H&M shares plunge after ‘worst sales on record’

By Thomas Mulier

H&M shares plummeted after the Swedish apparel chain lost more ground to Inditex’s Zara, amid a crisis in brick-and-mortar stores that threatens to undermine retailers with underdeveloped online businesses.

H&M reported the biggest drop in quarterly sales in at least a decade as fewer customers visited its flagship brand’s locations, leading the company to pare expansion plans and consider closures. The stock fell up to16%, the steepest intraday decline since March 2001.

A crisis that has shuttered shopping malls in the US is spreading to other parts of the world, hitting H&M’s earnings and forcing the retailer to cut prices to clear out inventory.

Rival Inditex has been outpacing the Swedish company as it expands more aggressively in e-commerce. The Spanish company this week reported a double-digit rebound in revenue growth for November and early December. H&M reported “quite possibly the worst quarterly sales performance on record,” said Raymond James analyst Cedric Lecasble.

Sales excluding Vat fell to $6bn (€5.1bn) in the three months to November, the Stockholm-based fashion retailer said. H&M’s sales have declined in only three quarters in the past 10 years.

It said it aims to accelerate a plan to better integrate physical and digital stores, and it will give more details on changes at a February meeting with investors. The retailer said online sales and revenue of brands other than H&M have been going well.

- Bloomberg



More in this Section

Facebook revenue and user numbers increase despite data scandal

Donald Trump has met Apple CEO Tim Cook to discuss trade

Lower earnings guidance drags down Glanbia shares

Fewer tests put 16% dent in NCT profit


Today's Stories

Risks remain despite upturn

High-speed broadband key to reviving rural areas

Lifestyle

New father’s life ‘changed forever’ after he was run over by surgeon

The biggest cancer killer will take your breath away

Hopefully she had an idea...

Power of the press: Meryl Streep and Tom Hanks discuss 'The Post'

More From The Irish Examiner