of inventory.
“The high number of new customers shows that we offer a compelling customer experience in these challenging times,” Zalando’s chief financial officer David Schröder said.
“Due to prevailing health and safety concerns, customers generally like to shop online, and they particularly like to shop with us. As a result, we were able to successfully scale our platform business in the second quarter and to make significant progress in building the Starting Point for Fashion in Europe.”