Key facts
- Zara owner Inditex reported 9% currency-adjusted sales growth in August.
- Inditex's second-quarter sales (May-July) reached €11 billion.
- Inditex's share price hit a record of €59.1 last month.
- Inditex is expanding its Lefties brand into Britain and plans to open in Germany next year.
Zara owner Inditex reported a better-than-expected start to its autumn trading, with currency-adjusted sales up 9% in August. This performance occurred even as extreme heat across Europe reshaped shopping behavior in its largest market. The fast-fashion giant achieved €11 billion ($12.8 billion) in sales during its second quarter, from May to July, a strong result amidst high energy prices and weak consumer sentiment. Inditex's share price reached a record of €59.1 last month. Filings from ultra-cheap fashion platform Shein indicated a sales slowdown, suggesting easing competitive pressure on European fast-fashion groups like Zara and H&M. The Spanish company is expanding its budget brand, Lefties, into Britain and plans to open stores in Germany next year, aiming to capture spending from lower-income shoppers.
Earlier in the year, Inditex reported an 11.5% currency-adjusted sales growth in May, surpassing analyst expectations. For the February-to-April first quarter, the company posted sales of €8.75 billion ($10.17 billion), an 8.8% increase in currency-adjusted terms. Inditex's investor relations director, Gorka Garcia-Tapia Yturriaga, noted the performance was significant given macroeconomic and geopolitical challenges, including impacts on sales in the Middle East. Chief Financial Officer Andres Sanchez stated that Inditex has adapted its supply chain to mitigate disruptions from global conflicts, with the impact of higher transport and fuel costs limited in the first quarter. Zara has also focused on larger stores and increased prices, particularly in the United States, its second-largest market, with growth attributed to volume rather than just price increases.