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Zalando Revenues Up 34 Percent, Even as European Lockdowns Ease

·3-min read

Zalando saw revenues grow another 34 percent to hit 2.73 billion euros over the past three months, even as the retail lockdown in Europe was relaxed.

The e-commerce giant has seen massive growth during the COVID-19 pandemic and the ensuing lockdown as Europeans flocked online to buy clothes. Even when compared to the second quarter of 2019, the last “normal” year for business before the health crisis hit, Zalando has grown revenues around 60 percent.

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Over the first six months of this year, Zalando’s revenues totaled 4.97 billion euros, an increase of 39.7 percent on the previous year.

“The increasing engagement by customers and brands underlines the long-term relevance of the Zalando platform and is a strong proof point of our successful strategy,” the company’s chief financial officer, David Schröder, said in a statement.

Zalando prefers to measure its success via gross merchandise value, or GMV. This accounts for how much stock Zalando has moved, as opposed to income from services like logistics and marketing. Over the second quarter, Zalando shifted 3.79 billion euros worth of product, an increase of 40 percent on GMV at the same time last year. This means that over the first half of this year, Zalando has sold 6.9 billion euros of clothing, makeup and other fashion goods.

That number is likely to continue to rise as more retailers, including brick-and-mortar stores impacted by lockdowns, partner with Zalando. The platform has 4,700 retailers enrolled in its partner program and also announced that, starting in October, it will work together with online beauty retailer Sephora in Germany.

Other key indicators for Zalando are site visits, active customers and orders, all of which rose compared to the same period last year. The company counted 44.5 million active customers, 1.69 billion site visits and 65.6 million orders over the second quarter. Almost all of the shoppers — 87.9 percent — came to the Zalando site via mobile devices.

Zalando also continued its expansion into other countries on the continent, starting to offer its services in Lithuania, Slovakia and Slovenia in June and, then from late July, in Croatia, Estonia and Latvia.

Over the past three months, GMV inside German-speaking countries, including Germany, Austria and Switzerland, added up to 1.16 billion euros, while in the rest of Europe GMV was 1.33 billion euros.

Zalando’s earnings before interest and taxes in the second quarter amounted to 184.4 million euros, or 6.7 percent of revenues versus 10.4 percent in the year-ago quarter. The company cited more investment “into customer acquisition and brand marketing” after scaling down such efforts last year, due to uncertainties when the pandemic first hit.

Zalando also confirmed guidance for the rest of the year with revenue growth of between 26 and 31 percent for the full year, GMV growth of between 31 and 36 percent, and adjusted EBIT of between 400 million euros and 475 million euros.

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