Asos: annual sales miss expectations

British clothing retailer Asos Plc did not quite meet sales expectations for the 2024/25 financial year. This was announced in a trading update published by the company on Tuesday.

In the past financial year, revenue was “slightly below market expectations”, the retailer admitted, without providing specific figures. The gross merchandise value (GMV) was also “lower than expected”.

Cost-saving measures lead to a significant improvement in earnings

Thanks to comprehensive reforms, the group was able to improve its profitability. Asos explained that the gross margin increased by approximately 350 basis points year-over-year due to a change in its business model and reduced markdowns.

Additionally, the group reported implementing a series of measures aimed at reducing costs and improving operational efficiency. These included reducing the causes of unnecessary returns; renegotiating delivery contracts; and optimising logistics capacities. The company expects these initiatives to generate significant savings from the current financial year onwards.

Management forecasts results for current year to be 'in line with market expectations'

In the past financial year, adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by more than 60 percent year-over-year, Asos explained. This was due to the higher gross margin and lower costs. This placed it “at the lower end” of the forecast range of 130 to 150 million British pounds. The adjusted EBITDA margin was over five percent, which was in line with expectations.

For the current 2025/26 financial year, management currently expects adjusted EBITDA to be in line with market expectations. In the medium term, the company aims to return to sales growth and improve its gross margin to around 50 percent and its adjusted EBITDA margin to around eight percent.

This article was translated to English using an AI tool.

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