German fashion web shop Zalando’s third quarter growth was astonishing once more: compared to the year before, it added another million new customers and achieved a 30 % turnover increase. Its profit disappeared almost entirely however.
Strong growth in DACH region
Zalando’s total third quarter turnover reached 1.075 billion euro, up 28.7 % compared to the year before. In the German-speaking DACH region (Germany, Austria and Switzerland), the web shop’s turnover shot up 22.3 % to 497.7 million euro. Last year’s local turnover growth stopped at 9.7 %. The rest of Europe performed even better, with a 30.9 % turnover increase to 489.7 million euro.
Its adjusted EBIT reached 15.7 million euro in the DACH region, but there was a 16.2 million euro loss for the rest of Europe. “Other” did post a 0.9 million euro profit, leading to an overall 0.4 million euro profit, down from 19.5 million euro last year. This has forced its profit margin down from 2.3 % to 0.0 %. Its net loss reached 11.1 million euro, compared to a 5 million euro profit in the year before. Over the three quarters, it did achieve a 41.5 million euro net profit, compared to 60.5 million euro in 2016’s first three quarters.
Million new customers
In the third quarter, Zalando added another million customers, which is its largest growth since 2015’s second quarter. It now has 22.2 million customers. Over the past twelve months, each customer ordered 3.8 times, an absolute record. The average value did drop from 62.8 to 62 euro. Mobile visits are still on the rise: nearly 72 % of every site visit is currently on a mobile device.
“The very strong revenue growth in the third quarter underlines our growth focus and shows that our investments already pay off. For the fourth quarter as well as the coming years, we continue to focus on growth with the goal to double our business by 2020”, CEO Rubin Ritter said.