Zara Owner Narrowly Misses Sales Forecasts, But Growth Picks Up After Slowdown — Update

By Andrea Figueras

Zara parent Inditex reported first-half sales that fell slightly short of analysts' projections, but its growth picked up during the summer after a slowdown earlier in the year amid fierce competition in the fashion industry.

The Spanish fashion giant on Wednesday said sales for the half year to July came to 18.36 billion euros ($21.50 billion), up 1.6% on year. This missed analysts' forecasts of 18.55 billion euros, according to a Visible Alpha poll of estimates.

The company, home to other brands such as Pull & Bear and Bershka, said first-half sales grew 5.1% compared with the prior-year period when excluding currency movements. This showed an acceleration from a 4.2% increase it booked in the first quarter.

The upward trend continued in August and early September, when sales jumped 9% at constant currency, Inditex said.

Shares in Inditex jumped 6.3% in European early trade, with analysts at RBC Capital Markets flagging a better-than-expected start to the fall/winter season.

Net profit for the first half rose 0.8% to 2.79 billion euros, while earnings before interest and taxes were 0.9% higher at 3.57 billion euros.

In March, the group posted results that triggered concerns about a sales slowdown after a strong post-pandemic stretch in which the company outpaced its long-standing Swedish rival H&M.

Inditex operates in 214 markets with a low market share in what it described as a fragmented sector. The company said it is working optimize its stores to boost productivity, and targets annual gross space growth of around 5% between 2025 and 2026.

For the year ending January 2026, Inditex continues to expect a stable gross margin, plus or minus 50 basis points. It also estimates a negative currency impact on sales of 4%.

The company said its logistics-expansion plan, which allocates an investment of around 1.8 billion euros, is on track. The retailer intends to scale its capabilities, generate efficiencies and increase the competitive differentiation at a time when the fashion sector contends with intense competition from the likes of Chinese rivals Shein and Temu as well as the impact of President Trump's tariffs.

Peer Primark expects sales for the quarter and the half year ending Saturday to grow 1%, with store openings offsetting a likely decline in like-for-like sales, parent Associated British Foods said Wednesday.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

September 10, 2025 03:52 ET (07:52 GMT)