Zalando is back to growth with restricted profitability

The German online pure-play fashion retailer Zalando has bounced back to growth after two quarters of declining sales. The growth has come at the expense of gross margin, which declined from above 40% to 38,1% during the last quarter of 2022.

This was probably partly driven by the cleaning of inventory, which for some time had grown more rapidly than the revenues.

The growth was driven by the rest of the Europe segment, which grew by 4,2%, whereas the DACH segment declined for the fourth quarter in a row.

For the first in Q4, the Rest of the Europe segment also became the bigger segment to drive profitability with 110 million euros in Adjusted EBIT.